GSIS flagged for P2 billion investment in 3 companies

MANILA, Philippines — The Commission on Audit (COA) has flagged the Government Service Insurance System (GSIS) for investing P2.3 billion in stocks of three companies with no record of profitability and for its failure to collect P14.7 billion in premium contributions paid by employees in various government agencies as of end of 2023.

In its 2023 annual audit report on the state insurance firm, the COA said a detailed examination of the GSIS Investment Reports for 2022 and 2023 showed it invested P2,307,919,680 of its funds in stocks of three companies “that have no proven track record of profitability over the last three years and have not paid dividends at least once over the same period.”

The three companies were not identified in the audit report, but the COA said a further examination of the GSIS Investments Reports showed that the state firm already incurred a total of P251.371 million in valuation loss as of the end of 2023 “attributable to the aforementioned investment in stocks.”

The COA recommended to the GSIS to “plan the recovery of the stock investments from the three companies at a term not disadvantageous to the (GSIS Investment) Fund.”

In the same audit report, the COA also called out the GSIS for its failure to collect from various government agencies, local government units, government-owned and controlled corporations and government financial institutions a total of P14.748 billion in premium contributions deducted from the salaries of its employees.

The audit body noted that of the total P22.343 billion in Social Insurance Contributions Receivables as of Dec. 31, 2023, some 66.01 percent or P14.748 billion was already past due, of which P4.464 billion remained unremitted or “outstanding receivables” for 10 to 15 years.

The COA recommended to GSIS to prepare a realizable collection and recovery plan with a workable timetable for cleansing and reconciliation of accounts with concerned agencies; conduct regular dialogues with the head of agencies, especially those tagged as “delinquents” on the possibility of entering a MOA to settle the issues and for GSIS to “exhaust all available remedies to collect the unpaid premium contributions from those erring agencies pursuant to Section 41 (w) of RA 8291.”

Meanwhile, the Alliance of Concerned Teachers (ACT) is calling on lawmakers to investigate the “questionable” P2.308-billion GSIS investments.

Stressing that “gambling” with public sector workers’ hard-earned contributions on high risk investments is alarming, the ACT said Congress needs to take action against GSIS for exposing pension funds to “reckless practices.” –  Neil Jayson Servallos