The Social Security System (SSS) agrees that further studies and consultations will have to be made amid its proposal to increase contribution rate by an additional 0.6%.

This was conveyed by SSS President and CEO Emilio S. De Quiros, Jr. in his reply letter to Employers Confederation of the Philippines (ECOP) President Edgardo G. Lacson on the Confederation's position paper expressing employers' "strong reservations on any increase in [social security] contributions given the volatile economic situation, the capacity of employers and employees to absorb the increases, and its overall impact on the economy and viability of businesses."

According to de Quiros, "considering that the SSS benefit program operates on a cross-subsidy system, the balance, so to speak, may be arrived at upon hearing all sides. The welfare of the working class may still be delivered without undue hardship on the part of the capital sector."

"We do not lose sight of the fact that the two previous 1%-contribution rate increases, i.e., from 8.4% to 9.4% in 2003 and from 9.4% to 10.4% in 2007, were all shouldered by the employers. After another four years from 2007, the proposal calls for an additional 0.6% contribution rate, but this time to be shared equally by the employers and their employees. On the other hand, the clamor for higher benefits may be felt from numerous legislative proposals seeking for pension increases. These factors form part of the complexities inherent in a contributory social insurance scheme like ours. And we agree that further studies and consultations must be made before implementing this proposal," de Quiros added.

De Quiros further wrote that said increase refers to what was approved in principle by the Social Security Commission (SSC) last March 16, i.e., an increase in contribution rate from 10.4% to 11% and an increase in monthly salary credit ceiling from P15,000 to P20,000. This, he said was justified by SSS on the basis of extending the actuarial life of the Fund, in general, and the provision of more meaningful protection to its members by way of higher amount of pensions and benefits.

De Quiros noted that the improved life expectancy among SSS members, the declining ratio between contributors and pensioners and trends in social security programs in other countries were the grounds cited in the proposal. Such approval in principle by the SSC was subject to the condition that consultations shall be done with various stakeholders – labor, employers, and the general public – before its endorsement to the Office of the President. "Although there are employers' representatives in the SSC, we consider inputs from other business groups as equally important," he emphasized.

Justifying SSS' proposal, de Quiros said based on financial sensitivity analysis made, of the reforms which are within the powers of the SSC, subject to the approval of the President of the Republic, none is more direct and appropriate as the present proposal to increase the contribution rate and the maximum salary credit.