Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRESS
Second Regular Session
HouseBi||No.9893
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Introduced by HON. RODOLFO "OMPONG" M. ORDANES
AN ACT PROVIDING FOR THE AUTOMATIC ANNUAL ADJUSTMENT OF THE
PENSIONS 0F RETIREES FROM THE GOVERNMENT WHO ARE MEMBERS OF
THE GOVERNMENT SERVICE INSURANCE SYSTEM
EXPLANATORY NOTE
This bill aims to provide for the annual automatic adjustment of the pensions of retirees
from  the  Philippine  Government  who  are  members  of  the  Government  Service
Insurance  System  (GSIS)  by  linking  their  pensions  to  the  annual  inflation  rate  or
movement  of the  Consumer  Price  Index  (Cpl)  issued  by  the  Philippines  Statistics
Authority (PSA).
The monthly retirement pensions Of GSIS members are lifetime benefits computed as
of their retirement date. As they receive their retirement pensions, the actual value Of
this amount diminishes as living costs rise, weakening their purohasing power for basic
needs such as food and medicines.
Republic  Act  No.  9291,  also  known  as  the  `The  Government  Service  Insurance
System Act of  1997,"  allows for periodic  pension  adjustments  based  on  the  GSIS'
actuary recommendations and Board approvalt . However, previous adjustments, such
as the  increases  of 1.5%  per year in  2013,  the  minimum  basic  monthly  pension  Of
P5,000.00 in 2013,  and the proposed increase to P6,000.00 in 2019,  have not kept
pace with inflation rates.
Although these adjustments provided relief for pensioners, they only occur irregularly
and  depend  on  the  Board's  recommendation  and  the  President's approval.  Even  if
they are endorsed,  the rates of these modifications still fall substantially behind the
actual  inflation  rates,  which  have  averaged  4  percent  annually  over  the  past  two
decades.
1  Section 14, Republic Act No. 9291


The adjusted pensions of retirees also remain significantly lower than those of active
government employees in comparable positions. For example, a typical public school
teacher who retired fifteen years ago receives a pension considerably less than the
salary of current teachers.
The proposed pension system has been a long practice in other countries. In fact, the
federal and state governments in the United States of America provide Cost of Living
Adjustments (COLA) to their retired public employees, typically tied to the Cpl or fixed
peroentages of monthly pensions. Other European countries,  Israel, and Chile, have
also established similar systems for automatically adjusting age-old pensions.
If passed  into  law,  this  bill  hopes to significantly benefit 577,765  GSIS  old-age and
survivorship  pensioners  (as  of  March   2023)2  and  future  retirees,   including  their
families,  and  make their hard-earned  pensions cope with the rising  cost of living for
the remaining years of their lives.
The needed amount for implementing this system will be souroed from the GSIS, given
its robust financial standing, as reflected by its reported net income of P80 billion pesos
in 2023.
Given the foregoing, the passage of this bill is earnestly sought.
RODOLFO "
M. ORDANES
2https://icrs.gcg.gov.ph/profiles/gsis#:~:text=As%20of%20March%202023%2C%20GSIS,old%2Dage%20and%20survivorship%20pensioners.


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRESS
Second Regular Session
House Bill No. 9 8 9 3
Introduced by HON. RODOLFO "OMPONG" M. ORDANES
AN ACT PROVIDING FOR THE AUTOMATIC ANNUAL ADJUSTMENT OF THE
PENSIONS OF RETIREES FROM THE GOVERNMENT WHO ARE MEMBERS OF
THE GOVERNMENT SERVICE INSURANCE SYSTEM
Be it enacted by the  Senate and the  House of Representatives of the Philippines in
Congress assembled :
SECTION   1. COVERAGE.  -  This  Act  shall  apply  to  all  living   retirees  from  the
government whose pensions are paid by the Government Service Insurance System
(GSIS) as of the effective date Of this Act.  It shall also apply to all future retirees from
the Government whose pensions are to be paid by the GSIS.
SECTION  2.  ANNUAL  ADJUSTMENT  OF  PENSION.  - The  monthly  pension  of a
retiree shall be automatically adjusted at every anniversary of his retirement date by
using the following formulae:
Mph    =MPoxK
K           = Cpln/Cplo
where:
Mpn    = new monthly pension of the retiree;
MPo    = original monthly pension of the retiree at the time of his retirement;
K          = adjustment factor to be applied to the original monthly pension;
Cpln   =   Consumer  Price  Index  (CPI)  issued   by  the  Philippines  Statistics
Authority  (PSA)  for  the  retirement  anniversary  month  when  the  new
monthly pension will take effect, and;
Cplo   =  Cpl  issued  by the  PSA for the  month  of the year when  the original
monthly pension took effect.
SECTION 3. SOURCE OF FUNDS AND PAYWIENT. -The amounts needed to pay to
each concerned retiree, that is, the difference between the original and current monthly


pensions, as a result of applying the formulae in Section 2 of this Act, shall be provided
from funds of the GSIS.
SECTION  4.  SEPARABILITY  CLAUSE.  -  If  any  provision  of  this  Act  is  declared
unconstitutional  or invalid,  other parts of provisions hereof not affected thereby shall
continue to be in full force and effect.
SECTION 5. REPEALING CLAUSE. -All laws, decrees, orders, rules, and regulations
or parts thereof inconsistent with the Act are hereby repealed or amended accordingly.
SECTION 6. EFFECTIvlrv. -This Act shall take effect fifteen (15) days following its
publication in at least two (2) newspapers of general circulation.
Approved,