The Senate national defense committee revealed today that the national government needs P9.6 trillion to solve the untamed pension fund problem for the military and uniformed services.
This was revealed today by Senator Panfilo M. Lacson, committee chairman, during his public hearing on the Military and Uniformed Personnel (MUP) Insurance Fund Act bills.
To resolve this multi-trillion-peso headache, Lacson said Congress would be required to appropriate P800 billion annually for the next 20 years.
The Government Service Insurance System (GSIS) presented different scenarios and computations in arriving at a fair and acceptable solution to the problem.
Lacson said the problem is overwhelming ‘’but we have to confront it.’’
Minority Leader Franklin M. Drilon said this gargantuan problem has been swept under the rug for decades and the Senate wanting to address the issue is the first step.
The role of Congress, according to Drilon, is to adopt a policy that would integrate and fund the retirement fund.
The 30-minute presentation by the GSIS of its scenarios and computations left him confused because it is difficult to digest, he said.
But the GSIS presentation is the start of the solution, Drilon added.
Senator Imee R. Marcos, chairwoman of the Senate economic affairs, said the presentation of proposed solutions to the Lacson committee hearing is ‘’pointless’’ if there is no commitment from the country’s economic managers.
Lacson said he still could not get the whole picture unless agencies such as the Armed Forces of the Philippies (AFP), Bureau of Fire Protection (BFP), Bureau of Prisons (BuCor) and National Mapping and Resource Information Authority (NAMRIA) have submitted their assets for valuation by the Bureau of Internal Revenue (BIR). This valuation will then be submitted to the GSIS.
In his opening statement to start the hearing, Lacson said last year and this year’s appropriations reflect the veracity of this serious financial concern, ‘’given the steep increase in the MUPs’ pension funding from P80 billion in 2020 to P120 billion under the 2021 General Appropriations Act (GAA).’’
‘’Among the many proposals from the Department of Finance (DOF) is the cancellation of automatic indexation. In this regard, we may have to request for a legal opinion from the Department of Justice (DOJ) on whether or not Congress can diminish or reduce the benefits already being received by existing pensioners, as well as those who are already in the service,’’ he added.
A DOJ representative later said the prepared DOJ position on the matter is still under review.