President Aquino vetoes SSS pension hike bill

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President Benigno Aquino III (File photo)

Metro Manila (CNN Philippines) — President Benigno Aquino has vetoed the bill to hike the Social Security System (SSS) pension.

The bill Aquino thumbed down mandates a P2,000 across-the-board increase in SSS monthly pensions.

In an official notice from Malacañang signed by the president on Tuesday (January 12), Aquino stated that while he recognizes the bill's objective to promote the well-being of the country's private sector retirees, he cannot support the bill in its present form because of its "dire financial consequences."

Aquino said the stability of the entire SSS benefit system will be "seriously compromised" in favor of two million pensioners and their dependents. He also said the adjustment will result in substantial negative income for the SSS.

He provided the breakdown of how the proposed increase will affect the income of SSS.

"The proposed pension increase of P2,000 per retiree, multiplied by the present number of more than two million pensioners, will result in a total payout of P56.0 billion annually. Compared against annual investment income of P30 billion to P40 billion, such total payment for pensioners will yield a deficit of P16 billion to P26 billion annually."

According to Communications Secretary Sonny Coloma, Executive Secretary Paquito Ochoa Jr. said Aquino has informed the Congress of the president's decision to veto the enrolled House Bill No. 5842, through the respective offices of House Speaker Feliciano Belmonte Jr. and Senate President Franklin Drilon.

Related: Senate approves bill granting an extra P2,000 monthly to SSS pensioners

The bill has been waiting for Aquino's approval since December 2015.

CNN Philippines' Patricia de Leon contributed to this report.