MANILA State pension fund Government Service Insurance System (GSIS) is inclined to take in newly-hired uniformed personnel under its social security coverage in support of President Duterte's thrust for a more sustainable pension fund for soldiers and policemen.
To be covered under GSIS are newly-appointed commissioned officers and enlisted personnel in the Armed Forces of the Philippines, Philippine National Police, Bureau of Fire Protection, Bureau of Jail Management Penology, Philippine Coast Guard, Bureau of Corrections and commissioned corps of the national Mapping and Resource Information Authority, GSIS President and General Manager Jesus Clint Aranas said.
In fact, our earlier pronouncement to accept newly-appointed uniformed personnel as members of the GSIS has taken a more concrete direction now that we have made it part of our proposed revisions to Republic Act No. 8291 (GSIS Act of 1997), Aranas added.
However, the pension fund chief stressed that GSIS cannot afford to absorb existing personnel and retirees as they are not required to pay contributions, and that their pension is anchored on an automatic indexation system - where the pension amount is continually adjusted to match the prevailing salary of the incumbent personnel of the same rank.
We cannot commingle the fund of the existing uniformed personnel with the coffers of GSIS. We suggest setting up another corporation for them. GSIS can manage the fund of this separate entity. We will only charge management fee if the fund will earn. But again, we need to clarify the benefit structure that will be put in place, Aranas said.
Aranas pointed out that under the proposed bill, new entrants who received their initial appointments after the effectivity of the new GSIS law will be accepted to the Military and Uniformed Personnel (MUP) Insurance Fund.
This is a more seamless and financially viable option. GSIS will manage the MUP Insurance Fund separately and independently from the Social Insurance Fund and other funds it administers. It will be contributory in nature and prospective in application, Aranas explains.
The necessity of creating a special fund for the uniformed personnel stems from the high-risk nature of their jobs and early retirement age of 56 years old, thereby contributing only for a short period and enjoying retirement benefits longer.
Under the proposed GSIS bill, uniformed personnel who will be covered by GSIS will mandatorily contribute premium and life insurance contributions through automatic salary deductions to qualify for future benefits.
At present, GSIS members pay a monthly premium of 9 percent of their salary while their employers shoulder 12 percent to complete the required total premium of 21 percent. (GSIS PR)
Source: Philippine News Agency