Philippines pension system remains among lowest ranked in global index

Traders Union
All News
Economic Data
Philippines pension index ranking

Highlights

Philippines' pension system score rises to 49.2 in 2026 from 47.1 in 2025, ranking fourth-lowest among 55 global systems and below the 65.6 global average.
Adequacy improves to 44.7 while sustainability slips to 63.9, but integrity lags at 35.7 compared to the 77.1 global average, leaving the system with a D grade.
About two out of five Filipinos aged over 60 lack pensions, with average SSS benefits at P5,700 monthly, highlighting calls for universal social pension and broader reforms.

2026 index results and reform gaps

As reported by BusinessWorld Online, the Marsh CFA Institute Global Pension Index shows the Philippines' overall score rises to 49.2 in 2026 from 47.1 in 2025, placing it fourth-lowest among the 55 systems covered. The country remains below the global average score of 65.6 and is the only pension system in East and Southeast Asia to receive a D grade.

A D grade, covering scores from 35 to 49, means a system has some desirable features but also major weaknesses that need to be addressed, with its efficacy and sustainability otherwise in doubt. The Philippines' adequacy score improves to 44.7 from 40.6, while its sustainability score slips to 63.9 from 64.4 but stays above the global average of 55.6. Its integrity score edges up to 35.7 from 33.2, remaining far below the global average of 77.1.

The country's pension system is centered on the Social Security System for private workers and the Government Service Insurance System for government workers. Ser Percival K. Peña-Reyes, senior research fellow at the Ateneo Center for Economic Research and Development, says the country needs reforms to strengthen accountability and transparency, improve pension adequacy, expand coverage, develop private retirement savings and support long-term sustainability.

He says fragmented pension arrangements, limited retirement savings, coverage gaps and weaknesses in governance and accountability remain the main obstacles. He also calls for a review of laws covering the SSS, GSIS and the Personal Equity and Retirement Account, while urging steps to improve SSS financial sustainability, contribution compliance and coverage of self-employed and informal sector workers.

Regional standing and pressure for broader coverage

Peña-Reyes says the government should make PERA more attractive through simpler administration, wider investment choices, stronger public awareness and more effective tax incentives. He adds that the Philippines needs comprehensive pension reform rather than periodic pension increases, with Singapore offering a regional reference point for fund governance and structured retirement savings.

IBON Foundation Executive Director Jose Enrique “Sonny” A. Africa says the system's relatively high sustainability score reflects how low benefits and coverage remain. He says about two out of five of the roughly 12 million Filipinos aged over 60 still do not have pensions, while average monthly benefits of P5,700 for SSS pensioners and P1,000 for indigent beneficiaries are inadequate, prompting his call for a universal social pension.

Globally, the Netherlands tops the index with a score of 85.8, followed by Denmark, Iceland, Singapore, Israel and Australia, all of which receive A grades. In East and Southeast Asia, Singapore is the only system with an A grade, while Hong Kong SAR receives a B, China and Malaysia get C+, and Taiwan, Japan, South Korea, Vietnam, Thailand and Indonesia receive C grades.

Marsh says falling fertility rates and rising life expectancy are reshaping pension design and long-term sustainability. Officials from Marsh and CFA Institute say retirement systems need clearer objectives, stronger governance, better funding for future obligations and more flexibility in product design and retirement age structures as demographic and market pressures intensify.

Our earlier article on planned Philippine sovereign bond reforms explained how a new pricing convention and anticipated index inclusion could improve liquidity and broaden the investor base, but won’t automatically translate into stronger productive investment. It also stressed that deeper capital markets—and investor trust through better governance, disclosure, and enforcement—plus a stronger domestic long-term investor base are needed for modernization to support real economic growth.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.