Republic of the Philippines
House of Representatives
Quezon City, Metro Manila

Eighteenth Congress
Second Regular Session

HOUSE BILL NO. be

Introduced By Representatives JORGE “PATROL” BUSTOS, PRESLEY C. DE
JESUS and MICHAEL L. ROMERO

EXPLANATORY NOTE

No less than the country’s Constitution recognizes the invaluable role of the
military and uniformed personnel, our frontliners in public order, security and
safety, in the protection of our sovereignty from threats, unrest, and lawlessness, in
and out of our country’s borders. Section 5 of Article XVI of the 1987 Constitution
mandates the State to pursue the strengthening of the patriotic spirit and nationalist
consciousness of the military, and also to ensure professionalism in the service,
with provisions for premium remuneration and benefits of its members. Indeed,
this obligation of the State extends beyond their active service, as these pensions
and financial support give a tremendous boost in keeping the nationalistic spirit
and patriotism alive in the hearts and lives of our modern heroes.

The Constitution also states that the State shall, from time to time, review
pertinent provisions of law to upgrade the pensions and other benefits due to
retirees of both the government and the private sectors. In coming up with more
efficient reforms and more streamlined system of benefits for the military and
uniformed personnel, it is but necessary to provide adequate and acceptable
remuneration and compensation by balancing governmental interest and the
mandate to provide for such benefits.

Time and again, our President, President Rodrigo Roa Duterte, have always
highlighted that “the (present) administration will remain steadfast in protecting
and advancing their (military and uniformed personnel) welfare through
modernization, capacity-enhancing initiatives, and provision of benefits for their


families.” He has also emphasized the importance of reforms, particularly as to the
pensions of retirees, as there will be an impending “budget burden where the total
cost of the pensions of retired soldiers will exceed the compensation of those in
active service.”*

In seeking a common ground to provide a win-win solution and at the same
time, still give our military and uniformed personnel their best due, this proposed
measure pursues to provide the government with ample financial flexibility, at the
same time ensuring that the State will not waver from its duty towards maintaining
a uniformed personnel with commensurate benefits and compensation, whether
they be in the active service or retirees, as the case may be.

This proposed bill seeks to provide a unified system for the separation,
retirement and pension system of the military and the unified personnel namely:
the Armed Forces of the Philippines (AFP), the Philippine National Police (PNP),
the Philippine Coast Guard (PCG), the Bureau of Fire Protection (BFP), the
Bureau of Jail Management and Penology (BJMP) and the Bureau of Corrections
(BuCor). This new unified system will ensure a sustainable, permanent, viable and
ACCEPTABLE solution to the “ballooning effect” budget of the current pension
system without diminishing the benefits that the retirees and current active
members of military and uniformed system are entitled to under existing laws.

In view of the foregoing, approval of this bill is earnestly sought.

W

CONG. JORGE “PATROL” BUSTOS

‘ON rae Cc JESUS
Pi
/

/
CONG. 'HAEL L. ROMERO

1 Gita-Carlos, Ruth Abbey, “Duterte vows support for retired MUP, dependents of fallen troops,” Philippine News
‘Agency, downloaded from hitps:/\www,pna.gov.ph/articles/1089451, last accessed 25 May 2020.
2 htips:/newsinfo. nquirer.neU 131326 I/ph-military-backs-duterte-call-for-revised-pension-system-for-uniformed-

personnel, last accessed 13 October 2020.



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Republic of the Philippines
Bouse of Representatives
Quezon Citp, Metro Manila

Eighteenth Congress
Second Regular Session

HOUSE BILE No.2 081

Introduced By Representatives JORGE “PATROL” BUSTOS, PRESLEY C. DE
JESUS and MICHAEL L. ROMERO

AN ACT
PROVIDING FOR A _ UNIFIED SYSTEM FOR _ SEPARATION,
RETIREMENT, AND PENSION OF THE MILITARY AND UNIFORMED
PERSONNEL (MUP) SERVICES OF THE REPUBLIC OF THE
PHILIPPINES, CREATING THE MILITARY AND UNIFORMED
PERSONNEL RETIREMENT FUND, PROVIDING FUNDS THEREFOR,
AND FOR OTHER PURPOSES

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

Section 1. Short Title. — This Act shall be known as the “Military and

Uniformed Personnel Service Separation, Retirement, and Pension Act.”

Title I

Declaration of Policy

Sec. 2. Declaration of Policy. — The State duly recognizes the vital role of
military and uniformed personnel in providing internal and external security,

promoting peace and order, ensuring public safety, and further strengthening local

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government capability, aimed towards the effective delivery of basic services to the

citizenry.

The State also recognizes the extraordinary hazards, risks, perils, and dangers

that military and uniformed personnel encounter in the performance of their duties.

It shall therefore be the prime concern of the State to provide all military and
uniformed personnel adequate remuneration and benefits, including retirement
benefits and pension. The State shall ensure that the retirement benefits and pension

scheme of the military and uniformed personnel is secure, equitable, and sustainable.

Title 1

Definition of Terms

Sec. 3. Definition of Terms. ~ For the purposes of this Act:

a. “Active Members” refers to military and uniformed personnel from the
Military and Uniformed Services in the Active Service prior to the affectivity
of this Act;

b. “Active Service” refers to Active Service rendered by a Military or Uniformed
Services Personnel as a commissioned officer, non-commissioned officer,
enlisted personnel, cadet, probationary officer, trainee or draftee in the Military
or Uniformed Services; Provided, That service rendered as a cadet,
probationary officer, trainee or draftee in the Military or Uniformed Services
shall be credited for retirement purposes with a maximum of four (4) years,

subject to applicable rules and regulations;


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. “Combat Casualty” refers to death or total permanent physical disability

incurred, while in Active service, during legitimate actual combat or armed

encounter, attack or operation;

|. “Death or Permanent Physical Disability in Line of Duty” refers to death,

illness or injury incurred while in the Active Service and not attended by
misconduct, wilful failure, the use of drugs or alcoholic liquor or vicious or

immoral habits;

. “Military Services” refers to the Armed Forces of the Philippines (AFP);

~ “Uniformed Personnel Services” refer to Philippine National Police (PNP),

Philippine Coast Guard (PCG), Bureau of Fire Protection (BFP), Bureau of Jail
Management and Penology (BJMP) and Bureau of Correction (BuCor);

. “New Entrants” refers to military and uniformed personnel from the Military

and Uniformed Services who entered or re-entered the Military and Uniformed

Sevices after the effectively of this Act;

. “Survivors” refers to the following:

1. Surviving spouse of a deceased Military or Uniformed Services
Personnel not separated by judicial decree from the deceased: Provided,
That their marriage was contracted during the Active Service of the
deceased: Provided, further, That entitlement of said spouse to benefits
under this Act shall terminate upon re-marriage or co-habitation with

another, or the commission against the biological or adopted children of

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the deceased of any of the acts of violence or abuse as defined under
Republic Act No. 9262, otherwise known as “Anti-Violence Against
Women and Their Children Act of 2004” and other related penal laws,
and other acts inimical to the welfare of the child of the deceased as
determined by a Board created for the purpose: Provided, finally, That
the conviction of the surviving spouse of any crime which carries a
penalty of imprisonment of more than six (6) years and one (1) day, the
conception of a child after the death of the deceased, or loss of the
Philippine Citizenship or acquisition of dual citizenship, shall terminate

the entitlement of such surviving spouse to benefits under this Act;

. Surviving legitimate, adopted and illegitimate children of a deceased

Military or Uniformed Services Personnel conceived, adopted or
acknowledge prior to separation or retirement of the deceased from
active service; Provided, That entitlement of said children to benefits
under this Act shall terminate when such children attain twenty-one (21)
years of age or upon marriage, whichever is easier; Provided, further,
That children who suffer from total permanent disability as defined in
this Act, shall be entitled to benefits under this Act during their lifetime;
Provided, finally, That the conviction of the surviving child of any crime
which carries a penalty of imprisonment of more than six (6) years and
one (1) day, or loss of Philippine Citizenship or acquisition of dual
citizenship, shall terminate the entitlement of such child to benefits
under this Act;


i 3. In default of those mentioned in sub-paragraphs h (1) and (2) above,

2 surviving parents of a deceased Military or Uniformed Services
3 Personnel who are primarily dependent on the deceased for support, or
4 in default thereof, surviving siblings who are under twenty-one (21)
5 years of age and unmarried; Provided, That the conviction of the parent
6 or sibling of the deceased for any crime which carries a penalty of
i imprisonment of more than six (6) years and one (1) day, or loss of
8 Philippine Citizenship or acquisition of dual citizenship, shall terminate
9 the entitlement of such parent or sibling to benefits under this Act;

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n i. “Total Permanent Physical Disability” refers to the anatomical loss or the

12 permanent loss of use of both hands, of both feet, or both eyes, of both ears or

13 any combination, or loss of mental faculties, as determined by the medical
4 board created for the purpose.

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16 Title 1

7 Applicability

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19 Sec. 4. Applicability. — This Act shall apply only to all New Entrants of the
20 Military and Uniformed Services.

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22 Title IV

23 Retirement

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25 Sec, 5. Compulsary Retirement. ~ The following active Military or Uniformed
26 Services Personnel shall be compulsory retired:

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. Those who attain the age of fifty-six (56): Provided, That he/she has

accumulated at least thirty (30) years of satisfactory Active Service;

. Those who suffer death in line of duty: Provided, That he/she has accumulated

at least thirty (30) years of satisfactory Active Service;

|. Those who incur total permanent physical disability in line of duty: Provided,

That he/she has accumulated at least thirty (30) years of satisfactory Active

Service;

|. Those who are combat casualties;

. Those subject to attrition, as provided in Section 18 of this Act: Provided, That

he/she has accumulated at least thirty (30) years of satisfactory Active Service;

or

» Those separated by their respective Discipline Board under Section 18 of this

Act: Provided, That he/she has accumulated at least thirty (30) years of

satisfactory Active Service.

Sec. 6. Voluntary Retirement. - Upon accumulation of at least thirty (30) years

of satisfactory Active Service, a Military or Uniformed Services Personnel may apply
for voluntary retirement from Active Service, subject to the approval of their

respective appropriate authority.


1 Title V

2 Separation

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4 Sec. 7. Compulsory Separation. — The following Military or Uniformed
5 Services Personnel shall be compulsory separated from the Active Service:

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7 a. Those who attain the age of fifty-six (56) without having accumulated at least
8 thirty (30) years of satisfactory Active Service;

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10 b. Those who death in line of duty but without having accumulated at least thirty
11 (30) years of satisfactory Active Service;
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3B c. Those who incur total permanent physical disability in line of duty but without
14 having accumulated at least thirty (30) years of satisfactory Active Service;
1s
16 d. Those subject to attrition, as provided in Section 18 of this Act, without
7 having accumulated at least thirty (30) years of satisfactory Active Service; or
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19 e. Those separated by their respective Disciplinary Board under Section 13 of this
20 Act without having accumulated at least thirty (30) years of satisfactory Active
21 Service.
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23 Sec. 8. Voluntary Separation. — A Military or Uniformed Services Personnel,

24 who has not accumulated at least thirty (30) years of satisfactory Active Service, may
25 apply for separation from Active Service, subject to the Approval of their respective
26 appropriate authority.

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Title VI

Retirement and Separation Benefits
Sec. 9. Gratuity and Retirement Pay. — When a Military or Uniformed Services
Personnel is retired under Title IV of this Act, he/she shall, at his/her option, received

Gratuity Pay or Retirement Pay described below:

a. Gratuity Pay — equivalent to one (1) month of base and longevity pay of

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the permanent grade last held for ever year of service payable in one (1)

lump sum;

. Retirement Pay — a monthly retirement pay equivalent to two and one-

half percent (2 2%) for each year of Active Service rendered, but not
exceeding ninety percent (90%) of the monthly base and longevity pay
of the permanent grade last held: Provided, That when he/she retires,
he/she shall be entitled to receive a lump sum equal to eighteen (18)
months of his retirement pay, and thereafter receive his/her annual
retirement pay payable in equal monthly instalments: Provided, further,
That if he/she dies before his/her retirement pay begins to accrue, the
Survivors of the latter shall be entitled thereof but shall receive only the
derivative benefits thereunder when they accrue: Provided, finally, That
the retirement pay of combat casualties, shall be computed at the rate of
ninety (90%) of their monthly base and longevity pay regardless of their

years in Active Service;


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After the retirement from the service, those retired under Title IV shall
immediately receive their benefits under this Act: Provided, That, those retired due to
Attrition under Section 5 (e), Honorably Discharged under Section 5 (f), and those
who avail of Voluntary Retirement under Section 6 shall be eligible to receive
monthly retirement pay only upon reaching the age of fifty (50): Provided, however,
that survivors shall immediately receive their survivorship benefits in the event the
retiree dies before his fiftieth (50) birthday for cause/s not attributable to the
Survivor entitled thereto; Provided, further, That nothing in this Section shall be
construed as authorizing adjustment of pay, or payment of any differential in
retirement pay to Military or Uniformed Services Personnel who are already retired
prior to the approval of this Act as a result of increases in salary of those in the
Active Service may have their retirement pension adjusted based on the rank they
hold and on the prevailing pay of military personnel in the Active Service, at the time

of the termination of their recall to Active Service.

Sec. 10. Separation Pay. — Except for those provided for in Section 12 of this
Act, when a Military or Uniformed Services Personnel is separated from the service
under Section 7 and Section 8 of Title V of this Act, he/she, or his/her survivors shall
receive a separation pay equivalent to on-month base plus longevity pay of the
permanent grade last held for every year of Active Service: Provided, That nothing in
this Section shall be construed as authorizing adjustment of pay, or payment of any
differential in separation pay to Military or Uniformed Services Personnel who are
already retired or separated from the service prior to the affectivity of this Act as a
result of increases in salary granted to Military or Uniformed Services Personnel in

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Sec. 11. Survivorship Benefits. - The survivors of a deceased Military or
Uniformed Services Personnel retired under Title IV, and separated under Section 7
(b) of Title V of this Act shall be immediately entitled to a monthly annuity
equivalent to seventy-five percent (75%) of his/her monthly retirement pay which the
deceased was receiving or entitled to received, to be divided among them in equal
shares and with the right of accretion: Provided, That the minimum monthly annuity
to be received shall be equivalent to fifty percent (50%) of the base and longevity pay
of the permanent grade last held: Provided, Finally, That if lump sum equal to
eighteen months (18) is availed and retiree dies within eighteen (18) months after
retirement, survivorship benefits shall only start on first month immediately after the

eighteen (18) months reckoned from date of retirement.

Sec. 12. Benefits for Death and Total Permanent Disability in Line of Duty. —
A Military or Uniformed Services Personnel separated under Section 7(c) of Title V
of this Act or his Survivors shall be immediately entitled to a monthly life annuity the
amount of which shall be fifty per centum (50%) of the base and longevity pay
computed on the basis of his/her actual rank held at time of death or disability.

Sec. 13. Separation by the Disciplinary Board. — A Military or Uniformed
Services Personnel referred to and found by their respective Disciplinary Board not
fit for retention in the Active Service because of substandard performance, low
potentiality, doubtful integrity and/or acts inconsistent with the best interest of the
service shall be separated from the Active Service: Provided, That the Disciplinary
Board, based on the facts and circumstances of the case, shall determine whether the
subject Military or Uniformed Services Personnel shall be granted an Honorable
Discharge and is entitled to receive benefits under Section 9 or 10 of Title VI of this

Act, as applicable, otherwise, all benefits under this act shall be forfeited.

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Sec. 14. Disability Pension. — A Military or Uniformed Services Personnel retired
due to disability which is the proximate result of wounds or injuries received, or
sickness or disease incurred in line of duty or as a battle casualty, shall receive, in

addition to the other benefits under this Act, Disability Pension fixed as follows:

a. If and while the disability is rated twenty-five percent (25%), the additional
monthly pension shall be PHP 2,500.00;

b. If and while the disability is rated fifty percent (50%), the additional monthly
pension shall be PHP 5,000.00;

c. If and while the disability is rated sixty percent (60%), the additional monthly
pension shall be PHP 6,000.00;

d. If and while the disability is rated seventy percent (70%), the additional
monthly pension shall be PHP 7,000.00;

e. Ifand while the disability is rated eighty percent (80%), the additional monthly
pension shall be PHP 8,000.00;

f. If and while the disability is rated ninety percent (90%), the additional monthly
pension shall be PHP 9,000.00; or

g. If and while the disability is rated one hundred percent (100%), the additional
monthly pension shall be PHP 10,000.00;

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Title VII

Military and Uniformed Personnel Retirement Fund

Sec. 15. Fund Management. — A new subsidiary of the Government Service
Insurance System (GSIS) shall be established for the management and maintenance
of the Military and Uniformed Personnel Retirement Fund (MUPRF). Within six (6)
months from the effectivity of this Act, the GSIS shall determine the manner and
undertake the creation of a subsidiary that will assume the management and
maintenance of the MUPRF either through the passage of an original charter by the
Congress or through Republic Act No. 11232 otherwise known as the “Revised
Corporation Code of the Philippines.”

Sec. 16. Fund Administration. — The Military and Uniformed Services shall
create or assign respective office, unit or entity that shall administer their respective
Retirement and Separation Fund (RSF) and discharge all necessary functions, except
for the management and maintenance of the fund, relevant to the retirement and
separation benefits of the New Entrants, in collaboration agreement with the GSIS

subsidiary managing the fund.

Sec. 17. Funding Sources. - The MUPRF shall be initially allocated a capital
of Five Billion Pesos (5,000,000,000.00). Aside from the initial capitalization, the
MUPRF shall be funded through mandatory contributions of New Entrants of seven
percent (7%) of their Base Pay as their personal share to the MUPRF, and twenty
percent (20%) from the National Government sourced from the annual General

Appropriations Act.

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Title VILL

General Appropriation

Sec, 18. Attrition. — The attrition systems of Military and Uniformed Services

shall be formulated by their respective Organizations.

Sec. 19. Retirement Grade. — Military and Uniformed Services covered under
this Act shall be retired in the grade they hold at the time of their retirement:
Provided, That for those compulsorily retired due to age or combat casualty shall be

retired at one (1) grade higher than the permanent grade last held.

Sec. 20. Manner of Increase of Pension Benefits. — Upon effectivity of this
Act, there shall be no automatic indexing of Gratuity and Retirement Pay,
Survivorship Benefits and other benefits with the salary increases of active Military

and Uniformed Services Personnel.

The Pension benefits, including additional Disability Pension, shall be
regularly reviewed every three (3) years and may be adjusted as recommended by the
actuary of the Pension Fund and approved by the Board of Directors of the Fund
Manager of the MUPRF.

Sec. 21. Retirement List. — Military and Uniformed Service Personnel retired
under Title IV of this Act shall be carried in the retirement list of the applicable
Military and Uniformed Services. The name of a retiree who loses his/her Filipino
Citizenship shall be removed from the Retirement List and his/her retirement benefits

terminated upon such loss regardless of acquisition of dual citizenship.

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Sec. 22. Recall to Active Service. — (1) AFP Personnel carried in the
Retirement List shall be subject to the Articles of War and may be recalled at any
time by the President to Active Service in the permanent grade last held upon
retirement. His/her refusal to perform such duty shall be a ground for court-martial
under Article 97 of the Articles of War and subsequent termination of payments of

benefits as determined by the court martial.

(2) When recalled to Active Service, a retiree shall receive the pay and
allowances of the permanent grade last held and shall continue to be carried in the
Retirement List. He/she shall be eligible for promotion under the Regular Force while

in active status or in the Reserve Force when in inactive status.

Sec.23. Non-Encumbrance of Benefits. — The benefits authorized under this
Act shall exclusively for the benefits of the retired or separated Military or
Uniformed Services Personnel and except as provided herein, shall not be subject to
attachment, gamishment, levy, execution or any tax whatsoever; neither shall they be
assigned, ceded, or conveyed to any third person; Provided, that if a retired or
separated Military or Uniformed Services Personnel who is entitled under this Act
has unsettled money and/or property accountabilities incurred while in the Active
Service, not more than fifty percent (50%) of the pension gratuity or other payment
due such Military or Uniformed Services Personnel or his/her survivors under this

‘Act may be withheld be applied to settle such accountabilities.
Sec. 24. Accrual of Benefits. — The benefits authorized under this Act shall

accrue to Military or Uniformed Services Personnel separated by board action or

court martial action except when non-entitlement of such benefits is expressly

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adjudged by the board or by the military court and approved by the approving

authority.

Sec. 25. Non-Diminution of Benefits. — Nothing in this Act shall be construed
in any manner to reduce whatever retirement and separation pay or gratuity or other
monetary benefits which any person is receiving or entitled to receive under the

provisions of existing laws.

Title IX

Miscellaneous Provisions

Sec. 26. Penal Clause. - Any person found to have participated directly or
indirectly in the commission of fraud, falsification, misrepresentation of facts,
collusion or any similar anomaly in the issuance of any certificate or document for
any purpose connected with this Act shall upon conviction be punished by a fine of
not less than the amount defrauded but not more than threefold such amount and/or
imprisonment of not less than six (6) months and one (1) day to six (6) years and
perpetual disqualification ftom holding public office and from practicing any
profession or calling licensed by the government; Provided, that the maximum
penalty shall be imposed if the offense was committed by any group who belongs to

an organized/syndicated crime group.

Sec, 27. Implementing Rules and Regulations. — Within sixty (60) days upon
the effectivity of this Act, the DOF, DND, DOJ, DOTR, Government Service
Insurance System (GSIS), and the Department of Budget and Management (DBM),
in coordination with the AFP, PNP, PCG, BJMP, BFP, BuCor and other relevant
offices shall formulate and issue the Implementing Rules and Regulations necessary

for the effective implementation hereof.
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Sec. 28. Appropriations. ~The amount necessary for the implementation of the
provisions of this Act shall be included in the annual General Appropriations Acct

following its enactment into law.

Sec. 29. Repealing Clause. — The pertinent provisions of Republic Act No.
6975, Republic Act No. 8551, Republic Act No. 9263, Republic Act No. 9993, and
Republic Act No. 10575 are hereby amended accordingly.

Presidential Decree No. 1656, Presidential Decree No. 1638, Republic Act No.
340, and Republic Act No. 5976 are hereby repealed. However, those considered
Active Members upon the enactment of this Act shall continue to receive the benefits
of the aforementioned laws. Nothing in this Act shall be construed to eliminate or in
any way diminish any benefits being enjoyed by Military and Uniform Personnel at

the time of pro time of promulgation of this Act.

All laws, rules and regulations, and other issuances or parts thereof, which are
inconsistent with the provisions of this Act are hereby repealed or modified

accordingly.

Sec. 30. Separability Clause. — If any provision of this Act shall be declared
invalid or unconstitutional, the remaining parts or provisions not otherwise affected

shall remain in force and effect.

Sec. 31. Effectivity Clause. — This Act shall take effect fifteen (15) days
following its complete publication in the Official Gazette or in two (2) national
newspapers of general circulation.

Approved,
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