Teodoro to review military uniformed personnel pension plan
Defense Secretary Gilbert Teodoro Jr. will review the military uniformed personnel (MUP) reform plan as President Ferdinand Marcos Jr. directed him to address pension issues following his appointment as the new defense chief.
"As I understand it, a team (is) going around now composed of economic officials and Department of Defense officials... and I'm going to review the plan in the coming days because that is the first marching order of the President," he said in a television interview on Wednesday night.
Teodoro said the instruction of Marcos "is to reduce the financial burden on the government, which can be unsustainable, if not remedied."
The House committee on ways and means estimates the cost of the pension plan at P141.06 billion for this year. It estimates this will increase 12 percent yearly.
"My job being to intermediate once again, between the end beneficiaries, who are our troops in the service right now, and the legislature which will enact the MUP reform plan. Having said that, also another issue is how to find the source for the seed capital if it's going to be a fund at all. That is another thing we have to look into," he said.
"If it's not remedied, and it's unsustainable, everybody will suffer because not only the soldiers but there's going to be inflation. There's going to be bigger deficits and the like," he added.
As he emphasized other benefits for the MUP, Teodoro expressed optimism that soldiers "will not mind contributing to the welfare of the country."
"It's really a matter of studying what is best for everyone. I'm sure our soldiers will not mind contributing to the welfare of the country since they're already risking their lives just as long as they know that their contributions. Not financial, but their sacrifices are put into something that will take care of them in the long run and their families," he said.
"I'm sure our soldiers if a system which is fair takes into account the sacrifices that they make, and they see that whatever is required to contribute. They will see that at the end of their tour of duty, they will get something that will take care of them. There are other benefits that can take the place of monetary benefits, like medical benefits, insurance and a like," he added.
Citing his experience in the financial sector, Teodoro said the fund should be loaded and mature before it can be totally self-sustaining.
"It's going to be a lot of sourcing required of the fund but there are things that I will insist on firstly of course, to grow the fund you need to take some risk, no risk, no reward, no growth. However prudential standards as the financial sector knows it should be in the law regarding the pension system if via funds or another system," he said.
"Secondly the management of that fund should be what the BSP calls the fit and proper rule, thirdly there should be total transparency and reporting of the fund," he added.
Teodoro said the fund should be subjected to the standard of the Department of Finance, Insurance Commission or Bangko Sentral ng Pilipinas rather than the Commission of Audit.
"(The) financial techniques and daily financial transactions are not within the ambit, I think, of the state audit code as amended," he said. Robina Asido/DMS
