In 2022, the Social Security Fund (SSF) declined by more than 17.6 billion baht, the first drop in five years, as a result of decreased market capitalisation (mark to market) and reduced contributions to alleviate the financial burden of subscribers during the pandemic, says a Finance Ministry source who requested anonymity.
Apart from conducting periodic fiscal risk assessments on income, expenditure and public debt, the Fiscal Policy Office also assessed fiscal risks from the operations of other sectors, particularly social security funds, which could pose fiscal risks to the government and should be monitored.
According to the source, the SSF tallied 2.361 trillion baht at the end of 2022, compared with 2.379 trillion at the end of 2021, attributed to decreased market capitalisation of investments and reduced contributions.
The government cut the contribution rate for employers and insurers under Sections 33 (regular employees), 39 (former employees still paying contributions to the SSF) and 40 (freelancers) of the Social Security Act.
However, financial compensation, such as unemployment benefits and sickness pay, is higher currently than before the pandemic, while the country's ageing demographics affect the long-term sustainability of the fund.
To increase income for the fund, the Labour Ministry is considering proposing a draft ministerial regulation to raise the salary ceiling used in calculating the monthly contributions by salaried employees from the current level of 15,000 baht on a gradual basis.
If implemented, the regulation is expected to help improve the SSF's cash flow thanks to higher monthly contributions to the fund from insurers and employers as a result of the increased ceiling.
Following state Covid relief measures, employees under Section 33, whose overall contributions from May to July 2022 were just 1% of their monthly income (capped at 15,000 baht), down from 5% previously, had contributions rise to 3% from October to December 2022.
For people insured under Section 39 (former employees contributing to the SSF after leaving their jobs), their contributions from May to July 2022 were only 91 baht, down from 432 baht previously, then increased to 240 baht from October to December 2022.
