BCDA asked to sell military properties
The Department of Finance has asked state-run Bases Conversion and Development Authority to dispose of the properties in former military camps to augment funds earmarked for the pension of uniformed personnel.
“We are working with the BCDA—it was set up to basically help the modernization [of the military]. We are discussing with them what kind of assets they can assign to cover these liabilities,” Finance Secretary Carlos G. Dominguez III told reporters last week.
“They own a lot of land—Fort Magsaysay [in Nueva Ecija], Fort Bonifacio [in Taguig City], so we’ll see what assets are there that can be used for this,” Dominguez added.
The Bureau of the Treasury is also spearheading a study to determine the viability of a new pension system for uniformed personnel, possibly by putting them under the coverage of pension fund Government Service Insurance System, National Treasurer Rosalia V. de Leon said.
However, the GSIS had said that placing uniformed personnel under its coverage might cost it P4 billion to P7 billion.
The Duterte administration was worried about the ballooning pension requirement of uniformed personnel, such that the interagency Development Budget Coordination Committee (DBCC) was pushing for a seed fund worth trillions of pesos that would generate income for retired military officers.
In its Fiscal Risks Statement 2017 report, the DBCC noted that the “problem” on ballooning pension costs for uniformed personnel was “mainly attributable to the features present in all existing retirement laws—pension entitlement of a retiree is automatically adjusted based on the prevailing scale of base pay for similarly ranked active personnel; pension is noncontributory in nature hence budget comes from the annual general appropriations of the government, and early entitlement to pension benefits even before attaining the compulsory retirement age of 56.”
The DBCC said that last year, uniformed personnel’s pension reached P71 billion, and was expected to more than double in eight years to P187.9 billion.
According to the DBCC, a technical working group composed of the departments of Budget and Management, Finance, Interior and Local Government and National Defense, and the GSIS had “recommended the creation of a seed fund necessary for the purpose of generating sufficient interest income to fund the annual pension requirements of all uniformed services.” —BEN O. DE VERA
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.