Senator Richard J. Gordon (Ind.) sought the Senate’s immediate action on the measure that would authorize the condonation of penalties on delinquent contributions to the Social Security System (SSS).
Gordon said the implementation of a one-time condonation program of contribution penalties not only represents an opportunity to expeditiously settle contribution delinquencies, but also paves the way for resumption of members’ entitlement to benefits and loan privileges.
“The SSS requires a certain number of contributions before benefits may be availed of. If his employer were delinquent in the payment of contributions, the worker would be denied of the said benefit,” he said.
Records of the SSS show that as of June 2007, there are 287,631 employers who are delinquent in the payment of the mandatory contributions. These figures translate to a total delinquency of P14.6-billion.
Gordon, chairman of the Senate committee on government corporations and public enterprises, said that the SSS Charter provides the legal mechanism and procedure to collect such delinquent accounts from non-complying employers. The law imposes a penalty of three percent per month until the delinquent account is paid in full.
He added that in many cases, accumulated penalties of employers already surpass the principal amount of obligation, thereby making it difficult for many employers to settle their delinquencies.
In response, Gordon filed Senate Bill 2454, which would authorize the condonation of penalties on delinquent social security contributions.
As a condition, the employer must submit the corresponding collection list and pay the principal obligation either in full, within a period of 12 months, or in installment, within a period of six months, from the effectivity of the Act.
“A contribution delinquency condonation program will facilitate and hasten the extra-judicial settlement of past due contributions from delinquent employers,” Gordon said.
“This measure offers a reprieve to thousands of employers facing financial difficulties, while enabling their employees to resume their entitlement benefits and loans,” he added.
The SSS has twice implemented condonation programs on penalties for contribution delinquencies in 1987 and 1997. By the end of the second program in 1997, the SSS was able to collect P859-million in delinquent contributions. (30/tgp)