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JAN.

11, 2012 DATE

NR # 2645B
REF. NO.

Solon urges the GSIS to improve its collection of premiums from members
A lawmaker has urged the Government Service Insurance System (GSIS) to improve its collection of the government workers monthly premium contributions so it can attend to the financial needs of its members. To strengthen and maintain the integrity of the government workers state insurance fund, there is a need to improve collection from employer contributors and members, prudence in investment of the funds and fast and efficient delivery of services to members, Rep. Sherwin Tugna (Party-list, CIBAC) said. Tugna said the GSIS served more than as a fall back of in-dire need active members, such as salary, policy, housing and emergency loans. In exchange of the government workers monthly premium contributions, the principal benefit package of the GSIS consists of compulsory and optional life insurance, separation, retirement, disability benefits for work related accidents and death benefits, Tugna said. Tugna said as of June 2011, the average monthly pension received by an old-age pensioner is P8,650, the survivors of a decedent is P2,442, and under disability and survivorship P1,647. Benefits granted under GSIS are not enough to guarantee a secure future for government employees that have given the prime years of their lives to public service, Tugna said. Tugna said one of the challenges that GSIS is facing is the continued decline of contributions for payment of benefits. Tugna said the total benefit payments made by GSIS grew by 10% annually from P17 billion in 2000 to P32.3 billion in 2007. Tugna said member contributions rose from P35 billion in 2000 to only P41 billion in 2007, reflecting a measly 2 percent yearly increase. The ratio of contributions to benefit payment declined continuously from 2.1 in 2000 to 1.3 in 2007, he said. Tugna said there is poor compliance because the incentives for evasion are built within the design of pension benefits and contributions. The minimum pension provision and the computation of pensions basing on salaries in the last 5 years of service tend to result in the evasion of appropriate

JAN. 11, 2012 DATE

NR # 2645B
REF. NO.

premiums, Tugna said. The reforms that will be made in the GSIS will help reduce corruption in the bureaucracy by addressing the security of the government workers, Tugna said. State workers will have so much to lose if they engage in corrupt practices and are thereafter prosecuted and convicted. They will lose all the benefits that ensure their families economic stability, Tugna said. Tugna said the GSIS was created by Commonwealth Act 186 on November 14, 1936 and was amended by Republic Act 8291 dated June 24, 1997 to promote the efficiency and welfare of the government employees and have defined benefit scheme that insures members against occurrence of certain contingencies in exchange for their monthly premium contributions.(30) jsc

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