AMENDING CERTAIN SECTIONS OF REPUBLIC ACT NUMBERED ELEVEN HUNDRED AND SIXTY-ONE, AS AMENDED, OTHERWISE KNOWN AS "THE SOCIAL SECURITY ACT OF 1954"

• Number: Presidential Decree No. 24
• Sections: 19

Preamble

WHEREAS, there were pending before Congress prior to

the promulgation of Proclamation No. 1081, dated September 21, 1972,

certain priority measures vital to the national development program of

the Government and which are considered by the President as urgent

measures;

WHEREAS, one of these priority measures is a bill

proposing amendments to the Social Security Act by increasing the

benefit rates granted under said law, increasing the loanable amount for

housing loans, and removing some technical flaws for a more effective

and efficient operation of the Social Security System (SSS); and

WHEREAS, the measure is necessary to effect reforms

in SSS operations and to revitalize its structure as an important:

agency in the promotion of the social and economic development programs

of the Government;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of

the Philippines, by virtue of the powers vested in me by the

Constitution as Commander-in-Chief of all the Armed Forces of the

Philippines and pursuant to Proclamation No. 1081, dated September 21,

1972, and General Order No. 1, dated September 22, 1972, do hereby amend

certain sections or provisions of the Social Security Act of 1954, as

amended, to wit;

"(i) Criminal action arising from violation of the provisions of

this Act may be commenced by the SSS or the employee concerned either

under this Act or in appropriate cases under the Revised Penal Code."

Section 1

SECTION 1. Section one of Republic Act Numbered

Eleven Hundred and Sixty-one, as amended, is further amended to read as

follows:

"SECTION 1. Short title. — This Act shall

be known as the 'Social Security Law.'

Section 2

SEC. 2. Section two of the same Act is further

amended to read as follows:

"SEC. 2. Declaration of policy. — It is

the policy of the Republic of the Philippines to establish, develop,

promote and perfect a sound and viable tax-exempt social security

service suitable to the needs of the people throughout the Philippines,

which shall provide to covered employees and their families protection

against the hazards of disability, sickness, old age, and death, with a

view to promoting their well-being in the spirit of social justice."

Section 3

SEC. 3. Section three of the same Act is further

amended by amending paragraphs (a) and (b) to read as follows:

"SEC. 3. Social Security System.—(a) To

carry out the purposes of this Act, the Social Security System with

principal place of business in Manila or Quezon City, Philippines, is

hereby created. The SSS shall be directed and controlled by a Social

Security Commission composed of the Secretary of Labor, the SSS

Administrator and six appointive members, two of whom shall represent

the labor group, two, the management group and two, the general public,

to be appointed by the President with the consent of the Commission on

Appointments. The Chairman of the Commission shall be designated by the

President of the Philippines from among the members of the Commission.

The term of the appointive members shall be three years: Provided,

That the terms of the first six appointive members shall be one, two

and three years for every two members, respectively. All vacancies,

except through the expiration of the term, shall be filled for the

unexpired term only. The appointive members of the Commission shall

receive fifty pesos per diem for each meeting actually attended

by them: Provided, That no compensation shall be paid for more

than eight meetings a month.

"(b) The general conduct of the operations and management functions

of the SSS shall be vested in an Administrator who shall serve as the

chief executive officer immediately responsible for carrying out the

program of the Social Security System hereby created and the policies of

the Commission. The Administrator shall be a person who has had

previous experience in technical and administrative fields related to

the purposes of this Act. He shall be appointed by the President of the

Philippines with the consent of the Commission on Appointments and shall

receive a salary to be fixed by the Commission with the approval of the

President, payable from the funds of the SSS."

Section 4

SEC. 4. Section five of the same Act is further

amended by adding thereto paragraph (d) to read as follows:

"(d) Execution of Decisions. — Any decision or award of

the Commission after the same has become final and executory shall be

enforced and executed in the same manner as decisions of Courts of First

Instance, and the Commission shall have the power to issue to the city

or provincial sheriff or the sheriff whom it may appoint such writs of

execution as may be necessary for the enforcement of such decision or

award and any person who shall fail or refuse to comply with such

decision, award, or writ, after being required to do so shall, upon

application by the Commission, be punished by the proper court for

contempt."

Section 5

SEC. 5. Section eight of the same Act is further amended by

amending paragraphs (f), (g), (i), and (m) to read as follows:

"(f) Compensation. — All actual remuneration for

employment, including the cash value of any remuneration paid in any

medium other than cash except that part of the remuneration in excess of

one thousand pesos received during the month.

"(g) Monthly salary credits. — The compensation base for

contributions and benefits as indicated in the schedule in Section

Eighteen of this Act.

"(i) Contribution.— The amounts paid to the SSS by the

employee and by his employer in accordance with Section Eighteen of this

Act.

"(m) Average monthly salary credit. — The result obtained

by dividing the sum of the monthly salary credits in the sixty-month

period ending on the last day of the second quarter preceding the

quarter of retirement due to old age or total disability by sixty, or

the result obtained by dividing the sum of monthly salary credits from

the month of coverage to the last day of the second quarter preceding

the quarter of death, or permanent disability or retirement by the

number of calendar months in the same period, whichever is greater;

except where the month of death or permanent disability falls within

eighteen months from the month of coverage, in which case, the average

monthly salary credit is the result obtained by dividing the sum of all

monthly salary credits from the month of coverage to the month

immediately preceding the month of death or permanent disability by the

total number of calendar months in the same period."

Section 6

SEC. 6. Section twelve of the same Act is further

amended by amending paragraphs (a), (c) and (d) to read as follows:

"SEC. 12. Retirement benefits. — (a) A

covered employee who (1) has paid at least one hundred twenty monthly

contributions to the SSS, has reached the age of sixty years and is

separated from employment or, if still employed, is receiving less than

two hundred fifty pesos monthly compensation or (2) has paid at least

one hundred twenty monthly contributions and has reached the age of

sixty-five years, or (3) has paid at least thirty-six monthly

contributions and bus become permanently totally disabled, shall be

entitled for as long as he lives but in no case for less than five years

to a monthly pension amount to be computed as follows:

"Forty-five per cent of the first three hundred pesos of the

average monthly salary credit or fraction thereof; plus

"Nine per cent of the excess over three hundred pesos; plus

"One tenth of one per cent of the average monthly salary credit for

each monthly contribution in excess of one hundred twenty and paid as

of the last day of the second quarter preceding the quarter of

retirement: Provided, That a member of the SSS covered prior to

June 18, 1962 and who was fifty years of age or over on the date of his

coverage shall be entitled to the benefits hereunder if he has paid a

number of monthly contributions equivalent to the number of calendar

months of coverage at age sixty, but in no case less than twenty-four: Provided,

further, That the monthly pension shall in no case be less than

forty-five pesos.

* * *

"(c) The monthly pension shall be suspended —

"1. Upon the re-employment of a retired employee who is less than

sixty-five years old if he receives from his employment a monthly

compensation of two hundred fifty pesos or more, in which case, he shall

again be subject to Section eighteen hereof, and his employer to

Section nineteen; or

"2. Upon the recovery of an employee retired due to permanent

total disability, or his failure to present himself for examination at

least once a year upon notice by the SSS.

"(d) The monthly pension of a surviving pensioner retired before

December 1, 1972 shall be increased by fifty per cent and the amount

shall be his new monthly pension beginning with said date."

Section 7

SEC. 7. Section thirteen of the same Act is further

amended to read as follows:

"SEC. 13. Death and permanent disability

benefits. — (a) Upon the covered employee's death, his

beneficiaries shall be entitled to the basic lump sum amount, plus

five-twelfths of one per cent of the basic lump sum amount for each

monthly contribution in excess of one hundred twenty monthly

contributions: Provided, That any of the following conditions

is satisfied at the time of death:

"1. He shall have paid eighteen monthly contributions within the

thirty-six calendar month period ending on the last day of the second

quarter preceding the quarter of death.

"2. His payment ratio is not less than eighty per cent: Provided,

further, That if none of the foregoing conditions are satisfied,

his death benefit shall be the above amount multiplied by one and

one-fourth times his payment ratio: Provided, finally. That the

death benefit shall not be less than the total contributions paid by

him and his employer in his behalf to the SSS nor less than five hundred

pesos: Provided, however, That the covered employee who dies

in the month of coverage shall be entitled to the minimum benefit.

"(b) Upon the covered employee's permanent total disability, if

such disability occurs before he has paid thirty-six monthly

contributions to the SSS, he shall be entitled to the basic lump sum

amount: Provided, That any of the following conditions is

satisfied at the time of permanent total disability:

"1. He shall have paid eighteen monthly contributions within

the thirty-six calendar month period ending on the last day of the

second quarter preceding the quarter of permanent total disability

"2. His payment ratio is not less than eighty percent: Provided,

further, That if none of the foregoing conditions are satisfied,

his permanent total disability benefit shall be the above amount

multiplied by one and one-fourth times his payment ratio: Provided,

finally, That the permanent total disability benefit shall not be

less than the total contributions paid by him and his employer in his

behalf to the SSS nor less than five hundred pesos: Provided,

however, "That a covered employee who becomes permanently, totally

disabled in the month of coverage shall be entitled to the minimum

benefit.

"(c) If the disability is partial but permanent, the amount of

benefit shall be such percentage of the sum of the benefit described in

the preceding paragraph and five-twelfths of one per cent of the basic

lump sum amount for each monthly contributions, in excess of one hundred

twenty monthly contributions, with due regard to the degree of

disability as the Commission may determine: Provided, That the

percentage degree of disability shall not be additive for distinct,

separate and unrelated permanent partial disabilities but shall be

additive for deteriorating and related permanent partial disabilities to

a maximum of one hundred per cent, in which case the employee shall be

deemed as permanently totally disabled."

Section 8

SEC. 8. Section fourteen of the same Act is further

amended by amending paragraphs (a) and (b), designating paragraph (b) as

(c) and adding thereto paragraphs (b), (d), (e), and

(f) to read as follows:

"SEC. 14. Sickness benefit. — (a) Under

such rules and regulations as the Commission may prescribe, any covered

employee under this Act who has paid at least twelve monthly

contributions and who, on account of sickness or bodily injury, is

confined for more than five days in a hospital, or elsewhere with the

Commission's approval shall, for each day of such confinement or

fraction thereof, be paid by his employer or by the SSS if such person

is unemployed, an allowance equivalent to seventy per cent of the

average daily salary credit subject to the following conditions:

"1. In no case shall the total amount of such daily allowance, if

any, be less than two pesos and fifty centavos nor exceed twelve pesos

nor paid for a period longer than one hundred twenty days in one

calendar year; nor shall any unused portion of the one hundred twenty

days sickness benefit granted under this section be carried forward and

added to the total period allowable in the subsequent year;

"2. No employee shall be paid any sickness benefit for more than

two hundred forty days on account of the same confinement; and

"3. The employee shall notify his employer of the fact of his

sickness or injury within five calendar days after the start of his

confinement unless such confinement is in a hospital or the employee

became sick or was injured while working or within the premises of the

employer in which case notification to the employer is not necessary: Provided,

That if the member is unemployed he shall directly notify the SSS of

his confinement within five calendar days after the start thereof unless

such confinement is in a hospital in which case notification is also

not necessary: Provided, further, That in cases where

notification is necessary, the confinement shall be deemed to have

started not earlier than the fifth day immediately preceding the date of

notification.

"(b) The Payment of such allowances shall be promptly made by the

employer every regular pay day or on the fifteenth and last day of each

month in the case of direct payment by the SSS for as long as such

allowances are due and payable: Provided, That payment by the

employer for current sick leaves of absence, if any, shall be reimbursed

by the SSS up to an amount not exceeding the sickness benefit upon

application for reimbursement by the employer.

"(c) One hundred per cent of the daily benefits provided in the

preceding paragraph shall be reimbursed by the SSS to said employer upon

receipt of satisfactory proof of such payment and legality thereof: Provided,

That the employer has notified the SSS of the confinement within five

calendar days after receipt of the notification from the employee: Provided,

further, That if the notification to the SSS is made by the

employer beyond five calendar days after receipt of the notification

from the employee, said employer shall be reimbursed only for each day

of confinement starting from the tenth calendar day immediately

preceding the date of notification to the SSS: Provided, finally,

That the SSS shall reimburse the employer or pay the unemployed member

only for confinement within the one year period immediately preceding

the date the claim for benefit or reimbursement is received by the SSS,

except confinement in a hospital in which case the claim for benefit or

reimbursement must be filed within one year from the last day of

confinement.

"(d) Where the employee has given the required notification but

the employer fails to notify the SSS of the confinement or to file the

claim for reimbursement within the period prescribed in this section

resulting in the reduction or denial of the claim such employer shall

have no right to recover the daily allowances he advanced to the

employee as required in this section.

"(e) The claim of reimbursement shall be adjudicated by the SSS

within a period of two months from receipt thereof: Provided,

That should no payment be received by the employer within one month

after the period prescribed herein for adjudication the reimbursement

shall thereafter earn simple interest of one per cent per month until

paid.

"(f) The provisions regarding the notification required of the

covered employee and the employer as well as the period within which the

claim for benefit or reimbursement may be filed shall apply to all

claims filed with the SSS beginning January 1, 1973."

Section 8-A

SEC. 8-A. Section fifteen of the same Act is further

amended to read as follows:

"SEC. 15. Non-transferability of benefits.

— The SSS shall pay the benefits provided for in this Act to

such persons as may be entitled thereto in accordance with the

provisions of this Act: Provided, That the beneficiary who is a

national of a foreign country which does not extend benefits to a

Filipino beneficiary residing in the Philippines, or which is not

recognized by the Philippines, shall not be entitled to receive any

benefits under this Act: Provided, further, That

notwithstanding the foregoing, where the best interests of the SSS will

be served, the Commission may direct payments without regard to

nationality or country of residence: Provided, further, That if

the recipient is a minor or a person incapable of administering his own

affairs, the Commission shall appoint a representative under such terms

and conditions as the Commission may deem proper: Provided,

further, That such appointment shall not be necessary in case the

recipient is under the custody of, or living with, the parents or

spouse, in which case the benefits shall be paid to such parents or

spouse, as representative payee of the recipient. Such benefits are not

transferable and no power of attorney or other document executed by

those entitled thereto, in favor of any agent, attorney, or any other

individual for the collection thereof in their behalf shall be

recognized except when they are physically and legally unable to collect

personally such benefits: Provided, finally, That in case of

death benefits, if no beneficiary has been designated said benefits

shall be paid to the legal heirs in accordance with the law of

succession.

Section 9

SEC. 9. Section sixteen of the same Act is amended

to read as follows:

"SEC. 16. Exemption from tax, legal process

and lien.— All laws to the contrary notwithstanding, the SSS and

all its assets, all contributions collected and all accruals thereto and

income therefrom as well as all benefit payments, and all papers or

documents which may be required in connection with the operation or

execution of this Act shall be exempt from any tax, assessment, fee,

charge, or customs or import duty; and all benefit payments made by the

SSS shall likewise be exempt from all kinds of taxes, fees or charges,

and shall not be liable to attachment, garnishment, levy or seizure by

or under any legal or equitable process whatsoever, either before or

after receipt by the person or persons entitled thereto, except to pay

any debt of the covered employees to the SSS."

Section 10

SEC. 10. Section eighteen of the same Act is further

amended by designating the present provision as paragraph (a) and

adding thereto paragraphs (b) and (c) to read as follows:

"SEC. 18. Employee's contribution. — (a)

Beginning as of the last day of the calendar month when an employee's

compulsory coverage takes effect and every month thereafter during his

employment, the employer shall deduct and withhold from such employee's

monthly salary, wage, compensation or earnings the employee's

contribution in an amount corresponding to his salary, wage,

compensation or earnings during the month in accordance with the

following schedule effective on January 1 1973:

Salary

Monthly

Bracket

Range of

Compensation

Monthly Salary

Credit

Employer's

contribution

Employee's

contribution

Total

Contribution

I

1

-

49.99

25

1.20

0.30

1.50

II

50

-

99.99

75

3.00

1.50

4.50

III

100

-

149.99

125

4.40

3.10

7.50

IV

150

-

199.88

175

6.20

4.30

10.50

V

200

-

349.99

225

7.90

5.60

13.50

VI

250

-

349.99

425

14.90

10.60

25.50

VII

350

-

499.99

425

14.90

10.60

25.50

VIII

500

-

699.99

600

21.00

15.00

36.00

IX

700

-

899.99

800

28.00

20.00

48.00

X

900

-

Over

1000

35.00

25.00

60.00

"(b) Increments in employer's and employee's contributions equal to

one-sixth of their respective contributions in the schedule in paragraph

(a) of this section rounded to the nearest ten centavos, shall be added

on January 1, 1974 and January 1, 1979.

"(c) Every employer shall issue a receipt for all contributions

deducted from the employee's compensation or shall indicate such

deductions on the employee's pay envelopes."

Section 11

SEC. 11. Section nineteen of the same Act is further

amended by designating the present provisions as paragraph (a) and

adding thereto paragraph (b) to read as follows:

"SEC. 19. Employer's contribution. — (a) Beginning as of

the last day of the month when an employee's compulsory coverage takes

effect and every month thereafter during his employment, his employer

shall pay, with respect to such covered employee, the employer's

contribution in accordance with the schedule indicated in Section

eighteen of this Act. Notwithstanding any contract to the contrary, an

employer shall not deduct, directly or indirectly from the compensation

of his employees covered by the SSS or otherwise recover from them the

employer's contributions with respect to such employees.

"(b) The remittance of such contributions by the employer shall be

supported by a quarterly collection list to be submitted to the SSS at

the end of each calendar quarter indicating the names and SSS numbers of

the employees, their actual compensation and the total contributions

paid for their account during the quarter."

Section 12

SEC. 12. Section twenty-two of the same Act is

further amended by amending paragraph (a) and adding thereto paragraphs

(d) and (e) to read as follows:

"SEC. 22. Remittance of contributions. —

(a) The contributions imposed in the preceding sections shall be

remitted to the SSS within the first seven days of each calendar month

following the month for which they are applicable or within such time as

the Commission may prescribe. Every employer required to deduct and to

remit such contributions shall be liable for their payment, and if any

contribution is not paid to the SSS , as herein prescribed, he shall pay

besides the contribution a penalty thereon of three per cent per month

from the date the contribution falls due until paid. If deemed expedient

and advisable by the Commission, the collection and remittance of

contributions shall be made quarterly or semi-annually in advance, the

contributions payable by the employees to be advanced by their

respective employers: Provided, That upon separation of an

employee, any contributions so paid in advance but not due shall be

credited or refunded to his employer.

"(d) The last complete record of monthly contributions paid by the

employer as of the date of filing of the action for collection shall be

presumed to be the monthly contributions for the account of the

employees listed therein payable by and due from the employer to the SSS

for each of the unpaid month, unless contradicted and overcome by other

evidence: Provided, That the SSS shall not be barred from determining

and collecting the true and correct contributions due the SSS even after

full payment pursuant to this paragraph, nor shall the employer be

relieved of his liability under section twenty-eight of this Act.

"(e) For purpose of this section, any employer who is delinquent or

has not remitted all the monthly contributions due and payable may

within six (6) months from the approval of this amendatory act remit

said contributions to the SSS and submit the corresponding collection

lists therefor without incurring the prescribed three per cent penalty.

In case the employer fails to remit to the SSS the said contributions

within the six months grace period, the penalty of three per cent shall

be imposed from the time the contributions first became due as provided

in paragraph (A) of this section."

Section 13

SEC. 13. Section twenty-four of the same Act is

further amended by amending paragraphs (a) and (b) and adding thereto

paragraphs (c), (d), and (e) to read as follows:

"SEC. 24. Employment records and reports.

— (a) Each employer shall immediately report to the SSS the names,

ages, civil statuses, occupations, salaries and dependents of all his

employees who are in his employ and who are or may later be subject to

compulsory coverage: Provided, That if an employee subject to

compulsory coverage should die or become sick or disabled or reach age

sixty without the SSS having previously received any report or written

communication about him from his employer or a contribution paid in his

name by his employer, the said employer shall pay to the SSS damages

equivalent to the benefits to which said employee would have been

entitled had his name been reported on time by the employer to the SSS,

except that in case of pension benefits, the employer shall only be

liable for the total five-year guaranteed pension: Provided,

further, That if the contingency occurs within thirty days from the

date of employment, the employer shall be relieved of his liability for

damages.

"(b) Should the employer misrepresent the true date of employment

of his employees or remit to the SSS contributions which are less than

those required in this act, resulting in a reduction of benefits, the

employer shall pay to the SSS damages to the extent of such reduction.

"(c) The records and reports duly accomplished and submitted to the

SSS by the employee or the employer, as the case may be, shall be kept

confidential by the SSS except in compliance with a subpoena duces tecum

issued by the Courts, shall not be divulged without the consent of the

administrator or any official of the SSS duly authorized by him, shall

be presumed correct as to the data and other matters stated therein,

unless the necessary corrections to such records and reports have been

properly made by the parties concerned before the right to the benefit

being claimed accrues, and shall be made the basis for the adjudication

of the claim. Such adjudication shall be final.

"(d) Every employer shall keep true and accurate work records for

such period and containing such information as the Commission may

prescribe, in addition to an 'annual register of new and separated

employees' which shall be secured from the SSS wherein the employer

shall enter on the first day of employment or on the effective date of

separation the names of the persons employed or separated from

employment, their SSS numbers, and such other data that the Commission

may require and said annual register shall be submitted to the SSS in

the month of January of each year. Such records shall be open for

inspection by the SSS or its authorized representatives quarterly or as

often as the SSS may require. The SSS may also require each employer to

submit, with respect to the persons in his employ, reports needed for

the effective administration of this Act.

"(e) Effective July 1, 1973, each employer shall require as a

condition to employment, the presentation of a registration number

secured by the prospective employee from the SSS in accordance with such

procedure as the SSS may adopt: Provided, That in case of

employees who have earlier been assigned registration numbers by virtue

of a previous employment, such numbers originally assigned to them

should be used for purposes of this section: Provided, further,

That the issuance of such registration numbers by the SSS shall not

exempt the employer from complying with the provisions of paragraph (A)

of this section."

Section 13-A

SEC. 13-A. Section twenty-five of the same Act is

further amended to read as follows:

"SEC. 25. Deposit and Disbursements.- All moneys paid to or

collected by the SSS every year under this Act, and all accruals thereto

shall be deposited, administered and disbursed in the same manner and

under the same conditions and requirements as provided by law

for other public special funds: Provided, That of the total

yearly collection of contributions and gross income from investments,

not more than twelve per cent during the fiscal year 1966-67, said

percentage limit to be decreased by one-half per cent each succeeding

fiscal year, but not less than seven per cent, shall be disbursed for

salaries and wages, purchases of office equipment and materials,

operational expenses and the establishment of regional offices of the

SSS: Provided, further, That if the expenses of the SSS in any

year are less than the maximum amount permissible, the difference shall

not be availed of as additional expenses of the SSS in the following

years: Provided, finally, That the implementation of the

decentralization of operations shall be given priority and the SSS shall

submit to Congress an annual progress report on the development of this

program."

Section 14

SEC. 14. Section twenty-six of the same Act is

further amended by amending all paragraphs and adding thereto paragraph

(g) to read as follows:

"SEC. 26. Investment of reserve funds. —

All revenues of the SSS as are not needed to meet the current

administrative and operational expenses incidental to the carrying out

of this Act shall be accumulated in a fund to be known as the 'Reserve

Fund' which shall be used exclusively for the payment of the benefits

under this Act, and no amount thereof shall be withdrawn or used for any

other purpose. Such portions of the reserve funds as are not needed to

meet the current benefit obligations thereof shall be invested to earn

an average annual income of at least seven per cent: Five per cent shall

be invested in bank deposits to be known as the 'contingency reserve

fund' to meet and cover contingent and extraordinary disbursements for

death, sickness and disability claims under this Act, and the remaining

balance shall be credited to a fund to be known as the 'investment

reserve fund to be invested by the Commission in any or all of the

following ways only:

"(a) In interest-bearing bonds or securities of the Government of

the Philippines, or bonds or securities for the payment of the interest

and principal to which the faith and credit of the Republic of the

Philippines is pledged.

"(b) In interest-bearing deposits or securities in any domestic

bank doing business in the Philippines: Provided, That such

deposits shall not exceed at any time the unimpaired capital and surplus

or total private deposits of the depository bank, whichever is smaller:

Provided, further, That said bank shall first have been

designated as a depository for this purpose by the Monetary Board of the

Central Bank of the Philippines: Provided, finally, That such

investment in deposits or securities shall be equitably distributed to

all designated depository banks.

"(c) In loans or interest-bearing advances to the National

Government for the construction of permanent toll bridges, toll roads or

government office buildings in accordance with actuarial considerations

and the conditions prescribed by the law in such cases: Provided,

That the tolls shall be collected by the SSS for a reasonable fee.

"(d) In direct housing loans to covered employees giving priority

to the low-income groups, up to a maximum of ninety per cent of the

appraised value of the properties to be mortgaged by the borrowers under

such rules and regulations as the Commission may adopt, and in building

projects referred to in Section four (j) of this Act for the

maintenance of hospitals and institutions for the sick, aged and

infirmed members and their families.

"(e) In investments which will provide credit facilities for small

short-term loans to covered employees: Provided, That not more

than ten per cent of the investment reserve fund at any time shall be

invested for this purpose.

"(f) In other income earning projects and investments secured by

first mortgages on real estate collaterals which, in the determination

of the Commission, shall redound to the benefit of the SSS, its members,

as well as the public welfare: Provided, That any such

investments shall be made with due diligence and prudence to earn the

highest possible interest consistent with safety.

"(g) As part of its investment operations the SSS shall act as

insurer of all or part of its interest on properties mortgaged to the

SSS or on the lives of mortgagors whose properties are mortgaged to the

SSS in accordance with such rules and regulations prescribed by the

Commission: Provided, That the Commission shall fix its own

rates of premiums based on studies recommended by the actuary but in no

case higher than the rates approved by the insurance commissioner: Provided,

further, That the SSS may insure any of its interest or part

hereof with any private company or reinsurer: Provided, finally,

That the general law on insurance and the rules and regulations

promulgated thereunder shall have suppletory application insofar as it

is not in conflict with the Social Security Law and its rules and

regulations."

Section 15

SEC. 15. Section twenty-eight of the same Act is further amended by

amending paragraphs (a) and (b) and adding thereto paragraphs (h) and

(i) to read as follows:

"SEC. 28. Penal Clause. — (a) Whoever, for the purpose of causing

any payment to be made under this Act, or under an agreement thereunder,

where none is authorized to be paid, shall make or cause to be made

false statement or representation as to any compensation paid or

received, or whoever makes or causes to be made any false statement of a

material fact in any claim for any benefit payable under this Act, or

application for loan with the SSS, or whoever makes or causes to be made

any false statement, representation, affidavit, or document, in

connection with such claim, shall be fined not less than five hundred

pesos nor more than five thousand pesos or imprisoned for not less than

six months nor more than one year, or both, at the discretion of the

court.

"(b) Whoever shall obtain or receive any money or check under this

Act or any agreement thereunder, without being entitled thereto with

intent to defraud any covered employee, employer or the SSS, shall be

fined not less than five hundred pesos nor more than five thousand pesos

and imprisoned for not less than six months nor more than one year."

"(h) Any employer who, after deducting the monthly contributions or

loan amortizations from his employee's compensation, fail to remit the

said deductions to the SSS within thirty days from the date they became

due shall be presumed to have misappropriated such contributions or loan

amortizations and shall suffer the penalties provided in

Section 16

SEC. 16. This Decree is hereby made part of the law

of the land and shall take effect immediately.

Done in the City of Manila, this 19th day of October, in the year of

Our Lord, nineteen hundred and seventy-two.

(Sgd.) FERDINAND E. MARCOS

President

Republic of the Philippines

By the President:

(Sgd.) ALEJANDRO MELCHOR

Executive Secretary