THE NATIONAL Electrification Administration (NEA) has directed electric cooperatives (ECs) to establish a retirement fund or plan for the financial security of their retiring employees.
“This retirement fund/plan is for the benefit of all regular employees of ECs to motivate them to render continuous, quality and efficient service to its member-consumers-owners and other stakeholders,” NEA said in Memorandum No. 2024-25 signed by its administrator Antonio Mariano C. Almeda.
NEA said that the plan would contain “the income goals of the fund, the investment actions to be made to achieve those goals, the benefits that an employee will receive upon separation and the requirements to be entitled to such benefits.”
It will be sourced from the internally generated fund of the EC, after the conduct of an actuarial valuation to determine the amount necessary to cover the retirement of all regular employees.
The retirement fund/plan is upon approval of NEA’s board of directors.
The amount should be included in the annual corporate operating budget of the EC after the conduct of an actuarial valuation and determination of the fund necessary for the purpose, the agency said.
“The EC shall submit an actuarial report of the accumulated funds every two years. Once the accumulated fund is sufficient for the retirement benefits of all existing EC employees, the EC shall desist from transferring funds for retirement,” NEA said.
NEA said that “retirement planning is crucial for all [ECs] and setting up a retirement fund/plan shall ensure ECs compliance with the laws.” — Sheldeen Joy Talavera
