Military and uniformed personnel pension conundrum [BusinessMirror]

From BusinessMirror: Retirement pensions, especially for those who have served honorably in the AFP and other uniformed services, must be treated as a vital part of an incentive package for retirees as well as for those planning to serve the country through the profession of arms. This was the stand of the Philippine Military Academy (PMA) “Matatag” Class of 1971 Inc. in its position paper.

Military and uniformed personnel pension conundrum

PMA ’71 position paper: Military retirement benefit a just due for service ‘paid in blood’

MAY 6, 2023

RETIREMENT pensions, especially for those who have served honorably in the Armed Forces of the Philippines and other uniformed services, must be treated as a vital part of an incentive package for retirees as well as for those planning to serve the country through the profession of arms.

This was the stand of the Philippine Military Academy (PMA) “Matatag” Class of 1971 Inc. in its position paper prepared primarily by retired Vice Admiral Ariston Delos Reyes and Col. Rolando Malinis.

It is based mainly on several studies of Delos Reyes and Malinis’s book titled Brothers, and significant contributions from former Senator Panfilo “Ping” Lacson, also from PMA ’71, and other “mistahs,” retired Commander Bienvenido Alano, Retired Col. Marte Chioco and other class members.

The position paper is an offshoot of the pronouncement of Department of Finance (DOF) Secretary Benjamin Diokno on March 28, 2023, about the Marcos administration’s intent to overhaul the pension system of military and uniformed personnel (MUP).

Salient points of that announcement focused on the non-contributory systems of the MUP retirement pensions and indexation of pension, as well as current payments received by those in the active service; and Diokno’s assertion that the current MUP retirement system is not sustainable and, if not reformed, could lead to fiscal collapse in the future.

Perk for hardships

“RETIREMENT pensions should be seen as a vital part of an incentive package for: a) retirees who not only served the country well, but also gave more during their active service tour by working beyond the mandatory eight-hour daily shift without overtime pay, and being assigned on various missions like national defense, internal security operations, UN peacekeeping missions, and disaster relief operations at great sacrifice to life and limb; and b) as a motivation for capable and promising young men to choose the profession of arms,” the paper’s executive summary read.

It added that the need for sound budget outlay must be balanced with the motivational needs of the MUP.


THE PMA Class of 1971’s paper also clarified that the MUP pension is not ballooning as claimed in earlier reports.

“The data gathered indicated that the main problem is not the growing financial requirements of the MUP pension, but the neglect of the government to sufficiently adjust its budget to cope with the capability development and operational requirements of the military; the fallacy of the Government Service Insurance System (GSIS) study about the P9.6-trillion liability of the MUP pension and its insufficiency as basis for outright and drastic changes to the MUP pension system.

“In 2021, then Senator Lacson emphasized the need for such completed actuarial study; and that the MUP Retirement System will cause fiscal collapse in the future was debunked,” it stressed.

Suggestions and recommendations:

TOWARD this end, the paper presented the following recommendations:

• That the proponents of pension reform led by Secretary Diokno heed the advice of Chief Presidential Legal Counsel Secretary Juan Ponce Enrile as well as the appeal for prudence by former Senator Lacson, and wait for the much-needed, completed actuarial study;

•That during preliminary discussions and consultations by the proponents with MUP and other stakeholders, an alternative bill on pension reform be duly considered with the following salient provisions:

• Equalize the MUP disability pension as mentioned by the President during his State of the Nation Address (SONA) in 2022;

ª Equalize the maximum MUP pension at 90 percent of base pay and longevity pay, thereby adjusting that for the military (85 percent at present); and,

• Ensure that the MUP and all other existing non-contributory pension systems are indexed to account for inflation.

“That the Presidential Adviser on Legislative Affairs consider recommending to the President to certify as urgent a Joint Resolution authorizing the increase in MUP base pay for 2024-2027, to be at par with that granted to all civilian government personnel in 2020-2023, pursuant to RA 11466. The pay adjustment should be strictly in accordance with RA 9166 of 2002,” it noted.

Republic Act 11466 is known as “An Act Modifying The Salary Schedule For Civilian Government Personnel And Authorizing The Grant of Additional Benefits, And For Other Purposes.”

Republic Act 9166 refers to “An Act Promoting The Welfare Of The Armed Forces of the Philippines by Increasing the Base Pay and Other Benefits of its Officers and Enlisted Personnel And For Other Purposes.”

It may be recalled that the President, during his SONA on July 25, 2022, mentioned that among his priority legislative measures would be the grant of monthly disability pensions in lieu of unequal disability benefits under existing laws for the MUP.

But this does not include changes in the MUP pension system as again being proposed by Diokno, which are similar to those contained in various bills, which were not passed into law during the 18th Congress (2019-2022).

Veterans’ benefits shall be provided by the government

ACCORDING to the position paper by the PMA Class of 1971 Inc., funds for the government shall provide the payment of benefits of veterans.

This is pursuant to Section 7, Article XVI of the 1987 Constitution of the Philippines, it emphasized in its position paper.

“Such benefits include, among others, AFP retirement pension, old age pension and total administrative disability pension, which have all been funded by the government,” the position paper read.

It also stressed that this provision is consistent with the military’s non-contributory pension system that has been in effect since 1935 pursuant to Commonwealth Act No. 1.

“The military career is a noble profession of arms. This calling is unique from all other professions, as it calls for those who pursue it to defend our country even if it means sacrificing their lives.”

In its paper, the PMA Class of 1971 cited the Code of Conduct of the Philippine Military, which states:

“…I am a Filipino soldier. I will fight and die in the true Filipino tradition of valor, honor, duty and loyalty. To all these I pledge my life, my treasure and my sacred honor.”

Similarly in the United States, Article One of the Code of Conduct for members of the Armed Forces states: “I am an American fighting in the forces which guard my country and our way of life. I am prepared to give my life in their defense.”

And this is why for the US government, the non-contributory pension system is exclusive to the military, it being considered as a gift of the American people to their soldiers for their honorable and dedicated service.

Paid in blood

THE following partial list of actual deaths of soldiers in the battlefield is being presented as proof that the sacred oath of the military to die for the country is real and not a mere statement:

• In November 1972, the casualty count at the Battle of Sibalu Hill listed 15 Marines killed in action (KIA) and 22 wounded;

• At the height of the conflict in Mindanao in 1973 when the government almost lost Central Mindanao to the Moro National Liberation Front (MNLF), the military forces at the Battle at Lebak lost 48 soldiers; there were 148 wounded, and one missing. Subsequent battles in Central Mindanao led to heavier casualties: the Army reported at least 149 deaths and 506 wounded.

•During the confrontation between the MNLF and the government in 1974, also known as the burning of Jolo or Siege of Jolo, 29 soldiers died;

• Government troops and Muslim rebels clashed on Basilan Island on April 30, 1978, which resulted in the deaths of 11 government soldiers;

• The Patikul Massacre, referring to an event that took place on October 10, 1977, in Patikul, Sulu, led to the death of 35 officers and men of the Philippine Army. Among the casualties were Brig. Gen. Teodulfo Bautista, Col. Gabriel Pangilinan, and four lieutenant colonels;

• In the infamous Mamasapano clash in 2015 between the Special Action Force of the Philippine National Police and the Moro Islamic Liberation Front, 44 police commandoes were killed; and;

• More than 165 soldiers died during the Marawi Siege in 2017.

“Our soldiers did not die in vain. Their supreme sacrifices, as well as the sufferings of those who survived, bore fruit. For one, they have fulfilled their mandate of protecting the people, territorial integrity, and sovereignty that goes with securing our democratic way of life and institutions; they have prevented the loss of Central Mindanao in the early 1970s Secessionist War; and they have halted the loss of more lives and further destruction of properties in Mindanao and other hotbeds of insurgency,” the PMA Class of 1971 Inc. position paper read.

DND appeals for understanding

MEANWHILE, the Department of National Defense (DND) said the government is fully aware and recognizes the concerns of active and retired soldiers about the proposed reforms for the MUP pension system to avoid fiscal collapse.

In a statement, DND chief Carlito Galvez Jr. appealed for understanding among members of the ranks, even as options are being carefully evaluated.

“We would like to give our assurance to our stakeholders that the government will always look after the welfare and livelihood of our men and women in uniform,” he said.

Galvez said they would also conduct consultations with active and retired uniformed personnel regarding the matter.

The DND chief stressed that the government is looking to adopt a more financially sustainable MUP pension system, to be founded on sound financial solutions and application of actuarial science.

“The government’s economic team is undertaking financial simulations to determine our optimal option. Just like in the case of Republic Act 11709, we are doing our best to determine and address the unintended consequences that may arise from proposed reforms on the MUP pension system,” Galvez said.

He also shared that President Ferdinand R. Marcos Jr. is looking for creative ways to provide benefits for uniformed personnel in grateful appreciation for their service, as the country works towards its post-pandemic economic recovery.

“Thus, we are appealing to our stakeholders to be circumspect and understanding of those who are working on the issue, and support our efforts in seeking solutions that will be beneficial to all, especially for our national fiscal health,” Galvez added.