SIXTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHIILIPPINES 
) 
-it'l'tntt 
"II,;, uf tlt. ~f<'T"'llr .• 
First Regular Session 
) 
'13 JUl -8 P 2 :40 
SENATE 
S.No. 610 
'ECEII"'" IlV'~ 
Introduced by Senator Ralph G. Recto 
Explanatory Note 
The PCSO has previously been mired in controversies over the alleged misuse of its 
Charity Fund - a billion pesos fund utilized to undertake medical and other social welfare 
program and projects of the PCSO and implemented through the services of Non-Government 
Organizations (NGOs), the Church and other program partners as conduits of funds for charity 
projects to the people. 
Given the discretionary nature of the Charity Fund and the lack of clear accountability 
provided in the PCSO charter, the disbursement of Charity Fund has not been in accordance with 
specific standards and is only subject to the approval of the PCSO board. 
Furthermore, the public is left in the dark as to the magnitude and allocation of the PCSO 
Charity Fund. There is no transparency in the use of the fund because it does not go through the 
usual budget scrutiny as it is considered an off-budget item and, therefore, not discussed in the 
congressional public hearings on the General Appropriations Bill. 
For ~s long as we leave the disbursement of the Charity Fund in the hands.iofthe PCSO 
board, allegations. of abuse in its utilization will continue to be a thorny problem for the 
institution. 
This bill intend.s to amend the charter of the PCSO. The Charity Fund which constitutes 
30% of the net receipts ofthe PCSO, under the bill, shall be used entirely for the National Health 
Insurance Program administered by the Philhealth. 
The equivalent amount shall be included in the General Appropriations Act (GAA) as a 
Special Purpose Fund for the counterpart shares of the national and local government in the 
National Health Insurance Program under the Philhealth. Thus, "what you see is what you get" 
as reflected in the GAA and no more "pork barrel" for the PCSO board. 
Hence, instead of the PCSO funneling the funds to its various government hospital 
beneficiaries, PCSO' s Charity Fund would now be directly infused to PhilHealth that will allow 
indigents to seek treatment in government and private hospitals as well. 
Given such set-up, indigents no longer need to suffer the long queues of patients in the 
PCSO for financial assistance before they can line up in the hospitals for the medical services. 
Instead, they can go directly ·to any hospital accredited by the PhiIHealth to avail the needed 
hospital services. 
. 
The provision of funds for PhilHealth will hasten the achievement of universal health 
care coverage and will mean health insurance coverage for the poorest of the poor who are the 
usual players of the PCSO's Lotto and Sweepstakes. 
This is also in line with the Aquino Administration Health Agenda which seeks to attain 
Universal Health Care by giving all Filipinos especially the poor and marginalized access to 
---------


needed health care services without having to use personal money by enrolling them in 
PhilHealth and enhancing the benefit package that it offers. 
With PCSO funds used to finance the National Health Insurance Program, there will be 
easing of pressure to raise new taxes to cover increasing requirements of the program. And, 
instead of PhilHealth members having to pay increased contributions to pay for enhanced 
benefits, the PhilHealth with additional funding from PCSO will now finance the additional cost 
of improved health services. 
The full implementation of universal coverage will increase health expen4itures of the 
PhiIHealth and will reduce out-of-pocket expenditures which have dire implications to the people 
particularly the poor. This will result in freeing scarce household funds that can now be used for 
other basic expenses like education and food. The availability of insurance can also shield the 
people from distress having to face unexpected hospital expenses. 
In view of the foregoing, the approval of the bill is earnestly sought. 
mksbc 


SIXTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
) 
~l?mItI? 
!tll",.r t~. ~''''t .. ,t 
First Regular Session 
) 
'13 
JUL -8 P 2 :.ttl 
SENATE 
S. No. 610 
Introduced by Senator Ralph G. Recto 
AN ACT 
ACCELERATING UNIVERSAL HEALTH CARE COVERAGE BY EARMARKING 
THE ENTIRE PHILIPPINE CHARITY SWEEPSTAKES OFFICE CHARITY FUND 
FOR SUCH PURPOSE, THEREBY AMENDING REPUBLIC ACT NO. 1169, AS 
AMENDED BY BAT AS P AMBANSA BLG. 42 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
1 
SECTION 1. Section 1 of Republic Act No. 1169, as amended by Batas Pambansa Blg. 
2 
42 is hereby further am~nded to read as follows: 
3 
"SECTION 1. The Philippine Charity Sweepstakes Office (PCSO~. - The 
4 
Philippine Charity Sweepstakes Office, [hereinafter designated the Office,l shall [be 
5 
the principal government agency for raising] RAISE and [providing] PROVIDE [for] 
6 
funds for THE NATIONAL HEALTH INSURANCE PROGRAM (NHlP) [health 
7 
programs, medical assistance and services] and charities of national character, and as 
8 
such shall have the general powers conferred in [section thirteen of Act Numbered 
9 
One thousand four hundred fifty-nine] SECTION 13 OF ACT NUMBERED 1469, 
10 
as amended, and shall have the authority:" 
11 
"A, To hold and conduct charity sweepstakes races, lotteries, and other similar 
12 
activities, in such frequency and mauner, as shall be determined, and subject to such 
13 
rules and regulations as shall be promulgated by the Board of Directors. 
14 
["B. Subject to the approval of the Minister ofIIuman Settlements, to engage in health 
15 
and welfare-related investments, programs, projects and activities which may be 
16 
profit-oriented, by itself or in collaboration, association or joint venture with any 
17 
person, association, company 01' entity, whether domestic or foreign, except for the 
18 
activities mentioned in the preceding paragraph (A), for the purpose of providing for 
19 
permanent .and continuing sources of funds for health programs, including the 
20 
expansion of existing ones, medical assistance and services, and/or charitable grants: 
21 
Provided, That such investments will not compete with the private sector in areas 


1 
where investments are adequate, as may be detennined by the National Economic and 
2 
Development Authority. "] 
3 
"[C]B. To undertake any other activity that will enhance its funds geheration 
4 
operations and funds management capabilities[, subject to the same limitations 
5 
provided for in the preceding paragraph]. " 
6 
"It shall have, a Board of Directors, hereinafter designated the Board, composed of 
7 
five members who shall be appointed, and whose compensation and term of office 
8 
shall be fixed, by the President [(Prime Minister)]." 
9 
Sec. 2. Section 6 of Republic Act No. 1169, as amended by Batas Pambansa Big. 42 is 
10 
hereby further amended to read as follows: 
11 
"SEC. 6 Allocation of Net Receipts. - From the gross receipts from the sale of 
12 
[sweepstakes I tickets, whether for sweepstakes races, lotteries, or other similar 
13 
activities, shall be deducted the printing cost of such tickets, which in no case shall 
14 
exceed two percent (2%) of such gross receipts to arrive at the net receipts. The net 
15 
receipts shall be allocated as follows:" 
16 
"A. Fifty-five percent (55%) shall be set aside as a prize fund for the payment of 
17 
prizes, including those for the owners, jockeys of running horses, and sellers of 
18 
winning tickets." 
19 
"Prizes not claimed by the public within one year from date of draw shall be 
20 
considered forfeited; and shall fonn part of the charity fund for disposition as stated 
21 
below." 
22 
"B. Thirty percent (30%), AS CHARITY FUND, WHICH shall be set aside as 
23 
contributions to the NHIP, CREATED UNDER REPUBLIC ACT NO. 7875, AS 
24 
AMENDED, 
~ND ADMINISTERED BY THE PHILIPPINE 
H~ALTH 
25 
INSURANCE CORPORATION (PHILHEALTH) FOR THE EXC~USIVE 
26 
PURPOSE OF UNIVERSAL HEALTH CARE COVERAGE: PROVIDED, 
27 
THAT THE EQUIVALENT AMOUNT SHALL BE INCLUDED IN THE 
28 
GENERAL APPROPRIATIONS ACT (GAA) AS A SPECIAL PURPOSE 
29 
FUND FOR THE COUNTERPART SHARES OF THE NATIONAL AND 
30 
LOCAL GOVERNMENT IN THE NHIP UNDER THE PHILHEALTH 
31 
[charity fund from which the Board of Directors, in consultation with the Ministry of 
32 
Human Settlements on identified priority programs, needs and requirements in 
33 
specific communities and with the approval of [he Office of the President (Prime 


t 
). . . 
1 
Minister), shall make payments or grants for health programs, including the 
2 
expansion of existing ones, medical assistance and services andlor charities of 
3 
national character, such as the Philippine National Red Cross, under such policies 
4 
and subject to such rules and regulations as the Board may from time to time 
5 
establish and promulgate. The Board may apply part of the contributions to the 
6 
charity fund to approved investments of the Office pursuant to Section I (B) hereof, 
7 
but in no case shall such application to investments exceed ten percent (10%) of the 
8 
net receipts from the sale of sweepstakes tickets in any given year)." 
9 
"Any property acquired by an institution or organization with funds given to it under 
10 
this Act shall not be sold or otherwise disposed of without the approval of the Office 
11 
of the President [(Prime Minister»), and that in the event of its dissolution all such 
i 
12 
property shall be transferred to and shall automatically become the property of the 
I 
13 
Philippine Government." 
14 
"C. Fifteen (15%) percent shall be set aside as contributions to the operating 
15 
expenses and capital. expenditures of the Office. 
16 
"D. All balances of any funds in the Philippine Charity Sweepstakes Office shall 
17 
revert to and form part of the charity fund provided for in paragraph (B) HEREOF[, 
18 
and shall be subject to disposition as above stated)." 
19 
"The disbursements of the allocation herein authorized shall be subject to the usual 
20 
auditing rules and regulations." 
21 
Sec. 3. Implementing Rules and Regulations. - Within sixty (60) days upon effectivity of 
22 
this Act, the PCSO, the PhilHealth and the Department of Budget and Management (DBM) shall 
23 
provide the necessary rules and regulations for the proper disposition of the said funds and the 
24 
effective implementation of this Act. 
25 
Sec. 4. Separability Clause. - If any provision of this Act is subsequently declared 
26 
unconstitutional, the validity of the remaining provisions hereof shall remain in full force and 
27 
effect. 
28 
Sec. 5. Repealing Clause. - All laws, decrees, executive orders, rules and regulations and 
29 
other issuances or parts thereof which are inconsistent with this Act are hereby repealed or 
30 
modified accordingly. 
31 
Sec. 6. Effectivity. - This Act shall take effect fifteen (15) days after its publication in the 
32 
Official Gazette or in any two (2) newspapers of general circulation. 
Approved, 
ml<sbc