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S. NO. 374 H. No. 2 / 65 OG No. 28, 7118 (July 14, 1969)

[ REPUBLIC ACT NO. 5435, September 09, 1968 ]

AN ACT AUTHORIZING THE PRESIDENT OF THE PHILIPPINES, WITH THE HELP OF A COMMISSION ON REORGANIZATION, TO REORGANIZE THE DIFFERENT EXECUTIVE DEPARTMENTS, BUREAUS, OFFICES, AGENCIES AND INSTRUMENTALITIES OF THE GOVERNMENT. INCLUDING BANKING OR FINANCIAL INSTITUTIONS AND CORPORATIONS OWNED OR CONTROLLED BY IT, SUBJECT TO CERTAIN CONDITIONS AND LIMITATIONS.

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Declaration of policy.—It is hereby declared to be the policy of Congress to promote simplicity, economy and efficiency in the government to enable it to pursue programs  consistent with national  goals  for  accelerated social and economic development and to improve the service in the transaction of the public business in the executive departments, bureaus,  offices, commissions, boards,  agencies and  instrumentalities  of the  government,  including banking or financial institutions and corporations owned controlled by the government within the limits of their respective charters,   except the  Legislative   and  Judicial departments, the General Auditing Office, the Commission on Elections and local governments, by:

(a). Limiting expenditures to the lowest amount consistent with the efficient performance of essential services, activities and functions;

(b). Eliminating duplication and overlapping of services activities and functions;

(c). Consolidating  and   integrating  services, activities and functions of a similar nature;

(d). Abolishing  services,   activities   and   functions necessary to the efficient conduct of government; and

(e). Defining and limiting executive functions, service and activities.

SEC. 2. For the purpose of carrying out the policy set forth in Section One of this Act, there is hereby created a Commission on Reorganization to be constituted within ten days after the approval of this Act.

a. The Commission shall be composed of nine members as follows:

(1)Three members of the Senate to be appointed by the President of the Senate, one of whom shall come from the party having the second largest number of votes in the last general elections;

(2)Three members of the House  of Representatives to be appointed by the Speaker of the House of Representatives,  one  of whom  shall  come from the party having the second largest number of votes in the last general elections;

(3)Three members to be appointed by the President of the Philippines,  who may  come from  within or without the government service. The President shall designate from among the members the chairman  of the  Commission.

b. The Chairman, with the approval of the Commission, shall have the power to appoint in accordance with the provisions of the Civil Service Law, and fix the compen-
sation of,  such  personnel as it may deem necessary for the proper performance of its duties.

c. The  Commission   shall   formulate  policy  guidelines not inconsistent with law, to be followed in effecting provisions of this Act and in conducting public hearings for the purpose of reconciling conflicting interests which may arise as a result of this reorganization.

d. The Commission shall consult with and make use such studies and recommendations as may be presented by the Management Service of the Budget Commission, the Council of   Administrative   Management,   the   U.P. Graduate School of Public Administration, the Joint Technical Staff on the Administrative Code Revision Project, and such other governmental units or agencies as it may designate or set up, or such, reputable private consultant management firms or entities, as it may deem necessary.

SEC. 3. To accomplish the objectives set forth in Section One of this Act, the  Commission is further authorized:

a. To group, coordinate, consolidate or integrate departments, bureaus, offices, agencies, instrumentalities and functions of the government;

b. To abolish departments, offices, agencies or functions which may  not  be  necessary,  or  create those which are necessary,  for the efficient conduct of government functions, services and activities;

c. To eliminate overlapping and duplication of services, functions and activities of the government;

d. To   transfer   functions,   appropriations,   equipments, properties,   records and personnel from one department, bureau, office, agency or instrumentality to another;

e. To create,  classify,  combine,  split and abolish positions ;

f. To standardize salaries, materials and equipments;  

g. To do whatever is necessary and desirable to effect economy and promote efficiency in the government service. The Commission shall study and investigate the present status   of   all   government   bureaus,   departments,   offices, agencies  and  instrumentalities of the  Executive  Branch of the Government, including government-owned or controlled corporations: Provided, however, That in the re­organization to be effected by this Act, no office or agency function of government shall be made to continue beyond the period authorized by law or beyond the time hen it would have terminated if the reorganization had not been  made.

SEC. 4. The Commission shall submit an integrated reorganization plan to the President not later than December 31, 1969, and the President shall, within forty days the opening of the next regular session, submit the same to Congress with or without modification, together  with a   declaration  that  such  reorganization   is  necessary accomplish the  purposes of Section One hereof, No organization plan shall become effective unless expressly approved by Congress which must either accept or reject it in toto.

Upon approval of the reorganization plan or plans by Congress, the President shall forthwith implement the same by issuing the necessary executive order or orders subject to the limits of the Appropriation Act for the fiscal year during which the implementation is effected.

SEC. 5. Whenever it becomes necessary to reduce the personnel of any office affected by the reorganization plan or plans or modifications thereof, the provisions on reduction in force of Rule VIII of the Civil Service Rules shall be applied: Provided, however, That, other things being equal, the preference in retention shall be given to a veteran-employee. Officers and employees whose positions are abolished or who may be separated from the service as a consequence of the reorganization authorized under this Act shall not lose their civil service eligibilities. Their names shall submitted to the Commissioner of Civil Service who enter   them  in  a preferential  re-employment  list  under proper classifications  as to  qualifications,  training, civil service  eligibility and  other  similar  factors  that  would facilitate their re-employment in appropriate vacancies the government: Provided, however, That the names o officers and employees whose efficiency ratings are below "satisfactory" or its equivalent, shall not be registered the preferential  re-employment  list:  Provided,   further, That those who may be separated or removed from service by reason of the reorganization shall be grant gratuity at a rate equivalent to one month's salary every year of continuous satisfactory service rendered the equivalent nearest fractions thereof favorable to them on the basis  of the highest salary received:  Provided, still further,  That   if  they  are already  entitled   to   any gratuity or pension under any other existing retirement or gratuity law, they shall have the option to select either such gratuity or pension or the gratuity provided under Reorganization Act: And Provided, finally, That any of such officers and employees who may be reinstated in the service before the expiration of the period for which has  been   paid   gratuity   shall   refund   the   unearned portion of such  gratuity before he  is  reinstated  in the
service.

SEC. 6. Hereafter, vacancies in any department, bureau, office or agency or instrumentality of the government, including government-owned or controlled corporations, shall be filled by certification of the Commissioner of Civil Service from the preferential re-employment list ahead of the regular register of eligibles, under such rules and regulations as the Commission on Reorganization may promulgate: Provided, That no appointment which is made in violation of this Section or of the rules and regulations promulgated hereunder by the Commission on Reorganization shall be approved by the Commissioner of Civil Service.

SEC. 7. To carry out the provisions of this Act, the sum f one million pesos or so much thereof as may be necessary is hereby appropriated out of any funds in the National Treasury not otherwise appropriated.

SEC. 8. This Act shall take effect upon its approval.

Approved, Sept. 9, 1968.