The monthly contribution to the city’s Social Security Fund (FSS) paid by employers and employees will be doubled to MOP90 (US$11.26) from the current MOP45, starting from January of next year. The current social security contributions conform to a 2:1 ratio, with employers paying MOP30 and workers MOP15 per month.
The ratio of the increased contribution will remain the same – 2:1 starting from January 1 2017, with employers paying MOP60 while employees pay MOP30.
The current contribution rate of the FFS began in July 1998 and has remained unchanged ever since, the president of the Administrative Committee of the Social Security Fund, Iong Kong Io, said at a press conference yesterday.
The increased contribution will input additional income to the FSS amounting to about MOP200 million each year, he said.
Iong also noted that this is not the first time a proposal for an increase in the FSS contribution has been discussed, as it was formerly tabled by the Standing Committee for the Co-ordination of Social Affairs in December 2012.
In February 2014, the increased monthly contribution to FSS was also proposed to the Committee to undergo the same increase it will in January, with the FSS president commenting that the increase was widely agreed upon by society.
“The increase to MOP90 takes into consideration the city’s economic environment and ability to pay – of both employers and workers,” the FSS president explained.
The FSS president added that the increased contribution paid by employers and workers can help reduce the financial burden on the government.
“The government is already paying the city’s pension fund and other social benefits. The increase of the FFS can contribute to its sustainability in the long term,” he said.
When asked whether the increase would be a burden for employers in the city, Mr. Iong responded that the increased payment is still a small expense for them.
Whether to adjust
With regard to the possibility of an adjustment of the current contribution ratio to 1:1, the FSS president said that the proposed adjustment had not reached consensus by the government yet. It will need to be researched, after setting up a central provident fund system in the future, he explained.
As Macau’s elderly population is growing, more people are receiving pension funds from the government, and for longer than before, he added.
“In order to establish a long-term and sustainable social security system, the responsibility must be shared by individuals, businesses and the government,” the FSS president stressed.
Ella Lei Cheng I, vice-president of the Macao Federation of Trade Unions (FOAM), commented that the government should not change the current contribution ratio to 1:1 without thorough consideration, according to a report by TDM Chinese Radio yesterday.
The FOAM vice-president hopes that the government can gradually implement the central provident fund system and make it mandatory. She also revealed that the central provident fund system is still under discussion by the CE.
Legislator Lei had a meeting with the Chief Executive to present recommendations for next year’s MSAR policy yesterday.
Maintain social welfare
Chiang Chong Sek, the president of FOAM, revealed that the CE would not lower the city’s current social welfare benefits for next year, according to a report by TDM.
“We suggested the government continue to implement the city’s social welfare benefits as in 2016 for next year and if the government maintains a surplus this year, the cash hand-out programme will continue,” Chiang said.
The FOAM vice-president said that the CE has already completed a budget of the city’s social welfare benefits for next year and assured that the total expenses of social benefits would not be smaller than this year.