Republic of the Philippines
‘ HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILL NOL605,

introduced by Rep. Precious Hipolito Castelo

EXPLANATORY NOTE

In light of the fact that no government agency undertakes a conscious monitoring on
how pension funds under the care of the Social Security System on the one hand
and by the Government Service Insurance Service on the other are being
administered, it behooves a cognizant entity to adopt a proactive approach as would
insure that state pension funds are carefully invested at no risk whatsoever on either
SSS or GSIS against losses or the possibility that such funds are being siphoned off
to benefit private sector entities.

Toward this end, the Bangko Sentral ng Pilipinas or the Monetary Board, as the case
may be, shall issue rules, regulations, guidelines and other sanctions as it may see
fit that will introduce a culture of transparency in the business or corporate affairs of
both the SSS and the GSIS.

There shail be an internal system of disclosure initiated by the state pension fund
itself for the full dissemination and information as regard how substantial chunk of
funds may be utilized for all their bonafide members and stakeholders. Not
surprisingly, SSS or GSIS is awash with cash but this shall not lend freedom for
them to invest in anyway they see.

It is of paramount consideration that pension funds are contributed by private and
public workers in the SSS and GSIS, respectively and therefore, it is only fitting and
proper that serious custodial job is reposed upon those that manage these pension
funds. In no permissible instance must management provide any part of the pension
funds to buoy up or resuscitate an otherwise ailing private or public entity.

Pension funds must accrue only to their legitimate contributors, no one else.

It is the intention of this bill to ensure that pension funds are not being siphoned off
for purposes other than the higher interest of its contributors, hence the immediate
passage of this proposed bill is most earnestly sought.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HoUSE BILL No, 1605

Introduced by Rep. Precious Hipolito Castelo

AN ACT
ENSURING THAT PENSION FUNDS OF SOCIAL SECURITY SYSTEM AND THE
GOVERNMENT INSURANCE SERVICE SYSTEM ARE SUBJECT OF A CULTURE OF
TRANSPARENCY AND INTERNAL SYSTEM OF DISCLOSURE IN ALL ITS BUSINESS
OR CORPORATE AFFAIRS AND FOR OTHER PURPOSES

Be it enacted in the Senate and the House of Representatives of the Republic of the
Philippines in Congress assembled:

SECTION 1: This Act shall be known as the “Pension Funds Disclosure Act.”

SEC. 2. There shall be adopted a culture of transparency and internal system
of disclosure in all the business and corporate affairs of the Social Security System
and the Government Service Insurance System as a matter of right and privilege on
the part of their private and public workers, respectively.

To this end, the Bangko Sentral ng Pilipinas or the Monetary Board, as the
case may be, must undertake a proactive approach to ensure that no funds
‘whatsoever could be siphoned off for purposes other than the benefits of the state
pension funds members and contributors.

SEC. 3. Alll returns on investment under this system of disclosure shall be fully
disseminated for the information of the private workers in the case of SSS and public
workers in the case of GSIS.

SEC. 4. The Social Security System and the Government Service Insurance
System shall issue respective rules, regulations, guidelines and sanctions against
violations under this Act.

SEC. 5. This Act shall take effect thirty (30) days after its publication in the
Official Gazette.

Approved,