For context, Diokno said veterans and military personnel receive an average monthly pension of 40,000 pesos. This equates to nine times (4,528 pesos) what retirees receive under the Social Security Scheme and three times (13,600 pesos) what pensioners receive under the Civil Service Insurance Scheme.
MANILA (Philippines) – The pending veterans and military pension reforms are expected to be passed by the end of the year as Treasury Secretary Benjamin Diocno hopes the move will clear some of the fiscal space.
Addressing the forum after President Ferdinand Marcos Jr. delivered his second annual address to Congress, Diokuno said the impact of these reforms could be seen by January 2024 at the earliest.
The Marcos Jr. government faces a colossal task of reforming pensions for soldiers and military personnel, but Mr. Diokno has already said that the pension will be nine times (4,528 pesos) what retirees under the social security system will receive and three times (13,600 pesos) what pensioners will receive under the civil service insurance system.
Veterans and military personnel receive an average monthly pension of 40,000 pesos.
“If my numbers are correct, we will be allocated around P300 billion in 2024,” Diokno said on Tuesday.
The reforms would free up fiscal space in the country’s annual budget, as taxpayers continue to bear the huge debts that the Duterte government incurred in dealing with the pandemic. In fact, Diokno said in March that the situation was already “dark.”
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“As we explained to them, this is for their own benefit and to make the future pension system more sustainable,” he said.
Former President Rodrigo Duterte signed a law in 2018 requiring pay increases for the military and police. A year later, the Duterte administration sought congressional help to pass a bill aimed at reforming the pensions of these workers.
Mr. Diokno explained the three types of beneficiaries targeted by this reform. Retired staff will not be required to contribute as the state has “contractual obligations”, but current staff will be asked to cooperate “in stages” and new hires will be required to pay the full amount.
MUP reform is an ongoing concern for the Marcos Jr. administration and is listed among the legislative priorities of Congress. The reform plan was unveiled in the president’s state address on Monday.
In effect, the Pentagon is already looking to sell land and real estate assets to fund military retirement pensions. One of the first marching orders of the new Secretary of Defense Gilbert Teodoro was to “fix” the military’s pension system.
The Marcos Jr. government has already held a series of talks with military and police officials, holding nine talks as of June.
“The results of the consultations have been very encouraging,” Diokuno said. — Ramon Royandoyan
