House eyes increase in retirees’ pension

MANILA, Philippines – The new leadership of the House of Representatives is eyeing an increase in the monthly pension of retirees.

“It is only right and just that the pensions of our retirees should be adjusted upwards so they can buy their groceries and their medicine at today’s prices,” newly elected Speaker Pantaleon Alvarez said on Monday after assuming the top House job.

“If we need to increase contributions so we can fund the increase in pension benefits, then we must. We must adjust not only to meet present needs but also to anticipate future needs,” he said.

He also called for a review of labor laws.

“The labor laws need revision. We should increase the penalties presently in our statutes for the non-payment of minimum wage, and the National Wages and Productivity Commission and DOLE (Department of Labor and Employment) should have an arm that will make sure violators are prosecuted. The practice of ‘endo’ should be looked into,” he said.

Endo (end of contract) is the notorious practice of employers who terminate workers before their six-month contract expires to skirt the regularization requirement under the law.

Alvarez’s pension adjustment plan apparently covers all pensioners, whether from the government or private sector.

The 16th Congress had passed a bill increasing the monthly pension of retired private sector personnel from the Social Security System (SSS), but then president Benigno Aquino III vetoed it.

Aquino said approving the adjustment without a corresponding increase in premium contribution would eventually result in the collapse of the SSS.

Authors of the vetoed bill have re-filed the measure in the 17th Congress.

As for military pensioners, Budget Secretary Benjamin Diokno has a problem with increasing their monthly benefit.

Last week, Diokno said he and President Duterte have agreed to discuss the problem after the latter’s State of the Nation Address.

“In six years’ time, the amount of budget for pension will be about 80 percent of the total budget for the military, while only 20 percent will go to the salaries of active personnel,” he said.

“In the past administration, the pension of the military and the police was indexed to the salary of the incumbent. With the increased salary of the military and police, the pensioners got higher pension. In fact, the pension of military retirees is much higher than the salaries of incumbents. In the police, it’s almost equal,” he said.

He added that for 2017, the amount needed for military pensions is P80 billion.

The Cabinet-level interagency Development Budget Coordination Committee (DBCC) had warned Congress about the ballooning military pension, calling it a “fiscal risk.”

Aware of the problem, Aquino had proposed the suspension of the indexation feature in the military pension system in presenting to lawmakers the draft Salary Standardization Law 4, which the last Congress failed to pass.

Authors of the proposed law have re-introduced the measure with its indexation provision suspended.