Military pension fund up for Duterte nod
President Duterte is studying the proposed new pension system for uniformed personnel submitted for his consideration by the economic team last month, which will collect contributions from active personnel.
“The President has already approved the basic outline of the pension plan, and they are working on drafting legislation, which they will ask the members of the legislature to file,” Finance Secretary Carlos G. Dominguez III told reporters recently.
Under the proposal, a new unit will be created to oversee the pension system for incoming uniformed personnel, to be managed by the state-run pension fund Government Service Insurance System (GSIS), Dominguez said.
To finance the pension of new uniformed personnel, the government will raise capital through joint development of military land with the private sector, the finance chief added.
Also, incoming uniformed personnel will be required to pay contributions, according to Dominguez.
For the part of the GSIS, president and general manager Jesus Clint O. Aranas told the Inquirer in September that they already submitted a 30-page draft bill to some legislators aimed at revising the pension fund’s charter.
If ever the GSIS will be tasked to supervise uniformed personnel’s pension, the pension fund’s charter needed to be first amended as handling military and police was not within the GSIS’s competencies at present, Aranas explained.
Under the GSIS’s proposal, it would only manage the pension of existing pensioners under a separate system and would charge management fees once the system started generating income.
As for new entrants, the GSIS will put up a separate and new insurance fund, hence will entail a reorganization at the pension fund that will nonetheless be of no cost to the GSIS, Aranas said.
The GSIS chief maintained that these pension funds for uniformed personnel must be separate and independent from the social insurance fund for civilian government personnel to protect the latter.
The proposed “Revised GSIS Bill” will make it compulsory for new entrants to the Armed Forces of the Philippines, the Philippine National Police, the Bureau of Fire Protection, the Bureau of Jail Management and Penology, the Philippine Coast Guard, the Bureau of Corrections and commissioned corps of the National Mapping and Resource Information Authority to become GSIS members.
The GSIS will form a “military and uniformed personnel (MUP) insurance fund,” which will be “contributory in nature and prospective in application” among commissioned and enlisted personnel who are newly appointed, newly commissioned, newly recruited and newly admitted to the service when the bill becomes law.
Since the MUP insurance fund will be managed separately and independently from the social insurance fund and other GSIS-administered funds, a new department, with a distinct accounting system, will be established.
Under the proposed Revised GSIS Bill, “the MUP insurance fund shall not be used for purposes other than those provided under this act,” such that “no portion of the MUP insurance fund shall accrue to the general fund of the national government and its political subdivisions, instrumentalities and other agencies, including government-owned and -controlled corporations.”
At present, uniformed personnel enjoy indexation of benefits, which means that even when they retire, they still get increases in benefits similar to what active members receive.
Under the GSIS proposal, only existing pensioners will continue to enjoy such benefit.
