Fund pension by fighting corruption

I recently went through the exercise of computing my probable SSS pension if I retire at 60 or 65, and whether it makes sense to keep making voluntary contributions, and until when. As a columnist, I am considered a freelancer and thus contribute to SSS as self-employed.

The result, of course, is obvious. At 65, whatever I will likely receive from SSS will not be enough to cover even my basic needs. I will need a supplemental pension, probably a private one, and set aside “enough” savings to keep me afloat until the end of my days.

In this context, I support the Senate proposal to grant an additional pension to retirees and to extend the benefit to all seniors, not just indigents. My main argument is straightforward: much of the government’s money is lost to corruption anyway. We might as well redirect it to our seniors, rich or poor.

Senate Bill No. 215, the “Lingap Para Kay Lolo at Lola Act,” proposes a monthly social pension of P1,500 for all senior citizens aged 60 and above, regardless of economic standing. The pension will not come from SSS or GSIS but directly from the National Government.

At first glance, the numbers seem daunting. Depending on coverage, the annual cost could range from P73.5 billion (if limited to indigent seniors) to over P200 billion (if granted to all seniors). Fiscal conservatives instinctively question such spending, pointing to deficits, debt servicing, and competing priorities.

On the other hand, by mitigating corruption in public works projects, the government could restore a substantial amount of money that can be directed toward this initiative. Funding options deserve careful study, but the proposal merits both government and public support.

I believe the nation can find a way to afford dignity for our seniors without breaking the bank. That is, if the present administration and present Congress can effectively combat corruption and ensure accountability, particularly in public works.

Those who argue against this “handout” cannot ignore the reality that far more money is stolen by crooks in government. Rather than letting them pocket the nation’s wealth, and fund their personal pensions, the government should channel it to our seniors.

One estimate places government losses from 2023 to 2025 at between P42.3 billion and P118.5 billion due to fraud, ghost projects, and substandard flood-control works. These figures assume kickbacks and “SOPs” ranging from 25% to 70% of project costs.

At Senate hearings, a former Department of Public Works and Highways (DPWH) engineer alleged that in 2023 some individuals pocketed 30% kickbacks on project budgets ranging from P355 million to P600 million in Bulacan alone. A contractor also alleged that numerous lawmakers demanded a 25% share of project costs to secure flood-control contracts.

Meanwhile, the government’s Social Pension Program for Indigent Senior Citizens (SPISC) under the Department of Social Welfare and Development (DSWD) currently provides P1,000 monthly to over four million indigent seniors, or those who are poor, frail, sickly, without income, and without family support. These are people who truly need government help.

In 2025, the program has an annual budget of P49.8 billion under the General Appropriations Act. It is implemented with LGUs, which verify eligibility, distribute payouts, and handle grievances.

Problems remain. Not all intended beneficiaries meet the government’s definition of “indigent,” and the delivery system can be uneven. Many seniors with meager pensions or irregular family support fall through the cracks. Others wait months for payouts. And with today’s prices, P1,000 barely covers maintenance medicine. Still, it helps. Thus, raising it to P1,500 would be a meaningful boost.

Senate Bill No. 215 proposes precisely that. The pension remains modest but more useful, and coverage expands to all seniors aged 60 and above, removing the indigent-only qualifier. It moves beyond being a mere poverty safety net and becomes a sort of basic income for all seniors.

The Philippine Statistics Authority estimates that in 2025, around 11 to 12 million Filipinos will be 60 or older. Most of them have no SSS or GSIS pension. Many worked in the informal economy and could not afford contributions to these pension systems.

The minimum SSS retirement pension is just over P2,000, while GSIS pays more. But even these amounts fall short given today’s costs of food, medicine, and utilities. An additional P1,500 monthly would be a lifeline, especially for seniors managing chronic illnesses like diabetes, hypertension, or heart disease.

The goal is to give seniors a modest, reliable stipend: enough to buy medicine, pay utilities, or add to the household food budget. For rural seniors with limited access to healthcare, this could mean the difference between survival and neglect.

If the program remains indigent-only, raising the pension to P1,500 raises the annual cost to the government to P73.5 billion. Heavy, but manageable. The national budget can shoulder this through better prioritization. If efficiencies can be gained, the pensions can be funded.

But if made universal, as proposed, the fund cost climbs to around P220 billion annually, or roughly equal to the DPWH allocation for major infrastructure projects in 2025. Such magnitude requires a sound funding plan.

I believe if there is will, there is a way. But this requires political will to fund the senior pension program and to fight government malfeasance. My call is to source pension money from “savings” generated by plugging corruption leaks in public works, especially flood control.

Flood control is notorious as a “black hole” of government spending. Every administration pours billions into dikes, dredging, and drainage, yet Metro Manila and much of Luzon still flood. The problem is not budget size, but corruption. As we now know, contracts are padded, overpriced, or entirely ghost projects.

With DPWH’s 2025 budget at over P800 billion, saving even 20% through tighter controls would yield over P160 billion, enough to cover most of the proposed pension program. Add a restitution mechanism, legislated so officials and contractors convicted of corruption must forfeit ill-gotten wealth to the pension fund. This not only creates accountability but ties restitution to a socially just outcome.

Raise the pension and make it universal, but pair it with anti-corruption reforms that institutionalize savings. Legislate restitution of ill-gotten wealth. Even partial recovery could sustain the pension program at P1,500 monthly per senior.

Phase the initiative: expand coverage first to seniors 75 and above in 2026, then to seniors 65 and above in 2027, and finally to all 60 and above by 2028. This gives fiscal space time to widen and systems time to adapt. By then, index the pension to inflation.

Call it a populist handout if you will. But better to give money to those who need it than to those who steal it. Senate Bill No. 215 is not only about pensions. It will be a test of how we value our elderly and how serious we are about cleaning up public finance. The challenge is not whether we can fund pensions, but whether we have the political courage to plug the leaks that make us think we cannot.

Rather than letting corruption fund the personal “pensions” of unscrupulous officials and their families — the most brazen criminals of all — we can turn the situation around. Redirect that money to support our seniors as we improve accountability in government.