Defense Secretary Gilberto “Gibo” Teodoro Jr. on Wednesday stated the burden on the federal government expenditures because of the pension of Armed Forces of the Philippines (AFP) retirees will scale back over time.
In an announcement, Teodoro identified a number of elements for the lawmakers to contemplate as they reform the pension system for army and uniformed personnel (MUP).
“The pension burden of the AFP retirees on government expenditures will actually reduce over time as the envisioned AFP Retirement trust fund becomes viable as a funding source given a constant force size,” he stated.
“Also, it is proposed that the share in the BCDA earnings of the AFP and other DND related GOCCs be realigned to service AFP retiree pensions,” he added.
Teodoro stated the AFP won’t increase the scale of its power in the identical method as different uniformed companies, whose numbers are being adjusted relying on the nation’s rising inhabitants.
Aside from this, Teodoro added that his division was knowledgeable that the monetary influence of the pension burden of the AFP retirees, now and sooner or later, is “substantially lower than as originally stated”.
“We likewise have no intention of downplaying the significant contributions of all sectors of our society in nation building and making our country resilient. But the undeniable fact is that all these collective efforts will fail if we do not have a strong, well equipped and, most importantly–a well motivated and professional AFP,” he stated.
“The Department hopes that our lawmakers will take these factors into consideration and help us ensure the welfare of our soldiers and their families,” he added.
On Tuesday, House methods and means panel chairperson Joey Salceda stated Teodoro’s proposal to permit full indexation would imply extra P1.2 trillion bills for the federal government.
Teodoro earlier proposed the total indexation of the MUP pension equivalent to personnel’s rank upon retirement.
On Wednesday, Finance Secretary Benjamin Diokno stood agency on eradicating the indexation from the MUP pension system as a part of proposed reforms to handle fiscal implications stemming from its present setup.
“It will not qualify as a reform if indexation will continue and the active members will not contribute. We have to reduce the fiscal impact of the MUP’s pension program and the contribution of active members will greatly help in managing that,” Diokno stated in an announcement.
Military and uniformed personnel at the moment don’t contribute to their pension fund, which is absolutely funded by the federal government beneath the nationwide funds.
Under the present system, retired MUPs’ pensions are mechanically listed to the prevailing wage of incumbent personnel of comparable rank. —Joviland Rita/ VAL, GMA Integrated News
Source: www.gmanetwork.com
