DIRECTING THE DEPARTMENT OF BUDGET AND MANAGEMENT TO REMIT DIRECTLY THE CONTRIBUTIONS AND OTHER REMITTANCES OF LOCAL GOVERNMENT UNITS TO THE CONCERNED NATIONAL GOVERNMENT AGENCI…

WHEREAS, the social-security and insurance program of the Government
is recognized as a source of social benefits for all government
personnel;

WHEREAS, benefits under the program become meaningful and can serve
the purpose intended by the law only if such social benefits are paid in
the right amounts to the rightful claimants when they fall due;

WHEREAS, it has been reported that the compulsory contributions to
the System are not remitted on time as mandated by existing laws and
most often LGU personnel cannot avail for themselves some of the
benefits under the System for non-remittance by some LGUs of both the
employer and the employee’s contribution;

WHEREAS, in addition to the arrearages on GSIS remittances, many
LGUs have incurred unreasonable delays in the remittance of the required
contributions for Pag-IBIG, the Employees Compensation Insurance
Premium (ECIP), Health Insurance Fund, and the BIR authorized
withholding tax; and

WHEREAS, the expeditious settlement of these arrearages and delayed
remittance depends to a large measure on some extra effort that will
ensure prompt payment of the contributions and remittances to concerned
government agencies, GFIs, and GOCCs.

NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the
Republic of the Philippines, by virtue of the powers vested in me by law
and the Constitution, do hereby order the following:

SECTION 1. The Department of Budget and Management
shall remit directly to the Government Service Insurance System
quarterly the local government unit’s shares as well as the employee
contributions due under Republic Act No. 8291, Republic Act No. 6111 and
Presidential Decree No. 626, as amended.

SECTION 2. The amount corresponding to the said
premium contributions shall be deducted from the Internal Revenue
Allotment (IRA) of Local Government Units concerned.

SECTION 3. The outstanding compulsory contributions
and other remittances of LGUs due the concerned government agencies,
GFIs, and GOCCs shall likewise be deducted from the IRA of LGU
concerned.

SECTION 4. For the effective implementation of this
Order, the concerned national government agencies, GFIs and GOCCs may
enter into an appropriate Memorandum of Agreement with the DBM. The
Local Government Units shall submit to the DBM a list of their existing
personnel covered under the Insurance System, the individual
contributions (government and employee share), together with the list of
delayed remittances due the national government agencies, GFIs, and
GOCCs. Failure of the LGU officials and/or employees to submit such
listing and other requirement shall be a basis for appropriate
disciplinary action and sanction.

SECTION 5. For the guidance of all local government
units and to ensure full compliance of this Order, the Department of
Budget and Management shall issue the necessary implementing rules and
regulation for the purpose.

SECTION 6. This Executive Order shall take effect on January 1, 2000.

Adopted: 21 Dec. 1999 

By the President:

(SGD.) RONALDO B. ZAMORA
           Executive Secretary