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Speaker Romualdez: Economic team, House leaders reach consensus on MUP pension reform funding

The Marcos administration's economic team and the officials of the House of Representatives have reached a consensus on how to fund the reforms needed for the Military and Uniformed Personnel (MUP) pension system, Speaker Martin Romualdez said Wednesday. 

"I am happy to report that we have reached a consensus after a three-hour meeting. We all agreed on a solution that we believe will be beneficial to all stakeholders in the MUP pension program," Romualdez said, according to a tweet from GMA Integrated News’ Sandra Aguinaldo.

The House created an ad hoc committee on the MUP pension systems chaired by Albay Second District Representative Joey Salceda.

The committee will lead all matters relating to the reforms of the pension systems, including funding and revenue sources, management and schemes, contributions and benefits, and provisions on fiscal sustainability.

The following will serve as vice chairpersons: Representatives Raul Tupas, Elizaldy Co, and Danilo Fernandez.

The members include Representatives Edwin Olivarez, Dong Gonzales, and David Suarez. 

Salceda said his election as committee chairperson guarantees three things: a sure salary increase, indexation of pensions, and funding for the pension system.

"President Marcos has already helped address the problem by being very responsible about any salary increase for the MUP before a viable pension system is in place. And with this reform, his government will solve the pension problem for decades to come," the lawmaker said.

"This solution also enables a salary increase for the MUP since we can control its fiscal consequences on the pension system," he added. 

The reform of the MUP pension system was among the key measures cited by President Ferdinand "Bongbong" Marcos Jr. in his second State of the Nation Address on July 24. 

''We are inclusive in our pursuit of social protection. The pension of the military and uniformed personnel is as important, urgent, and humanitarian as that of all other civilian Filipino employees,'' Marcos said.

''Efforts are underway to make it fully functional and financially sustainable. We are once again working closely with Congress to ease the transition from the old system to the new one, so as to be able to guarantee that no effects are felt by those in the uniformed services.''

In May, the President pushed for "self-regenerating" pension plans for both the Armed Forces of the Philippines and the Philippine National Police in an effort to avoid a scenario in which funds would be depleted.

The economic team, headed by Finance Secretary Benjamin Diokno, had warned of the consequences of the pension payments, with the total yearly payouts expected to hit the P1-trillion mark by 2035 from P213 billion in 2023.

Diokno previously said the impact of the MUP pension reform would be felt by the first month of 2024 after Defense Secretary Gilbert Teodoro Jr. said that the MUP pension reform would be passed into law by the end of the year.  —VBL, GMA Integrated News