The Social Security System (SSS) announced several relief and restructuring programs on Thursday to help employers and borrowers with overdue balances on their employees’ monthly contributions, as well as housing or salary loans, ease their financial woes in the wake of the COVID-19 pandemic.
Aurora Ignacio, SSS president and CEO, noted in a virtual press briefing that non-payment of contributions and loans results in a penalty.
Late Borrower Payments To Bear No Penalties; Relief Programs For Delinquent Employers Rolled Out By SSS
“But given the circumstances we face, we do not want to add burden to those who are already encountering hardships but rather help them get back on their feet. With that in mind, today, we are launching four new pandemic relief and restructuring programs (PRRP),” Ignacio said as quoted by GMA News Online.
Applications for the Enhanced Installment Payment Program, Contribution Condonation Penalty Program, Penalty Condonation Program, and Housing Loan Restructuring, and Short-Term Member Loan Penalty Condonation Program will be available this month, according to the SSS head.
“Employers will be able to pay delinquent SSS contributions free of penalties in full or installment for a period of four to 24 months depending on the total amount of delinquency,” Ignacio stated of the Contribution Penalty Condonation Program, also known as PRRP 2.
From March 2020 onwards, the program will apply to unremitted or underpaid payments, and it will be available to approved companies for six months beginning November 2021.
All delinquent employers or those who have not submitted all contributions due and owing to the SSS, as well as those who have not yet registered with the SSS, including household employers, are eligible for the condonation program.
Meanwhile, the Enhanced Installment Payment Program, commonly known as PRRP 3, allows qualified employers to pay past due SSS contributions and compensation in installments for a period of nine to sixty months, depending on the total delinquency balance.
PRRP3 will begin this month, same as PRRP2.
Employers must show that their firms were “affected financially by calamity, man-made disaster, economic crisis, etc.” to qualify for the PRRP2 and PRRP3.
Ignacio explained that the he PRRP4, or Housing Loan Restructuring and Penalty Condonation Program, allows “qualified SSS housing loan borrowers, successors-in-interest, and legal heirs to pay the outstanding principal, interests, insurance dues, and legal expenses of their SSS housing loans in full within 90 calendar days from the receipt of the notice of approval of the application, or pay 50% within 90 calendar days from the receipt of the notice of approval of the application, and the remaining 50% in 12 equal monthly instalments.
She stated that any overdue fines would be waived upon complete payment.
Starting November 22, 2021, and ending February 21, 2022, the PRRP4 will be accepting applications for three months.
Finally, the PRRP5 allows “all due and demandable arrears composed of the outstanding principal and interest of a member-borrowers’ past due salary, calamity, and/or emergency loans, as well as loans under the salary loan early renewal program and restructured loans under the Loan Restructuring programs to be consolidated.”
“The consolidated loan may be settled through one-time full payment in 30 calendar days from the member-borrower’s receipt of notice of approval or through paying 50% of the consolidated loan within 30 calendar days from receipt of the notice of approval and paying the remaining 50% in six equal monthly installments,” Ignacio said.
“Unpaid penalties will also be condoned upon full payment,” she said.
From November 15, 2021 to February 14, 2022, the PRRP5 will be open for applications for three months.
“In trying times like these, people need the SSS and social security protection even more. We highly encourage our members and employers to take this opportunity to regain their good standing with us, avoid further accrual of penalties and enable themselves and their employees to qualify for the benefits and loan programs they need during this pandemic,” Ignacio said.
According to Mario Sibucao, senior vice president of the Social Security System, there are “700,000 plus employers [with] P55 billion total delinquency, of which 20% are considered fines to be forgiven.”
The COVID-19 epidemic, according to the SSS chief, will result in a decrease in both contribution and loan payments in 2020.
Ignacio added that from January to December 2020, member-housing loan payment collections totalled P244.36 billion, down 8.8% from the P267.91 billion received in the same time in 2019.
“Prior to 2020, there was a steady increase in our collections,” she said.
The pandemic has impacted society not just in the aspects of health and public safety, but also in the sphere of business and economic activities, which affected the number of contributions remitted by the SSS, which provides pensions and loan benefits to the majority of the Filipino people.
Despite this, employers, as well as loan borrowers from the agency, can breathe a sigh of relief, with the latest development announced by the agency. While the program has suffered a drop in contributions as compared from the same time a year ago, with some relief offered by the government, members with outstanding loans can settle their balances without the accrued penalties.
While it can put some strain on one’s annual budget, there are still some positive takeaways from this. Many Filipinos depend on their pension by the time it reaches its maturity age. And when their payments get cut for whatever reason (no matter how extraordinary they are), they will still need to compensate for the lost months, with penalties. This time, however, due to the extraordinary situation we’re all in, there’s some reprieve given for Filipinos who need to settle their dues, hopefully by year-end. This is to ensure that the incoming financial year will be dutifully covered, especially now that things are looking much better than the previous months. This development seeks to benefit both employers and their employees, who undoubtedly pushed harder this time around to make ends meet.