House approves military, uniformed personnel pension system bill

By Jose Cielito Reganit

September 26, 2023, 6:38 pm

<p><em>File photo</em></p>

File photo

MANILA – The House of Representatives approved on third and final reading on Tuesday morning a consolidated bill providing for a pension system for military and uniformed personnel (MUP).

House Bill 8969, which was approved with a vote of 272-4 with one abstention, also provides for a guaranteed 3 percent annual salary increase for MUP for the first 10 years from the time the proposed law takes effect.

Speaker Ferdinand Martin Romualdez, one of the principal authors of the measure, said the proposed law rationalizes the system of granting monthly pensions and other benefits to personnel of the uniformed services in a way that is fair to them and the national government.

"This landmark legislation demonstrates our unwavering commitment to the men and women in uniform, who risk their lives daily to maintain peace and order. It provides a robust, sustainable, and fair pension system that recognizes their invaluable service to our nation," Romualdez said in a statement.

"With this reform, we're not only prioritizing the well-being of our MUP but also ensuring the country's economic stability. It is a testament to our commitment to national security and fiscal responsibility."

The proposed Military and Uniformed Personnel Pension System Act covers “all employees of the government who wear uniforms, with ranks, may be armed or unarmed, primarily involved in national defense, enforcement of laws, and in the maintenance of peace, order, and security and who belong to any of the following services: Armed Forces of the Philippines, Philippine National Police, Philippine Coast Guard, Bureau of Fire Protection, Bureau of Jail Management and Penology, Bureau of Corrections, and commissioned officers of the hydrography branch of the National Mapping and Resource Information Authority who were transferred from the Bureau of Coast and Geodetic Survey.”

Under the measure, the mandatory retirement age is 57 years, or upon accumulation of 30 years of active service, whichever comes later. MUPs may voluntarily retire after 20 years of service.

For key officers, retirement is upon completion of a tour of duty or relief by the President.

MUP killed in action or wounded in action resulting in total disability, as certified by their respective services, shall be considered compulsorily retired for purposes of computing their benefits.

The proposed MUP pension law further provides that for those already in active service before the enactment of the measure, their monthly retirement pay shall be 50 percent of the base pay and longevity pay of the grade next higher to the salary grade they last held in case of 20 years of service, increasing by 2.5 percent for every year of service beyond 20 years to a maximum of 90 percent for 36 years of service and over.

The retiree may opt to receive in advance in one lump sum his retirement benefits for 36 months and get his monthly pension after three years or receive his pension as it accrues after his retirement.

In the case of MUPs killed or wounded in action resulting in total permanent disability, retirement pay is computed at 90 percent of their base pay plus longevity pay, regardless of years of service.

For new entrants or those who entered or reentered the service after the enactment of the proposed MUP pension law, retirement pay will be 50 percent of their base pay plus longevity pay in case of 20 years of service, increasing by 2.5 percent for every year of service beyond 20 years to a maximum of 90 percent for 36 years of service and over.

The pension of retired MUP and survivorship pension of qualified survivors shall be automatically indexed at a rate not exceeding 100 percent of the increase in the base pay of active MUP holding the same rank during the same year.

The proposed law also creates two MUP trust funds – one for the Armed Forces of the Philippines and another for uniformed personnel services – and an MUP trust fund committee chaired by the Secretary of Finance to administer the funds.

It designates the Government Service Insurance System (GSIS) as manager of the trust funds.

Financing sources for the trust funds shall include mandatory monthly contributions from new MUP entrants at the rate of 9 percent of their salary, with the national government contributing 12 percent; augmentations from unprogrammed appropriations in the annual national budget; proceeds from lease, joint development and disposition of government properties; and government savings.

MUP trust funds will be exempt from all taxes, assessments, fees, charges, or duties of all kinds.

The trust fund committee is mandated to assist indigent pensioners.

The MUP pension bill punishes the commission of fraud, falsification, misrepresentation of facts, collusion, or any similar anomaly in the issuance of any certificate or document for any purpose connected with the proposed law with a fine of not less than the amount defrauded but not more than three times such amount, or imprisonment of six months and one day to six years and perpetual disqualification from holding public office and practicing any profession licensed by the government.

The finance secretary, in consultation with the secretaries of defense, interior and local government, justice, transportation, environment, and budget, as well as the GSIS president and general manager, is mandated to issue the implementing rules and regulations. (PNA)