EXPLANATION OF VOTE

SB 2506; Committee Report 597

INCREASING PENSION FOR SENIOR CITIZENS

Senate President Pro Tempore Ralph G. Recto

30 May 2022

Mr. President, my dear colleagues: 

Age may just be a number, but the numbers on old-age pension are in the billions.

The Social Pension for Indigent Senior Citizens, or SocPen for short, debuted in 2011 with 138,960 beneficiaries and a budget of P1.6 billion. 

This year, the program covers 4,079,669 seniors, costing taxpayers P25.01 billion.

This means that in over a decade, the number of beneficiaries soared 28-fold, and appropriations by almost 14-fold.

In fact, the budget for SocPen outpaced the growth in national expenditures. No other social program has been that turbocharged.

While the magnitude of both beneficiaries and budget has expanded, the pension amount of P500 a month has shrunk in real value.

Because of inflation, the peso has lost one-fourth of its purchasing power since 2011.

Although this bill seeks to nominally double the monthly pension to P1,000, the truth is, such will only partly recoup what our currency’s buying power had lost to increases in the prices of goods over the past 10 years.

Mr. President: 

You and I know that every bill carries a price tag, often disclosed but sometimes hidden, and this has a hefty one. 

Doubling the SocPen monthly rate would mean doubling the SocPen annual budget, in this case from P25 billion to P50 billion.

But this calculation does not take into account the seniors who should be enrolled in SocPen but are not.

If the left out lolos and the left behind lolas are brought under this welfare umbrella, the annual budget could reach P60 billion per one estimate, and that is based on the current pension level of P500 a month.

This will surely trigger the fiscal equivalent of a fire alarm in the executive.

And when the predictable pushback comes from those who will surely bristle at the cost, let us not throw in the towel, but in true Senate tradition engage them in negotiations until they see the light.

Just as what this Senate did on this issue, when we united in advocating an expansion of the SocPen coverage in the 2014 and 2015 national budgets.

The Finance chair at that time, Chiz Escudero, eventually found the means, a kind of enterprise he later parlayed into the “kung gusto may paraan, kung ayaw may dahilan” slogan.

Ganoon din sa Free College. Hindi po ba’t hinadlangan din? The bill had to go through formidable barricades on the way to the Palace. But in the end, it became a law.

My point is, cost does not cancel the necessity of a project. Money, or lack of it, is the laziest argument against an idea, or to justify its demise. 

And most importantly, neither does it extinguish the legitimate claims of seniors, as supported by studies, that the time to increase the senior pension is now.

For example, increasing the SocPen stipend to P1,000 a month would meet 15 percent of the average expenditures on food and health of the seniors in the bottom half of their per capita income group.

One urban legend is that seniors “splurge” their SocPen stipend on vices and nonessentials—as if the amount is big enough to deserve that verb.

On the contrary—research shows that they spend it on food and medicine. 

Hindi pinangtatalpak sa e-sabong, kundi pinambibili ng gamot at pagkain.

It is an amount that would barely allow them to get by, certainly not get rich. It will not bankrupt the government.

Besides, if salary hikes for government men and the pension system for retired uniform men are deemed necessary, how can the SocPen with its relatively small budget footprint be dismissed as a luxury?

But raising the P500 pension is one thing, making it available to the deserving is another. A rising tide must raise all ships.

Ngayon po kasi, pension from GSIS, which accounts for 5.3 percent; SSS, 19.9 percent; and SocPen, 37.9 percent cover only 63.1 percent of 65-year-olds.

This means one in three of our SCs maintain no old-age pension account. These pension-nadas number around 5.5 million, most of them on the lower floors of the economic pyramid.

SocPen still has an undercoverage rate of 66 percent among the bottom 50 percent of seniors, according to a recent PIDS study by the eminent Dr. Jose Ramon Albert and Mika Munoz.

However, raising the senior pension highlights the need to straighten out implementation knots and kinks in our SocPen system.

The PIDS study by the eminent Dr. Albert and Ms. Muñoz proposes a raft of proposals.

Foremost of which is a pivot to the anti-poverty objective of the program. It has to embrace again its raison d’etre, which is to be a tool versus indigence. 

Kung tama ang basa ko, i-un-couple ang programa sa pulitika (in the instances where this occur) at ikabit ulit sa poverty.

They also proposed that instead of a singular rate, there can be three, for different income deciles, because “differentiating the amount based on need ensures that the program provides bigger assistance to those in most need of assistance.”

One other recommendation is so jarring in its simplicity, and leaves one wondering why it has not been done by the DSWD leadership. 

This is about the SocPen central office management team, which has seven, I repeat, seven people to manage a P25 billion program.

Why DSWD, headed by a general, allows an infantry squad to run a program which involves 4 million people boggles the mind.

Dr. Albert and his team also propose ease of payment modes like e-wallets, the benefits of which the pandemic recently highlighted. 

When the surge in the cases led to the mass incarceration of our seniors at home, online financial services became their link to the outside world.

I know, Mr. President, that it will be hard to weave the above points into this measure, but let these serve as notice that we will be keenly watching how this bill, when it becomes a law, will be implemented.

I remember one favorite analogy of the late Dinky Soliman, who launched SocPen during her watch, in illustrating why the march of legislated reforms, to live up to its promise, should be escorted by administrative reform.

Sabi niya, kung butas ang balde, ang solusyon ay hindi buksan lalo ang gripo at palakasin ang daloy ng tubig, kundi takpan ang tulo.

‘Yan po ang kaakibat na gawain sa pagpapataas at pagpapalawig ng social pension for seniors.

Isa pang kailangan gawin matapos takpan ang butas, ay lakihan ang balde at gripo.

Ours may be a nation of millennials, but it is also home to millenniors. The greying of the Philippines has begun.

In 2015, 7.42 million lang ang seniors. By 2050, when we’ve become names etched on marble plaques on Senate hallways, except the indestructible Manong Johnny who will still be hale and hearty, the senior population is expected to hit 21.4 million.

This has tremendous budgetary implications on health, state pension and social services.

The time to plan for this demographic eventuality was yesterday.

Thus, this SocPen bill is only a component of our work to make this nation old-age friendly in the years to come.

With this note, and the hope that implementors and the next government consider the points I raised and read and heed various PIDS studies, I vote for the approval of this bill.