Land Conversion Moratorium, SSS Pension Hike to Undermine Growth Momentum

A two-year moratorium on land conversion would undermine the country’s growth momentum while an across-the-board pension increase for Social Security System (SSS) retirees minus a corresponding hike in member contributions could force the SSS to go bankrupt.

To rescue the SSS from possible bankruptcy, the government would have to use taxpayers’ money to keep the pension fund afloat, thus unduly diverting funds that could otherwise be used to fund the pro-poor and pro-growth programs, Finance Assistant Secretary Paola Alvarez said today.

In a statement, Alvarez, the Department of Finance (DOF) spokesperson, stressed that “all policy recommendations to President Duterte by DOF Secretary Carlos Dominguez III and the other economic managers are anchored on sustaining high growth and enabling all sectors across all regions to benefit from it in the form of more jobs, higher incomes and better living standards.”

“Our economic managers are working on the premise that the Duterte government needs more, not less, funds to finance President Duterte’s 10-point socioeconomic reform agenda for high–and inclusive–growth. To pander to short-term populist initiatives will be a disservice to the President and the overwhelming majority who have given him the electoral mandate to effect real change on his watch,” said Alvarez.

Alvarez’s statement was in response to allegations made by certain groups that the country’s economic managers have been giving the President wrong and anti-poor advice on the issues of land conversion and the SSS pension hike.

Said Alvarez: “The big picture is that the Duterte brand of social reforms is anchored on sustaining high growth and enabling all sectors across all regions to benefit from it. This is the basis of all policy recommendations to President Duterte by Finance Secretary Carlos Dominguez III and the other economic managers.”

“To transform the Philippines into an upper middle-income economy by 2022, we need to invest big in infra, human capital and social protection–to a level equivalent to a 3% budget deficit,” she said “Hence, the need to generate a lot more funds to bankroll these pro-poor and pro-growth programs.”

She said, “The government certainly cannot do so if the president’s economic team were to support populist proposals willy-nilly just to earn political pogi points for the Duterte administration–oblivious to their disastrous impact on revenue generation for the social reform agenda on high–and inclusive–growth.”

“The 10-point socioeconomic agenda is meant to sustain high growth, transform the economy into a truly inclusive one, and keep the Philippines’ momentum as one of Asia’s fastest-growing economies by improving the ease of doing business and thereby attract more FDIs (foreign direct investments),” she said.

“Thus, a two-year moratorium on land conversion would undermine the growth momentum while the pension hike could force the SSS to go bankrupt, a move that would compel the government to use taxpayers’ money to keep the pension fund afloat–and divert money that could otherwise be used to fund the pro-poor and pro-growth programs,” she added.

“Besides,” she said, “it would actually be anti-poor if the economic managers were to suggest to the President for all taxpayers, including wage earners and other low-income workers, to pay for the pension hike of some 2 million private employee-pensioners.”

“Our economic managers are working on the premise that the Duterte government needs more, not less, funds to finance the President’s 10-point socioeconomic reform agenda for high–and inclusive–growth. To pander to short-term populist initiatives will be a disservice to the President and the overwhelming majority of Filipinos who have given him the electoral mandate to effect real change. ●