AMID the noise over the Marcos gold and a new Iloilo city police chief, there was a report about a plan of the Social Security System (SSS) to use the members’ money in new investments.
Nothing amiss in the plan on first look because the SSS board of directors anyway is tasked to see that the fund grows, does not run dry, and the system does not fall into bankruptcy. The SSS works to protect the fund by having good housekeeping, improving collection efficiency, and investing in projects that are almost certain to bring returns. But it has not always been straight when it comes to SSS investments.
Its latest plan – to build a factory for airplane spare parts – is one that raises the question. Why does SSS want to go into making aircraft parts?
The SSS is the agency that holds the private sector employees’ money and the share from their employers for social insurance. The fund is used for loans, emergency needs and pension upon retirement of members. The SSS board members and top officials are appointed by the President.
SSS chairman Dean Amado Valdez’s announcement last week of a plan to put up investment at the Clark Freeport should be monitored and studied. Valdez said the SSS was hoping to meet with the Bases Conversion and Development Authority and the Clark Development Corp. to finalize plans of SSS to put up investment at Clark. According to an Interaksyon.com article, Valdez said, “We’re looking for a 500-hectare lot where we could build a manufacturing plant for aircraft spare parts.” He did not elaborate on why that kind of an investment, why a plant for plane parts and who are the other parties to be involved.
The absence of details should be a signal for SSS members to start finding out more about the plan and demanding transparency on the use of the fund.
During the administration of President Joseph Estrada, the SSS had to change tack on a plan after a private group of retirees demanded transparency. The Philippine Association of Retired Persons (Parp) discovered that then SSS president Corazon dela Paz had signed an agreement to sell to Banco de Oro the agency’s 188 million shares of stock in Equitable PCIBank without public bidding at a grossly disadvantageous price of P43.50 per share when the market value was P60 and rising.
The Parp went to court to stop the sale, going as far as the Supreme Court. The issue became the subject of a Senate committee inquiry, until finally the shares were sold to Banco de Oro at P92 per share to settle the case. This was one of the achievements of Parp, said founder Amado F. Cabaero (my father). The Parp has been pushing for representation of retirees in the SSS board.
In fairness to Valdez, the current SSS administration has several short-term projects lined up to improve service to members. These are the real-time posting of contributions and a scheme to have qualified members pre-approved for loans.
With SSS plans on new investments and projects, it becomes important that its board has a wider representation of the fund’s stakeholders to ensure their interests are protected.