CoA questions SSS monitoring of pension payments

The Commission on Audit (CoA) identified deficiencies in mechanisms under the Social Security System (SSS) intended to monitor its pension payments to beneficiaries from 2024 to 2025.

State auditors identified that SSS had paid deceased pensioners a combined P943.8-million through the said period, contradictory to its policy on cancelling the benefit if the beneficiary is confirmed dead.

CoA stressed that the agency faces “inherent risks” when it came to its pension operations as there were both internal and external issues that may lead to fund leakage, stressing that addressing such challenges was important to strengthen the “fund’s financial health.”

The audit agency said that it had limited its scope to look into retirement pensioners, particularly into those that had filed for a funeral benefit claim which it deemed as a “constructive notice” of the death of a pensioner.

There, it uncovered that a total of 46,759 deceased pensioners continued to receive their monthly benefits despite prior submissions for the funeral claims.

“These unauthorized payments resulted in substantial overpayments that persisted for extended periods due to the SSS’s failure to promptly suspend the accounts of deceased members upon notice of death,” the report read.

The audit further disclosed how there were some overpayments to deceased member’s accounts that would last for years on end, a finding it said indicated a failure in the agency’s automated data matching and manual verification controls.

It likewise stated that the Annual Confirmation of Pensioners (ACOP) program failed to impose its mandatory requirement of reporting for domestic retirees aged 79 and below as it found that a majority of deceased pensioners fell within the threshold.

“This structural limitation exempts a significant portion of the pensioner population from regular confirmation, thereby escalating the risk of undetected deaths and the subsequent continuation of unauthorized pension payment,” state auditors said.

In view of its findings, CoA said that it was likely that such overpayments to deceased pensioners could have occurred in periods that preceded its current audit scope.

The report likewise indicated that there was a “critical systemic failure” in the monitoring and verification framework of the SSS.

“This ongoing fiscal leakage not only compromises the actual viability of the [Social Security Fund] but also indicates a significant oversight in fiduciary responsibility,” it said.

Management of the SSS indicated in the report that it had managed to retrieve P457.30 million from the said amount and that it was in the process of implementing further improvements to its existing systems.

It had likewise offered its commitment to recover outstanding payments amounting to P486.50-million in relation to the findings of state auditors through the use of the funeral and death benefit claim.

CoA, meanwhile, said that it would continue to monitor the actions and initiatives of SSS, particularly with the remaining balance while also ensuring that recommended changes to the policies of the agency would be followed.