CSC: Proposal to scrap mandatory retirement may affect pension benefits of government workers

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Metro Manila (CNN Philippines, August 10) — Scrapping the mandatory retirement age will potentially affect the fund life of the Government Service Insurance System that provides retirement benefits to public sector workers, the Civil Service Commission said Wednesday in reaction to a proposal to allow continued employment even after the age of 65.

"If you lift the mandatory age of retirement, you have to consult GSIS on this because you're talking about the fund life of the GSIS," CSC Commissioner Aileen Lizada Lizada told CNN Philippines' The Source.

"It has been set who will retire, when will they retire. The funds of GSISS have been invested so they know the ROI (return of investment), they know how much is involved when one retires," she added.

According to the GSIS, the optional retirement age in the Philippines is 60 while the compulsory retirement age is 65.

Lizada noted that among members of the Association of Southeast Asian Nations, the Philippines has the oldest mandatory age of retirement. She said she even surveyed in the past some employees about their ideal age of retirement, and almost all wanted a lower age of 56-60.

"When I went around, I consulted employees in 2019, 98-99% are for the lowering of optional age of retirement of 60-56 but mandatory retirement still remains at 65 so that they can finish the 15 years of service," she said, adding that many employees get easily burned out due to the nature of their jobs.

Under Republic Act 8291 or the Government Service Insurance System Act of 1997, those who have rendered at least 15 years of public service and are 60 years old upon retirement can avail of their pension. Lizada said this law also complements the Republic Act 10911 or the Anti-Age Discrimination in Employment Act, which recognizes the employee retirement and voluntary retirement plan in accordance with the Labor Code.

She said the proposal may also affect the pension benefits of future retirees. She noted however, that employees who still want to work for the government beyond the age of 65 can serve as consultants, but this will not count as government service anymore.

Senior Citizen Party-list Rep. Rodolfo Ordanes Jr. earlier proposed an amendment of the Labor Code by adding a provision allowing an employee beyond 65 years to continue his or her employment as long as he qualifies under the bona fide occupational qualifications of his job.

Socioeconomic Planning Secretary Arsenio Balisacan recently supported this suggestion, noting that many senior citizens up to 70 years still consider themselves as "very productive members of our society." He stressed, however, the importance of guiding them in finding suitable career options.