Restructured MUP signed before yearend – Estrada

MANILA, Philippines — The Senate hopes to pass the reformed pension system of military and uniformed personnel before yearend, according to Sen. Jinggoy Estrada.

“There is no pension without contribution,” Estrada said in an interview with “The Chiefs” on Cignal TV’s One News, as MUPs continue to oppose the reform.

“We are not messing with the pension of retired personnel. (This will only affect) active and new entrants,” he said.

The current MUP pension system is non-contributory and, as such, retirement pensions and benefits are fully funded by the government through annual appropriations.

Under the proposed reform, active personnel would contribute five percent of their monthly pay to their retirement fund for the first three years. New military entrants would be contributing nine percent of their basic salary and longevity pay.

Economic managers led by Finance Secretary Benjamin Diokno earlier claimed the MUP pension needs to be restructured to prevent a fiscal collapse.

The MUP pension payout this year is around P213 billion, projected to reach P1 trillion by 2035.

Estrada vowed to invite retired Navy vice admiral Ariston delos Reyes of the Philippine Military Academy Class 1971 as a resource person.

In the same interview with The Chiefs, Delos Reyes said that MUPs should not be singled out as members of the judiciary, prosecution service and constitutional commissions do not contribute to their pension.

Estrada said he was not aware that the judiciary’s pension is also non-contributory.

“We want to have a win-win solution here because this is a very delicate and complicated problem,” he noted.

Delos Reyes questioned the “fiscal collapse” claimed by economic managers.

“Is there a crisis? Will 0.5 percent of the (gross domestic product) cause a financial crisis?” he said, as the Philippines’ GDP is at P23 trillion while the 2023 MUP pension is at P128 billion or around 0.5 percent.

Estrada hopes economic managers will “refrain from using that term fiscal collapse or fiscal crisis, as if the government will collapse if we don’t take action on this MUP pension problem.”