SPEAKER Ferdinand Martin G. Romualdez on Tuesday commended the chair and members of the Ad Hoc Committee on the Military and Uniformed Personnel (MUP) Pension System for coming up with a revised version of the reform bill that is now acceptable to all stakeholders, including the Armed Forces and the National Police.

“Salamat sa House Ad Hoc Committee, makakatulog na nang mahimbing ang mga military at uniformed personnel natin gayundin ang kanilang mga pamilya.

Sigurado nang mababayaran ang lahat ng pensyon nila, may dagdag pa silang suweldo taun-taon,” Speaker Romualdez, head of the 312-member House of Representatives, said.

The House leader aired the commendation after he was informed that all stakeholders invited in the first hearing called by the Ad Hoc Committee expressed satisfaction with the provisions of a substitute bill introduced by the panel.

The substitute bill, which was approved by the Ad Hoc Committee with amendments, consolidated all House measures introduced by various Members related to proposed reforms in the MUP Pension System.

Speaker Romualdez ordered the creation of the Ad Hoc Committee to thresh out disagreements over various proposals on the pension system reforms.

It is chaired by Rep. Joey Salceda, chair of the House Committee on Ways and Means. Joining as vice chairs are the chairs of the House Committees on Appropriation, National Defense and Public Order and Security.

Salceda said “let me reiterate the Three Guarantees of this reform: Guaranteed salary increase. Guaranteed pension indexation. Guaranteed funding sources for the pension.”

“This is on top of the President’s commitment to resolve all arrears to pensioners. The House is committed to approving its version on third reading as soon as possible. I thank the House leadership, helmed by Speaker Martin Romualdez, for his trust and for his guidance,” Salceda said.

Speaker Romualdez said the salient agreements reached during the hearing include:

* 90 percent maximum retirement package based on base pay of all MUP, raising by 5 percent the previous package for AFP personnel;

* Include PNP personnel who served below 20 years in list of eligible for separation lump sum;

* Fix to 57 the age of retirement for all MUP;

* Guaranteed 3 percent salary increase annually for all MUP;

* Two separate pension management system, one for AFP and one for civilian uniformed personnel;

* 50 percent indexation for MUP;

* Creation of a window in the pension fund system for disadvantaged pensioners.

Salceda said the representatives of the Armed Forces of the Philippines (AFP), the Philippine National Police (PNP), Bureau of Fire Protection (BFP), Bureau of Corrections (BuCor), Bureau of Jail Management and Penology (BJMP), and Philippine Coast Guard (PCG), as well as their mother agencies Department of National Defense (DND) and Department of Interior and Local Government (DILG) accepted the proposal which was formalized and amended with inputs from today’s hearing.

“We can already see the light at the end of this fiscal tunnel. The services accepted. The economic managers also see the substantial improvement this formula makes over the current system,” Salceda said.

“We are pleased to report to the President and to the public that, today, we have formalized a solution to the MUP Pension problem.

The members of the Ad Hoc Committee on the MUP Pension System have agreed in principle on an MUP Pension Reform that is amenable to both the military and uniformed services and to the economic managers,” Salceda said in a subsequent statement.

The agreed upon provisions, which were moved for approval by National Defense Chair Rep. Raul Tupas, were as follows:

1. Retention of promotion to one rank higher upon retirement;

2. Uniform 90% of longevity pay plus base pay for lump sum benefit upon separation below 20 years in service, which will create a new benefit for the PNP which currently does not have it;

3. Uniform multiple of 1.0 x Years of Service for lump sum benefit;

4. Guaranteed 3% annual increase in salaries for 10 years;

5. indexation of pensions to 50% of adjustment in pay;

6. Creation of window for indigent pensioners under the trust funds;

7. Regular IFRS-compliant reports every three years for the pension system;

There will also be a phased in contribution scheme of 5% of salaries for the first three years, 7% for the next three years, 9% thereafter for active personnel; 9% immediately for new entrants, but including a larger government counterpart to complete the 21% contribution.

“This is a win-win solution, because we are removing the risks of sudden spikes in pension liabilities while also ensuring that salaries and pensions increase at manageable levels.”

Salceda pointed out that “For the past 25 years, the salaries have only increased for nine years, so this is also a win for the active personnel, who will get a salary increase every year for the next ten years.”

“We are also ensuring that all the MUP services will get a separation benefit if they leave the service below 20 years in service. That is a new benefit to the PNP,” Salceda said.