“The President has approved a P1,000 pension increase this month, with a corresponding 1.5 percent contribution rate hike in May 2017 and increase in monthly salary credit to P20,000 from P16,000,” Abella told reporters.

“He [Duterte] seeks to fullfill a social contract with the Filipino people specially the elderly and the poor, to give them their best lives in service, while exercising fiscal responsibility to ensure the economic sustainability and protect those who invested in the nation’s future,” he added.

Duterte finalized his decision during a Cabinet meeting on Monday.

In the same news conference, SSS Chairman Amado Valdez said the initial P1,000 pension hike effective January would be followed by another P1,000 hike in 2022 or earlier, as suggested by members of Congress.

“The first P1,000 [will be implemented]this January. We projected the next P1,000 in 2022 but if we are able to implement and get favorable results, maybe it won’t take until 2022, maybe by 2019 we can already comply with the next P1,000,” Valdez said.

The President promised to increase SSS pensions when he campaigned for the presidency last year. His predecessor, Benigno Aquino 3rd, vetoed a legislated adjustment, saying it would bankrupt the pension fund for private workers.

Duterte admitted in a recent interview that his economic managers were not keen on granting the P2,000 across-the-board increase in SSS pensions as the agency might face bankruptcy.

“If anything goes there, it will be passed on to the taxpayers. Those who are not members. That’s the problem. Because hindi naman kasalanan ng buong bayan [it’s not the fault of the entire country],” the President said.

Fund life up to 2040

In Tuesday’s news conference, SSS President Emmanuel Dooc told reporters the SSS had enough funds to support the pension hike this month.

However, there could be a “slight delay” to February as the SSS “recomputes” its finances.

“This will take effect this month, if I’m not mistaken, but maybe due to some system requirement because we need a recomputation, we need to prepare a table, there may be a slight delay,” Dooc said.

“This is an obligation under the law. Actually, it’s not just an obligation under the law. It’s a moral obligation because you are building social protection. I’m calling the attention of employers to really pay the contributions so we can deliver the increase in benefits,” he added.

In a statement, Valdez explained that the combination of additional contributions and a higher monthly salary ceiling meant that the SSS fund would last up to 2040.

Valdez said the SSS would intensify its collection efforts by going after non-complying employers.

He reiterated plans to diversify assets by directly investing in up to 25 percent ownership in a wide range of industries, including infrastructure projects like toll roads, real estate and even lottery operations.

Valdez also said that SSS had cut down operating expenses in its 2017 budget by P1 billion, as part of measures to improve its performance and address a “structural imbalance” in funding.

“There are a lot of interventions that we are already doing to raise more funds for the SSS pension fund,” he said.