Updated 23:35 PM PHT Wed, January 4, 2017
Metro Manila (CNN Philippines) — A higher contribution to go along with a pension hike.
This is the most viable solution the Social Security System (SSS) chair Amado Valdez — along with the board — is seeing right now.
Valdez said according to a board resolution submitted to the President, a P1,000 hike could be given to pensioners but this would need a 1.5 percentage point rise in members' monthly contribution beginning June.
Based on a sample computation, a member paying the smallest monthly contribution of P110 will have to pay P125 instead.
The SSS would need to shell out P33B if more than 2 million retirees would get the pension hike this January. This would shorten the SSS fund life to the year 2032, from the current 2042.
But with the adjustment in contribution, the fund life can last to 2040. Out of 6 proposals, this was seen as the most feasible.
"It was really well studied (by the board) and that is what we submitted to the President (Duterte) for his approval," Valdez said on Wednesday.
Valdez clarified the SSS was not passing the buck to the President — citing that according to its charter, the President should approve any increase in pension or contribution.
He added that proceeds from higher contributions would be earmarked for SSS investments -- not the pension hike.
Valdez said the President could still reject the SSS board resolution raising pension and contributions.
But this would mean going back to the drawing board.
CNN Philippines' Ruth Cabal contributed to this report.