SIXTEENTH CONGRESS OF THE 
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REPUBLIC OF THE PHILIPPINES 
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Third Regular Session 
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■'5 DCr27 p 6 rj57
SENATE
s.No. 2995
■4
Introduced by Senator Ralph G. Recto
AN ACT
RATIONALIZING THE POWERS, DUTIES AND ACCOUNTABILITIES OF THE 
SOCIAL SECURITY COMMISSION, FURTHER AMENDING FOR THE PURPOSE 
REPUBLIC ACT NO. 1161, AS AMENDED, OTHERWISE KNOWN AS THE “SOCIAL 
SECURITY LAW” 
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Explanatory Note f  * * * 4,
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In the spirit of social justice, the State is mandated to establish, develop, and promote a 
suitable, sound and viable social security service that will protect covered employees and their 
families from the hazards of disability, sickness, old age and death.
Social insurance programs are designed to mitigate income risks by pooling resources 
and spreading risks across time and groups of individuals1. Social insurance like the Social 
Security System (SSS) needs to provide basic economic security for the people while curbing 
poverty, providing economic stability, redistributing income and preserving important social and 
individual values. Given these requirements, an effective social security protection will depend 
significantly on a robust financial capacity, extensive membership, and sustainability of benefits 
vis-i-vis revenues.
Ycar-on-year financial reports of the SSS indicated an effective management of the social 
pension funds. Total SSS revenue grew by an average annual rate of 10% from 2010 to 2014. 
Membership contributions rose by 52% from P79.27 billion in 2010 to P120.65 billion in 2014 
when the Commission increased the PI5,000 maximum salary credit to PI6,000. Investments 
likewise grew by 23% during the same period, from P27.85 billion to P34.53 billion. Total assets 
in 2014 have increased by 43.55% from total assets in 2010. The average annual operating cost 
from 2010-2014 amounted to only about six percent (6%) of the total collected revenues, or 
roughly 36% lower than the established charter limits3.
Despite the rosy financial statistics, the SSS is still fraught with two crucial concerns. 
First, constrained capacity to improve collection rate and efficiency deprived the Commission of 
additional funds that it could use for social security protection and investments. In 2014, SSS 
collected from 11.17 million paying members which accounts for only 46.7% of the average full­
time employed labor force4. A Commission on Audit Report also noted the P8.168 billion pesos 
delinquency in premium contributions and penalties as well as a net receivable of 61.23 billion 
from its membership loans, of which P20.7 billion has been delinquent for over five years5. 
Second, restricted investment options kept the Commission from maximizing potential market
' Manasan, R. G. (2010). **Refonning Social Protection Policy; Responding to the Global Financial Crisis and 
Beyond.” Research Paper Series. Makati: Philippine Institute for Development Studies.
Social Security System. (2004). Actuarial Study Notes. Quezon City: Social Security System.
Social Security System. (2014). Year-ender Report. Quezon City: Social Security System
Total Average Labor Force Estimate for 2014 is 41.379 million; Total employed labor force is 38.651 million. 
Data taken from Philippine Statistics Authority 2015 Current Labor Statistics.
5 Commission on Audit. (2014) Annual Audit Report of the Social Security System.