AFP concerned about looming crisis on pension system

MANILA, Philippines – The Armed Forces of the Philippines (AFP) yesterday expressed concern over the looming crisis in the military’s pension system that could affect the retirement benefits of soldiers.

AFP public affairs chief Col. Arnulfo Burgos Jr. said they have undertaken measures to avert a possible crisis.

“We in the AFP have long recognized and anticipated this problem which may occur in the pension system by year 2016,” Burgos told The STAR.

“We are actually concerned about this potential problem, knowing that many of our soldiers in the active service will be affected,” he added.

Burgos said the problem could be prevented by state agencies dealing with the military’s retirement system.

“We are optimistic that concerned authorities would be able to address and avert this potential problem,” he said.

Burgos said the AFP is continuously ensuring the integrity of the military pension payroll to avoid ghost pensioners, adding that a system is in place to verify the authenticity of documents being submitted by retirees and their beneficiaries.

“The system entails regular coordination and cross-checking with other agencies like the Philippine Veterans Affairs Office (PVAO), National Statistics Office, the Bureau of Immigration and the Ombudsman,” he said.

On Monday, Budget Secretary Florencio Abad warned of a looming crisis in the AFP pension system as budgetary requirements for pensions are seen to overtake those for active personnel by 2016.

“We have to resolve this looming problem in the pension of our uniformed personnel decisively at the soonest time possible,” Abad said.

“It is very likely that in the next five years, the government will allocate more funds for the pension requirements of retired military personnel than the salaries of those still active in service,” he added.

According to the budget secretary, the pension benefit requirements of the military or those under AFP and PVAO would amount to P67 billion by 2016. This would overtake the projected personal services requirements for active military staff of P63.7 billion.

Abad said the Department of Budget and Management and the Government Service Insurance System would conduct a study and create a system that would ensure the sustainability of the retirement scheme.

The national government shoulders the benefits being given to retired military personnel. The amount of pension requirements is growing due to the increasing number of retirees.

There are about 4,000 to 5,000 new retirees every year. The government owes around P16 billion to about 112,000 military pensioners.

The AFP Retirement and Separation Benefits System had earlier called for the passage of a bill that would reform the pension system to reduce the government’s ballooning pension requirements.

The bill calls for the scrapping of the “indexation” provision of the current retirement law, which raises the retirees’ benefits whenever the salaries of active soldiers are upgraded. –Alexis Romero (The Philippine Star)