Instituting reforms on the country's pension system is about time, a lawmaker-economist said on Saturday, following a 2022 index rating the Philippines as having almost the worst pension system in the world.

Albay Representative Joey Salceda is proposing that both the Executive and the Legislative branches convene high-level task forces to study and enact pension reforms before the term of President Ferdinand "Bongbong" Marcos Jr. ends in 2028.

"I am proposing that the House of Representatives create a select commission on pension reforms, with the mandate to work with national government agencies to craft a full appraisal of the size of the country's pension problem and propose solutions within six months," he said.

"Although not as immediate, this is just as worrisome as the fiscal cliff that major Philippine economists foresaw in the early 2000s, which led us to legislate VAT reforms," he said.

Small space did not deter reforms

"The Arroyo administration then had limited political room, but got the reforms done, President Marcos has the mandate of the vast majority of this country's voters. So, I am hopeful that the economic team will wield that rare popular mandate and commit to reform.

"Neglecting pension reform now will be a sin of omission the next generation would rightly blame us for," he added.

Salceda said the country's pension system "has been steadily sliding and is now among the world's worst retirement systems in the world", based on the Mercer CFA Global Pension Index report for 2022.

The index rated the Philippines as only being second to last to Thailand among 44 countries that account for 65 percent of the world's population.

Salceda believes this has been the result of "decades of neglect, bad policies, special treatment for certain sectors, and a culture that is indisposed to saving for the future have all led to this predicament."

"But now that it has surfaced within our lifetime, it is our duty to solve it," he said.

In the index, the Philippines scored 42.0, slightly above Thailand, which scored 41.7. Countries were rated according to the adequacy, sustainability, and integrity of their pension systems.

"While the country's pension benefits are currently still sustainable relative to much of the rest of the world, it is only because they are woefully inadequate for the needs of old age," Salceda said.

"As a result, if we don't make reforms within this generation, we will burden our children. Gen Z breadwinners will continue to be the retirement plans of their parents. Instead of saving for homes or for their children's educations, they will be supporting the living and medical expenses of their elders. And that will keep us from being a rich country," he added.

The lawmaker called it a "terrible curse" if parents would be "dependent" on their children's wealth.

"Because the ability of our young to build their own wealth will be hampered by the needs of their dependent parents. And that's a terrible curse on our children — a curse only my own generation of policymakers can lift. If we ignore this growing problem, we will be truly irresponsible parents," he claimed.