SSO floats changes to retirement fund
To prevent the Social Security fund being drained by payments to retirees, a government subsidy will be requested and contribution from beneficiaries and their employers will be increased from 3 to 12 per cent, the Social Security Office (SSO) said yester
Payment conditions should also be altered, SSO chairman Somkiart Chayasriwong said. Those contributing from a salary base of Bt9,000 for less than 15 years will receive a one-off payment, while those contributing for 15-30 years will Bt2,000-Bt5,000 per month, he said.
The proposed methods would extend the national retirement fund to 75 years, instead of the current 32 years, he added. Apart from these, the SSO is seeking Bt58 billion that authorities still owe to the SSO, and another unpaid Bt4.3 billion contribution owed by employers, said Somkiart, the permanent secretary to the Labour Ministry and ex-officio chairman of the SSO.
The SSO retirement fund currently stands at Bt929 billion – most of it for medical treatment – and covers more than 9 million employees. Payment of pensions will begin in 2015, and the entire Bt929 billion will used up by 2044 if the new proposals are not put in place soon.
Currently, a Bt750 contribution is made by each employee who falls within the salary bracket of Bt15,000. However, a new type of contribution, with no ceiling specified, will be open for employees who want to contribute more and expect long-term monthly payment when they retire, SSO secretary-general Jeerasak Sukhonthachart said.
SSO spokesman Arak Phrommanee said by 2024, there would be about 817,680 retirees receiving a total of Bt41.9 billion in monthly payments, and another 121,860 who would be receiving one-off payments totalling Bt11 billion. By 2034, those figures will more than double, and the SSO needs to multiply its fundamental funds five-fold to survive, he said.
