Manila Bulletin
Philippines
DND recognizes concerns of retirees amid proposed reforms in MUP pension system
Philippines
DND recognizes concerns of retirees amid proposed reforms in MUP pension system
DND recognizes concerns of retirees amid proposed reforms in MUP pension system
Published Apr 3, 2023 06:59 am
The Department of National Defense (DND) said Sunday, April 3, that it recognizes the concerns raised by some retirees as the government seeks to implement reforms in the military and uniformed personnel (MUP) pension system.
DND Officer in Charge (OIC) Senior Undersecretary Carlito Galvez Jr. appealed for understanding as he said that options for reforms in the MUP pension system “are being carefully evaluated.”
“We would like to give our assurance to our stakeholders that the government will always look after the welfare and livelihood of our men and women in uniform,” Galvez said.
“Proposed reforms to the MUP pension system are still currently being studied while we also conduct consultations with active and retired uniformed personnel regarding the matter,” he added.
Department of Finance (DOF) Secretary Benjamin Diokno has advised President Ferdinand Marcos Jr. to implement reforms in the current MUP pension system, which he described as “fiscally unsustainable,” to prevent a “potential fiscal crisis.”
Diokno explained that the current pension system is fully funded by the government.
“That means it is appropriated annually in the budget, but there is no contribution from the retirees,” Diokno said in a press briefing last March 28.
Accordingly, the current MUP pension system covers retirees from the Armed Forces of the Philippines (AFP), Bureau of Jail Management and Penology (BJMP), Bureau of Fire Protection (BFP), Philippine National Police (PNP), Philippine Public Safety College (PPSC), Philippine Coast Guard (PCG), and the Bureau of Corrections (BuCor).
Diokno then proposed the removal of automatic indexation of pension to the salary of active personnel of single rank. Under the present system, the pension amount is automatically pegged according to the current salary of the personnel of similar rank in active service.
He also said that MUPs shall receive their pension starting at 57 years old, and mandatory contributions be required for active personnel and new entrants similar to Government Service Insurance System (GSIS) pensioners. Under the current system, pensions can be received after 20 years of service without a minimum pensionable age requirement, and is fully funded by the national government.
These reforms are sought by Diokno to be applied to all active and new entrants in the uniformed sector.
But some retirees in the uniformed sector expressed concern that the reforms might be the end of the line for some of them.
“To most of the retirees, particularly in their senior years, the retirement benefits are the only means to survive,” the Police Retirees Association, Inc. said in a statement.
For his part, Galvez said that the government is looking to adopt a “more financially sustainable” system which will be founded on “sound financial solutions” and “application of actuarial science.”
He said that Marcos Jr. is looking for “creative ways” to provide benefits for the uniformed personnel in grateful appreciation for their service as the country works towards its post-pandemic economic recovery.
“Thus, we are appealing to our stakeholders to be circumspect and understanding of those who are working on the issue, and support our efforts in seeking solutions that will be beneficial to all, especially for our national fiscal health,” Galvez stressed.