‘Our uniformed personnel deserve genuine solutions and sustainable support, not empty promises that cater to a political agenda.’
THERE’S no disputing our profound debt of gratitude to military and police personnel for keeping our nation secure and our communities safe.
It’s this very sentiment, perhaps, that inspired Senate President Francis Escudero to file Senate Bill No. 276 seeking to establish a P20-billion trust fund for uniformed service personnel.
While seemingly noble on the surface, this proposal threatens to deepen an already cavernous fiscal crisis and reeks of political pandering to the very institutions that should be shielded from such.
The bill aims to institutionalize a Comprehensive Social Benefits Program (CSBP) trust fund, extending coverage to a wide array of uniformed services, from the Armed Forces, the Philippine National Police, to the Philippine Coast Guard, and their dependents.
The proposed fund will finance lump-sum financial assistance for death or total disability, educational scholarships, aid for home construction, and health and medical assistance, on top of the regular pension.
But this seemingly benevolent gesture cannot be viewed sans suspicion. It comes at a time when the nation grapples with a gargantuan P14-trillion unfunded liability in the military and uniformed personnel (MUP) pension scheme.
It’s a crisis that has been ballooning for years, up from P9.6 trillion in 2019. The problem lies in the MUP’s non-contributory nature.
Unlike private and other public sector workers who diligently contribute to their SSS and GSIS pension funds, uniformed personnel receive pensions without contributing a single peso. This means the government is forced to appropriate a staggering P140 billion annually to cover these pension payouts.
The situation is further exacerbated by the automatic indexation of retirees’ pensions to the salaries of active personnel — any salary adjustment will directly translate to a higher pension for retirees.
Finance officials have been ringing alarm bells since 2023, stressing the utter unsustainability of this system. Their proposed solutions, among others, were mandatory contributions from uniformed personnel and the removal of salary indexation.
The Senate Economic Planning Office, in a 2024 paper, even recommended further raising the retirement age and establishing an MUP Compensation and Retirement Modernization Commission.
Predictably, proposals to reform the MUP pension have been met with fierce resistance from both active and retired personnel, who argue their sacrifices for national security warrant their current benefits, and for a status quo on non-contributory fund.
Now, Escudero’s P20-billion proposal enters the already volatile landscape. While the intent is laudable, the timing and the potential fiscal implications are troubling.
This P20 billion, without clearly defined and sustainable funding sources, will simply carve another gaping hole in the national budget.
It’s an additional burden on top of an already unsustainable pension system that is draining national coffers at an alarming rate.
In 2022, the senator advocated for a sustainable pension system and even reminded government not to forget to fix the ballooning liabilities in the MUP pension. He appeared to have forgotten this by throwing more fuel to the fire with his proposal.
After delaying the impeachment trial of Vice President Sara Duterte, which endeared him to the Duterte bloc and appears to give him a second Senate presidency, Escudero is clearly attempting to curry favor with the powerful military and police establishments.
Selling them false hope with a P20-billion trust fund, while ignoring the elephant in the room – the P14-trillion unfunded pension liability – is an irresponsible act of political opportunism.
Our uniformed personnel deserve genuine solutions and sustainable support, not empty promises that cater to a political agenda.
Indeed, the future welfare of our uniformed services demands a more honest and fiscally responsible approach.
