DBCC flags ballooning military pensions

The Marcos Jr. administration's economic team has once again flagged the fiscal risks arising from the ballooning pension of military and uniformed personnel (MUP), which, if left unaddressed, would impact not only the national coffers but also the pensioners themselves.

- Ben Arnold de Vera

"The need to reform the MUP pension system has consistently been identified as a significant risk observed by the national government (NG) throughout the various iterations of this report. Since MUP pensions are fully funded by the general appropriations act (GAA), any fiscal and/or economic shock affecting the NG would directly impact not only the NG fiscal position but also MUP pensioners," the Cabinet-level, interagency Development Budget Coordination Committee (DBCC) said in its Fiscal Risks Statement 2026 published on Thursday, Dec. 11.

Since the Benigno Aquino III administration, the DBCC has been flagging the continued rise in MUP pension payments as a fiscal risk, straining the government's limited budget resources.

As of 2023, government estimates showed that MUP's unfunded liabilities soared to at least ₱9.6 trillion from only ₱5 trillion in 2016. Unfunded liabilities refer to the amount anticipated as future payouts for active personnel as well as current pensioners.