(File photo)
MANILA – Officials from the Department of National Defense (DND) and Department of Finance (DOF) confirmed that the Duterte administration’s proposed reform of the military and uniformed personnel (MUP) pension system will only apply to new entrants in the service.
In a statement Monday, DND spokesperson Arsenio R. Andolong stressed that the reform aims to create a more financially sustainable MUP pension system.
"While the versions in Congress and Senate have yet to be finalized, the reform intends to control the looming PHP9.6 trillion worth of unfunded pension liabilities, which may continue to grow if the current scheme prevails," he added.
The DOF has also cited that the MUP pension reform is about saving the pension system and is crucial to the country's post-coronavirus pandemic fiscal and economic recovery.
In a radio program last week, Valery Joy Brion, DOF spokesperson on the MUP pension reform, explained that the Senate's discussions on the proposed reform point to the creation of a dual pension structure.
This will retain the present pension and retirement benefits system of currently active and retired personnel while applying the reform only to those who will enter the service upon effectivity of the law.
Some of the proposed changes include mandatory contributions to fund pensions, discontinuation of automatic indexation, computation of pension benefits at-rank upon retirement, adjustment of pensionable age, creation of a trust fund committee to oversee the MUP pension system, and designation of the Government Service Insurance System as the administrator of the MUP pension system. (PNA)
