President Duterte has signed the law giving him the power to defer the increases in contributions of the Social Security System (SSS) for the duration of the State of Calamity.

Republic Act (RA) No. 11548 amended section 4(a)(9) of RA 11199 or the Social Security Act of 2018, which allows the Social Security Commission, the governing body of the SSS, to implement the contribution rate increase.

Duterte signed the measure on May 26, 2021.

The new law allows the President to extend the deferment of the SSS contribution hike for another six months for a total of one year upon the recommendation of the Social Security Commission.

Sec. 4(a)(9) of the Social Security Act of 2018 imposes a one-percent contribution increase on SSS members every two years starting 2019 until 2025.

This means that from a contribution rate of 12 percent in 2020, the contribution rate will increase to 13 percent beginning January 2021.

It likewise stated that other scheduled contribution rates and the monthly salary credits shall continue to be valid and effective, provided that no changes in the implementing rules or administrative procedures would be introduced by the Social Security Commission that will defer the disbursement of benefits.

"The rate of penalty on unpaid loan amortizations shall be determined and fixed by the Commission from time to time through rules and regulations on the basis of applicable actuarial studies, rate of benefits, inflation, and other relevant socioeconomic data," the law read.

In February, Senator Richard Gordon, sponsor and one of the authors of the bill in the Senate, pointed out that having the mandated contribution increase was not timely because of the continuing hardship brought about by the coronavirus (COVID-19) pandemic to the people and to the business sector.

He said that the measure provides the people with the flexibility to adapt to the pandemic, giving them financial breathing space to be able to adjust to the ongoing crisis.