PHILIPPINE SOCIAL SECURITY SYSTEM:SOLVENT, STABLE and DYNAMIC

EDWIN J. S. PINEDA

Former Senior Economist
University of Asia & the PacificPHILIPPINE RETIREMENT INCOME SYSTEM

CoveredPopulation

Institutions

Indigent
Population

Working
Population

Working
Population

Principle

Indiv.

All Sectors

Gov’t

PrivateGov’t

Private

Corp.

DSWD,
DOH, LGU’s,NGO’s,GSIS(Pension)

SSS(Pension)

GSIS(Life Ins),
Pag-ibig

HDMF
RA 7641

Life Insurance,
Pre-need Trust
Arrangements,
Tax Qualified &Unqualified
Pensions Plans

SSS-WISPSSS-Flexi FundSSS Peso Fund
Retirement
Goals

GeneralPopulation

Minimum Pension,
Replacement Ratio

Replacement
Ratio

Supplementary
Retirement
IncomeRedistribution

Redistribution,
Social Insurance

Equity,Insurance,
Provident Fund

Equity,Insurance

Discretionary

Mandatory

Mandatory

Voluntary

Alleviation

Source: Updated proceedings from the Retirement Income Commission (RIC) circa 2000

2021 Philippine Social Security Fund P&L and Balance Sheet(in PhP Millions)

REVENUES & EXPENDITURES%∆REVENUESASSETS & RESERVESASSETS

258,534.57

8.9

Members’ Contribution

224,003.23

9.7

Investments

Investment & Other Income

34,531.343.8

1,089,142.32

Benefit Payments%∆

657,486.43

9.5

611,628.62

11.3

Property & Equipment

9,597.38

32.1

64.2

Others36,260.43 (16.7)

221,839.81

14.7

LIABILITIES

7,600,981.38

Operating Expenses

10,095.05

14.2

RESERVES(6,943,495.0) (13.0)

Net change in Policy Reserves

857,207.46

85.9

EXPENDITURESNET REVENUE/(LOSS)(830,607.80) (95.0)

Source: Social Security System, 2021 Annual Report

12.7

Includes Flexi Fund, Peso Fund, Mortgagor’s Insurance Account,
Mandatory Provident Fund

Achievements from the Social Security Act of 2018
(In PhP Billion)

Unemployment Benefits
2,000

1,709.01

1,500

15

1,609.86-10.06106.331,000500

Expanded Maternity Leave Law
Benefit
13.56

5117.86
2019

2020

2021

Collection from Delinquent accounts
86.47

67.28
5.60

42
Source: Social Security System, 2021 Annual Report

2019

2020

2021

-2019

2020

2021

UNFUNDED LIABILITIES (Open Formula)2019 Actuarial Valuation &Estimated Life of FundOpen GroupAs of Dec 31,
2021

Key Projection Results
Year of Reserve Exhaustion

2054

Year Net Revenue turns Negative2045

Social Benefit Liability

PhP6.874T
US$123.732B

Reserves

PHP0.626T
US$11.268B

Unfunded Liability

PhP6.248T
US$112.464B

PhP-US$ exchange rate is PhP55.56/US$ as of Jan. 13, 2023
Source: Social Security System, 2021 Annual Report

PV ofFuture Benefits& Future Expenses

ClosedAs of Dec 31,2021

PhP7.591T
US$136.638B-PV ofFuture Payroll Taxes-Existing Reserves(Excluded in ClosedMethod)=_______
UNFUNDED
LIABILITIESNATIONAL EXCESS DEATHS vs. FORECAST
Past 7 years

Source: Newsletter 19 Aug 2022 Philippines: Summary of 2021 Registered Deaths, Excess Mortality, and Covid-19 Deaths: Overall and by Region is provided.
supersally.substack.com/p/Philippines-summary-of-the-2021-registered

NCR EXCESS DEATHS vs. FORECAST
Past 7 years

Source: Newsletter 19 Aug 2022 Philippines: Summary of 2021 Registered Deaths, Excess Mortality, and Covid-19 Deaths: Overall and by Region is provided.
supersally.substack.com/p/Philippines-summary-of-the-2021-registeredSource: Newsletter 19 Aug 2022 Philippines: Summary of 2021 Registered Deaths, Excess Mortality, and Covid-19 Deaths: Overall and by Region is provided.
supersally.substack.com/p/Philippines-summary-of-the-2021-registeredSource: Newsletter 19 Aug 2022 Philippines: Summary of 2021 Registered Deaths, Excess Mortality, and Covid-19 Deaths: Overall and by Region is provided.
supersally.substack.com/p/Philippines-summary-of-the-2021-registered

Philippine Historical Annual Registered Live Births% Change 2021 Preliminary Data to date

Source: Newsletter 9 Jan 2022 Philippine Updates on Covid-19 Vaccination, Sudden Deaths. China letting Covid-19 Rip. Concerning Drops in2022 Registered Live Births supersally@substack.com

Total Fertility Rates for the Three Years Preceding the Survey
PHILIPPINES, 1993-2022
4.8

Rural

4.7

4.33.8

3.5
2.9

4.1

Total
3.5

3.7

3.0

Urban
19931998

3.5

3.0

2003

3.3

2.8

2008

3.0

2.2
2.7
1.92.6

2013

2.4
2017

1.72022

Source: Newsletter 9 Jan 2022 Philippine Updates on Covid-19 Vaccination, Sudden Deaths. China letting Covid-19 Rip. Concerning Drops in2022 Registered Live Births supersally@substack.com

PHILIPPINE SOCIAL SECURITY SYSTEM:SOLVENT, STABLE and DYNAMIC

EDWIN J. S. PINEDA

Former Senior Economist
University of Asia & the Pacific