SSS monthly pension seen doubling in 2026

Future pensioners of the Social Security System (SSS) who contributed for at least three decades would nearly double their benefits in 2026 from the current monthly maximum pension of R10,900 once the pension fund’s proposed reform measure is passed into law.

In a statement, Emmanuel F. Dooc, SSS president and chief executive, said the estimated monthly pension of a member with at least 30 paying years will increase to R20,300 in 2026.

This is based on higher monthly salary credit (MSC) or the monthly contribution cap from R16,000 annually to R30,000 in the next five years, Dooc said. The MSC is shared by employer and employee for employed members.

Aside from higher monthly pension, benefits such as maternity, sickness, and funeral received by the member will also increase once the reform agenda is implemented as these are computed based on the MSC.

Dooc explained the success of the proposed Social Security Reform Act of 2017, which is currently being deliberated in the committee level in the Senate, will improve the benefits being received by the members and pensioners.

“The estimated pension could increase to as much as R20,300. As we have proposed earlier, the adjustment in MSC should increase gradually every year to R20,000 next year, to R25,000 in 2020 and R30,000 in 2021,” Dooc said.

“As we increase the coverable income, the benefits also increase because this is the basis for computation of SSS benefits,” he added.

Dooc explained that the benefit of an SSS member is computed based on the number of credited years of service (CYS) and his MSC.

Under the current maximum MSC of R16,000 annually and monthly contribution rate of 11 percent, the maximum basic monthly pension is only R10,900 for a member who retires with at least 30 credited years of service or the number of years he paid SSS contributions.

In the current MSC structure, the maximum average daily salary credit is at R533 so he is eligible for a sickness benefit of R480 per day. If the MSC and contribution rate will be adjusted to R30,000, the sickness benefit per day will increase to R900.

Maternity benefits for caesarian delivery will also increase from the current R41,600 to R78,000 under a maximum MSC of R30,000. While those who will undergo normal birth will get R60,000 from the current R32,000 under the proposed R30,000 maximum MSC.

Even funeral benefits for those who paid at least 120 contribution at the corresponding MSC before the semester of death of the member will increase to R38,000 from the current R29,600.

Dooc earlier expressed hopes that the contribution increase will be implemented by January 2018, after the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) bill and the passage of the SS Reform Act of 2017.

“We are really hoping for the passage of this bill, which according to Sen. Gordon is a landmark bill. This will not only ensure the viability of the pension fund for the current and future members but it will also improve the benefits being enjoyed by our contributingmembers,” Dooc said.

“For a minimal increase in their monthly contribution, a potful will be added to their benefits and pension,” he added.

The SSS chief said the economic managers in the Cabinet maintained that additional contributions are necessary to keep the state fund running, even with the pension increase.