ECONOMIC MANAGERS will send to Congress by this year a proposal that will transfer the military pension scheme to state-run Government Service Insurance System (GSIS).
Budget Secretary Benjamin E. Diokno told reporters yesterday “We will submit a draft (bill) before the end of the year” that will enable GSIS to handle troop’s pensions.
He added that they will also determine where to get the needed P7 trillion as seed fund.
Mr. Diokno said the bill will mandate new recruits to contribute to their own pension, to be in the hands of GSIS, adding that “right now, they are not paying anything…for their contribution in the pension fund….So they will have to contribute.”
The P7 trillion for the military’s pension is an initial estimate and “is not final,” Mr. Diokno said. “It may be higher than P7 trillion, I don’t think it’s lower….This is a work in progress and we are in the middle of addressing this monumental problem during the term of the President.”
The Bureau of the Treasury, together with the GSIS, is currently conducting actuarial work for estimating the overall liability.
The Budget secretary said payments for military pension account for P90 billion — or about two-thirds of the Department of National Defense’s P134.29-billion budget this year, and which could double if not addressed, he noted.
Mr. Diokno said they are looking into selling the Bases Conversion and Development Authority properties to partially fund the required amount.
“We’ll identify some assets that will pay for the P7 trillion. If that isn’t enough, then we will pay through the budget. But it needs to be over time. That is our future liabilities so it’s not an annual one-time settlement. — Elijah Joseph C. Tubayan