MANILA, Philippines — The Social Security System (SSS) has laid out the guidelines for the enrolment of members in a mandatory provident fund (MPF) program.
To be launched in January 2021, the pension fund’s new provident fund called the Worker’s Investment and Savings Program (WISP) would provide an additional layer of protection, as it entitles members to retirement, total disability and death benefits on top of their regular benefits provided by the SSS.
“It allows faster accumulation of a worker’s savings because of the employer share in the contribution. Moreover, WISP contributions will be invested following the principles of safety, high yield, and liquidity, and as provided under the SS Act of 2018, which will yield additional pension income for contributing members,” SSS president and chief executive officer Aurora Ignacio said in a statement.
WISP covers all SSS members who have contributions in the regular SSS program and whose monthly salary credit exceeds P20,000. It will also apply to members who have no final claims in the regular SSS program.
“Enrolment in the MPF Program shall be automatic when MSC exceeds P20,000 starting applicable month of January 2021,” the SSS said.
Contributions to the WISP Fund will be paid together with the contributions under the Regular SSS program.
“MPF contributions shall be the prescribed contribution rate times MSC in excess of P20,000 up to the prescribed maximum MSC,” the SSS said.
For example, an employee with a MSC of P25,000, provident fund at a contribution rate of 13 percent, will need to remit P3,250. Of this amount, P2,600 will go to the regular social security fund and P650 to the WISP fund.
Members who fail or are late in the payment of contribution will be imposed a penalty rate of two percent per month on their total contributions.
The pension fund said the withdrawal of contributions is not allowed.
Earnings realized from investments shall be distributed proportionately based on the member’s contribution.
The basis for the WISP benefits is the total accumulated account value of the member at the time of the approval of the claim for retirement, total disability or death.
The benefit shall be paid together with the SSS regular benefit, either in lump sum or annuity.
“Annuity shall be given in the form of fixed amount of monthly pension, to be paid until the member’s account value is fully settled, covering at least 15 years,” the SSS said.
In the event of death of the pensioner, any remaining balance in the accumulated account value will be paid to their beneficiary in lump sum.