SSS Contributions Increases by 0.6 Percent this Year

Starting January this year, the monthly Social Security System (SSS) contributions rises to 11 percent with its new schedule having 0.6 percent increase from 10.4 percent. The SSS has 30.04 million individual members and 871,642 employers.

The 0.6 percent increase converts to a total contribution of at least P285 for the employee whose monthly income ranges from P2, 250 to P2, 749. While the employer’s share in the total contribution will amount to P194.20, the employee shells out P90.80 in the P285. The SSS website said the new contribution scheme offers a lower rate for the self-employed, voluntary members and OFW members.

In Metro Manila, the minimum wage rate is P429 per day, which amounts to P8,580.00 for 20 working days in a month. The contribution rate at this wage level is P945.00, of which P308 is the employee’s share while the employer’s share is P636.20, Gma News Online reported.

In Region 7, the minimum wage rate ranges from P282.00 to 327.00 per day.

Employees in the private sector who earn more than P15,750 per month in compensation income, the total contribution is P1,790, for the employee’s share of P581.30 and employer’s share of P1,208.70.

SSS president and CEO Emilio de Quiros has said last that the increase in contribution rate is to correct unfunded liability, which will be reduced by P166 billion or 15 percent by the increase.

As of December 2011, the unfunded liability of SSS was at P1.07 trillion, which increases by about 8 percent a year, Gma News Online reported.

The SSS chief added the higher contribution rate will allow the pension fund to extend the Social Security Fund or SSF by four more years from 2039 to 2043. SSF is the total contribution of private sector employees currently held by SSS.

In the new contribution schedule, P16,000 is the maximum monthly salary credit.

De Quiros said “The new maximum MSC at P16,000 means that a greater portion of the members’ incomes are covered in their SSS contributions…Higher contributions eventually mean higher benefits in the future.”

Source: Gma News Online