SSS contributions down 7.1% as recession slashed jobs

Contributions to the state-run pension fund Social Security System (SSS) dropped 7.1 percent to P204.75 billion in 2020 as millions of its members lost their jobs amid the COVID-19 pandemic, the Department of Finance (DOF) said Friday.

Last year’s contribution collections were not only lower than the P220.38 billion collected in 2019 but also 17-percent below the P246.83-billion target for 2020, the SSS said its preliminary report to Finance Secretary Carlos Dominguez III, who also chairs the policy-making Social Security Commission (SSC).

“The drop was the result of 1.5 million members unable to pay their contributions because of COVID-19-related job losses,” the DOF quoted the SSS as saying.

Last week, the SSS said about three million out of its 38.8 million registered members stopped contributing to the pension fund for private-sector workers last year amid the harder times wrought by COVID-19.

Despite the bigger total membership, the SSS had only around 16 million actively paying members.

In the case of its voluntary or informal members, the SSS found out that they were prioritizing allocating the money they earned or their savings to basic needs such as food and shelter amid the pandemic-induced recession.

Contributions accounted for the bulk of the SSS’s income.

In a separate statement also on Friday, the SSS said its investment income—another major source of revenues—declined to P32.47 billion in 2020 from P40.97 billion in 2019.

“The SSS investment portfolio still provided decent earnings last year despite the pandemic that shook the Philippine stock market,” its president and chief executive Aurora Ignacio said, citing that their return on investment of 5.89 percent “[outperformed] key market indicators such as the 10-year treasury bond and 364-day T-bill rates, which averaged 3.43 percent and 2.42 percent, respectively.”

“The SSS’s investment performance has consistently outperformed major investment benchmarks,” Ignacio added.