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Nation at a Glance — (03/21/19)

News stories from across the nation. Visit www.bworldonline.com (section: The Nation) to read more national and regional news from the Philippines.
Nation at a Glance — (03/21/19)

Ayala Land Offices opens new Clock In flexible workspace in Vertis North

Ayala Land Offices (ALO), the office leasing arm of Ayala Land, Inc., recently opened its latest flexible, co-working space under the brand name Clock In in Vertis North, a sprawling mixed-use development of its parent company in Quezon City.

The new Clock In occupies 800 square meters of space on the sixth floor of Vertis North Corporate Center 1, which is in close proximity to critical transportation hubs, major Metro Manila arteries, a slew of retail establishments, residential properties and hotels.

It is the fourth Clock In flexible workspace to go online since Ayala Land entered the shared office space business in 2017, after the one at the Penthouse of the Makati Stock Exchange building in Makati City and the other two in Bonifacio Global City (BGC) in Taguig City. Three more are scheduled to open by the end of the year — at The 30th in Pasig City, at Ayala North Exchange in Makati City and Alabang Town Center in Muntinlupa City.

According to Carol Mills, Vice President and Head of Ayala Land Offices, rapid advancements in mobile technology and connectivity are changing the way people work, resulting in jobs that are based online and the realization of businesses that tasks can be performed under flexible conditions.

“We are leveraging the synergies of Ayala Land to address the growing demand for shared spaces that inspire innovation and collaboration,” she said.

At the opening of Clock In Vertis North, she said they were pleased with the occupancy of Clock In Makati and BGC, noting that the take-up was fast within the first year.

“We were able to expand our tenant base to include start-up companies, small, medium enterprises and companies that perhaps could not have been able to locate in our traditional offices,” Ms. Mills said.

A flexible workspace like Clock In has huge advantages such as fully furnished facilities and services. Its plug-and-play simplicity meshes well with the always-on-the-go work styles prevalent today. It also entails low start-up costs and flexible lease terms and provides passport access across all Clock In locations.

That’s why it’s incredibly popular among start-ups, small and medium-sized enterprises, digital nomads, freelancers, road warriors and swing-space seekers, and it is beginning to catch on with large corporates, specifically those that deploy project-based teams in satellite offices.

Designed as a modern twist to an English pub, Clock In Vertis North features a workspace that can seat up to 185 people, fostering collaboration and productive discourses among tenants. It has 23 private offices, a 28-seater co-working space, two meeting rooms (an 8-seater and a 12-seater), and an event space for a variety of purposes, including company presentations, product launches and mixers.

All tenants get to enjoy fast Internet connection of up to 80 mbps, maintenance services, administrative and IT support, unlimited supply of coffee and tea, among other perks.

Ms. Mills added, “In this fast-paced digital world, new skills and business models are needed to thrive. Companies are recognizing that in order to attract and retain top talent, they need to be more community-minded and this should be reflected in the kind of work environment they provide. Clock In by Ayala Land Offices offers the environment for the new generation of businesses to begin.”

For more information, visit http://www.clock-in.com.ph.

Bad debts outpace total bank loans’ rise

SOURED DEBTS held by Philippine banks rose in 2018 to outpace the growth in total loans at a time of higher interest rates and rising commodity prices.
Non-performing loans (NPLs) held by banks hit P178.532 billion last year, 16.7% more than the P152.985 billion in 2017, according to data the Bangko Sentral ng Pilipinas (BSP) released on Tuesday.
NPLs are loans left unpaid for at least 30 days beyond due date. These are considered risky assets given the slim chance borrowers would settle such liabilities.
The growth in soured debts outstripped the 13.6% increase to P10.076 trillion in total loans handed out by banks.
As a result, industry NPLs took a bigger slice of total loans at 1.77% in 2018, compared to the preceding year’s 1.73%.
Problem debts held by universal and commercial banks grew 16.4% to P113.518 billion from P97.531 billion as of end-2017, faster than the total loan portfolio of these big lenders that expanded by 14.6% to P9.018 trillion.
This pushed big banks’ NPL ratio to 1.26% of total loans from 1.24% in 2017, capping declines observed since 2013.
Across the Philippine banking system, past due loans — which refer to all types of loans left unsettled beyond payment date — soared 44.2% to P253.582 billion, data showed.
Restructured debts fell 14.9% to P39.713 billion.
Still, banks added just a little to their reserves to cover prospective loan losses. The lenders set aside P187.342 billion, just 1.7% more than the previous year’s allowance for possible defaults.
This eroded the banks’ coverage ratio to just 104.93%, still enough to cover the entire NPL stash but significantly less than the 120.44% provision the year prior.
Philippine banks made a cumulative P178.835 billion in 2018, up 6.4% from the P168.075-billion profit the previous year.
BSP Deputy Governor Chuchi G. Fonacier said that the higher NPL may be attributed to a “stricter definition” of past-due and non-performing loans as provided under a recent circular.
The higher NPLs also came after the BSP raised benchmark borrowing rates by a total of 175 basis points in 2018 in five successive rate hikes meant to rein in inflation expectations as consumer prices surged by as high as 6.7% in September and October. The key rate rose to 4.75% from three percent in early 2018, which in turn pushed market yields higher.
The central bank monitors NPL ratios of banks and other firms in order to keep track of asset quality and maintain the soundness of the financial system.
In a March 6 webcast, S&P Global Ratings said the higher NPLs do not ring alarm bells just yet, noting that the ratio “continues to remain very low.”
At the same time, the global debt watcher cited the rapid rise of interest rates as well as currency volatility as key risks to bank profiles.
“We expect the uptick in NPLs to continue in 2019 as well,” Nikita Anand, S&P’s associate for Financial Institutions Ratings, had said then. — Melissa Luz T. Lopez

Regulator mulls Manila Water penalties

THE METROPOLITAN WATERWORKS and Sewerage System (MWSS) said on Tuesday it was studying the prompt imposition of penalties against the Manila Water Company, Inc. for current service disruptions, marking a shift from its statement the day before that penalties will have to be incorporated in rate rebasing done every five years.
Leaders of the MWSS were summoned to a meeting with President Rodrigo R. Duterte that was to take place late in the afternoon of the same day in Malacañan Palace.
“We are studying that right now. We are exploring that option of imposing it by June or July,” MWSS-Regulatory Office Chief Regulator lawyer Patrick Lester N. Ty told the Senate Committee on Public Services when pressed on the matter in a public hearing.
The committee, led by Senator Grace S. Poe-Llamanzares, questioned Mr. Ty after he said the regulator does not have authority to promptly impose penalties for noncompliance with requirements in concession agreements.
It was the same stand he took the day before in a hearing at the House of Representatives, prompting Speaker Gloria M. Arroyo to tell reporters afterwards that lawmakers will have to tighten sanctions under such deals.
In the same hearing on Tuesday, Senate President Vicente C. Sotto III said Article 10.4 of the concession agreement between the MWSS and Manila Water provided that failure to meet any service obligation for more than 60 days, or 15 days “in cases where the failure could adversely affect public health or welfare”, will subject concessionaires to financial penalties.
“The amount of any such penalty shall be equal to 25% of the costs that, in the reasonable opinion of the Regulatory Office, the concessionaire will incur in order to meet the service obligation in question,” the provision read in part.
Mr. Ty explained that the MWSS penalizes concessionaires through rate rebasing, noting that the same provision said that penalties “shall be rebated to customers” every five years.
“Admittedly, the regulatory office has only been imposing it during rate rebasing, but there’s no provision that prohibits the regulatory office from doing that earlier,” Mr. Ty said.
CAUTIOUS
He said the regulator is looking at imposing any sanction by July since the immediate priority is to restore services to all areas in Metro Manila’s “east zone” that has been entrusted to Manila Water since 1997.
“One, we want to focus first on fixing things; second, we expect the next monthly bill will be very low because the usage of everyone will be very low; and third, of course, to observe due process,” Mr. Ty said.
“If we just impose [penalties] on Manila Water, they can actually file an arbitration case and — I’m not sure if you’ve known — we have been losing our arbitration cases,” he added, to which Ms. Poe responded: “Maybe you should get better lawyers.”
For his part, Manila Water President and Chief Executive Officer Ferdinand M. dela Cruz said the company will comply with penalties that MWSS will impose, provided these are in accordance with the concession agreement.
“We will comply with the process and there’s a process and whatever comes out of that performance review and the required penalties, if it is within the framework of the concession agreement process, Manila Water will comply,” Mr. dela Cruz told the panel.
Among others, the concession agreement requires provision of “uninterrupted 24-hour supply of water to all connected customers in the service area”.
SUMMONED TO MALACAÑANG
In a chat with reporters on Tuesday afternoon, Presidential Spokesperson Salvador S. Panelo said Mr. Duterte was scheduled to meet later that day with MWSS officials to check on compliance with his order to the agency last Friday to instruct Metro Manila’s two water concessionaires to tap more water from Angat Dam in order to improve service delivery.
“Siguro mage-explain ’yung MWSS… Siguro magre-report sila kung ano na nangyari. Di ba may directive siya? baka magre-report, O, ano na nangyari sa directive ko,’ baka ganun,” he told reporters.
In his statement last Friday, Mr. Panelo said: “The President is aware and concerned about the (suffering) of the residents of Metro Manila due to the present water crisis.”
He added that Mr. Duterte ordered the MWSS to “demand from the Manila Water Company, Inc., Maynilad Water Services, Inc. and other responsible offices to release water from Angat Dam by noon time today, March 15.”
He said further that the expected water releases “should be sufficient for 150 days to cover affected areas in Metro Manila.”
“In the event of failure to act or comply with this directive, the President will personally go to them and make the responsible officers account for such failure,” Mr. Panelo also said.
Water services have improved somewhat since then as Manila Water secured the green light to tap deep wells to augment supply for a limited time. — Charmaine A. Tadalan with ALB

Feb. marks fourth straight month of BoP surplus — BSP

THE COUNTRY’s external position remained in surplus in February to mark the fourth straight month of net dollar inflows, the Bangko Sentral ng Pilipinas (BSP) reported on Tuesday.
The Philippines’ balance of payments (BoP) position recorded a $469-million surplus last month, narrowing from January’s $2.704-billion surfeit but turning around from the $429-million deficit seen in February 2018.
The BoP measures the country’s transactions with the rest of the world at a given time. A surplus means more funds entered the Philippines compared to money pulled out by foreign investors.
The central bank on Tuesday attributed the positive BoP to bigger net foreign currency deposits held by the national government, coupled with strong income from the BSP’s overseas investments. The BSP added that its foreign exchange operations boosted the BoP tally.
The Bureau of the Treasury raised $1.5 billion from the sale of 10-year dollar bonds to foreign investors in January, which was followed by a two-week offer of five-year retail Treasury bonds that started late February.
The February figure also reflects the higher gross international reserves that month, totaling $82.78 billion. Currency traders have said that the BSP likely bought more dollars to rebuild the reserves, which had slipped to a seven-year low in 2018 as the monetary authority used the amount to cushion the peso’s drop.
Year-to-date, the BoP tally now stands at a $3.17-billion surplus, turning around from the $961-million deficit in 2017’s first two months. This compares to the $3.5-billion deficit the central bank expects for 2019, as well as the $2.306-billion gap incurred in 2018.
“The surplus may be attributed partly to remittance inflows from overseas Filipinos in January 2019 and net inflows of foreign portfolio investments for the first two months of the year, which was a reversal of the net outflows reported in January-February 2018,” the BSP said in a press release.
The central bank attributed 2018’s huge BoP gap to a wider trade deficit. The current account deficit — which measures external goods trade — stood at an all-time-high $7.9 billion in 2018, bigger than the $2.2 billion recorded in 2017 and surpassing the $6.4-billion projection of the BSP. — Melissa Luz T. Lopez

Moody’s: PHL among least affected by Sino-US trade row

THE PHILIPPINES is among the economies least affected by simmering trade tensions between the United States and China, Moody’s Investors Service said in a March 19 note, citing its relatively low exports to Beijing compared to those of other Asian economies.
In a report, the credit watcher placed the Philippines in the middle of the pack in terms of the impact of the still unresolved tariff wars between the world’s two biggest economies.
Thailand, Vietnam, Taiwan and Malaysia are seen to benefit the most out of the trade war, as they are likely to receive the trade and investment opportunities diverted from China. These four economies scored the highest in terms of export similarity, which means that they can offer roughly the same manufactured goods that are sourced from China.
The Philippines was found better-positioned to benefit than the likes of Sri Lanka, Cambodia and Bangladesh.
“The weakening of export shipments over the past year has been broad-based, reflecting the deteriorating outlook for global growth and, in particular, China,” Moody’s said in its note. “Lower import demand from the region’s largest economy reflects both domestic and external factors, including slower domestic demand as credit availability has tightened and the trade dispute with the US.”
China was the country’s biggest trading partner in 2017, as it is the source of $21.394 billion worth of imports and received $8.699 billion of Philippine goods exports, according to latest full-year trade data of the Philippine Statistics Authority.
In the same note, Moody’s attributed slower capital formation growth in the Philippines and Indonesia to rising interest rates against the backdrop of growing current account deficits and exchange rate volatility.
At the same time, stronger public spending on infrastructure can be expected to “contain further weakening” of investments.
Hong Kong and Mongolia are expected to see the biggest slowdowns in economic growth due to their significant trade exposures to China, alongside Singapore, Vietnam and Taiwan. — Melissa Luz T. Lopez

CPG allots P8 to P10 billion for capital spending

By Vincent Mariel P. Galang, Reporter
CENTURY Properties Group, Inc. (CPG) said it is allotting between P8 to P10 billion this year for capital expenditures, which will be used for its residential and office projects and land acquisitions.
“Actually, we see the market right now very, very bullish… for everything across-the-board. We’re just trying to tweak our business plan to become more efficient,” Marco R. Antonio, chief operating officer of CPG, said during a briefing at Century City Mall in Makati City on Tuesday.
The capex will be sourced from internal funds, as well as the company’s retail bonds which are up for approval by the Securities and Exchange Commission on March 26.
This comes after CPG reported its net income surged 72% to P1.1 billion in 2018 from P650 million in the year prior. Revenues jumped 60% to P10.7 billion in 2018, on the back of the completion of three residential buildings, an office tower, and 259 affordable housing units.
“For our bottomline… income surged (over) 70% from P650 million in 2017 to P1.1 billion full year 2018. Prior, we’ve had several years of over a billion but maybe in the past three years this is probably I guess to return above P1 billion, so it’s a very much positive sign that our strategy of diversification is starting to bear fruit,” Mr. Antonio said.
Known for its high-rise residential projects, CPG has in recent years diversified into affordable housing and commercial leasing.
This year, the company is looking to expand its affordable housing projects through its joint venture company with Japan’s Mistubishi Corp. Last week, it launched PHirst Park Homes community in San Pablo, Laguna.
“We’re looking to launch one per quarter, that’s our target. If not, we’re still looking to launch four by the end of the year,” Mr. Antonio said. “This year, it will be [more in the South], but next year we’re planning to do a lot of North.”
Also, Mr. Antonio said CPG is looking into building low-rise condominiums and townhouses.
“It’s going to be a healthy split between in-city, of course we have residential condo, which we plan to have probably 20% to 30% of our sales. We’re also thinking of doing projects that are going to be low-rise in nature that will allow the company to do quicker cash cycles, quicker return on investments and also quicker delivery to the end-user buyer,” he said.
Out of its target to have 32 office and commercial buildings by 2021, CPG is planning to add four more to its current portfolio of 24 this year.
“We finished ACC [Asian Century Center] last year. This year we will finish Century Diamond, and then end of next year we’re targeting the completion of Century Spire,” he explained.
Asian Century Center is a commercial building in Fort Bonifacio with net leasable area of 30,000 square meters (sq.m.) finished last year, while Century Spire is located within Century City and due for completion next year. On the other hand, Century Diamond Tower in Makati City is a project with Mitsubishi Corp.
In addition to this, CPG said its partnership with Global Gateway Development Corp. (GDCC) for a 2.6 hectare residential and office development in Clark is undergoing masterplanning stage and is targeted to start development by end of 2019.
“I think what’s happening is that the growth is not just happening in Metro Manila but nationwide, so given that people everywhere are sharing in the prosperity and growth. Because of that not only are we seeing demand from Metro Manila because… of the price differential and people being able to get more space outside of Metro Manila, but also the strength of the local market,” Mr. Antonio said.
Shares in CPG went up by 5.05% or P0.025 to P0.52 apiece on Tuesday.

Robinsons Retail profit up 2%

ROBINSONS Retail Holdings, Inc. (RRHI) reported a 2% rise in its net income attributable to equity holders of the parent company in 2018, as same-store sales growth (SSSG) grew across all formats.
In a statement, RRHI said its attributable net income stood at P5.08 billion last year, up from P4.97 billion in 2017.
Core net income jumped 6.2% to P5 billion for 2018, from P4.69 billion in the previous year. RRHI said its core income excluded interest from bonds, equitized net earnings from the 40% stake in Robinsons Bank, and unrealized foreign exchange gains/losses, and non-recurring expenses.
The Gokongwei-led retailer has yet to submit its annual report to the corporate regulator.
RRHI said its consolidated net sales increased by 15.1% to P132.7 billion in 2018, “driven by the strong blended SSSG of 5.9%, the sales contribution from the 104 net new stores opened during the twelve months of 2018 and the one-month consolidation of the Rustan Supercenters, Inc.”
The company said the bulk of sales or 47% came from the supermarket segment, although details were not disclosed. It noted Robinsons Supermarket’s share to total net sales is seen to rise this year, with the full consolidation of Rustan Supercenters.
“The strong SSSG in 2018 brought about by the increase in disposable income from the reduction in personal income tax was largely driven by the supermarket segment which recorded SSSG of 7.6%, followed by specialty stores at 6.9%, convenience stores at 5.1%, DIY at 5.0%, drugstores at 3.3%, and department store at 2.3%,” RRHI said.
Under the Tax Reform for Acceleration and Inclusion (TRAIN) law which took effect in January 2018, non-minimum wage earners receiving a monthly wage of P21,000 and below are exempted from paying the personal income tax. Those earning above the amount also received significant tax cuts.
RRHI said earnings before interest, taxes, depreciation and amortization (EBITDA) went up by 7.6% to P9 billion.
Aside from Robinsons Supermarket, RRHI’s portfolio includes Robinsons Department Store, The Generics Pharmacy, South Star Drug, Handyman Do It Best, True Value, Toys “R” Us, Ministop, Daiso Japan, Costa Coffee, Savers Appliances, Top Shop and Dorothy Perkins.
The listed Gokongwei-led company ended 2018 with 1,910 stores, excluding the franchised stores of The Generics Pharmacy. Broken down, the figure includes 252 supermarkets, 52 department stores, 210 do-it-yourself stores, 499 convenience stores, 510 drugstores and 387 specialty stores.
RRHI’s gross floor area increased by 28.8% year on year to 1.48 million square meters. The retailer said it spent P4.4 billion in capital expenditures for 2018.

STI opens two academic centers in Manila, Bulacan

STI Education Systems Holdings, Inc. opened two new academic centers this month as part of its nationwide expansion.
The listed company told the stock exchange on Tuesday it inaugurated an academic center in San Jose del Monte, Bulacan on Mar. 4 and another one in Sta. Mesa, Manila on Mar. 11, both accounting for a total investment of about P1.3 billion.
“In our pursuit of academic excellence, we constantly upgrade our campuses to deliver our promise and expand our geographical coverage to make real life education more accessible for the Filipino youth,” STI President and Chief Operating Officer Peter K. Fernandez was quoted as saying.
The two academic centers can accommodate a total of 15,000 senior high school and college students.
STI Holdings said senior high school, as well as tertiary courses in Information and Communications Technology, Business and Management, Tourism Management, Hospitality Management, Arts and Sciences and Engineering are offered in both campuses.
Aside from the two new academic centers in San Jose del Monte and Sta. Mesa, STI also has a presence in Batangas, Las Piñas, Calamba, Cubao, Lucena, Caloocan, Ortigas-Cainta, Novaliches, Fairview, Naga and Bonifacio Global City.
In the first three quarters ending December, the attributable net income of STI Holdings dropped 38% to P190.4 million due to the lower-than-expected turnout of college freshmen enrollees. — Denise A. Valdez

SEC issues rules for investment adviser pass

THE Securities and Exchange Commission (SEC) has issued the guidelines that will allow the free movement of investment advisers within members of the Association of Southeast Asian Nations (ASEAN) that are signatories to a framework that aims to enhance the connectivity of capital market professionals in the region.
As signatory to the memorandum of understanding on the ASEAN Capital Markets Forum (ACMF) Pass, licensed professionals in their home country can perform investment advice activities and issue research report on the region’s financial products in a host country.
The signatories to the framework are the Philippines, Malaysia, Singapore, and Thailand.
The guidelines are applicable to professionals in the Philippines who intend to obtain an ACMF Pass in another signatory country, and those in other signatory countries who want to obtain that same pass.
The qualified capital market professionals in the Philippines include sales personnel of a broker dealer and/or investment house, who is a natural person hired to buy and sell securities on a salary or commission basis.
Also included are certified investment solicitors who are licensed by the SEC and appointed by a fund manager or mutual fund distributor to solicit, sell or offer to sell the shares or units of an investment company to the public.
Key officers of fund managers and other professionals that the SEC may, in the future, determine as also eligible to apply for the ACMF Pass.
The ASEAN capital market products that they may give advice on are limited to shares, bonds, and units of collective investments scheme, including units of real estate investment trust, and units of infrastructure fund.
The scope of their activities in a host jurisdiction is limited to issuing or promulgating research analysis or research reports concerning the capital market products that are solely incidental to the giving of general investment advise.
They are also permitted to give general investment advice to both retail and non-retail investors concerning the allowed capital market products.
The SEC guidelines identified two activities that are prohibited under the pass, namely: giving advice to investors by considering their investment objective, financial situation and particular needs; and soliciting for sales of the capital market products.
Under the guidelines the mode of performance of the investment service may either be through physical presence of electronic means.
The ACMF Pass is valid for two years from the date of grant unless earlier revoked or canceled by the SEC. Renewal guidelines for professionals in the Philippines issued by other signatory countries will be provided by the relevant host jurisdictions.
SEC Chairman Emilio B. Aquino signed the guidelines on Feb. 26, 2019. The commission issued the rules as signatory to the ASEAN Capital Market Professional Mobility Framework. — Victor V. Saulon

DMCI to launch 10 projects

DMCI HOMES is unveiling 10 new projects worth P104 billion this year, including developments in Davao City and Cebu.
In a disclosure to the stock exchange, DMCI Holdings, Inc. said its property subsidiary is allocating P17.9 billion in capital expenditures (capex) to fund the new project launches. This is 23% higher than the P14.5 billion the company spent in 2018.
The capex will come from a mix of internally generated funds and bank borrowings.
One of the projects is Kalea Heights in Cebu, which DMCI Homes said is a new market for the company.
“We believe that the DMCI Homes brand can do well in the competitive Cebu market. There’s wider acceptance of condominium living in the area and our projects offer great value for money,” DMCI Homes President Alfredo R. Austria was quoted as saying.
For Quezon City, DMCI Homes will launch The Cresmont and Cameron Residences, while in Las Piñas City, Parama Residences and Sonora Residences will be introduced.
The company is also unveiling Sovanna Towers and Allegra Garden Place in Pasig City, The Camden Place in Manila, and Sage Residences in Mandaluyong City.
Outside Metro Manila, DMCI Homes said it will launch Belleza Towers in Davao City.
Earlier this month, DMCI Homes Project Development Manager April B. Bernal said the company is targeting to hit P38 billion in reservation sales for 2019.
Last year, the Consunji-led developer launched projects worth P28 billion.
DMCI Homes reported its net income rose 9% to P3.9 billion in 2018, due to a one-time gain from the sale of land in Quezon City worth P715 million. Without this, its core profit fell by 11% due to the higher cost of raw materials, as well as the adoption of a new accounting standard that changed the recording of broker’s commissions.
Since 1999, the company has been developing homes and resort-themed projects in the Philippines. It has launched 73 projects to date. — Vincent Mariel P. Galang

SSS to raise contribution rates by the 2nd quarter

SSS-Social Security System
THE SOCIAL SECURITY System will increase member contributions next quarter. — BW FILE PHOTO

THE SOCIAL SECURITY System (SSS) is set to raise contribution rates starting next quarter after its amended charter was signed by President Rodrigo R. Duterte.
Members of the state pension fund will have to pay more for their monthly contributions starting next quarter as it adjusts the contribution rate to 12% from the current 11%.
The minimum and maximum monthly salary credits will also be increased to P2,000 and P20,000, respectively.
Starting April, 8% of the 12% rate will be shouldered by the employer and 4% by the employee, from the current 7.37%-3.63% split.
“We all want a comfortable retirement and to do that, those who are in their productive years must work hard to save more,” SSS officer-in-charge Aurora C. Ignacio was quoted as saying in the statement.
For an employee who earns a monthly salary of P10,000, his personal share will increase by P36.70 to P400, while his employer’s share will go up by P63.30 to P800.
The change in the contribution schedule is the first in the series of adjustments to be implemented every other year until 2025, when the contribution rate will be at 15%.
By 2025, the sharing scheme will be 10% for the employer and 5% for the employee.
Signed by Mr. Duterte last Feb. 7, Republic Act No. 11199 or the Social Security Act of 2018 allows the Social Security Commission or the policy-making body of the pension fund to adjust contribution rates and monthly salary credits of its members without the president’s approval.
This was pushed by the pension fund to ensure the long-term viability of its fund life to 2045 from the current 2032.
“We hope that our members will understand the importance of adjusting contributions to make sure that the pension fund remain strong and viable for the current and forthcoming generations,” Ms. Ignacio added.
The SSS is expected to generate an additional P31 billion as it imposes the implementation of a gradual increase of monthly contributions as allowed by the law. — Karl Angelo N. Vidal

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