The proposal bringing the country’s military, police, coast and jail guards, as well as firemen pension, under the ambit of the Government Service Insurance System (GSIS) should be completed by year-end.
Finance Secretary Carlos G. Dominguez III said on Wednesday he has asked the Armed Forces of the Philippines (AFP) and the Philippine National Police (PNP) to provide the Department of Finance (DOF) with an updated list of personnel, since the latest record the government has was still dated 2010.
“We will complete the study maybe by the end of the year. Then, we will present that, obviously, to the Cabinet and then if required, which I think it is, has to be legislated,” Dominguez told financial reporters.
National Treasurer Rosalia V. de Leon also confirmed the review on military pensions is under thorough evaluation.
“We are looking into the guidelines, in terms of how much [increase in pension rates can be implemented],” de Leon said.
This developed even as the military continues to liquidate the assets of the pension fund known as the Armed Forces of the Philippines—Retirement and Separation Benefit System (AFP-RSBS) and refund the contribution of military personnel.
The AFP-RSBS was deactivated in 2007 by then-President Gloria Macapagal-Arroyo, the fund having failed long before to deliver its mandate to take care of the retirement benefits of its members.
Based on data from the Department of Budget and Management (DBM), the government needs to fund the pension needs of 210,816 retirees coming from the military, police, coast guard and fire bureau, totaling an estimated P73.9 billion.
This represents a 4.08-percent expansion from estimated pension of some P71 billion as of 2016.
In April this year, the DOF and the DBM bared a plan to create a retirement fund for soldiers, through the GSIS, finally to address the increasing pension cost of soldiers serving the military.
Dominguez said this was a priority measure that needs to go through legislation quickly.
“That is a political decision, one that will have to be legislated. But we have to fix it,” he said.
In February Budget Secretary Benjamin E. Diokno said addressing the cost of military pension through the annual budget was unsustainable and that the Legislative-Executive Development Advisory Council also agreed there should be a review of the pension system for military personnel and for policemen.
The Cabinet-level Development Budget Coordination Committee earlier said the pension requirement of military personnel as of end-2016 amounted to P71 billion and that this could more than double in eight years to P187.9 billion.
In the 2017 General Appropriations Act, the government sought a budget of P3.35 trillion of which P110 billion was allotted the PNP and another P137.2 billion for the Department of National Defense with P137.2 billion.
Last September, President Duterte signed an executive order (EO) increasing the combat duty and incentive pay of the AFP and the PNP.
Under the EO, the combat-duty pay of the enlisted personnel of the AFP and the PNP was raised to a fixed rate of P3,000 per month, from only P500 in the case of the AFP and only P340 a month for the PNP.