DBM to address military pension problem

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The Department of Budget and Management (DBM) had created a working group to address the ballooning fund requirement for the pensions of military personnel.

“The biggest elephant in the room is the military pension. The problem started since the Ramos administration.

Right now our estimate is that the funding requirement will be in the account of something like P8 trillion,” Budget Secretary Benjamin Diokno said during the Economic Journalists Association of the Philippines’ Economic Forum held on Thursday at the Ayuntamiento, Manila.

Diokno said past administrations did not address the problem.


“The military pension is based on the current salary of the incumbent. So every time you adjust the rate, the pension will also adjust. Nowhere to go with that kind of system,” he said.

“The Estrada, Arroyo, Aquino administrations had ended but they did not address that issue. We in the Duterte administration are going to address that issue,” he added.

He said the technical working group will tackle the problem before the end of the year.

The pension of soldiers and policemen are sourced from the national budget, which the DBM claims is not sustainable.

This year, the Department of National Defense got a budget appropriation of P137.2 billion.

In a fiscal risk statement for 2017, the Bureau of the Treasury noted that the ballooning uniformed personnel pension continues to be a source of fiscal risk.

The problem can be attributed to the “features” in the retirement laws of the uniformed services, such as the automatic adjustment of a retiree’s pension, according to the report.

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