Guidelines Prescribing the Documentary Requirements and Procedures in the Processing and Payment of Retirement Benefits of PNP Personnel

August 13, 2013

PNP MEMORANDUM CIRCULAR NO. 010-13

GUIDELINES PRESCRIBING THE DOCUMENTARY REQUIREMENTS AND PROCEDURES IN THE PROCESSING AND PAYMENT OF RETIREMENT BENEFITS OF PNP PERSONNEL

1. References:

a. Republic Act (RA) No. 10154 dated July 14, 2011, entitled "An Act Requiring All Government Agencies to Ensure the Early Release of the Retirement Pay, Pensions, Gratuities and Other Benefits of Retiring Government Employees";

b. Civil Service Commission (CSC) Resolution No. 1300237 dated January 30, 2013, entitled "Implementing Rules and Regulations (IRR) of RA 10154";

c. Department of Budget and Management (DBM) Budget Circular No. 2013-1 dated April 12, 2013, entitled "Guidelines Prescribing the Documentary Requirements and Procedures in Processing/Payment of Retirement Benefits of Government Employees";

d. Department of the Interior and Local Government (DILG) Circular No. 2013-5 dated May 22, 2013, entitled "Guidelines Prescribing the Documentary Requirements and Procedures in Processing/Payment of Retirement Benefits of Civilian and Uniformed Personnel";

e. Commission on Audit Circular No. 2013-001 dated January 10, 2013, entitled "Amendment to COA Circular No. 2010-001 dated June 14, 2012 prescribing additional documentary requirement for retirement benefits and increasing the amount of cash advance requiring fidelity bond from Php2,001 to Php5,001";and

f. PNP Memo Circular No. 2011-007 dated February 26, 2011, entitled "Guidelines and Procedures in the Processing of Retirement Claims and Benefits due to the PNP Uniformed Personnel and other Retirement Activities". CHcESa

2. Purpose:

This Circular provides the guidelines, documentary requirements and procedures in the processing and payment of retirement benefits of PNP personnel.

3. Objectives:

a. Ensure the timely release of monetary benefits to retiring PNP personnel;

b. Prescribe a standard checklist of documentary requirements to support claims for retirement benefits to be submitted to the DBM;

c. Direct the modes of payment for Terminal Leave (TL) or Retirement Gratuity (RG) either through the Modified Disbursement System (MDS) or Advice to Debit Account (ADA);and

d. Prescribe guidelines in the payment or release of retirement benefits to the retiree's legal heirs in the instance that the retiree dies while processing his/her claims.

4. Scope:

This Circular shall cover the processing and payment of TL and RG benefits of PNP personnel who are retiring upon the effectivity date of this Circular.

5. Definition of Terms:

a. Advice to Debit Account (ADA) — refers to the document which shall serve as a notice to the bank to debit the agency's MDS sub account for payments made for Retirement Gratuity and Terminal Leave (RG/TL) benefits; EHaCTA

b. Department of Budget and Management (DBM) — is an executive body under the Office of the President of the Philippines. It is responsible for the sound and efficient use of government resources for national development and also as an instrument for the meeting of national socio-economic and political development goals;

c. Government Servicing Bank (GSB) — financial institutions authorized, upon accreditation by the Monetary Board, to accept government deposits and perform banking services on behalf of government agencies. Presently, only three government financial institutions have been designated to be servicing banks of the MDS, name: Land Bank of the Philippines, Development Bank of the Philippines, and Philippine Veterans Bank;

d. List of Actual Retirees to be Paid (LARP) — is the list of retirees to be paid of either TL or RG prepared by the Directorate for Comptrollership;

e. Land Bank of the Philippines (LBP) — is one of the GSB owned by the Philippine government. It is officially classified as a "specialized government bank" with a universal banking license;

f. Modified Disbursement System (MDS) — is a procedure whereby disbursements by National Government (NG) agencies chargeable against the account of the Treasurer of the Philippines are effected through Government Servicing Banks (GSBs);

g. Notice of Cash Allocation (NCA) — cash authority issued by the DBM to central, regional and provincial offices and operating units to cover the cash requirements of the agencies;

h. Retirement Gratuity (RG) — benefits due to an employee or personnel as a result of his retirement from the service subject to existing laws and regulations;

i. Special Allotment Release Order (SARO) — a specific authority issued to identify agencies to incur obligations not exceeding a given amount during a specific period for the purpose indicated. It shall cover expenditures the release of which is subject to compliance with specific laws or regulations, or is subject to separate approval or clearance by competent authority; CHATEa

j. Special Budget Request (SBR) — a request submitted by the agency to the DBM requesting the release of fund for specific purpose. The release of said fund is subject to compliance with specific laws or regulations or is subject to separate approval or clearance by competent authority; and

k. Terminal Leave (TL) — benefits given based on total number of leave credits accumulated by the retiree from the time he entered the service up to his retirement date subject to existing laws and regulations.

6. General Provisions:

a. The submission and processing of documentary requirements; the release of funds for the purpose; and actual payment of TL/RG Benefits shall be completed within the prescribed period. The pertinent requirements and procedures are as follows:

1) Retiring PNP Personnel shall submit a written expression of intent to retire not later than three (3) months for Non-Uniformed Personnel (NUP) and six (6) months for Uniformed Personnel, prior to the effective date of their retirement indicating therein their preferred mode of payment either through Modified Disbursement System (MDS) or Direct Payment (through Advice to Debit Account [ADA]) to retirees' bank account (Savings/Current/ATM) maintained with any branch of an MDS-Government Servicing Bank (GSB) of the PNP which currently is the Land Bank of the Philippines (LBP).

2) Retiring PNP personnel are no longer required to personally compile and follow-up their retirement claims/benefits except to submit a written expression of intent to retire indicating therein their preferred mode of payment either through MDS or ADA. Transmittal of retirement documents shall be done from office to office to avoid fraudulent/spurious documents coming from third parties. All documentary requirements prescribed must be completed by the PNP Retirement Benefits Administration (PRBS) as stated in the PNP Memorandum Circular No. 2011-007 dated February 26, 2011, not later than one hundred (100) days prior to the effective date of retirement.

3) Not later than ninety (90) days prior to the effective date of retirement of PNP Personnel, the following PNP Offices/Units shall perform the following tasks:

a) PNP Retirement Benefits Administration (PRBS): cHaDIA

i. Ascertain the completeness, authenticity, accuracy and consistency of data reflected in submitted documents as well as the computation/s of the amount of TL/RG claims;

ii. Indicate (stamp-mark) the date of receipt of complete documents in the Retirement Application Form in clear bold marks, countersigned by the designated receiving and validating personnel; and

iii. Coordinate with other concerned agencies, e.g.,Ombudsman and NAPOLCOM to facilitate the release of required clearances of retiring PNP personnel.

b) The Directorate for Comptrollership (DC) shall submit to the DBM the Special Budget Request/s (SBR) for the release of funds to cover retirement benefits chargeable against the Pension and Gratuity Fund together with the following:

i. Documents listed in the prescribed Checklist of Documentary Requirements shown as Annex A in this Circular; and

ii. List of Actual Retirees to be Paid (LARP) in the format prescribe under Annex B. The LARP shall contain the following information:

• Names of the actual retirees categorized into compulsory or optional;

• Name of Government Servicing Bank (GSB),the Branch, Address and Savings Account Number;

• Position, Title and Item Number of NUP;

• Rank of Uniformed Personnel pursuant to Section 74 of RA 6975: Retirement in the Next Higher Rank;

• Date of birth, original appointment and retirement of concerned PNP personnel; aDcETC

• Highest Monthly Salary per Notice of Salary Adjustment (NOSA for NUP and Base Pay in the next higher rank for Uniformed Personnel);

• Gross amount of retirement claim, deductions and net amount due;

• TLB based on number of leave credits earned; and

• RGB based on total creditable services and number of gratuity months.

4) The DBM shall be requested to verify the computation, ascertain its compliance in accordance with pertinent regulations, and release the required funds within ten (10) to twenty (20) days; and

5) Within the remaining prescribed period, the PNP, upon receipt of funds from the DBM, shall record and effect the payment of benefits to retiring PNP personnel.

b. To enable the DBM to determine the required appropriation level for retirement benefits, the PNP through DC, shall submit the list of prospective retirees for the next budget year to the DBM using Budget Preparation (BP) Form 206 as prescribed in the National Budget Memorandum No. 117. IaDTES

7. Specific Guidelines:

a. The PNP, through DC, shall submit the following to the DBM:

1) SBR for TL/RG benefits to be supported by the required documents per Annexes A and B under this SOP. The request shall be submitted to the Budget and Management Bureau D of DBM; and

2) Separate LARPs according to the mode of payment chosen by the retiring PNP personnel. PNP retirees shall be given the option to choose their preferred mode of payment, either through MDS or Direct Payment (through ADA) to retirees' bank accounts (Savings/Current/ATM) maintained with any branch of the MDS-GSB of the PNP. Each page of the LARP shall be taken as an independent list which shall be duly totaled and certified by officials concerned.  

b. To facilitate the processing of release of documents for retirement benefits, requests for the payment of TL benefits of resigned/separated PNP personnel should not be included in the SBR and LARP as these are not covered by RA 10154.

c. PNP Offices/Units indicated below shall also perform the following tasks:

1) Upon receipt of the SARO, DC shall obligate the amount of retirement benefits approved/released by the DBM. Once obligated, the PNP shall commence the disbursement within thirty (30) days from the actual date of retirement of the PNP retiree.

2) PNP Finance Service (PNP FS) shall issue individual MDS checks for those who opt to be paid thru this mode including those retirees maintaining accounts outside the PNP's MDS-GSB. SEIaHT

3) PNP FS shall issue only one (1) ADA, if practicable, equivalent to the total amount per List of Actual Retirees to be Paid (LARP) for retirees who opt for Direct Payment. The following procedures shall be observed in issuing the ADA (the format is shown in Annex C):

a) The ADA shall be individually prepared by the Checking Section of PNP FS for PNP retirees who opt to be paid through ADA with their corresponding bank accounts to ADA-GSB;

b) PNP FS shall authorize the LBP to debit the Special MDS Account using the ADA;

c) The ADA shall be co-signed by TDC and D, FS; and

d) Attach a copy of the LARP to the ADA, supported by the NCA issued. However, if the ADA contains a lesser number of names than those listed in the LARP (e.g.,non-inclusion or deferment of payment to certain retirees),the names of affected retirees in the LARP shall be deleted by the PNP FS.

4) FS shall deduct the retiree's outstanding accountabilities with government institutions from his/her TL/RG benefits covered by SARO/NCA upon authorization from the concerned PNP retiree.

d. The LBP, upon receipt of the NCA and LARP from DBM, shall credit the same to the PNP's Special MDS Account.

1) Upon receipt of the ADA from the agency, the LBP shall effect payment, not earlier than 24 working hours but not more than 48 working hours after receipt of the ADA, to the retiree's savings/current/ATM account, consistent with the names of PNP retirees indicated in the LARP attached to the NCA. THaDEA

2) The LBP shall, on the next banking day after effecting the direct payment in favor of the PNP retirees indicated in the LARP, shall provide the PNP through the Accounting Division of DC as well as the PNP FS with copies of the duly validated/posted ADA (i.e.,machine validation shown in the lower portion of the LARP).

e. In the case of deceased PNP retirees, the payment of their retirement benefits shall be to their heirs. The following additional requirements shall support the SBR:

1) Copy of the Death Certificate of the PNP retiree; and

2) Copy of the Decree of Entitlement or Decision of Adjudication Board identifying the legal heirs of the deceased for PNP Uniformed Personnel. The legal heirs identified in the document shall be the only payees to be honored by the LBP.

f. In the event that the retiring PNP personnel dies after the SARO/NCA has been issued and his claim for payment of TL/RG benefits is still being processed, the payment of the retirement benefits shall be given to his heirs. The payment of the same shall be honored by LBP provided the documents cited under item 6e1 to 6e2 above are submitted to the LBP.

g. In case of change/correction of names of retirees due to typographical errors,the following procedures provided under C.L. Nos. 2001-14 and 2002-17 are reiterated:

1) Upon certification made by D, PRBS as to the identity of a PNP retiree, and upon favorable recommendation by TDPRM, the Chief, PNP, or his duly authorized representative, shall approve any correction of names in the list of retirees; and

2) Approved corrections shall then be relayed through an official letter to the LBP to be signed by TDC and D, FS in the ADA form. CAaSHI

7. Penal Provision:

Heads of PNP Offices/Units concerned shall be responsible for the observance of the guidelines and procedures set in this Circular. Any violation/s hereof shall be dealt with accordingly.

8. Repealing Clause:

All provisions of existing circulars and other issuances inconsistent with this Circular are hereby rescinded/repealed and/or modified accordingly.

9. Effectivity:

This Circular shall take effect after fifteen (15) days from filing of a copy hereof at the University of the Philippines Law Center in consonance with Section 4 of Chapter 2, Book VII of Executive Order No. 292, otherwise known as "The Revised Administrative Code of 1987 n",as amended.

(SGD.) ALAN LA MADRID PURISIMAPolice Director GeneralChief, Philippine National Police

 

n Note from the Publisher: Written as "Administrative Code of 1997" in the original document.