MANILA, Philippines – The Department of National Defense (DND) and the Armed Forces of the Philippines (AFP) are crafting a new policy and system for providing retirement and separation benefits for soldiers.

Defense Secretary Voltaire Gazmin said the new system will replace the AFP-Retirement and Separation Benefit System (AFP-RSBS) which is to be abolished for its failure to attain self-sufficiency in paying retired military personnel.

“Studies for a new retirement and benefit system have already been initiated... the new retirement system that will eventually take-over the AFP-RSBS and at some time in the future, relieve the national government from supporting military retirement benefits,” said Gazmin.

Gazmin said he instructed the RSBS through the office of the AFP chief-of-staff and chairman of the board of trustees General Ricardo David to conduct the study.

The AFP-RSBS was established in 1973 to take over from the national government in supporting the pension requirements of AFP retirees, after a period of 25 years. It was initially funded with P200 million from the national treasury.

“For various reasons, this objective of self-reliance in funding pensions and benefits was not realized,” said Gazmin.

From the goal of self-sufficiency, the government turned out to be continuously shelling out money to shoulder the retirement expenses for retired military personnel.

This prompted then President Gloria Macapagal-Arroyo, through the recommendation of then Defense Secretary Gilberto Teodoro  Jr. to issue Executive Order No. 590 in 2006 which ordered the dissolution of the RSBS.

Gazmin said they immediately planned to expedite the creation of new retirement system for soldiers in response to the concerns raised by Sen. Ralph Recto, chair of the Senate ways and means committee, regarding the possibility of the government ending up shelling out more money for the pension benefits of retired soldiers and policemen than for the salaries of those still in active service.

“The possibility of an integrated retirement benefit system which will support the pension and other retirement benefits of all uniformed service personnel will also be studied,” said Gazmin.