Executive Secretary Eduardo Ermita admitted the government was unable to face its obligations to the veterans with the billions in arrears for monthly pensions and other benefits due to lack of funds.

Ermita assured the government is trying to look for new sources of funds, including the possibility of submitting a supplemental budget to cancel the pension backlog.

"One of the recommendations is to submit a supplemental budget that would include the arrears in the veterans’ pension. Let us see what the Department of Budget and Management (DBM) will do," he said, adding, "Any supplemental budget must be done, without adding to the government’s deficit woes."

The Palace official encouraged the grumbling veterans to usek a more diplomatic approach to their problem by seeking an audience with Budget department officials, led by Budget Secretary Emilia Boncodin, about the matter.

"I’m sure they are in their correct sense to understand that aside from demonstrations, there are other ways to bring this to the attention of the administration, Maybe, they can get just organize a group that can have a meeting with the DBM so they can get a more direct answer," he said.

Reports said the estimated 300,000 veterans are planning to hold a series of protests and ask other militant groups to hold similar civil disobendience rallies to force the government to pay up.

Ermita said the government is not threatened by civil disobedience from the Filipino war veterans, saying most of them are "very sensible" and would likely not push through such plan.

"They are retired officers of the Armed Forces who pledged to safeguard our security. They are the last ones to even think of destabilization," he added.

He also disclosed the government’s plan to develop part of the Veterans Memorial Medical Center, a prime lot in Quezon City, to raise funds for retired officers.