Press Release
April 8, 2007

Govt owes veterans, military retirees P40 B - Recto

Government owes veterans and military retirees about P40 billion in pension arrears and a senator said a plan must be put in place on how to settle these obligations.

Sen. Ralph Recto said accounts payable to former soldiers can be drawn from improved finances of the government and future revenue stream.

If we are going to balance the budget in 2008, and declare victory in the fiscal wars by then, shouldnt we start paying the balance of what we owe to those who fought real wars for us? Recto said.

The re-electionist senator was referring to the plan of the government to balance the budget in 2008, meaning the government would be financing its budget without taking out any loan, which would be the first time since 1994.

Recto said Defense and Budget officials admitted in a hearing called by the Senate defense committee on Aug. 23, 2005 that total arrearages in veterans benefits by the end of 2005 would be P39.26 billion.

The amount was broken down as follows: P26.35 billion in benefits administered by the Philippine Veterans Affairs Office and P12.90 billion in benefits granted by the Armed Forces of the Philippines .

The amount has breached the P40 billion mark by now, Recto said, despite billions of pesos in annual appropriations for pensions of veterans and military retirees.

Half of the arrears is due to unpaid total administrative disability pension or TADP which was authorized by Republic Act 7696.

Recto described the TADP as an unfunded mandate, a case of mandating expenditure without specifying how it can be funded, resulting in a backlog of claims without any corresponding funding scheme.

There should be an agreed solution, to which all parties must sign in, on how to settle these arrears over a prescribed period of time, he said.

The TADP allots a P1,700 monthly pension for a veteran, or P500 to a surviving spouse , or to an unmarried minor child of a deceased veteran.

The TADP is on top of old -age pension of P5,000 a month, disability pension of between P1,000 to P1,700 a month, depending on gravity of disability, and a death pension of P1,000 to a surviving spouse, unmarried children or parent of a veteran.

Other benefits include educational, medical and burial assistance.

All of the above entitlements are being implemented except for TADP , which is supposed to be given to a veteran once he reaches 70 years of age, whether he has disability or not.

To its credit, government has been allocating big amounts for veterans welfare yearly, Recto said. This year, pension for veterans and retired uniformed personnel will reach P31.7 billion, of which P15. 2 billion will be given to PVAO, Recto said.

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