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DND eyes 'phased' mandatory contribution under new military pension system

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ABS-CBN News

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img alt=" The Philippine contingent composed of members of various agencies prepare before participating in search and rescue operations in quake hit Turkey at the Ninoy Aquino International Airport (NAIA) Terminal 3 in Pasay City on February 8, 2023. Jonathan Cellona, ABS-CBN News/File" src="https://sa.kapamilya.com/absnews/abscbnnews/media/2023/news/07/24/20230208-ph-turkey-quake-response-jc-9.jpg"/><figcaption>The Philippine contingent composed of members of various agencies prepare before participating in search and rescue operations in quake hit Turkey at the Ninoy Aquino International Airport (NAIA) Terminal 3 in Pasay City on February 8, 2023. Jonathan Cellona, ABS-CBN News/File</figcaption></figure></div><p>MANILA — The Department of National Defense (DND) on Monday said it was eyeing &quot;phased&quot; mandatory contributions under the proposed military pension reform. </p><p>The current military pension system is fully funded by the national government, with the retirees not paying any contribution.</p><p>&quot;The transition from non-contributory to contributory shall be phased and not implemented in one go,&quot; Defense Secretary Gibo Teodoro told ANC&#x27;s &quot;Headstart.&quot;</p><p>&quot;The contributor...shall feel the least financial impact as possible,&quot; he added. </p><p>Finance Secretary Benjamin Diokno earlier called for reforms on the military and uniformed personnel&#x27;s pension, which he said was unsustainable and could lead to fiscal collapse. </p><p>The government is estimated to spend P848.39 billion annually for the next 20 years to finance the current pension system, he said. </p><p>He added that the accumulating pension liabilities would likely increase public debt by as much as 25 percent by 2030.</p><p>&quot;We can no longer afford to keep this around,&quot; he said. </p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/news/05/07/23/dof-chief-calls-for-overhaul-of-military-pension-system">&#x27;Big drain to national budget&#x27;: DOF chief calls for overhaul of military pension system</a></li></ul><figure class="op-interactive"><iframe allow="autoplay; fullscreen" frameBorder="0" height="100%" id="ivsplayer01" scrolling="no" src="https://player.ivideosmart.com/ivsplayer/v4/dist/html/iframe-src.html?iframeid=ivsplayer01&amp;key=e8c22c015ca9eafa76f1e3edfa03c603&amp;spid=3001339&amp;vid=2732007" width="100%"></iframe></figure><div class="iwantbar">Watch more News on <a href="https://www.iwanttfc.com/#!/browse/Genres/News/tag_id_genres/id_news" target="_blank">iWantTFC</a></div><p>According to Teodoro, the proposed pension reforms will cover new entry-level officers and enlisted personnel. </p><p>He believes this will not discourage new recruits as &quot;the AFP is a value-proposition in itself; it has very competitive pay skills.&quot;</p><p>&quot;You will have some contribution, the contribution will be even smaller perhaps than one in the private sector and your starting salary will be bigger anyway,&quot; he added.</p><p>The DND and economic managers agreed that the &quot;AFP retirement system shall be separate from the rest,&quot; Teodoro said.</p><p>&quot;There are lines of convergence but it is a distinct discipline and organization from the rest of the law enforcement agencies,&quot; he said.</p><p>Teodoro said President Ferdinand Marcos Jr. might include a general outline of the proposed military pension system in his second State of the Nation Address on Monday, July 24.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/video/news/05/31/23/marcos-says-talks-underway-to-reform-afp-pension-system">Marcos says talks underway to reform AFP pension system</a></li>	<li><a href="https://news.abs-cbn.com/news/05/20/23/marcos-mup-pension-fund-could-be-depleted-in-5-6-years">Marcos: MUP pension fund depleted in 5-6 years if it doesn&#x27;t ‘become self-sustaining’</a></li>	<li><a href="https://news.abs-cbn.com/news/07/19/23/pnp-says-ready-for-proposed-mup-pension-system-reforms">PNP says will not be affected by proposed MUP pension system reforms</a></li></ul><div> </div>

The defense department is eyeing 'phased' mandatory contributions under the proposed military pension reform. 