REPUBLIC OF THE PHILIPPINESDEPARTMENT OF NATIONAL DEFENSE

GENERAL HEADQUARTERS, ARMED FORCES OF THE PHILIPPINESCamp General Emilio Aguinaldo, Quezon City

OTAG/AFPRD 30 September 2014

CIRCULARNUMBER 04

MANAGING AND PROCESSING OF RETIREMENT AND SEPARATION OFMILITARY PERSONNEL AND TRANSFER OF PENSION BENEFITS

IN THE ARMED FORCES OF THE PHILIPPINES

1. REFERENCES:

a. PD 1638 dtd 10 Sep 1979, entitled “Establishing a New System of Retirement and Separation for Military Personnel of the AFP and for Other Purposes”.

b. PD 1650 dtd 10 Nov 1979, also known as Amending Sections 3 and 5 of PD 1638 entitled “Establishing a New System of Retirement and Separation for Military Personnel of the AFP and for other Purposes”.

c. RA 9485 dtd 02 Jun 2007 entitled “Anti-Red Tape Act of 2007”.

d. RA 9225 dtd 25 Aug 2003 entitled “An Act Making the Citizenship of Philippine Citizens who Acquire Foreign Citizenship Permanent”.

e. RA 8533 dtd 23 Feb 1998 entitled “An Act Amending Title I, Chapter 3, Article 39 of EO 209, otherwise known as the Family Code of the Philippines”, nullifying the prescriptive period for action or defenses grounded on psychological incapacity.

f. RA 8367 dtd 21 Oct 1997 entitled “An Act Providing for the Regulation of the Organization and Operation of Non-Stock Savings and Loan Associations”.

g. RA 3019 dtd 17 Aug 1960 entitled “Anti-Graft and Corrupt Practices Act”.

h. RA 340 dtd 26 Jul 1948 entitled “An Act to Establish a Uniform Retirement System for the Armed Forces of the Philippines, to Provide for Sep-aration There from and for Other Purposes”.

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i. RA 136 as amended by RA 209 dtd 1 Jun 1948 entitled “An Act Providing for the Immediate Payment of Monies due to Deceased Filipino Members of the United States Army, United States Navy, Philippine Scouts, Philippine Army, including Duly Recognized Guerilla Organizations, and Deceased Civilian Employees of the War and Navy Departments and other Departments of the United States Government and of the Philippine Army, and Deceased Civilians with Claims for Supplies Furnished or Services Rendered under the Laws of the United States and/or to the Philippine Army, and for Other Purposes”.

j. EO 209 dtd 6 Jul 1987 entitled “The Family Code of the Philippines”.

k. Department Circular No. 03-A, DND dtd 14 Sep 2000, Subject: Codified Approving and Signing Authority on Military Personnel Administration Mat-ters.

l. Change 2 of AFPR G 131-272 dtd 09 Jul 2001, Subject: Leave

m. SOP Nr 6, GHQ AFP dtd 14 Aug 2007, Subject: Processing of Ap-plication for Retirement/Separation Claims and Transfer of Pension Benefits.

n. SOP Nr.6, GHQ AFP dtd 25 May 2005, Subject: Processing of Late claims for Retirement and Separation Benefits of AFP and Former PC Personnel.

o. SOP Nr 2, GHQ AFP dtd 02 Apr 1993, Subject: Retirement-In-Place.

p. Ltr Dir Nr. 53-00, GHQ AFP 30 Oct 2000, Subject: Disposition of Prospective Retirees.

2. PURPOSE: This Circular prescribes the policies and procedures gov-erning the management and processing of retirement and separation benefits of mili-tary personnel and derivative benefits of legal beneficiaries in the Armed Forces of the Philippines.

3. SCOPE: This Circular applies to all retiring or separating military personnel and their legal beneficiaries.

4. DEFINITION OF TERMS:

a. Active Commissioned Service-In-Grade - Cumulative years in the active service rendered by an officer in a particular grade on permanent status.

b. Active Service - years rendered as a commissioned officer, enlisted man, cadet, probationary officer, trainee or draftee in the AFP and service rendered by him as a civilian official or employee in the Philippine Government prior to the date of his separation or retirement from the AFP, for which military and/or civilian service he shall have received pay from the Philippine Government and/or such others as may hereafter be prescribed by law as active service.

c. A year of Active Military Service - twelve (12) months.

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d. Civilian Service - Service rendered by the military personnel as a civilian official or employee in the Philippine Government for which he/she had received pay/salary.

e. Clearance - Official certification of no money and property ac-countabilities such as DLO, SAO, Housing, NAF, Accounting/Final and Om -budsman Clearances, and no pending case, and other required clearances.

f. Commutation of Leave Balance - Unused leave credits as earned salaries of the retired/separated personnel with the amount based on the present permanent rank’s base pay and long pay.

g. Compulsory Retirement - Retirement upon completion of at least 30 years active service or upon reaching 56 years of age, whichever comes later. Provided, that such officer or enlisted personnel who shall have attained 56 years of age with at least 20 years of active service shall be allowed to complete 30 years of service but not beyond his/her 60th birthday.

h. Compulsory Retirement with CDD - Retirement of military per-sonnel with 20 years of active service due to anatomical loss or the permanent loss of use of both hand, both foot, both eyes, both ears or any combination, or loss of mental faculties as determined by the AFP Medical Board.

i. Legal Beneficiary - Legal spouse/children below 21 years old/parent or parents/unmarried siblings of AFP pensioner.

j. Line of Duty (LOD) Status - Shall mean that the death, illness or injury incurred was not due to misconduct, negligence, suicide, the intemperate use of drugs or alcoholic liquor or vicious or immoral habits as determined by Major Service Line of Duty Status Board.

k. Military Active Service - Actual service rendered by an individual as a commissioned officer, enlisted man and woman, cadet, probationary officer, trainee or draftee in the Armed Forces of the Philippines.

l. Military Personnel – Commissioned officers, enlisted personnel, cadet, probationary officer, trainees and draftees who are in the active service of the Armed Forces of the Philippines.

m. Monies – arrears in pay and allowances to which the deceased might have been or would be lawfully entitled; all amounts due to the estates of de -ceased civilians for supplies furnished or services rendered under the laws of the United States and/or to the Philippine Army; accrued retirement and insurance pro-ceeds which upon the deaths of the individual; and deposits (RA 209).

n. Optional Retirement - retirement upon accumulation of at least 20 years of satisfactory active service at own request by military personnel, requiring approval of the President, be retired from the active military service.

o. Principal Pensioner - Retired/separated military personnel who is receiving monthly pension from the AFP.

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p. PenMIS (Pension Management Information System) - A pensioners’ database system containing complete information of each pensioner, which is used by the pension system stakeholders in processing the retirement and separation benefit claims including the transfer of pension.

q. Pensioners’ List - roll of authorized AFP pensioners being maintained by AFPPGMC.

r. Posthumous Retirement - retirement of an officer or enlisted per-sonnel with at least 20 years of accumulated satisfactory service who dies in line of duty.

s. Posthumous Separation - separation of an officer or enlisted personnel with less than 20 years of active service who dies in line of duty or on ac -count of any wound, injury or illness contracted in line of duty.

t. Resumption of Pension - Commencement of monthly pension after the 36 months advance pension or lump sum during retirement, subject to existing DBM rules implementing the appropriate pension rate.

u. Retired List - Roll of retired and honorably separated personnel being maintained by the AFP.

v. Separation with CDD - Separation of an officer or enlisted personnel due to partial or total permanent physical disability incurred in line of duty before completing 20 of active service.

w. Survivors shall mean –

1) Surviving spouse if married to the deceased prior to the latter's retirement/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 upon the re-marriage of said spouse.

2) Surviving children of an officer or enlisted personnel born of his/her marriage contracted prior to his/her retirement/separation from the service, and children, adopted or acknowledged, while the deceased parent was still on active military service: Provided that entitlement to benefits shall terminate when such children attain 21 years of age or contracted marriage.

3) In default of those mentioned in paragraph 1 and 2 above, surviving, legitimate, adopted or acknowledged natural children, who have reached twenty - one years of age, or in their absence, his surviving parent or par -ents, or in default thereof, his surviving unmarried brothers and sisters.

x. Terminal Leave - Final leave consisting of accumulated unused leave granted to a member of the armed forces just prior to separation or discharge from service.

y. Transfer of Pension - Processing of derivative benefits granted to the legitimate survivors/beneficiaries of retired military personnel in the form of monthly pension, or arrears for entitlements not provided on the right time.

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z. 36-Months Lump Sum - Three (3)-year advance monthly pension granted to retiring military personnel at his option.

5. POLICIES

a. All AFP and Major Service offices processing the retirement/separation claims must adhere to Section 5 of RA 9485 or the Anti-Red Tape Act to improve the system and reduce the processing time for all claims.

b. Only military personnel who optionally/compulsorily retire, retire/separate with CDD, posthumously retired/separated, and their legal ben-eficiary/ies are entitled to monthly pension, except for the beneficiary/ies of those separated with CDD under RA 340. In case of the 36-months lump sum option, only optional, compulsory, and compulsory retirement with CDD military personnel are entitled to the 36-Months lump sum.

c. The processing of retirement and separation of military per-sonnel shall be composed of Phase 1 or “Orders and Clearances” with Major Service Adjutants/Pension Branches, clearance-issuing offices and OTAG, AFP as stake-holders and Phase 2 or “Benefits” with AFPPGMC, GHQMFO, AFPFC, and GHQ Accounting Center as stakeholders. All stakeholders must follow the sequential time-frame prescribed in this Circular. (Annex A).

d. Military personnel must file his/her Personnel Action Form from the unit not earlier than a year before its effectivity date. The benchmark for pro-cessing of compulsory and optional retirement is that the benefit must be pro -vided a day after retirement (Annex B).

e. For civilian government service years to be accredited as active service, only a Confirmation Order of government service filed within ten (10) years upon appointment/enlistment in the active military service shall be considered.

f. For purposes of Optional Retirement, unused leaves or avail-ment of terminal leave shall not be credited to complete the minimum require-ment of 20 years of active service. Terminal leave enjoyed shall no longer earn leave credits.

g. In the case of Posthumous Retirement/Separation, Phase 1 must entail not more than three (3) months, while, Phase 2 shall entail not more than two (2) months upon issuance of retirement/separation orders. LOD status shall be determined by the LOD Status Board of respective units (Annex C).

h. The Judge Advocate General (TJAG) or his/her authorized

representative shall proceed to ascertain by the best means within his/her power the names and residences of the persons who are lawfully entitled to the monies of sur-vivors as per Section 3 of RA 209, in the case of Posthumous Re-tirement/Separation and derivative benefits of deceased pensioners. The Decla-ration of Legal Beneficiaries from Major Service Judge Advocate/TJAG or autho-rized representative must be issued within five working days from the date of re-quest.

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i. Major Service PGABs must immediately forward the following initial documents of KIA/battle casualties for the benefits to be processed in one and a half month. Simultaneously, the full requirements for posthumous re -tirement/separation claims shall still be submitted and pass through the regular pro-cessing flow (see Annex C).

1. Casualty or Spot Report from Unit;

2. Death Certificate (NSO or LCR);

3. NSO Marriage Contract if the deceased is married; Birth Certificate if Single;

4. Statement of Service;

5. Statement of Last Payment;

6. LBP Pension Account Number; and

7. NSO CRS Form # 5 of surviving spouse (if claimant is parent, CRS Form # 5 of the deceased)

j. The processing of Compulsory Retirement/Separation with CDD must not be more than four (4) months for Phase 1, and two (2) months for Phase 2. The disability of military personnel shall be determined by the AFP Medical Board with appropriate Orders (Annex D).

k. Major Service Adjutants, PGAB/Pension Branches, and OTAG, AFP shall process all clearances except for the Final (Accounting) Clearance, and must ensure the completeness, validity, and authenticity of documentary re -quirements prior sending to Phase 2 (Annex E).

l. OJ1/Major Service Ones must prepare a list of compulsory retiring military personnel every first quarter of the year and shall issue same to TAG, AFP for retiring officers and the different Major Service Adjutants for retiring in order to anticipate and be ready for the processing of Compulsory Retirement Orders and avoid de facto services.

m. The President has the signing authority to approve the ap-plication for Optional Retirement/Separation of Regular officers, Reserve and TAS officers with Security of Tenure (SOT) while the Secretary of National Defense has the delegated signing authority to approve Compulsory Retirement Order of all of-ficers based on records. MS Commander has the delegated signing authority to ap-prove application for regular retirement, Posthumous Retirement/Separation, Com-pulsory Retirement with CDD, and Separation with CDD of all EP.

n. The Major Service Commander has the delegated signing authority to approve the applications for the reversion of their officers without SOT, retirement/separation of their respective EP including Women’s Auxiliary Corps (WAC), the Commutation of Accumulated Leave Balance and terminal leave of their personnel.

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o. The Deputy Chief of Staff, AFP (TDCS) has the delegated signing authority to approve applications for Reversion of TAS officers without SOT, terminal leave and the Commutation of Accumulated Leave Balance of TAS officers. The AFPPGMC shall process the Commutation of Accumulated Leave Balance of TAS officers.

p. Major Service shall pay the Separation Gratuity of separated Officers charged against their respective personnel (PS) savings while the payments for TAS, personnel’s separation gratuity shall be charged against GHQ’s PS savings.

q. Retiring military personnel with government property/money accountability incurred while in the active service shall be allowed to file for re -tirement/separation and for such application to be processed subject to the fol-lowing conditions:

1) For accountability of less than fifty percent (50%) of the 36 Months Lump sum, the AFP shall withhold the concurrent amount from the 36 Months Lump sum to settle such accountability, requiring a written consent from the subject military personnel.

2) For accountability of more than 50% of the 36 Months Lump sum, the AFP shall withhold the 50% of the retiring/separating military per-sonnel’s 36 Months Lump sum, and the remaining 50% shall be deducted from the monthly pension thereafter until his/her accountability is fully settled.

3) In case of firearms (FAs) accountability, a Board Res-olution shall be required from the MS Survey Board explaining the loss of FAs and recommending the settlement of FAs accountability.

r. Military personnel who are posthumously retired/separated with government money/property accountability with the AFP shall be given orders with-out delay. Incurred unclear property accountability shall be automatically con-verted to monetary value which shall be deducted on the monthly pension of his/her legal beneficiary.

s. Military personnel applying for Optional Retirement with pending case/s at the Efficiency and Separation Board (ESB), General Court Martial (GCM), and Ombudsman shall be allowed to file for retirement/separation. However, Phase 2 of the processing shall be held in abeyance until favorable resolution of the case.

t. For retiring military personnel who died prior resumption of his/her pension or upon death of principal pensioner, OTAG/Major Service Adjutant shall issue without delay the Certificate of Legal Beneficiaries, as requested by le-gitimate beneficiaries, to serve as one of the bases of TJAG in the required is -suance of Declaration of Legal Beneficiaries prior to the processing Posthumous Re-tirement or the transfer of pension benefits by AFP PGMC. Contested claims shall be referred to the Office of the Judge Advocate General, AFP for adjudication.

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u. All retirement/separation claims not filed within three (3) years from the effective date of retirement/separation shall be subjected to deliberation and validation by the Major Service Retirement and Separation Adjudication Board (MS RSAB) for recommendation thru a board resolution, along with pertinent documents, to the AFP RSAB.

v. The pension benefits of retirees/beneficiaries who have acquired foreign Citizenship shall be terminated upon loss of Filipino Citizenship. However, re-entitlement of monthly pension shall be restored upon reacquisition of lost Filipino Citizenship pursuant to RA 9225.

w. Monthly pension shall resume three (3) years after retirement date. AFP retirees shall appear in person or submit a proof of life at AFPPGMC three months prior resumption of pension (Annex F).

6. PROCEDURES

a. Accreditation of Civilian Government Service

1) The military personnel shall submit his/her request for accreditation of Civilian service to OTAG, AFP/Major Service Adjutants (Attn: C, Military Personnel Status Board) with the following supporting documents:

a) Appointment Order/Contract of Services;

b) Certificate of Accreditation of Government Service from Civil Service Commission;

c) Service Record duly certified by HRMO/Personnel Officer; and

d) Proof of Payment receiving salary from former Government employment.

2) MPSB shall validate the authenticity/genuineness of the documents submitted. It shall conduct deliberation for such with a resolution in -dicating approval and recommendation to OTAG, AFP.

3) OTAG, AFP/Major Service Adjutant shall endorse the rec-ommendation for approval to TDCS/MS Commander.

4) Upon approval, OTAG/Major Service Adjutant shall issue Confirmation Order and copy furnished the concerned individual.

b. Issuance of Clearances

1) For compulsory retirement, Major Service Adjutants/PGABs shall request MS Clearances of retiring military personnel si -multaneously with the request for Compulsory Retirement Order. In this mode of re-tirement, the processing of clearance must not affect the processing of Order. For optional and other mode of retirement/separation, Major Service Adjutants/PGABs

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shall request first Major Service Clearances of retiring/separating military personnel prior orders.

2) Command Clearance shall be issued as a final clearance after securing the Major Service Clearance and Records Check which shall ensure that retiring/separating military personnel have no property or money accountability, no pending legal or administrative case, and has no contractual service obligation.

3) Upon publication of Orders, Major Service Adjutants/PGABs with the Major Service Clearance-issuing offices shall request for GHQ Clearances except for the Final Accounting Clearance, and must ensure that they have one synchronized updated records for clearance purposes.

4) Since the Ombudsman Clearance has six (6) months validity, Major Service Adjutants/PGABs shall ensure that the said Clearance must reach Phase 2, two months before it expires.

5) Final Accounting Clearance shall be issued only if retiring/separating military personnel have settled all property or money ac-countabilities, and legal or administrative cases.

c. Issuance of Orders for Compulsory Retirement of EP

1) Major Service Adjutant shall maintain records/documents such as Statement of Service (SOS), Birth Certificate, Seniority Lineal List in determining the Compulsory Retirement date of EP (Annex G). If retirement is with CDD, Confirmation Orders shall be attached.

2) Upon verification of its authenticity, Major Service Adjutant shall issue Retirement Orders, copy furnishing PGAB/Pension Branches, Major Service Finance Centers, MS Ones, NRD OTAG, and unit assignment of re-tiree.

d. Issuance of Orders for Optional Retirement of EP

1) Concerned EP shall file his/her Personnel Action Form (PAF) for Optional Retirement from unit to Major Service PGAB/Pension Branches (see Annex F for Requirements).

2) Major Service Adjutant shall secure approval for the Optional Retirement from the Major Service Commander.

3) Upon approval, Major Service Adjutant shall issue Optional Retirement Orders, copy furnish PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, NRD OTAG, and unit assignment of retiree.

e. Issuance of Orders for Compulsory Retirement of Line Officers and TAS Officers

1) OTAG, AFP/TAS Chief shall maintain records/documents such as Statement of Service (SOS), Birth Certificate, Seniority Lineal List in determining the Compulsory Retirement date of Officers.

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2) Upon verification of its authenticity, OTAG, AFP shall is-sue Retirement Orders, copy furnishing Major Service Adjutant, Major Service PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, NRD OTAG, AFPPGMC, and unit assignment of retiree.

f. Issuance of Orders for Optional Retirement of Line Officers and TAS Officers

1) Concerned officer shall file his/her Personnel Action Form for Optional Retirement from unit to Major Service PGAB/Pension Branches.

2) Major Service Adjutant shall forward to OTAG, AFP for is-suance of Optional Retirement Order.

3) OTAG, AFP shall secure approval of Optional Retirement Order from the President thru CSAFP and SND.

4) Upon approval, OTAG, AFP shall issue Retirement Orders, copy furnishing Major Service Adjutant, Major Service PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, NRD OTAG, AF-PPGMC, and unit assignment of retiree.

g. Issuance of Posthumous Retirement/Separation LOD Status for Non-battle Casualty

1) Unit concerned shall create a Line of Duty Status Board which shall determine the Line of Duty (LOD) status of non-battle casualty. It shall conduct deliberation and approval of LOD status which shall be reflected on a Board Resolution.

2) Unit concerned shall submit request thru channel the is-suance of LOD Status Order to Major Service PGAB/Pension Branches (Annex H).

3) Major Service PGAB shall forward request to Major Service Adjutant (if EP) or OTAG, AFP (if Officer).

4) OTAG, AFP/Major Service Adjutant shall secure approval for issuance of LOD Status Order from MS Commanders for EP, from TDCS for TAS personnel, and from CSAFP for line and TAS Officers. Upon approval, OTAG, AFP/Major Service Adjutant shall issue LOD Status Order copy furnishing PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, and NRD OTAG.

5) With LOD Status Order, Major Service Adjutant shall en-dorse to Major Service Judge Advocates for Declaration of Legal Beneficiaries of EP, while, OTAG, AFP endorse to TJAG, in case of officers.

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6) Major Service shall secure approval of Posthumous Retirement/Separation Order of EP from Major Service Commander and issue, copy furnishing PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, and NRD OTAG, while, OTAG, AFP must secure and issue such from the SND thru CSAFP, in the case of officers, copy furnishing same offices plus AF-PPGMC.

h. Issuance of Posthumous Retirement/Separation Order for Battle Casualty

1) Unit concerned shall submit request thru channel the is-suance of Posthumous Retirement/Separation Order to Major Service PGAB/Pen-sion Branches/Chief, TAS (Annex I).

2) Major Service PGABs/Pension Branches shall forward re-quest to Major Service Judge Advocates for the Declaration of Legal Beneficiaries. For line and TAS Officers, Major Service PGAB/Pension Branches/Chief, TAS shall forward same request to TJAG, AFP.

3) Major Service PGAB/Pension Branch shall immediately forward the the documents listed in para 5 sub-para i of this Circular to AFPPGMC for the Direct Pension processing of benefits.

4) Upon approval, Major Service Adjutants shall issue Posthumous Retirement/Separation Order, copy furnishing PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, and NRD OTAG.

5) OTAG, AFP shall secure approval of Posthumous Retirement/Separation Orders of line and TAS officers from the SND, and issue copy furnishing Major Service Adjutant, Major Service PGAB/Pension Branches, Major Service Ones, Major Service Finance Centers, NRD OTAG, and AFPPGMC.

i. Issuance of Retirement/Separation with CDD Order (P-4)

1) Upon determination that an officer/EP is unfit for military service, the Disability Separation Board (DSB), AFP Medical Center (AFPMC) shall prepare the Certificate of Disability Discharge and Worksheet immediately and secure the approval for issuance of Disability Discharge (P-4) Order by the Com-mand Adjutant, AFPMC.

2) Upon issuance of Disability Discharge (P-4) Order, the DSB shall submit request for confirmation of the Disability Discharge (P-4) Order to TSG, AFP with the following requirements:

a) Certificate of Disability Discharge and Worksheet (AGO Form 40); and

b) Certificate of Disability Discharge Orders

3) TSG, AFP shall review and validate the CDD Worksheet and shall endorse the request for CDD Confirmation Orders to J1, AFP.

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4) In the case of officer, J1, AFP shall direct OTAG, AFP to issue CDD Confirmation Order. In the case of EP, J1 shall send directive to the concerned Major Services to issue Confirmation Order.

5) Upon receipt of the directive, OTAG, AFP/Major Service Adjutant shall issue CDD Confirmation Orders, copy furnishing Major Service Adjutant, Major Service PGAB/Pension Branches, Major Service Ones, Major Ser-vice Finance Centers, NRD OTAG.

6) Upon receipt of Confirmation Orders, concerned of-ficer/EP shall submit thru channel Personnel Action Form for retirement/separation to Major Service Adjutant for line officers and EP, and TAS Chiefs for TAS officers (An-nex J).

7) Major Service Adjutant shall secure approval of the Major Service Commander and issue Retirement/Separation with CDD Orders for EP copy furnishing PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, and NRD OTAG.

8) Major Service Adjutant/TAS Chiefs shall forward the re-quest of line officers/TAS to OTAG, AFP after securing an Endorsement Letter from Major Service Commanders.

9) OTAG, AFP shall secure the approval of Retirement/Separation with CDD Orders for line and TAS officers from the President thru SND and CSAFP. Upon approval, OTAG, AFP shall issue copy furnishing Major Service Adjutants, Major Service PGAB/Pension Branches, Major Service Finance Centers, Major Service Ones, and NRD OTAG.

j. Encoding of Retirees’ Information

1) While clearances and other requirements are being re-quested, Major Service PGAB/Pension Branches shall ensure the validity and cor-rectness of information on all requirements and encode the retirees’ information in the PenMIS.

2) Major Service PGAB/Pension Branches shall encode complete information of claimants as the system requires.

k. Processing and Payment of 36 Months Lump sum

1) Upon receipt of the retirement/separation folder, AF-PPGMC shall validate the retirees’ data and approve in the PenMIS, and secure Fi-nal Clearance.

2) AFPPGMC shall prepare, assign list number and print Disbursement Voucher (DV) for submission to GHQ-MFO.

3) For retiring military personnel who have incurred money and property accountabilities with the government, AFP PGMC shall reflect sub-sequent deductions in their retirement benefit/Lump Sum Voucher.

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4) GHQ MFO shall request funds thru channels to DBM for the payment of 36 Months Lump sum.

5) GHQ Accounting Center shall record/journalize funded DVs and forward same to GHQ MFO for final audit.

6) AFP Finance Center shall execute payment of 36 months Lump sum within 24 hours from the date of retirement.

7) For retiring military personnel with pending case that is service-related, may submit a written request to the Chief, AFP PGMC for the re-lease of his/her retirement benefits which shall be submitted to OTJAG for legal eval-uation and litigation. Pending cases of military personnel with the Office of the Om-budsman in violation of the provisions of Republic Act 3019 also known as Anti-Graft and Corruption Practices Act, and military officers with administrative case be-fore an Efficiency and Separation Board, involving misconduct in office shall not be allowed to receive their retirement benefits pending resolution of the case.

8) OTJAG. AFP shall litigate and recommend whether or not the retiree with pending case shall post a surety/indemnity, property or such other similar security bond. The retiree shall be paid of his retirement entitlements based on the stipulated terms and conditions in the security bond. Surety/indemnity bond from AFPGIC and GSIS and property bond posted by the retiree are acceptable. Other forms of security may be acceptable on a case to case basis. GHQ MFO shall ensure that funds for payment of the retirement benefits of the concerned retiree are readily made available.

9) AFPFC shall release the retirement benefits of a retiree with pending case docketed at the office of the Ombudsman provided that the pre-ceding that is in accordance with sub-paragraph 7.

10) AFPPGMC shall regularly furnish OTJAG and AFPFC list of military personnel with pending case at the office of the Ombudsman.

l. Processing and Payment of Commutation of Leave Balance

1) For Major Service Officers and EP

a) Upon completion of retirement/separation doc-uments including Leave Records of the retiring military personnel, Major Service PGAB/Pension Branches shall prepare DVs for the payment of Commutation of Leave Balance.

b) Major Service MFOs shall request funds from DBM, thru channels for the payment of Commutation of Leave Balance.

c) Accounting Service Units records/journalize funded DVs and MS Finance Centers shall execute the payment of Commutation of Leave Balance.

d) Major Service Finance Center executes payment.

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2) For TAS Officers

a) Upon completion of retirement/separation ap-plications with required documents by TAS officers, OTAG, AFP shall issue the Statement of Service and Leave Records reckoned from their date of entry in the military service up to the date of retirement/separation.

b) AFP PGMC shall process and prepare DVs for the payment of Commutation of Leave Balance of TAS officers to be forwarded to GHQ MFO.

c) GHQ-MFO shall request funds from DBM, thru channels for the payment of Commutation of Leave Balance of TAS officers.

d) GHQ Accounting Center shall record/journalize funded DVs.

e) AFPFC shall prepare the checks/ADA and execute the payments of the Commutation of Leave Balance of TAS officers.

m. Processing of Resumption of Pension

1) On the 33rd month after retirement date, the AFP retiree shall appear in person or submit proof of life such as AFP Pensioner’s ID, Retirement Order at AFPPGMC for validation, update, and resumption of pension.

2) AFPPGMC shall issue authority to implement the resumption of pension. If any, payment of arrears for prior years shall be done through generation of DVs and funding of which shall be requested by AFP PGMC.

3) AFPFC shall execute payment for the resumption of pen-sion and those corresponding arrears for the current year. Arrears for prior years shall be paid upon the availability of funds.

n. Processing of Transfer of Pension

1) Upon death of the principal pensioner, legal ben-eficiary/ies shall submit original and photocopied requirements (Annex K) for Trans-fer of Pension to AFPPGMC.

2) TJAG shall issue Declaration of Legal Beneficiaries within five working days from request, based on the Certificate of Legal Beneficiaries and other documents as basis for the processing and payment of claims.

3) Contested claims filed by claimants other than those legitimate/acknowledged beneficiaries of the pensioner prior to his/her retirement from the active service shall be forwarded to TJAG for adjudication.

4) AFPPGMC shall compute initial payment for the supplementary claim and subsequent placement of the beneficiary in the gains payroll for the following month. Prior year claims will be paid through DVs and funding of which shall be requested by AFPPGMC.

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5) GHQ Accounting Office shall journalize funded DVs and forward same to GHQ MFO for final audit.

6) AFPFC shall implement payment of derivative pension benefits to the legal beneficiary/ies through ATM Pension Account, and Passbook for 75 years old and above.

o. Computation of Benefits

1) Monthly pension for Compulsory, Optional, and Com-pulsory Retirement with CDD is computed at 2.5% of monthly base pay and longevity pay but not to exceed eighty five percent (85%) of the rank next higher than the permanent rank last held for each year of active service rendered (Section 17, PD 1638), or “(Base Pay + Long Pay of Retirement Pay Rank) x 2.5% (50% if 20 years) per year of active service”, not Exceeding 85%.

2) 36-Months Lump sum is a three-year advance pension benefit granted to regular retirees, at his/her option which is computed as “Base Pay + Long Pay of Retirement Pay Rank multiplied by 2.5% per year of active service x 36 months”.

3) Monthly pension of legal beneficiary/ies of posthumously retired and separated, and Separation with CDD are computed as “Base Pay + Long Pay of Retirement/Separation Pay Rank multiplied by 50%”.

4) Monthly pension of surviving beneficiaries of principal pensioners or transfer of pension is computed as “monthly pension multiplied by 75%”.

7. DUTIES AND RESPONSIBILITIES

a. Retiring/Separating Military Personnel

1) The retiring military personnel shall check his/her in-formation on military and family documents and shall ensure zero-discrepancy prior filing Personnel Action Form.

2) About sixteen (16) months prior retirement/separation date, military personnel shall verify from previous unit assignments any money and property accountabilities and pending legal or administrative cases. Appropriate steps must be sought to expedite the resolution/clearing of same. Likewise, to ascertain the conformity of personal and service records with government agency like the NSO, verifications must be made from Major Service Adjutant/OTAG, AFP ensuring the correctness of all data entries, and authenticity of all required doc-uments.

3) In accomplishing AGO form 110 (Personal Action Form), clearly state the type of retirement/separation and its effective date, option to the mode of payment either 36 lump sum or regular monthly pension and with contractual obligation/service, if any.

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4) In accomplishing AFP Personnel Data sheet/dependents information, provide latest pictures of dependents and attached required personal documents as stated in AFP personnel Directive 01-05 dated 02 Jun 05 and execute an affidavit acknowledging/declaring therein in the legal beneficiaries.

5) TAS officers who were assigned with the different MS and applying for retirement/separation from the active service shall accomplish AGO form 110 and secure MS Clearance for money/property accountability prior en-dorsement by TAS officers of the MS to GHQ TAS offices.

6) Retiree/beneficiaries who acquire other citizenship shall apply for dual citizenship to resume or retain monthly pension and comply with the requirements under RA 9225.

b. Concerned Unit and Unit Ones

1) It is the responsibility of the Unit Ones to know and relay updated policies, requirements, and procedures for retirement/separation to all per-sonnel of the Unit.

2) Provide assistance to all military personnel applying for retirement/separation claim by ensuring the correctness of entries in the Personnel Action Form and the completeness of the Unit Clearances.

3) Properly indorse the application for retirement/separation to the Major Service Adjutant/PGAB/Pension Branches with the following basics re-quirements:

a) AFP AGO Form 110 (Personnel Action Form);

b) Unit Clearance;

c) Statement of Account(s)/Property Accountability/ies; and

d) Attached charge/s, if there be any.

4) Designate Survivor Officer/NCO that will assist legal ben-eficiary/ies of posthumously retired/separated military personnel, particularly in com-pleting Unit Clearance, service related required documents, personal docu-ments, submitting, and following up posthumous retirement/separation claims.

5) To avoid intentional or unavoidable delays and over pay-ment, furnish copy of Personnel Action Form of personnel applying for retire-ment/separation to apprise and allow the MS Finance Service Units to effect the stoppage of their pay and allowances on their retirement/separation.

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c. Major Service Adjutants/PGAB/Pension Branches

1) Examine the authenticity and completeness of all re-quired documents in the retirement/separation applications submitted by Unit Per-sonnel Office/PGAO. Concerned individuals/Units with incomplete information must be notified the fastest available means to correct the deficiency.

2) Furnish Major Service Finance Center a copy of Per-sonnel Action Form applying for retirement/separation, and secure statement of last payment, DLO Clearances and Statement of Accounts.

3) Issue Orders and Certificate of Beneficiaries of retiring EP.

4) Implement and administer the DLO centralized clearance system in securing the required command clearances including Ombudsman Clearance.

5) Upon approval of their respective Major Service Com-manders, issue retirement/separation orders for retiring enlisted personnel includ-ing those assigned in GHQ AFP and AFPWSSUs under honorable condition without prejudice for retirement benefits under PD 1638 as amended, effective on their date of retirement/separation from the active service. Likewise, issue reversion orders for reserve officers without SOT.

6) Issue the latest Statement of Service and Statement of Leave Records to all personnel who are applying for retirement/separation and re-quest to OTAG a copy of latest Statement of Service of Service and Statement of Leave Records of retiring Generals/Flag Officers for the commutation of their leave credits.

7) Process Commutation of Leave Balance of retiring military personnel including General/Flag Officers and endorse same to cognizant Major Service/GHQ Offices for funding and subsequent payment by Major Service Finance Centers/AFPFC.

8) Endorse to AFPPGMC zero-discrepancy complete retirement/separation folder.

9) Create MS RSAB to adjudicate cases of retirement/separation benefit claims filed after three (3) years of the supposed re-tirement/separation from the military service.

10) Maintain Major Service Retirees’ List.

d. OTAG, AFP

1) Approve and issue Compulsory Orders based on pertinent records, and Optional Retirement Orders and Separation Orders of regular officers and reserve/TAS officers with SOT and for reversion of TAS officers without SOT, copy furnishing Major Service/GHQ offices.

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2) Issue the latest SOS and Statement of Leave Records of all General/Flag Officers, TAS officers assigned with GHQ applying for re-tirement/separation copy furnishing Major Service/GHQ offices.

3) Administer the centralized records/clearance system in coordination with OTIG, OTPMG and OESPA.

4) Forward the completed GHQ clearances of line and TAS officers who have filed application for retirement/separation benefit claims to AF-PPGMC.

5) Issue Certificate of Beneficiaries without delay as re-quested by the legal beneficiaries thru AFPPGMC upon the death of the principal/ re-tiree and also for TAS officers who were posthumously retired/separated while in service.

6) Maintain the AFP Retirees’ List. It shall also administer and maintain the non-current records of all retired and separated AFP personnel.

7) Adjudicate cases on the accreditation of government service as active service of retired/separated AFP personnel and TAS officer through the Military Status Board.

e. AFPPGMC

1) Validate and approve the encoded data of retirees’ in the PenMIS for retirement/separation benefit claims.

2) Secure Final/Accounting Clearance of all military per-sonnel applying for retirement/separation claims.

3) Process Commutation of Leave Balance of TAS officers.

4) Request funding of lump sum and pension to DBM thru channel.

5) Issue to AFPFC the Authority to Gain the pensioner in the Alpha List of AFP Pensioners, Monthly Report of Changes, Authority to effect collection of B4 accounts, for implementation. Likewise, process and validate applications for resumption, restoration of pension and transfer of pension to legal beneficiaries.

6) Upon release of SARO and corresponding NCA, prepare Obligation Slip (OS) and certify chargeability to the DV and forward same to GHQ Accounting Office.

7) Reflect deductions in the lump sum voucher for retirees who have unsettled or outstanding government money and property accountability.

8) Administer the PenMIS, develop database and system program, and complete the pension payroll module of PenMIS.

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9) Maintain the AFP Pensioners’ List.

10) Adjudicate cases of late filing of retirement/separation benefit claims and appeal for amendment of separation orders thru AFP RSAB.

f. GHQ MFO

1) Conduct pre-audit of all DVs and review the priority list of payees as attachment in the Special Budget Request to reach the approval of DBM for the issuance of SARO and NCA.

2) Upon receipt of SARO and NCA from DBM, issue Allotment Advice with corresponding NTA to AFP PGMC for the preparation of ALOBS and furnish a copy to GHQ Accounting Center for journalization/recording.

3) Conduct final audit and forward funded DVs to AFP Fi-nance Center for the payment of retirement benefit claims to retirees and bene-ficiaries.

4) Monitor B4 Accounts.

g. GHQ Accounting Center

1) Issue clearances and Statement of Accounts to all AFP personnel applying for retirement/separation upon receipt of request from AFP PGMC. Retirees with unsettled or outstanding government money/property ac-countability/ies shall be issued the certificate of money property accountability and accountability update form with specific remarks.

2) Upon receipt of SARO and NCA from GHQ MFO, jour-nalize and certify availability of funds.

3) Return the funded DVs to GHQ MFO for final audit.

4) Record B4 Accounts and render monthly report, copy furnishing AFPFC, AFPPGMC, and AFPMFO.

h. AFP Finance Center

1) Issue Statement Last Payment and Latest Pay Slip to retiring or to be separated TAS officers.

2) Issue Certificate of Deductions and official receipts to retirees who settled their incurred money and property accountability/ies thru pay-ment.

3) Upon receipt of the funded DVs from GHQ MFO, prepare the check/ADA and execute payment of the 36 months lump sum or regular monthly pension and derivative pension to concerned retirees and beneficiaries without de-lay. Same undertaking shall be done for the payment of commutation of leave credits of TAS personnel.

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4) Effect implementation of collection of B4 Account.

i. OTIG, OTPMG, OTJAG, OESPA and GHQ Accounting Center

1) TJAG, AFP to issue without delay Declaration of Legal Beneficiaries for Posthumous Retirement/Separation and derivative benefit claims.

2) Establish, update and maintain an electronic database system or a list of personnel with DLO case (pending and resolved cases) and money/property accountabilities with the government. These offices must provide their MS counterparts of the updated list regularly to ensure synchronized in -formation.

3) Indicate therein specific remarks on the cases or the accountability as follows:

a) Pending cases punishable by dishonorable dis-charge or separation with prejudice to retirement/separation benefits

b) Not deficient in filing of Statement of Asset, Li-abilities and Net Worth (SALN) and Disclosure of Business Interests and Financial Connections

c) With cleared or unclear money and property ac-countabilities

4) Share the instituted database of personnel with DLO cases and money/property accountabilities accessible in the Intranet for immediate verification and reference.

j. Major Service MFO

1) In the payment of the Commutation of Leave Balance and Separation Gratuities of Major Service personnel, conduct pre-audit of all DVs and review the priority list of payees as attachment in the Special Budget Request to reach the approval of DBM for the issuance of SARO and NCA.

2) Upon receipt of SARO and NCA from DBM, issue Allotment Advice with corresponding NTA to Major Service PGABs for the preparation of ALOBS and furnish a copy to Major Service Accounting Center for journalization/recording.

3) Charge the payment of Commutation of Leave Balance and the Separation Gratuities against the Major Service PS Savings.

4) Conduct final audit and forward DVs to Major Service Fi-nance Centers for the payment of Commutation of Leave Balance to the re-tirees/payees.

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k. Major Service Accounting Office

1) Issue clearances and Statement of Accounts to all personnel under their respective jurisdictions who are applying for re -tirement/separation and for the payment of their commutation of leave as re-quested by Major Service Adjutant/PGAB/Pension Branch. Retirees with unsettled or outstanding money/property accountability/ies shall be issued the certificate of money/property accountability and accountability update form with specific remarks.

2) Upon receipt of SARO and NCA from Major Service MFO, journalize and certify availability of funds.

3) Return the funded DVs to MS MFO for final audit.

l. Major Service Finance Centers

1) Issue Statement of Last Payment and Latest Pay slip to personnel applying for retirement/separation under their paying jurisdiction.

2) As indicated in the Personnel Action Form of personnel applying for retirement/separation schedule and effect the deletion from the payroll on the date of their retirement/separation from the active service to avoid over -payment.

3) Upon receipt from MS MFO of the funded DVs, prepare the check/ADA and execute payment of Commutation of Leave Balance to retired AFP personnel without delay.

8. RESCISSION: All previous policies in conflict with this Circular are hereby rescinded.

9. EFFECTIVITY: This Circular shall take effect upon publication.

BY ORDER OF THE SECRETARY NATIONAL DEFENSE:

OFFICIAL: GREGORIO PIO P CATAPANG JRGeneral AFPChief of Staff

RONALD N ALBANO Brigadier General AFP The Adjutant General

DISTRIBUTION: “A”

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