Integrating the military’s pension system with the Government Service Insurance System (GSIS) could require raising as much as P7 trillion instead of just P4 trillion as initially estimated.
“We already did a study last year but the computation … [is]a bit iffy as of now. What we only know is initially it would require P4 trillion and then it became P7 trillion,” GSIS Chairman Francisco Duque 3rd told reporters.
“As of now, the study is ongoing. At the end of the day, [what is important]is really the funding requirement. So if there is no funding requirement, I don’t think the shift to the GSIS will be happening anytime soon,” he added.
“We can always solve such problem. The question really is if the programs will be sustainable. The P7 trillion requirement I think is already the higher limit of the computation. May be P4 trillion to P5 trillion will be the lower limit.”
The Finance department for its part said it was still completing a study that would determine the feasibility of integration.
“We don’t have the complete information because we don’t have the latest information up to even the end of last year. We are waiting for the new set of data to compete the study,” Finance Secretary Carlos Dominguez 3rd said.
Pensions paid to retired soldiers and policemen are sourced from the national budget, which the Department of Budget and Management claims is not sustainable.
In a fiscal risk statement for 2017, the Bureau of the Treasury noted that ballooning military pensions were a fiscal risk.
The problem was traced to “features” such as automatic pension adjustments mandated by the military’s retirement rules.