AFP adopting new pension plan to avert fiscal crisis
The Armed Forces of the Philippines (AFP) is bracing its soldiers and retirees for an overhaul of its pension system.
The military has embarked on a mass information campaign on a proposed new retirement benefits law that would do away with the automatic increase in pension rates when the salaries of soldiers are increased.
In its information campaign, the AFP told soldiers and retirees that reforms in the pension system were needed to avert a crisis in which the government would no longer be able pay the billions of pesos in annual pension requirements.
AFP Deputy Chief of Staff for Personnel (J1) Brig. Gen. Honorato de los Reyes said they would use “all available means of communication” to make sure that soldiers and their families are properly informed of the proposed retirement and benefits system.
News of the planned deactivation of the AFP Retirement and Separation Benefits System (RSBS) has triggered misgivings among retired and active soldiers.
De los Reyes said that until the new retirement plan is approved by Congress, the current AFP retirement law for or Presidential Decree 1638 is still in effect and remains unchanged.
He said the objective of the new plan “is to make the system more effective and sustainable for the AFP.”
According to the AFP information message, the other provisions of the draft proposal include raising the retirement age from 56 to 58; no longer being promoted to the next rank upon retirement; deactivation of the RSBS; increase in members’ contributions and in the government’s counterpart in the pension fund; and computations for periodic adjustments of separation and retirement benefits.
RSBS president retired Rear Admiral Emilio Marayag had said that without the reforms, the annual pension requirements for soldiers alone would reach P1 trillion by 2040.
