EIGHTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES. )
First Regular Session )
HOUSE OF REPRESENTATIVES
4537
H.B. No.

Introduced by Rep. Vilma Santos-Recto
6th District of Batangas

AN ACT
INSTITUTIONALIZING THE RIGHTS OF GOVERNMENT SERVICE
INSURANCE SYSTEM (GSIS) MEMBERS, PROVIDING THEM ADDITIONAL
REPRESENTATION IN THE GSIS BOARD, ENSURING PROMPT PAYMENT OF
ALL THEIR BENEFITS AND FOR OTHER PURPOSES

EXPLANATORY NOTE

Today, there are approximately 1.4 million government employees in the country.
They are the hardworking civil servants whom we engage whenever we avail of services
from various government agencies. They serve with honor and competence despite grueling
workloads, uncomfortable work conditions and meager salaries.

In recognition of the valuable services rendered by the government workforce, the
Government Service Insurance System (GSIS) was established through Republic Act (R.A.)
No. 8291, otherwise known as the Government Insurance Act of 1997, to respond to the
needs of the growing bureaucracy. Under this law, the GSIS is mandated to insure its
members against the occurrence of certain contingencies in exchange to their monthly
premium contributions. Indeed, through time, GSIS members and their dependents have
relied primarily on the benefits and claims from the GSIS as an additional resource to meet

financial needs.

In the past, however, there have been a number of stories of misery, disappointment
and desperation from many GSIS members. There were reported complaints of delays in the
receipt of payment for claims, non-updating and non-reconciliation of members’ records and
contributions, and inefficiency in providing services, among others. These problems in one
way or another have caused additional burden to its members.


In order to alleviate the problems encountered by the members of the GSIS, this bill
amends certain provisions of R.A. No. 8291 by institutionalizing a Members’ Rights which
perhaps is the first of its kind in the world as far as government pension systems are
concerned. In addition to their rights under existing laws, the GSIS members are granted
specific rights such as: a) Right to courteous and responsive service; b) Right to information;
¢) Right to GSIS benefits; d) Right to expeditious processing of claims, e) Right to be heard;
and, f) Special Rights for the elderly.

The bill not only strengthens members’ rights but, as an added feature, it also spells
out the responsibilities of the agency. This provision aims to address inefficiency and
negligence of government agencies as employers in remitting contributions to the GSIS.
Under the bill, itis the main responsibility of the agencies to remit employees and employer's
contributions to the GSIS within the prescribed time and in the prescribed format. The
agencies concerned are also required to promptly produce the documents generated by the
agency and required to facilitate the processing of a member's claim from GSIS.

The prescriptive period in claiming of benefits is also lifted to allow members or their
designated beneficiaries to claim GSIS benefits for an indefinite period.

This bill also grants the Regional Trial Court (RTC) to have concurrent jurisdiction
over disputes arising from the grant of benefits provided by the law. Hence, GSIS members
will now have an alternative venue aside from the GSIS should they opt to appeal decisions
on their claims for benefits.

The proposed law likewise provides limitation on foreign investments so that
investible funds of the GSIS can be made available in the local market to finance priority
programs and projects of the government.

Additional representation for members in the GSIS board is also provided in this bill.
‘The Secretary of Education and Chairperson of the Civil Service Commission shall be
additional members of the board to further strengthen the representation of teachers who
compose approximately 60% of the GSIS membership and to promote the welfare of the civil
servants.


Lastly, in order to protect the rights of GSIS members, the bill adds penal provisions
for violations of the law.

While this bill is not expected to address all the problems of the GSIS, it is a measure
geared towards achieving a healthier and more responsive insurance system that provides the
benefits and services that our civil servants rightfully deserve.

In light of the foregoing, immediate pa

VILMA SANTOS-RECTO


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EIGHTEENTH CONGRESS OF THE. )

REPUBLIC OF THE PHILIPPINES )
First Regular Session )
HOUSE OF REPRESENTATIVES
4537
H.B. No.

Introduced by Rep. Vilma Santos-Recto
6th District of Batangas

AN ACT
INSTITUTIONALIZING THE RIGHTS OF GOVERNMENT SERVICE
INSURANCE SYSTEM (GSIS) MEMBERS, PROVIDING THEM ADDITIONAL
REPRESENTATION IN THE GSIS BOARD, ENSURING PROMPT PAYMENT OF
ALL THEIR BENEFITS AND FOR OTHER PURPOSES

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

Section 1. Short Title. — This Act shall be known as the “GSIS Members’ Rights and
Benefits Act”.
Sec. 2. Declaration of Policy. ~ It is a declared policy of the State to provide, develop
and promote a sound social security system responsive to the needs of its workers.
The State shall review and strengthen policies that advance and protect the welfare of
workers in the public sector.
‘The Constitution guarantees the right of all workers to participate in policy and
decision-making processes affecting their rights and benefits as may be provided by law.
In the pursuit of these policies, the State shall:
(a) Ensure the adoption of policies beneficial to GSIS members paving the
way for a responsible, integrated and transparent social security system;
(b) Provide greater representation for members at the highest policy-making
level of the GSIS;
(©) Insulate the Social Insurance Fund (SIF) from dissipation due to the
volatility of the global economy;
(d) Ensure that top-level officials of the GSIS are held accountable for
mismanagement and inefficiencies in the delivery of services to members and

beneficiaries; and


(©) Provide GSIS members and beneficiaries alternative venues in the
settlement of disputes.
Sec. 3. Section 2 of Republic Act No. 8291, otherwise known as “The Government
Service Insurance Act of 197” is hereby amended to read as follows:
“Sec. 2. Definition of Terms. ~ Unless the context otherwise indicates, the
following terms shall mean:
“XXX
“(f) Dependents ~ Dependents shall be the following:
(@) the legitimate spouse dependent for support upon the member or pensioner;
(b) legitimate, legitimated legally adopted child, including the illegitimate
child, who is unmarried, [not gainfully-employed] not over the age of majority,
or is over the age of majority but incapacitated and incapable of self-support
due to mental or physical [defeet] DISABILITY acquired prior to the age of
majority; and (c) the parents dependent upon the member for support;
“po.”
Sec. 4, Members’ Rights. — In add
members shall have the following rights:
(a) Right to Courteous and Responsive Service
1. To be considered a GSIS member from the first day of government

service;

to their rights under existing laws, the

2. To be provided prompt and accurate service;

3. To be accorded respect by the executives and employees of the GSIS; and

4. To be afforded comfortable and customer-friendly facilities when
transacting with the GSIS.

(b) Right to Information

1. To be informed of the laws, regulations, policies or programs affecting the
members’ rights, benefits, obligations, and privileges, including
amendments or changes thereto;

2. To be provided with copies of GSIS policies and regulations pertaining to

benefits and claims administration;
3. To be informed of the various modes and options in availing benefits;


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4. To receive accurate and updated membership data, records and
information, including records of premium remittances and loan payments,
among others;

5. To have GSIS data and records protected from unauthorized, unlawful or
improper disclosure; and

6. To be informed in advance of documents required to facilitate transaction,
processing period and updated status of claims or loan applications.

(©) Right to GSIS Benefits

1. To receive on time the benefits the member has qualified to even after
separation from the service;
2. To avail the mode of retirement, among the different applicable
retirement laws and be allowed to change the preferred mode: Provided,
That the retirement pension package has not yet been received;
3. To be protected against discrimination and thus receive the same
benefits and privileges granted other members similarly situated;
and
4. To receive benefits exempt from all taxes, fees, charges and duties of all
kinds.
(@) Right to Expeditious Processing of Claims
1. To claim and receive on time benefits provided under applicable laws;
2. To exhaust all legal remedies under existing laws; and
3. To be protected from diminution of benefits that may arise with the
passage of a subsequent law or regulation.
(e) Right to be Heard
1. To be represented in the GSIS Governing Board;
2. To participate in meaningful exchange of views in dialogues and fora
conducted by GSIS without fear of reprisal;
3. To be consulted on the policies and programs to be implemented by the
system;
4. To convey grievances and be accorded immediate response; and
5. To transact business with the GSIS in person or through electronic access
points.


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Sec. 4-A. Special Rights for the Elderly, Disabled and Seriously-Ill Members,
Beneficiaries and Pensioners. ~ The following special rights are to be afforded to the elderly,
disabled and seriously-ill members, beneficiaries and pensioners, to wit:

1. To be provided special access lanes;

2. To be prioritized in the processing and releasing of claims and benefits;

3. To be given preference in the dissemination of information pertaining to
policies; and

4, To be accorded leniency in the submission of documents: Provided, That
there is substantial compliance with the requirements prescribed by GSIS.

Sec. 5. Agency’'s/Employer’s Responsibilities. - The government agencies covered by
the GSIS Act, as employers, shall have the following responsibilities:
1. To remit employees’ and employers’ contributions to the GSIS within the
prescribed time mandated by the GSIS Act;
2. To provide promptly documents from the agency required to facilitate the
processing of documents and claims;
3. To provide additional documents as necessary to reconcile the records of
accounts; and
4. To inform GSIS, through their agency authorized officers, of any update
pertai
claims and benefits.
Sec. 6. Section 7 of Republic Act No. 8291, otherwise known as “The Government
Service Insurance Act of 1997” is hereby amended to read as follows:

ig to personal or service records that may affect the processing of

“Sec. 7. Interests on Delayed Remittances. — Agencies which delay the
remittance of any and all monies due the GSIS shall be charged interests as may be
prescribed by the Board but notfless] MORE than two percent (2%) simple interest
per month, Such interest shall be paid by the employers concerned.”

Sec. 7. Section 28 of Republic Act No. 8291, otherwise known as “The Government
Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 28. Prescription. ~ Claims for benefits under this Act [except-forife
and-retirement] shall be imprescriptible.

Sec. 8. Section 30 of Republic Act No. 8291, otherwise known as “The Government
Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 30. Settlement of Disputes. ~ The GSIS AND THE REGIONAL

TRIAL COURT (RTC) shall have original and [exclusive] CONCURRENT
4


jurisdiction to settle any dispute
administered by the GSIS.

“oon”
Sec. 9. Section 31 of Republic Act No. 8291, otherwise known as “The Government

ising under this Act and any other laws

Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 31. Appeals. — Appeals from any decision or award of the Board OR
RTC shall be governed by [Rules 43 and 45 of] THE PERTINENT RULES
FOUND IN the 1997 Rules of Civil Procedure [adopted by the Supreme Court on
April 8, 1997 which will take effect on July 1, 1997]: Provided, That pending cases
and those filed prior to July 1, 1997 shall be governed by the applicable rules of
procedure: Provided, further, That the appeal shall take precedence over all other
cases except criminal cases when the penalty of life imprisonment or death or
reclusion perpetua is imposable.

04."
Sec. 10. Section 36 of Republic Act No. 8291, otherwise known as “The Government

Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 36. Investment of Funds. — xxx
“XXX

“@) In foreign mutual funds and in foreign currency deposits or foreign
currency-denominated debts, non-speculative equities and other financial instruments
or other assets issued in accordance with existing laws of the countries where such
financial instruments are issued: Provided, That these instruments or assets are listed
in bourses of respective countries where these instruments or assets are issued:
Provided, further, That the issuing company has proven track record of profitability
over the last three (3) years and payment of dividends at least once over the same
period: PROVIDED, FINALLY, THAT NOT MORE THAN FIVE PERCENT
(5%) OF THE ABOVE-MENTIONED FUNDS SHALL BE INVESTED
ABROAD.”
Sec. 11. Section 42 of Republic Act No. 8291, otherwise known as “The Government

Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 42. The Board of Trustees; Its Composition; Tenure and Compensation.

— The corporate powers and functions of the GSIS shall be vested in and exercised by

the Board of Trustees composed of the President and General Manager of the GSIS

and [eight-{8)] TEN (10) other members to be appointed by the President of the
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Philippines, one (1) of whom shall be either the President of the Philippine Public
School Teachers Association (PPSTA) or the President of the Philippine Association
of School Superintendents (PASS), THE SECRETARY OF THE DEPARTMENT
OF EDUCATION (DepEd), THE CHAIRPERSON OF THE CIVIL SERVICE
COMMISSION (CSC), another two (2) shall represent the leading organizations or
associations of government employees/retirees, AND another four (4) from the
banking, finance, investment, and insurance sectors, and one (1) recognized member
of the legal profession who at the time of appointment is also a member of the GSIS.
The Trustees shall elect from among themselves a Chairfmen}PERSON while the
President and General Manager of the GSIS shall automatically be the vice-
chair[man|PERSON.
“0K.”
Sec. 12. Section 43 of Republic Act No. 8291, otherwise known as “The Government

Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 43. Powers and Functions of the Board of Trustees. ~ xxx
“XXX.
“(d) upon the recommendation of the President and General Manager, to approve the
GSIS’ organizational and administrative structures and staffing pattern[;] SUBJECT
TO EXISTING CIVIL SERVICE LAWS, RULES AND REGULATIONS and to
establish, fix, review, revise and adjust the appropriate compensation package for the
officers and employees of the GSIS with reasonable allowances, incentives, bonuses,
privileges and other benefits as may be necessary or proper for the effective
management, operation and administration of the GSIS, which shall be exempt from
Republic Act No. 6758, otherwise known as the Salary Standardization Law and
Republic Act No. 7430, otherwise known as the Attrition Law.
“om”
Sec. 13. Section 49 of Republic Act No. 8291, otherwise known as “The Government

Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 49. Dispensation of Social Insurance Benefits. — (a) The GSIS shall pay
the retirement benefits to the employee on his last day of service in the government:
Provided, That all requirements are submitted to the GSIS [within-e-reasonable
period] SIXTY (60) DAYS prior to the effective date of the retirement;

co sate)


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Sec. 14, Section 52 of Republic Act No. 8291, otherwise known as “The Government
Service Insurance Act of 1997” is hereby amended to read as follows:

“Sec. 52. Penalty. — xxx

xxx

“(j) Failure of the PRESIDENT AND GENERAL MANAGER AS WELL
AS Members of the GSIS Board, including the chair[man]PERSON and the vice-
chair[man]PERSON, to comply with the provisions of paragraphS (R) AND (w) of
Section 41 AND SECTION 49 hereof, shall subject them to imprisonment of not less
than six (6) months nor more than one (1) year or a fine of not less than [Fie] TEN
thousand pesos (P[S] 10,000.00) nor more than [FeaJTWENTY thousand pesos
(P[49]20,000.00) without prejudice to any civil or administrative liability which may
also arise therefrom|:]: PROVIDED, THAT IN CASE GSIS FAILS TO COMPLY
WITHOUT VALID AND JUSTIFIABLE REASON WITH THE
REQUIREMENTS REFERRED TO IN SECTION 49 OF THIS ACT, A
PENALTY OF NOT MORE THAN TWO PERCENT (2%) SIMPLE
INTEREST SHALL BE CHARGED PER MONTH FROM GSIS: PROVIDED,
HOWEVER, THAT IN CASE THE RELEASE OF THE RETIREMENT
BENEFITS REFERRED TO IN SECTION 49 OF THIS ACT COULD NOT BE
ACCOMPLISHED DUE TO FORCE MAJEURE AND OTHER
INSUPERABLE CAUSES, THE PENALTY OF IMPRISONMENT AND FINE
IMPOSED UNDER THIS PARAGRAPH SHALL NOT APPLY.

“Criminal actions arising from violations of the provisions of this Act may be

commenced by the GSIS or by the aggrieved member, either under this Act or, in
appropriate cases, under the Revised Penal Code[] AND OTHER SPECIAL
LAWS.

Sec. 15. Implementing Rules and Regulations. - The implementing rules and
regulations to carry out the provisions of this Act shall be adopted and promulgated by the
GSIS, in consultation with the Civil Service Commission (CSC) not later than ninety (90)
days after the approval of this Act.

Sec. 16. Separability Clause. — If any part or provision of this Act shall be held to be
unconstitutional or invalid, other parts or provisions hereof which are not affected shall

continue to be in full force and effect.


we ene

Sec. 17. Repealing Clause. — All laws, decrees, executive orders, rules and regulations,
or parts thereof which are inconsistent with this Act are hereby repealed, amended or
modified accordingly.

Sec. 18. Effectivity. — This Act shall take effect fifteen (15) days after its publication in
the Official Gazette or in at least two (2) newspapers of general circulation.

Approved,