Republic of the Philippines 
House of Representatives 
Quezon City, Metro Manila 
Twentieth Congress 
First Regular Session 
HOUSE BILL NO. 2974 
Introduced by Representatives Ferdinand Martin G. Romualdez, Yedda 
Marie K. Romualdez, Andrew Julian K. Romualdez and Jude A. Acidre 
AN ACT 
CREATING A SUSTAINABLE FISCAL FRAMEWORK FOR THE 
PENSION 
SYSTEM 
OF 
THE 
MILITARY 
AND 
UNIFORMED 
PERSONNEL, PROVIDING MECHANISMS FOR THE DISPOSITION 
OF 
GOVERNMENT 
ASSETS 
FOR 
THE 
PURPOSE, 
AND 
APPROPRIATING FUNDS THEREFOR 
EXPLANATORY NOTE 
Securing the pension system for military and uniformed personnel (MUP) 
is a vital obligation of the State. Because of long-standing issues in the design of 
the system, however, the MUP pension is now facing an imminent existential 
threat. The possibility that the state will be unable to meet the funding 
requirements of the MUP pension is real, and its signs are now evident given the 
government's budget deficit is at ₱375.7 billion.1 
From 2018 to 2022, MUP pension requirements have grown at an annual 
rate of 12% on the average. Such funding requirements will continue to elevate 
at a fiscally unsustainable rate, as pension payments are indexed to growing 
salaries of active MUP. Moreover, the ballooning MUP pension requirements, 
with no corresponding financing source cover, create significant fiscal risk to the 
government and expose the MUP pension from fiscal and economic shocks. Thus, 
it is imperative to make crucial changes to save the pension system. 
1 As of March 2025, reported by the Bureau of Treasury 
August 4, 2025
5:00 pm


2 
To keep the pension system alive for current and future pensioners, we 
must address the system's most significant weaknesses. First, the pension of the 
MUP is indexed to the salary of active personnel. Second, unlike other 
government employees, the MUP are entitled to a retirement pension starting at 
20 years of service before reaching retirement age. Finally, unlike the pension of 
government employees under the Government Service Insurance System (GSIS), 
the MUP pension is non-contributory. 
The urgency of the situation is shown clearly by the size of the problem. 
The estimated total funding requirement is around P9.6 trillion if the status quo 
is maintained, according to the latest actuarial study by the GSIS.2 
The size of the problem will continue to expand as we recruit more MUP. 
The MUP pension is already nine times that of the average pensioner of the Social 
Security System (SSS) and three times that of the average GSIS pensioner. 
To address this staggering fiscal overhang, this measure proposes the 
following reforms: 
(1) Mandatory contributions. New entrants, or those who will entering
the service after the enactment of this Act, will contribute 9% of their
monthly compensation as personal share and the National Government
will provide 12% as its share;
(2) Fund administrator of MUP pension. The MUP Trust Fund
Committee will be established as the administrator of the MUP Trust
Fund, with the Bureau of Treasury (BTr) as the Secretariat and the GSIS
as the fund manager;
(3) Pension indexation. Limits the automatic indexation of pension and
survivorship benefits to adjustments in the salary of those in the active
service holding the same rank, with a three percent (3%) annual cap on
the salary increase of MUP for the next ten (10) years following the
effectivity of the measure. The bill also allows the President, upon
recommendation to the MUP Trust Fund Committee, to increase
pensions at a rate lower than the growth rate in salaries, when the
national government incurs an unmanageable public sector deficit;
(4) Other sources of funding. Earmarks proceeds from the lease, joint
development, auction of development rights, or disposition of
government properties identified for the purpose, and investment
income from the Trust Fund as sources of additional funding for the
maintenance of MUP Trust Fund; and proceeds from the disposition of
certain assets of the military and uniformed services for budgetary
2 GSIS using data as of December 31, 2019 


3 
support of the uniformed services for capital outlay and maintenance 
and other operating expenditures; 
(5) Tax treatment of the MUP Trust Fund. Exempts MUP Trust Fund,
its assets, revenues, including all accruals thereto, and benefits paid,
from all taxes, assessments, fees, charges, or duties of all kinds.
During the 19th Congress, Representative Joey Salceda chaired the Ad Hoc 
Committee on the Military and Uniformed Personnel Pension System which 
consolidated all the pertinent bills on the proposed pension system into House 
Bill No. 8969. The substitute bill was approved by the House and transmitted to 
the Senate in September 2023. 
In view of the urgency of the matter, the approval of this bill is urgently 
sought.  
FERDINAND MARTIN G. ROMUALDEZ 
YEDDA MARIE K. ROMUALDEZ 
ANDREW JULIAN K.  ROMUALDEZ 
JUDE A. ACIDRE 


Republic of the Philippines 
House of Representatives 
Quezon City, Metro Manila 
Twentieth Congress 
First Regular Session 
HOUSE BILL NO. 2974 
Introduced by Representatives Ferdinand Martin G. Romualdez, Yedda 
Marie K. Romualdez, Andrew Julian K. Romualdez and Jude A. Acidre 
AN ACT 
CREATING A SUSTAINABLE FISCAL FRAMEWORK FOR THE 
PENSION 
SYSTEM 
OF 
THE 
MILITARY 
AND 
UNIFORMED 
PERSONNEL, PROVIDING MECHANISMS FOR THE DISPOSITION 
OF 
GOVERNMENT 
ASSETS 
FOR 
THE 
PURPOSE, 
AND 
APPROPRIATING FUNDS THEREFOR 
Be it enacted by the Senate and House of Representatives of the Philippines 
in Congress  assembled: 
TITLE I 
General Provisions 
SECTION 1.  Short Title.  –  This Act shall be known as the “Military and 
Uniformed Personnel Pension System Act.” 
SEC. 2. Declaration of Policy. – The State duly recognizes the vital role 
of the Military and Uniformed Personnel in providing internal and external 
security, promoting peace and order, and ensuring public safety. 
The State also recognizes its obligation to secure the pension system for 
the Military and Uniformed Personnel given the distinctive personal risks in their 
role in nation-building and national security. 


2 
 
Towards these ends, the State shall guarantee the sustainability of the 
pension and other benefits of the Military and Uniformed Personnel by 
establishing a fiscal framework that fully supports their funding requirements. 
SEC. 3.  Definition of Terms.  –  As used in this Act: 
(a) Active Service refers to active service rendered by the 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; 
(b) Military and Uniformed Personnel refers to all employees of the 
government who wear uniforms, with ranks, may be armed or unarmed, 
primarily involved in national defense, enforcement of laws, and in the 
maintenance of peace, order, and security and who belong to any of the 
following services: Armed Forces of the Philippines, Philippine National 
Police, Philippine Coast Guard, Bureau of Fire Protection, Bureau of Jail 
Management and Penology, Bureau of Corrections, and the commissioned 
officers of the Hydrography Branch of the National Mapping and Resource 
Information Authority who were transferred from the Bureau of Coast and 
Geodetic Survey; 
(c) New Entrants refer to Military and Uniformed Personnel who entered or 
re-entered the Military and Uniformed Services after the effectivity of this 
Act;  
(d) Pension refers to the sum of money representing the monthly retirement 
pay or the monthly life annuity of a Military and Uniformed Personnel; 
(e) Survivors refer to the following:  


3 
 
1. Surviving spouse if married to the deceased prior to the latter’s 
retirement or separation and not legally separated by judicial decree 
from the deceased issued on grounds not attributable to said spouse: 
Provided, That entitlement to benefits shall terminate until the said 
spouse remarries, cohabits, or engages in a common law relationship; 
2. Surviving children shall mean: 
i. 
Born of the marriage contracted prior to the retirement or 
separation from the service; 
ii. 
Adopted or acknowledged by the deceased while in active 
service; and, 
iii. 
Children who are eighteen (18) years old and above but suffering 
from mental or physical incapacity, or any disability that renders 
them totally dependent on the deceased.  
Provided, That entitlement to benefits shall terminate when the 
surviving children attain eighteen (18) years of age or get married, except 
for surviving children who were duly certified by the appropriate medical 
certification process of the respective military or uniformed services, to be 
incapable of employment by reason of their mental or physical incapacity. 
In default of those mentioned in paragraphs (1) and (2), above, or in 
their absence, the surviving parent or parents, or in default thereof, the 
surviving unmarried brothers and sisters who are below eighteen (18) years 
of age and without parental obligation; and 
(f) Survivorship Pension refers to the monthly benefit or the monthly life 
annuity of the beneficiaries of a deceased Military and Uniformed 
Personnel who is retired under the provisions of existing laws. 
SEC. 4. Compulsory Retirement. – The following shall be compulsorily 
retired: 


4 
 
(a) Military Personnel – Military Personnel shall be compulsorily retired 
from service in accordance with Section 6 of Republic Act No. 11709, as 
amended by Section 2 of Republic Act No. 11939, under at least one of the 
following conditions:  
(1) Upon reaching fifty-seven (57) years of age, or upon accumulation of 
thirty (30) years of satisfactory active service, whichever comes later; or 
(2) For key officers upon completion of tour of duty, or upon relief by the 
President.  
(b)  Uniformed Personnel – Uniformed Personnel shall be compulsorily 
retired from service upon reaching the age of fifty-seven (57) years old, or upon 
accumulation of thirty (30) years of satisfactory active service, whichever comes 
later. 
Military or Uniformed Personnel killed-in-action or wounded-in-action 
resulting in total permanent disability as duly certified by the appropriate medical 
certification process of the respective services, shall be deemed compulsorily 
retired for purposes of computing retirement benefits. 
SEC. 5.  Optional Retirement. – A Military and Uniformed Personnel may 
voluntarily retire upon accumulation of at least twenty (20) years of satisfactory 
active service, subject to the approval of the appropriate authority. 
SEC. 6. Harmonization of Total Permanent Disability Benefits. – 
Military and Uniformed Personnel with total permanent disability as a result of 
injuries suffered or sickness contracted in the performance of duty as duly 
certified by the appropriate medical certification process of the respective 
services, that the extent of the disability or sickness renders such personnel unfit 
or unable to further perform the duties of his position, shall be compulsory retired. 
TITLE II 
Fiscal Sustainability of Pension Benefits 


5 
 
SEC. 7.  Fiscal Risk Management. – To ensure that fiscal risks related to 
the Military and Uniformed Personnel Pension System are managed and 
addressed, the Secretary of Finance, as Chairperson of the Military and 
Uniformed Personnel Trust Fund Committee created under Section 12 of this Act, 
shall: 
(a) Formulate policies, consistent with law, to ensure the fiscal 
sustainability of the pension of Military and Uniformed Personnel; 
(b) Obtain information from any officer or office of local governments and 
agencies and instrumentalities of the National Government, as may be necessary; 
(c) Assess possible risks to the fiscal sustainability of the pension of 
Military and Uniformed Personnel and propose appropriate policy interventions; 
(d)  Identify, manage, and control risks that the pension of the Military and 
Uniformed Personnel may pose to the National Government’s fiscal position; and 
(e) Inform both Houses of Congress of such risks through the annual Fiscal 
Risk Statement and propose legislative reforms to address such risks. 
SEC. 8. Retirement Pay. – For those who entered the active service prior 
to the effectivity of this Act, the monthly retirement pay shall be fifty percent 
(50%) of the base pay and longevity pay of the grade next higher than the 
permanent grade last held by the personnel in case of twenty (20) years in active 
service, increasing by two and one-half percent (2.5%) for every year of active 
service rendered beyond twenty (20) years to a maximum of ninety percent (90%) 
for thirty-six (36) years of active service and over. 
Upon retirement, a military or uniformed personnel shall choose between 
the following modes of payment of retirement benefits: 
(a) Lump Sum – Received in advance and in one lump sum, retirement 
benefits equivalent to thirty-six (36) months; and three (3) years thereafter, 
received monthly retirement benefits as they accrue; or 
(b)  Direct Pension  –  Received monthly retirement benefits as they accrue. 


6 
 
The retirement pay of a Military and Uniformed Personnel who is killed-
in-action or wounded-in-action resulting in total permanent disability, as duly 
certified by the appropriate medical certification process of the respective 
services, is computed at the rate of ninety percent (90%) of the monthly base and 
longevity pay of the retirement grade of the personnel regardless of years in active 
service. 
For new entrants, monthly retirement pay shall be fifty percent (50%) of 
the base pay and longevity pay of the permanent grade last held by the personnel 
in case of twenty (20) years in active service, increasing by two and one-half 
percent (2.5%) for every year of active service rendered beyond twenty (20) years 
to a maximum of ninety percent (90%) for thirty-six (36) years of active service 
and over. 
Nothing in this section shall be construed as authorizing any downward 
adjustment of pay, or payment of any differential in retirement pay, to Military 
and Uniformed Personnel who are already retired prior to the approval of this 
Act. 
SEC. 9. Separation Pay. – Military and Uniformed Personnel who 
separates or resign from the service without reaching twenty (20) years of 
satisfactory active service shall receive a separation pay equivalent to one-month 
base pay plus longevity pay of the permanent grade the Military and Uniformed 
Personnel holds at the time of separation for every year of active service.  
SEC. 10.  Adjustments in Active Personnel Pay and Pension Benefits. – 
The pension of retired Military and Uniformed Personnel and survivorship 
pension of qualified survivors shall be subject to an automatic indexation at a rate 
not exceeding one hundred percent (100%) of the increase in the base pay of the 
Military and Uniformed Personnel in active service holding the same rank during 
the same year: Provided, That for the first ten (10) years from the effectivity of 


7 
 
this Act, there shall be a guaranteed annual adjustment in the base pay of active 
Military and Uniformed Personnel of three percent (3%). 
There shall be no automatic adjustment of the retirement and survivorship 
benefits to the prevailing scale of salary of the active Military and Uniformed 
Personnel of the same rank for new entrants. The Military and Uniformed 
Personnel Trust Fund Committee, created under Section 12 of this Act, may 
increase the retirement benefits herein provided by not more than one and a half 
percent (1.5%) of the retirement benefit within a given year, when the financial 
sustainability of such increase is supported by an actuarial study. 
The President of the Philippines is hereby authorized, upon the 
recommendation of the Military and Uniformed Personnel Trust Fund 
Committee, and subject to consultation with the President of the Senate and the 
Speaker of the House of Representatives, to adjust the pension and survivorship 
pension at a rate lower than the adjustment prescribed herein due to adverse fiscal 
or economic conditions, as certified by the Development Budget Coordination 
Committee. 
TITLE III 
Military and Uniformed Personnel Trust Funds 
 SEC. 11. MUP Trust Funds. – There shall be two (2) trust funds for the 
Military and Uniformed Personnel Services as follows:   
(a)  Armed Forces of the Philippines Trust Fund. – The Armed Forces of 
the Philippines Trust Fund, hereinafter referred to as the AFP Trust Fund, is 
hereby created for the budgetary support of separation and retirement benefits of 
the Armed Forces of the Philippines, including the payment of the retirement pay, 
separation pay, and assistance to indigent pensioners under this Act, as well as 
the disability and survivorship pension under existing laws; and 
(b)  Uniformed Personnel Services Trust Fund. – The Uniformed Personnel 
Services Trust Fund, hereinafter referred to as the UPS Trust Fund, is hereby 


8 
 
created for the budgetary support of separation and retirement benefits of the 
uniformed personnel services, including the payment of the retirement pay, 
separation pay, and assistance to indigent pensioners under this Act, as well as 
the disability and survivorship pension under existing laws. 
SEC. 12.  Military and Uniformed Personnel Trust Fund Committee. – 
To carry out the declared policy of this Act, the Military and Uniformed Personnel 
Trust Fund Committee, hereinafter referred to as the Committee, is hereby 
created.  The Committee shall be organized within ninety (90) days from the 
effectivity of this Act. The Committee is composed of the following members: 
a. Secretary of Finance as Chairperson; 
b. Secretary of Budget and Management; 
c. Secretary of National Defense; 
d. Secretary of the Interior and Local Government; 
e. Secretary of Justice; 
f. Secretary of Transportation;  
g. Executive Secretary of the Office of the President; 
h. President and General Manager of the Government Service 
Insurance System; 
i. Chief of Staff of the Armed Forces of the Philippines; and 
j. Chief of the Philippine National Police. 
Provided, That the participation of representatives of the Military and 
Uniformed Services in deliberations and decision-making processes of the 
Committee shall be limited to the matters concerning their respective trust fund.    
The Bureau of the Treasury shall serve as the Secretariat of the Committee 
and maintain the records and accounts of all investments, receipts, disbursements, 
and other transactions relating to the management, administration, and utilization 
of the MUP Trust Funds: Provided, That these records and accounts are 


9 
 
maintained in accordance with the existing accounting and auditing laws, rules 
and regulations, and audited by the Commission on Audit. 
SEC. 13.  Powers and Functions of the Committee. – The Committee 
shall exercise the following powers and functions: 
(a)  Act as Trustee of the MUP Trust Funds and such other assets as may 
be assigned to the pension system of the Military and Uniformed Personnel and 
direct how the assets of the MUP Trust Funds are managed; 
(b)  Manage the MUP Trust Funds, through the fund manager designated 
under Section 14 herein, and ensure that the fund is actuarially and financially 
optimal and sustainable; 
(c)  Authorize the necessary expenses to manage and administer the MUP 
Trust Funds; 
(d)  Implement and execute functions related to the disposition of assets 
identified under this Act; 
(e) Create, manage, and utilize separate trust fund sub-accounts for the 
different Military and Uniformed Services; 
(f) Cause the undertaking of a survey or consultation to assess the 
preferences of Military and Uniformed Personnel on the features of the pension 
system, including willingness to pay for contributions and interest in various 
benefit and investment schemes; 
(g) Commission an actuarial evaluation of the fiscal sustainability of the 
pension scheme, including specific recommendations on the rates for 
contributions and investment options for the MUP Trust Funds, as applicable; and 
(h) Perform other necessary functions for the effective management of the 
MUP Trust Funds. 
Provided, That within one (1) year from the effectivity of this Act, the fund 
manager shall conduct the studies prescribed under this Section: Provided, 
further, That the findings and recommendations obtained from the studies shall 


10 
 
be submitted to the Committee which shall promulgate the implementing rules 
and regulations with respect to the mandatory contribution scheme, and other 
features of the pension scheme as applicable. 
SEC. 14. Manager of MUP Trust Funds. – The Government Service 
Insurance System (GSIS) is designated as the fund manager and benefits 
administrator of the MUP Trust Funds, and shall: 
a) Implement an investment management and benefits administration 
strategy as directed by the Committee; 
b) Monitor market and economic trends and track securities to make 
informed investment decisions; 
c) Recommend its portfolio strategy to the Committee; 
d) Track financial results of companies in the portfolio and its various 
metrics, including price-to-earnings ratios, inflation-adjusted return, 
sales, earnings, and dividends; and 
e) Perform other acts necessary to fulfill its mandate under this Act, or 
such acts that may be delegated by the Committee. 
SEC. 15. Structure, Staffing Pattern, and Operating Budget. – The 
organizational structure and staffing pattern for the management of the MUP 
Trust Funds within the Government Service Insurance System and for the 
creation of the MUP Trust Fund Secretariat within the Bureau of the Treasury 
shall be approved by the Committee within one hundred twenty (120) days from 
the effectivity of this Act: Provided, That appointees to various positions shall 
comply with the qualification standards approved by the Civil Service 
Commission: Provided, further, That the Government Service Insurance System 
shall be entitled to management fees, to be charged against the MUP Trust Funds.  
SEC. 16. Joint Responsibility. – For the purpose of ensuring that only 
qualified Military and Uniformed Personnel retirees and beneficiaries shall 
receive the retirement pension or separation benefits, the respective services or 


11 
 
mother units shall assist and share, jointly or separately, the duty and obligation 
with the Committee in monitoring proof of life or life events that will affect the 
qualification of pensioners and beneficiaries to receive the pension or benefit. The 
initial computation of pension and benefits accruing to each retiree or beneficiary 
shall be jointly undertaken and agreed upon by the concerned mother unit and        
the Committee. 
SEC. 17. Funding Sources. – The MUP Trust Funds shall be funded 
through the following: 
a) Capitalization. – Such sums as may be necessary to capitalize and 
sustain the fund as determined by the Committee shall be appropriated 
and released to the MUP Trust Funds; 
b) Mandatory Contributions. – New entrants shall contribute nine percent 
(9%) of their monthly compensation as personal share and the National 
Government shall provide twelve percent (12%) as its share. 
Provided, That both the share of Military and Uniformed Personnel and 
the share of the National Government may be reduced by the 
Development Budget Coordination Committee due to adverse fiscal or 
economic conditions or the fiscal constraints of the National 
Government; 
c) Additional Sources of Funding. – The MUP Trust Funds may be 
augmented from the unprogrammed appropriations and proceeds 
derived from the lease, joint development, auction of development 
rights, or disposition of government properties identified for the 
purpose, investment income from the MUP Trust Funds identified and 
administered by the fund manager subject to actuarial validation, and 
savings of the National Government: Provided, That the proceeds from 
the disposition of assets of the military or uniformed service shall inure 
exclusively to its personnel. 


12 
 
d) Sources of Funding for the AFP Trust Fund. – The AFP Trust Fund may 
be funded from the proceeds of the following: 
1. Residual assets and funds of the AFP retirement separation 
benefits system; 
2. Sale of military reservations, as may be authorized by 
Congress, pursuant to the provisions of existing laws and 
regulations governing sales of government properties, 
including such immovable and other facilities as may be 
found therein, not otherwise covered by the Bases Conversion 
and Development Authority, as provided for in Republic Act 
No. 7227, as amended; 
3. Lease or joint development of military reservations, as may 
be authorized by the President, pursuant to the provisions of 
existing laws and regulations governing lease or joint 
development of government properties, including such 
immovables and other facilities as may be found therein, not 
specifically enumerated under Republic Act No. 7227, as 
amended; 
4. Income derived from public-private partnerships entered into 
by the Department of National Defense (DND) or the AFP, as 
may be authorized by the President, pursuant to the provisions 
of existing laws and regulations; and 
5. Non-strategic real estate assets of the DND or the AFP as 
determined by the Secretary of National Defense. 
SEC. 18. Assistance to Indigent Pensioners. – The MUP Trust Fund 
Committee shall provide assistance to indigent pensioners to be financed out of 
the AFP Trust Fund and UPS Trust Fund.  The Committee shall formulate the 
guidelines to govern the amount and manner of distribution to indigent 


13 
 
pensioners: Provided, That beneficiaries shall be those who are (i) not gainfully 
employed; (ii) not having a means of livelihood; (iii) frail, sickly, or with 
disability; or, (iv) having an improved well-being but still at high-risk of 
subsequently falling back into survival level as they precariously live with little 
or no protection against economic shocks: Provided, further, That their aggregate 
income from all sources is deemed inadequate for daily sustenance: Provided, 
finally, That nothing in this Act shall be construed to reduce any existing benefits 
and allowances of any form under existing laws, decrees, issuances, executive 
orders, and other applicable laws. 
SEC. 19. Government Guarantee. – The government of the Republic of 
the Philippines hereby guarantees the fulfillment of the obligations of the MUP 
Trust Funds to its members when they fall due. 
SEC. 20. Disposition of Military and Uniformed Services Assets. – 
Within thirty (30) days from the effectivity of this Act, the concerned Military 
and Uniformed Services shall submit a complete list of their real assets in the 
manner prescribed by the Department of Finance to identify additional sources of 
funding for budgetary support of their services, and augment the financing of the 
separation, retirement, and pension benefits of their Military and Uniformed 
Personnel under existing laws and this Act. 
Thereafter, the Department of Finance shall conduct a complete accounting 
and inventory of the assets of Military and Uniformed Services that may be used 
to support the MUP Trust Funds, including the amount, value, description and 
nature of such funds, properties, assets, records, choses in action, and other rights, 
claims, or causes of action pertaining thereto, and submit a report to the Office of 
the President, both Houses of Congress, and the Commission on Audit. 
Within thirty (30) days from the receipt of the inventory by the Department 
of Finance, the Commission on Audit shall audit the accounting and inventory of 
the assets of concerned Military and Uniformed Services to determine the 


14 
 
completeness of the inventory and establish the reasonableness of the asset 
valuation. 
Within one (1) year from the submission of the accounting and inventory 
of the assets of concerned Military and Uniformed Services, the Commission on 
Audit shall submit to the Committee the audit report, including the complete list 
of the assets of concerned Military and Uniformed Services and their valuation, 
and the empirical basis and the methodologies employed for the valuation. 
The Committee shall, within fifteen (15) days from the receipt of the audit 
report, publish the audit report in at least two (2) newspapers of general 
circulation. Nothing herein shall be construed as preventing the designated 
disposition entity from procuring a third-party appraisal of any of the assets of 
concerned Military and Uniformed Services prior to or while preparing the 
privatization or disposition plans of the assets. 
The Committee shall coordinate with the Office of the President, 
Philippine Reclamation Agency, and other disposition entities to be identified by 
the Committee in the execution and delivery of this mandate. 
The Committee shall prioritize the disposition modes that may generate 
income from these assets without undertaking the sale thereof except when the 
Committee determines that selling a specific asset is the most optimal financial 
option: Provided, That the Committee may sell only portions thereof to meet the 
financial requirements. 
To optimize revenues from the assets of the concerned Military and 
Uniformed Services, the Committee may seek the services of the Privatization 
Group of the Department of Finance which shall recommend to the Committee 
the most financially advantageous manner of disposition of the assets. 
Within one (1) year from the effectivity of this Act, the Military and 
Uniformed Services may add to the list such real assets required for identification 
and submission under this section and which belonged to the Military and 


15 
 
Uniformed Services prior to the effectivity of this Act. Any real asset that is 
required by this Act to be included in the submitted lists and which are not 
included in actual submissions by the Military and Uniformed Services may be 
disposed of by the Committee in the manner it deems appropriate. 
SEC. 21. Tax Treatment of the MUP Trust Funds. – Notwithstanding any 
law to the contrary, the MUP Trust Funds, its assets, revenues, including all 
accruals thereto, and benefits paid, are exempt from all taxes, assessments, fees, 
charges, or duties of all kinds. These exemptions shall continue unless expressly 
and specifically revoked. 
Subject to Section 24 of this Act, the MUP Trust Funds, the properties of 
the Military and Uniformed Services identified by the Committee to be disposed 
and sums or monies for the payment of the benefits provided under this Act are 
exempt from attachment, garnishment, execution, levy or other processes issued 
by the courts, quasi-judicial agencies or administrative bodies and from all 
financial obligations of the members, including pecuniary accountability arising 
from or caused or occasioned by the members’ exercise or performance of official 
functions or duties, or incurred relative to or in connection with the members’ 
position or work except when the monetary liability, contractual or otherwise, is 
in favor of the MUP Trust Funds. 
All other applicable tax exemptions granted to the GSIS shall also apply to 
the MUP Trust Funds.  
TITLE IV 
Transitory Provisions 
SEC. 22. Transfer of Power and Functions. – For purposes of 
administration of  Military and Uniformed Personnel pension and retirement 
benefits, the powers and functions of units or instrumentalities of agencies that 
employ Military and Uniformed Personnel and administer their pension system 
or parts thereof are hereby transferred to the Committee.  


16 
 
SEC. 23.  Period of Transfer. – There shall be a transition period of five 
(5) months from the effectivity of this Act to implement the transfer of powers 
and functions, rights, assets, and liabilities mentioned in this Title: Provided, That 
the same transition period shall be provided to allow the units or instrumentalities 
of agencies administering the Military and Uniformed Personnel Pension System 
to restructure: Provided, further, That all civilian personnel in the units or 
instrumentalities administering the Military and Uniformed Personnel Pension 
System affected by the transfer of powers and functions provided in this Title 
shall continue in office without need of reappointment: Provided, finally, That 
civilian employees in the units or instrumentalities of agencies administering the 
Military and Uniformed Personnel Pension System who opt to retire or resign as 
a result hereof, if qualified, shall be allowed and be entitled to retirement and 
separation benefits under existing laws to officials and employees affected by an 
approved reorganization program. 
TITLE V 
Final Provisions 
SEC. 24. Non-encumbrance of Benefits. – The benefits authorized under 
this Act, except as provided herein, are not subject to attachment, garnishment, 
levy, execution or any tax whatsoever, and may not be assigned, ceded, or 
conveyed to any third person: Provided, That if a retired or separated Military 
and Uniformed Personnel who is entitled to any benefit under this Act has 
unsettled money or property accountabilities incurred while in the active service, 
an amount not exceeding fifty percent (50%) of the pension gratuity or other 
payment due to the Military and Uniformed Personnel or their survivors under 
this Act may be withheld and be applied to settle such accountabilities. 
SEC. 25.  Appropriations. –  Upon the effectivity of this Act, there is 
hereby authorized to be appropriated the amount of Fifty million pesos 
(P50,000,000.00) as funding for the MUP Trust Fund Committee Secretariat. 


17 
 
Thereafter, the amount needed for the operation and maintenance of the 
Secretariat shall be included in the annual General Appropriations Act. 
SEC. 26. Financial Reporting Framework. – The financial statements and 
reports of the Military and Uniformed Personnel Pension System shall be 
prepared, in accordance with the relevant International Financial Reporting 
Standards and Principles. 
 SEC. 27. Submission of Report to Congress. – In accordance with the 
pertinent provisions of this Act and its Implementing Rules and Regulations, and 
International Financial Reporting Standards and Principles, the Committee shall 
submit to both Houses of Congress every three (3) years after the effectivity of 
this Act, the financial statements and reports, and all information as may be 
required, to monitor and assess the distribution of retirement benefits and pension 
as well as the overall performance of Military and Uniformed Services which are 
funded in whole or in part by the National Government. 
SEC. 28. Penal Clause. – Any person who participates 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 of such 
amount or imprisonment of not less than six (6) months and one (1) day to six (6) 
years and perpetual disqualification from holding public office and from 
practicing any profession licensed by the government. 
SEC. 29. Implementing Rules and Regulations. – Within sixty (60) days 
from the effectivity of this Act, the Secretary of Finance shall, in consultation 
with the Secretaries of National Defense, Interior and Local Government, Justice, 
Transportation, Environment and Natural Resources, Budget and Management, 
and the President and General Manager of the GSIS, promulgate the necessary 
rules and regulations for the effective implementation of this Act. 


18 
 
Supplemental rules and regulations governing the management and 
administration of the pension system of the Military and Uniformed Personnel 
may be issued within one (1) year from the effectivity of this Act. 
SEC. 30. Separability Clause. – If any provision or part of this Act is 
declared invalid or unconstitutional, the remaining parts or provisions not 
affected shall remain in full force and effect. 
 SEC. 31. Repealing Clause. – The pertinent provisions of these laws are 
hereby repealed, amended, or modified accordingly. 
(a) Section 11 of Republic Act No. 340, as amended, entitled “An Act to 
Establish a Uniform Retirement System for the Armed Forces of the 
Philippines, to Provide for Separation Therefrom, and for Other 
Purposes”; 
(b) Sections 2(b), 3, 5, 11, 12, 14, 16, 17, 18, 19, 20, and 22 of Republic 
Act No. 5976, otherwise known as the “Coast Survey Officers 
Retirement and Separation Act of 1969”;  
(c) Sections 5, 17, and 26 of Presidential Decree No. 1638, entitled 
“Establishing a  New System of Retirement and Separation for Military 
Personnel of the Armed Forces of the Philippines and for Other 
Purposes,” as amended by Presidential Decree No. 1650;  
(d) Presidential Decree No. 361, entitled “Providing for an Armed Forces 
Retirement and Separation Benefits System,” as amended by 
Presidential Decree No. 1656 and Presidential Decree No. 1909; 
(e) Section 39 of Republic Act No. 6975, otherwise known as the 
“Department of the Interior and Local Government Act of 1990”; 
(f) Section 3 of Republic Act No. 8291, as amended, otherwise known as 
the “Government Service Insurance System Act of 1997”; 
(g) Sections 4 and 5 of Republic Act No. 9040, otherwise known as the 
“AFP Tax Exemption for Pay and Allowances Act of 2001”; 


19 
 
(h) Sections 17 and 18 of Republic Act No. 9993, otherwise known as the 
“Philippine Coast Guard Law of 2009”; 
(i) Sections 2 and 24 of Republic Act No. 10575, otherwise known as the 
“The Bureau of Corrections Act of 2013”; and 
(j) Section 8 of Republic Act No. 11709, as amended, entitled “An Act 
Strengthening Professionalism and Promoting the Continuity of 
Policies and Modernization Initiatives in the Armed Forces of the 
Philippines, by Prescribing Fixed Terms for Key Officers Thereof, 
Increasing the Mandatory Retirement Age of Generals/Flag Officers, 
Providing for a More Effective Attrition System, and Providing Funds 
Therefor.” 
All other laws, rules and regulations, and other issuances or parts thereof, 
which are inconsistent with the provisions of this Act, are hereby repealed, 
amended, or modified accordingly. 
SEC. 32. Effectivity. – This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation. 
    Approved,