Y 
'THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
) 
"{)4 , ;j\j 3C) 
:.I i) 
First Regular Session 
) 
S E N A T E  
U 
S.B. NO. 1145 
Introduced by Senator Aquilino Q. Pimentel, Jr. 
EXPLANATORY NOTE 
Our country's civil service, as mandated by the Constitution, must, at all 
times, be efficient, responsive, progressive, courteous, and of sound integrity and 
morality. 
The present government Structure however, is bloated and overstaffed, 
oftentimes with duplicating and overlapping functions between government 
agencies, thus resulting to non-pevorming and unproductive public workers. 
This legislative measure proposes the re-engineering of government 
bureaucracy is order to promote a competent and responsible government 
service. 
Under this bill, an independent Commission on Government Re- 
Engineering is proposed to be created. It is tasked to conduct studies, review 
policies and programs relevant to the re-engineering of the government 
bureaucracy. The Commission shall submit the re-engineering plans for specific 
agencies or sectors of the government to the President, who shall review, 
approve and implement the same. 
Furthermore, retirement / separation benefits and additional incentives 
shall be given to government personnel who may be affected by the re- 
engineering program. 
It is the aim of this bill to provide for a better government manpower 
resources and bureaucracy. 
The urgent passage of this bill is therefore requested. w 
MENTEL, JR. 


Y”% ‘1 I‘ 
THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
1 
*\: 
,;i 3G 
I 
I t  
First Regular Session 
1 
/ 
W 
S E N A T E .  ’ 
S.B. NO. 
11135 
Introduced by Senator Aquilino Q. Pimentel, Jr. 
AN ACT 
TO RE-ENGINEER THE GOVERNMENT BUREAUCRACY BY AUTHORIZING 
THE 
PRESIDENT TO IMPLEMENT THE 
RE-ENGINEERING PLAN, 
CREATING THE COMMISSION ON GOVERNMENT RE-ENGINEERING, AND 
PROVIDING FUNDS THEREFOR 
Be it enacted by the Senate and House of Represenfatives of the 
Philippines in Congress assembled. 
SECTION I. 
Short Title. - This Act shall be known as “the Re-engineering 
Act of 2004.” 
Sec. 2. 
Declarafion of Policy. - It is hereby declared the policy of 
the State to promote efficiency, effectiveness, and economy in government 
service in order to ensure social equity and transparency by focusing its functions 
and resources on the essential role, scope, and level of governance through a 
bureaucracy that has a well-defined structure and operating systems. 
Sec. 3. Coverage. - This Act shall cover all entities of the Executive 
Branch, including all Departments and their attached agencies, commissions, 
boards, councils, authorities, offices, government-owned and -controlled 
corporations, state universities and colleges, and other instrumentalities of the 
Executive Branch; and all their appointive officials and employees who are on a 
permanent, temporary, casual, or contractual status, as attested to by the Civil 
Service Commission (CSC). 
The Legislature, the Judiciary, Constitutional Offices, and Local 
Government Units (LGUS) may, within their respective authorized appropriations 
and in coordination with the Executive Branch, likewise re-engineer their 
respective offices. 
Sec. 4. 
Reorganization 
Principles 
and 
Guidelines. - 
The 
reorganization shall be carried out in accordance with the following principles and 
guidelines: 
a) 
The role of government and the scope, level, and prioritization of 
government activities shall be determined in accordance with the 
Constitution, specifically, the principles of social justice, democracy, 
sustainability, transparency and accountability, the political and 
socio-economic objectives of the government, and the available 
resources; 


The national government shall assist and monitor local government 
units (LGUs) in order to complement the greater autonomy granted 
to them. The delineation of responsibilities between the national 
government and LGUs in the provision, production, and delivery of 
goods and services shall be clearly defined and agreed upon. 
A structural framework shall be adopted that will define the vertical 
and horizontal compartmentalization of the Executive Branch, 
including its basic structural and functional configuration; 
A standard typology of government organizations and personnel 
ranks which will guide the determination of the organizational 
configuration and proper grouping of agencies shall also be 
adopted; 
All government systems and procedures shall be rationalized, 
streamlined, and designed within the context of decentralized 
decision-making authority within the Executive Branch and its 
departments, 
agencies, 
bureaus, 
offices 
and 
other 
instrumentalities; and 
Sec. 5. 
Authority of the President to Implement Re-engineering 
Plans- The President is hereby granted'the authority to review, approve, and 
implement re-engineering plans for specific agencies or sectors submitted by the 
Commission on Government Re-engineering herein created and hereinafter 
referred to as the Commission. 
The President may propose any modification on a re-engineering plan or 
parts thereof submitted by the Commission only once. Within a period not 
exceeding six (6) months from his receipt of the plan, the President shall forward 
the proposed modification to the Commission, which, in turn, shall submit its 
recommendation to the President within three (3) months from its receipt hereof. 
If the president fails to act on a re-engineering plan at the end of the same six- 
month period, the said plan shall be deemed approved and executory. 
All decisions of the President in this act may be appealed to the 
court of appeals and finally to the supreme court only on errors or questions of 
law. 
Sec. 6. 
Creation 
of 
fhe 
Commission on 
Government 
Re- 
Engineering. - An independent and autonomous Commission on Government 
Re-Engineering is hereby created.. The Commission shall be the primary agency 
of government that shall formulate the re-engineering plans for the Executive 
Branch. 
The Commission shall be organized ninety (90) days from the effectivity of 
this Act. 
Sec. 7. Powers and Functions. - The Commission shall have the following 
powers and functions: 
a.) 
To conduct studies and review policies, programs, and models 
relevant to the re-engineering of the government bureaucracy; 
b.) 
To determine the social relevance, economic contribution, and 
general significance of the activities, programs, functions, roles, 
units, departments, agencies and instrumentalities of government 


and to classify them as either vitaVessential or non-vitalhon- 
essential; 
c.) 
To consult with experts, affected government employees, union or 
other 
labor 
groups, 
and 
constituencies 
of 
government 
instrumentalities regarding the functions, roles, and general 
contribution of these instrumentalities to public welfare and socio- 
economic development; 
d.) 
To develop a monitoring and evaluation mechanism that would 
enable 
comprehensive and participative determination of the 
effects of re-engineering programs implemented to see what the 
gains are form these programs, to immediately mitigate any 
adverse effects which it may have, and to address areas which still 
require improvements. 
e.) 
To formulate, within a period not exceeding three (3) years from the 
effectivity of this Act, re-engineering plans for the Executive Branch, 
its sectors, or its specific agencies. The plans may contain any or all 
of the following: 
1) 
Structural, sectional, and operating systems and frameworks 
which define the overall hierarchical and functional 
structures 
of 
the 
Executive 
Branch; 
national-local 
responsibilities; the mandates and functions of sectoral 
departments; and the strategy to streamline and upgrade the 
operating systems of government; 
2) 
Alternatives such as the creation, abolition, merger, 
integration, or restructuring of departments, bureaus, offices, 
agencies, government-owned and -controlled corporations, 
and state universities 
and 
colleges, that will eliminate 
overlapping, duplication, proliferation and diffusion of 
functions, programs, and activities; as well as the transfer of 
appropriations, equippent, properties, records, personnel, 
and transactions from one agency to another; 
3. 
A government staffing and compensation policy and a 
human resource development strategy that shall include: the 
creation, classification and abolition of positions, hiring of 
personnel, and upgrading of compensation structures, 
incentives, add rewards systems; 
4. 
Safety net mechanisms and their implementation strategies 
for employees who may be affected by the re-engineering; 
and 
5. 
Standards, parameters, guidelines, and corresponding 
budget that will be adopted in the implementation of the plan. 
f.) 
To submit, at any time within three (3) years from the effectivity of 
this Act, the re-engineering plans for the President’s review, 
approval, and implementation. 
g.) 
To oversee the implementation of the re-engineering plans. 


Sec. 8. 
Composition. - The Commission shalJ be composed of 
five (5) regular members of the Commission. as follows: 
a> 
an expert on government operations, 
b) 
an expert on organization and management, 
c) 
an expert on financial management, 
d) 
an expert on human resource management, 
e) 
the Chairperson of the Public Sector Labor Management Council 
(PSLMC); and 
9 
the representative of the employees’ union. 
The experts on organization and management, financial management, 
and human resource management must also be knowledgeable in government 
operations. They may come from the public or private sector. 
The experts shall serve the Commission on a full-time basis while the 
Chairperson of the PSLMC and the representative of the employees’ union shall 
serve the Commission as ex-officio members. 
The President shall appoint the full-time members of the Commission as 
well as its Chairperson who shall be chosen from among the full-time members. 
Sec. 9. 
Term of Office and Compensation of the Members of fhe 
Commission. - The members of the Commission shall have a term of office of 
five (5) years, however, the President may extend their term of office for another 
year. 
Should a full-time member of the Commission fail to complete his or her 
term, the President shall appoint a successor who is also an expert in the same 
field as that of the member to be succeeded. Should the Chairperson of the 
PSLMC fail to complete his or her term, the incoming Chairperson shall 
automatically become a member of the Commission. 
All successors shall serve only the unexpired portion of the term of the 
members whom they succeeded. 
The Chairman shall be entitled to the same compensation as that of a 
Department Secretary while a full-time member shall be entitled to the same 
compensation as that of an Undersecretary. 
The ex-officio members of the commission shall be entitled to 
reimbursement of actual transportation, representation, and other expenses 
actually incurred the performance of their functions or to any other compensation 
as may be applicable under existing laws, rules, and regulations. 
Sec. I O .  Removal from Office. - The President may, in accordance with 
the due process of law, remove for cause any member of the Commission before 
the expiration of his or her term. 
Sec. 11. The Secretariat. - The Commission shall organize a Secretariat 
that shall assist the Chairman in the performance of his functions and shall serve 
as the technical arm of the Commission. The Secretariat shall be headed by an 
Executive Director who shall be appointed by the President and who shall be 


responsible for the efficient and effective day-to-day management of the 
operations of the Commission. 
The CSC and the Department of Budget and Management (DBM) shall 
provide the necessary technical and clerical personnel, either on detail or 
secondment basis. As the need arises, technical personnel from other 
government agencies may be tapped to augment the Secretariat personnel. The 
Commission is also authorized to hire consultants who will provide additional 
technical support to the Commission. 
The term of office of the secretariat shall be co-terminus with that of the 
commission. 
Sec. 12. 
Re-engineering Dis-Engagement Program - A safety net 
program to be called the Re-engineering Dis-engagement Program and 
hereinafter referred to as the RDP, is hej-eby created and shall be offered only to 
government employees affected by the re-engineering. 
Sec. 13. 
RetiremenVSeparation Benefits for Personnel Who May be 
Affected by the Reengineering Program. - Personnel who may be affected by the 
reengineering program shall be paid the following retirement or separation 
benefits, whichever is applicable: 
Appropriate unemployment benefits to Government Service 
Insurance System (GSIS) members subject to its existing rules and 
regulations, to be paid for by GSIS; 
Refund of their Pag-ibjg contributions (both personal and 
government plus interest), pursuant to existing rules and 
regulations of the Home Development Mutual Fund (HDMF); 
Commutation of unused vacation and sick leaves, in accordance 
with existing rules and regulations; 
For those qualified to retire, the option to avail of a lump sum and 
pension from any of the retirement laws administered by the GSIS; 
For those not qualified to retire, separation from government 
service with the option to avail of separation gratuity provided either 
under RA No. 8291 (An Act Amending PD 1146, as Amended, 
Expanding and Increashg the Coverage and Benefits of the 
Government Service Insurhnce System, Instituting Reforms Therein 
and for Other Purposes) or RA No. 6656 (An Act to Protect the 
Security of Tenure of Civil Service Officers and Employees in the 
Implementation of Goverpqent Reorganization), as well as the 
return of their GSIS personnel contributions pertaining to retirement 
only and the corresponding share of the government with interest 
earned; 
Sec. 14. 
Additional lncenfives for Affected Employees. - In addition to 
the above-mentioned retirement and separation benefits, the National 
Government shall provide the following incentives: 
a) 
1 '/4 
months of the present basic salary for those who have 
rendered 10 years and below; 


b) 
1 1/2 months of the present basic salary for every year of service for 
those who have rendered 1 I 
to 20 years; 
c) 
1 % months of the present basic salary for every year of service ,for 
who have rendered 21 to 3Q years; and 
those 
d) 
2 months of the present basic salary for every year of service for 
those who have rendered 31 years and above. 
GSIS members who do not qualify for retirement by reason of non- 
fulfillment of the required period of government service may be able to qualify by 
making use of the period during which they have rendered services to a private 
employer and for which contributions were paid to the SSS, by summing up the 
worker's creditable services or contributions in each of the Systems. They shall, 
however, be entitled to the retirement benefits proportionate to their creditable 
service in government. 
Sec. I 
5. Period of Applicability and Effectivity of Retirement, Separation, 
and lncenfive Benefits. 
- The President shall commence to implement the 
provisions for retirement, separation, and incentive benefits of 
affected 
employees within one (1) year from his approval of re-engineering plans 
Sec. 16. 
Options for Retirees, 
-' To provide a sense of fulfillment and 
source of livelihood after their retirement from government service, the affected 
employees can avail of the following opportunities: 
a) 
Those with special skills may register with the Secretariat (to be 
formed in cooperation with Civil Service Commission) which shall 
handle the pool of specialists whose services as resource 
speakers, consultants, and the like the government and private 
sector may tap; 
b) 
They may join a cooperative whose membership and management 
shall be limited to retirees; 
c) 
They may file membership with SSS and avail of special benefits 
for retirees such as shorter loan maturation period; and 
They may opt to pool their resources for business ventures through a 
special credit program to be provided by government financial institutions. 
Sec. 17. Restriction on the Employment and Replacement of Retired or 
Separated Personnel. - Affected employe& shall not be eligible for appointment 
to, or employment in any branch, division, instrumentality or agency of the 
government, including government-owned or controlled corporations, whether,on 
a permanent, temporary, casual, contractual, or emergency status, within a 
period of five (5) years after separatiop, unless they refund the benefits they 
received. Those that will be re-employed in the government shall be treated as 
new entrants insofar as GSlS coverage is concerned. 
Sec. 18. 
Report to Congress. - The President shall submit a written 
report to Congress within three (3) months after the completion of the 
implementation of the re-engineering plan for each department/agency 
Sec. 19. 
Formulation of implementing rules and regulation. - Within 
one (I) 
month after the approval of this act, the President shall convene the 


Oversight Committee as herein provided for. The said committee shall formulate 
and issue the appropriate rules and regulations necessary for the efficient and 
effective implementation of any and all provisions of this act. 
A.) 
the Committee shall be composed of the following: 
the Executive Secretary, who shall be the chairman; 
three (3) members of the Senate to be appointed by the 
President of the Senate, to include the Chairman of the 
Committee 
on 
Civil 
Service 
and 
Government 
Reorganization; 
three (3) members of the House of Representatives to be 
appointed by the Speaker, to include the Chairmen of the 
Committees on Government Reorganization, and Civil 
Service and Professional Regulation; 
the Cabinet represented by the following: 
(a) Secretary of Budget and Management; 
(b) Chairperson of Civil Service Commission; and 
(c) Director-General of National Economic Development 
Authority. 
9.) 
The committee shall submit its report and recommendation to the 
president within two (2) months after its organization. 
If the 
President fails to act within thirty (30) days from receipt hereof, the 
recommendation of the oversight committee shall be deemed 
approved. 
C.) 
The services of a technical staff shall be enlisted from among 
qualified employees of congress and government offices. 
Sec. 20. Continuing “Scrap-And-Build Policy of fhe Government. - After 
the re-engineering of the Executive Branch is fully implemented, the national 
government shall adopt a continuing “scrap-and-build” policy, subject to review 
and approval by Congress, for organizational and staffing changes in accordance 
with the following principles and guidelines: 
The proper scope, level, and focus of government interventions, 
distribution of functions among levels of government, design of the 
administrative structure and level of manpower complement of the 
Executive Branch shall be established and fixed after the 
implementation of the re-engineering under this Act; 
An agency may be created provided an existing equivalent 
organizational unit is abolished; and 
Increases in the personnel and staffing complement of any 
department of the Executive Branch shall be allowed only for 
population-sensitive positions, such as teaching and related 
teaching, uniformed, and medical and allied-medical positions. 


For this purpose, the Commission shall provide the detailed guidelines on 
the continuing implementation of the “scrap-and-build” policy. 
Sec. 21. Funding Requirement. - The amount necessary for the initial 
implementation of this Act shall be sourced from any available savings of the 
Executive Branch. Such sums necessary for the succeeding implementation of 
this Act shall be included in the annual General Appropriations Act (GAA). 
The retirement and separation benefits herein granted shall be included in 
the Miscellaneous Personnel Benefits Fund as provided for under the General 
Appropriations Act. 
Sec, 22. Repealing Clause. - All laws, decrees, orders, rules and 
regulations or parts thereof which are inconsistent with the provisions of this Act 
are hereby repealed or amended accordingly 
Sec.23. Separability Clause. - If for any reason any section or provision 
of this Act is declared unconstitutional or invalid, other sections or provisions 
hereof which are not affected thereby shall continue to be in full force and effect. 
Sec. 24. 
,Effectivity. - This Act shall take effect immediately upon its 
approval. 
Approved,