Senator Francis Tolentino has sought a Senate probe into the reported P843.9 billion net loss incurred by the Social Security System (SSS) even as the Upper House is scheduled to adjourn sine die on June 3.
In Senate Resolution 1006 filed yesterday, Tolentino asked the Senate leadership to direct the Senate committee on government corporations and public enterprises ‘’to conduct an inquiry, in aid of legislation, on the reported millions of losses in the Social Security System's 2021 unaudited financial statements to ensure its financial viability and capacity to carry out its fiduciary responsibilities to the general public.’’
Tolentino said the losses allegedly resulted from a change in accounting standard brought by Philippine Financial Reporting Standards (PFRS).
SSS explained that the increase in its net loss from the previous year is due to the recognition of the Margin for Adverse Deviation (MfAD) in policy reserves.
Considered as a buffer for conservatism, MfAD are elements in the assumptions used in the calculation of an actuarial liability for possible unfavorable deviations from expected experience.
Although the SSS ensured that its cash flows and funding situation remain secured, there is a need to study the effects of its net losses to ensure it remains financially viable for paying out benefits to covered members, Tolentino said.
With the increasing membership base of SSS, there is likewise a need to revisit existing social security benefits guaranteed under the Social Security Act of 2018 to further assist Filipino pensioners and beneficiaries in addressing their financial burdens, he pointed out.
As of April 2021, 40.49 million Filipinos are enrolled with the Social 6 Security System (SSS).
From this, about 76 percent or 30.77 million are employed members, while 5.03 million are voluntary paying members, 3.35 million are self-employed members, and 1.34 million are Overseas Filipino Workers (OFW) members.
The effect of the reported losses should be scrutinized for the purpose of crafting laws and regulations that would provide further security to the agency's long-term financial standing in order to fulfill its fiduciary duties to all its stakeholders, Tolentino stressed.