By means of Aubrey Rose A. Inosante, Reporter
THE GOVERNMENT is now preparing one I amproven version of the bill to reform the pension system for military and uniformed personnel (MUP), Department of Budget and Management (DBM) Secresaid Amenah F. Pangandaman.
“MUP is not dead,” she said last Friday during the Fiscal Policy Conference.
‘It is a different version than Minister Ben [Diokno] intended from the very beginning. Hopefully we can come up with a nice version that is still slightly better than expected.”
Ms. Pangandaman made the statement after former Chief Financial Officer Benjamin E. Diokno said he does not think the current version of the MUP reform is the same asto make a difference.
‘I think the military pension law is dead… The measure they are coming up with is not what we wanted. It won’t make much difference. In fact, it could worsen the situation,” Mr Diokno said.
The Department of Finance (DoF) led by Mr Diokno had earlier pushed for a version of the bill that would require contributions from all active staff and new entrants and abolish full indexation of pensions.
Mr Diokno had previously urged that the MUP pension system should be overhauled, noting there was a risk of a “fiscal collapse”.
Last year, the House of Representatives approved a version of the MUP reform bill that does not require mandatory contributions from active personnel. The House version also provides for an automatic indexation of the MUP pensions with 100% of the increase in the basic salary of active personnel.
“Discussions are still ongoing and updates will be made. There is no discussion yet, but this will depend on the end of the 19th centurye Congress and early 20’se Congress,” said Deputy Budget Secretary and Chief Economist Joselito R. Basilio Business world on the sidelines of a forum.
In an interview with Business worldTreasury Secretary Ralph G. Recto said there is “no update” on the MUP bill.
“There is a good chance that there will be no bill on the MUP,” he said on the sidelines of a budget hearing in the Senate on November 6.
Mr Recto urged changes to the MUP’s pension scheme, but only for newcomers.
The Senate version of the MUP reform bill has been awaiting second reading approval since November 2023.
Senate Bill No. 2501 seeks to fix the monthly pension pay at 50% of the basic salary for the last position of retired MUPs. It also requires new MUPs to contribute to the new pension fund system.
Under the Senate bill, members of the military would have to contribute 7% of their basic monthly salary, while the national government would contribute 14%.
The House version, on the other hand, establishes a membership contribution of 9% of the monthly salary for newcomers and a government supplement of 12%.
“The ideal, or the standard, is GSIS (Government Service Insurance System) – 9% and 11%. (The standard should be) 21-24% to make it sustainable and have a good actuarial life,” Mr. Basilio said.
‘That’s the idea. So things would play around that. The contribution can be 5-4%.”
The MUP includes eight agencies such as the Armed Forces of the Philippines, the Philippine National Police, the Philippine Coast Guard, the Bureau of Fire Protection, the Bureau of Jail Management and Penology, the Bureau of Corrections, the National Mapping and Resource Information Authority and Philippine Veterans. Office Affairs.