FREQUENTLY ASKED QUESTIONS (FAQs)
1. Why was AFPRSBS created?
AFPRSBS was created by virtue of PD 361 signed in December 30, 1973, as a funding scheme established to guarantee continuous financial support to the AFP military retirement system.
AFPRSBS was created by virtue of PD 361 signed in December 30, 1973, as a funding scheme established to guarantee continuous financial support to the AFP military retirement system.
2. Why did AFPRSBS fail to assume the pension obligation of AFP retirees so that the national government can be unburdened of the budgetary requirements for the soldiers’ pension?
Representatives of the SSS and GSIS agree that the current contribution set-up used by RSBS will not be able to sustain a pension system for the soldiers because of the following:
Representatives of the SSS and GSIS agree that the current contribution set-up used by RSBS will not be able to sustain a pension system for the soldiers because of the following:
- The System was underfunded from the very start.
- There is no government counterpart in the pension contribution system aside from the P200M initial seed capital.
- PD 361 as amended by PD 1656, mandates AFPRSBS to return the soldiers’ contribution. SSS and GSIS do not refund the contributions of its members, and these contributions are used to further make their fund grow and sustain their pension requirements.
- Compared to other countries, the AFP pension is generous because it is 1) based on the base pay and longevity pay of the next higher grade; 2) it increases every time the active soldier’s salary increases; 3) it is granted earlier, at 56 years of age; and, 4) the soldiers’ dependents are given a high percentage of the pension once widowed (75%).
- In addition, the increase in number of pensioners is also contributing to the escalation in the pension requirement. The improved life expectancy of retirees further result in a pension requirement that is increasing at a faster pace than the yield from RSBS investments.
3. What is Memorandum Order No. 90 S-2016?
Memorandum Order No. 90 issued by the Office of the President supplements Executive Order (EO) Nos. 590 s. 2006 and 590-A s. 2007, which directs the abolition of the Armed Forces of the Philippines-Retirement and Separation Benefits System (AFP-RSBS), privatization of its subsidiaries, and for other purposes. It was signed April 8, 2016.
Memorandum Order No. 90 issued by the Office of the President supplements Executive Order (EO) Nos. 590 s. 2006 and 590-A s. 2007, which directs the abolition of the Armed Forces of the Philippines-Retirement and Separation Benefits System (AFP-RSBS), privatization of its subsidiaries, and for other purposes. It was signed April 8, 2016.
4. What are the salient features of M.O. 90 S-2016?
It provides for the following:
It provides for the following:
- Abolition of AFPRSBS
- Privatization of its subsidiaries
- Winding down and liquidation of AFPRSBS assets
5. What does winding down and liquidation mean?
It means the AFPRSBS Board of Trustees (BOT) shall act as a Board of Liquidators (BOL), and is directed to, among others:
It means the AFPRSBS Board of Trustees (BOT) shall act as a Board of Liquidators (BOL), and is directed to, among others:
- Cease collecting members’ contributions and accrual of interest thereon effective March 31, 2016
- Maintain minimum personnel required to wind down its corporate affairs
- Collect all indebtedness due to AFPRSBS
- Refund members contributions as they fall due
- Service the remaining membership loan programs
- Liquidate/Sell the assets of AFPRSBS
6. Who will oversee/implement the provisions of MO 90 S-2016?
The Governance Commission for GOCCs (GCG) will oversee the winding down and liquidation of AFPRSBS and will be assisted by a Technical Working Group (TWG) from DND, DOF, DBM, PMO, AFPRSBS and AFP in implementing the provisions of MO 90 S-2016.
The Governance Commission for GOCCs (GCG) will oversee the winding down and liquidation of AFPRSBS and will be assisted by a Technical Working Group (TWG) from DND, DOF, DBM, PMO, AFPRSBS and AFP in implementing the provisions of MO 90 S-2016.
7. What is the current status of RSBS? Is AFPRSBS bankrupt?
AFPRSBS Financial Position
As of 31 May 2016
Total Assets P 17,096,828,492.18
Total Liabilities P 16,180,816,932.20
Total Equity P 916,011,559.98
AFPRSBS is NOT bankrupt. Bankruptcy means an inability to pay obligations. AFPRSBS has been debt-free since February 2006 and is capable of settling its obligations. The remaining liabilities of AFPRSBS refer to the principal members’ contributions and accrued interest as of 31 March 2016.
AFPRSBS Financial Position
As of 31 May 2016
Total Assets P 17,096,828,492.18
Total Liabilities P 16,180,816,932.20
Total Equity P 916,011,559.98
AFPRSBS is NOT bankrupt. Bankruptcy means an inability to pay obligations. AFPRSBS has been debt-free since February 2006 and is capable of settling its obligations. The remaining liabilities of AFPRSBS refer to the principal members’ contributions and accrued interest as of 31 March 2016.
8. Can we still transact business with RSBS now that it is abolished?
RSBS will continue to honor its contractual obligations with its business partners, joint venture partners, clients, buyers, members and other stakeholders while it liquidates its assets.
RSBS will continue to honor its contractual obligations with its business partners, joint venture partners, clients, buyers, members and other stakeholders while it liquidates its assets.
9. How much refund am I entitled to? If our contributions stopped in March 2016 and we will be retiring five (5) years from now, will our contributions still earn interests?
The System will give you a full refund of your contributions plus interest per annum. Contributions are accumulated with the following interest:
The System will give you a full refund of your contributions plus interest per annum. Contributions are accumulated with the following interest:
- Prior to 1991: No interest
- 1992-1995: 4% p.a. simple interest
- 1996-March 31, 2016: 6% p.a. simple interest
- April 1, 2016 onwards: No interest
10. When can the soldiers get the refund of contributions?
As stated in Presidential Decree No. 1656, E.O. Nos. 590 s. 2006 and 590-A s. 2007, and Memorandum Order No. 90, s. 2016, refund of contributions shall be released as they fall due or upon separation or retirement from military service.
As stated in Presidential Decree No. 1656, E.O. Nos. 590 s. 2006 and 590-A s. 2007, and Memorandum Order No. 90, s. 2016, refund of contributions shall be released as they fall due or upon separation or retirement from military service.
11. Does RSBS still offer loans to its members?
Yes. A soldier who has been issued an Order of Retirement may advance his contribution under the Discounting of Refund of Contribution Loan Program with minimal interest, up to one (1) year before the retirement date.
Yes. A soldier who has been issued an Order of Retirement may advance his contribution under the Discounting of Refund of Contribution Loan Program with minimal interest, up to one (1) year before the retirement date.
12. Once RSBS is fully abolished, where can we transact our concerns on our refund of contributions?
After RSBS is fully abolished, all membership concerns shall be handled by its successor-in-interest.
After RSBS is fully abolished, all membership concerns shall be handled by its successor-in-interest.
13. Can those members who went on AWOL or dishonorably discharged still claim their refund of contributions?
Yes, full refund of contributions plus interest will be given regardless of mode of separation for as long as there is an Order of Separation or Retirement.
Yes, full refund of contributions plus interest will be given regardless of mode of separation for as long as there is an Order of Separation or Retirement.
14. Are there still available real estate properties that soldiers can purchase?
Interested buyers may go to our Marketing and Sales Department at the 2nd Floor, RSBS Building, Camp Aguinaldo or call telephone numbers 911-0313/ 912-0056 to inquire about available inventories and payment terms for the projects.
Interested buyers may go to our Marketing and Sales Department at the 2nd Floor, RSBS Building, Camp Aguinaldo or call telephone numbers 911-0313/ 912-0056 to inquire about available inventories and payment terms for the projects.
15. Until when is RSBS’ corporate life?
The RSBS corporate life will be terminated upon appointment of the successor-in-interest.
The RSBS corporate life will be terminated upon appointment of the successor-in-interest.
16. Can we apply our refund of contributions as downpayment to purchase RSBS real estate properties?
This can be considered on a case to case basis.
This can be considered on a case to case basis.
17. Can you transfer the remaining funds to let’s say, AFPSLAI or our respectiveFinance Centers, so it will still earn interests?
NO, the MO 90 does not provide for this.
NO, the MO 90 does not provide for this.
18. Will there still be a Board of Liquidators (BOL) five (5) years from now when we retire?
The BOL will exist until the corporate life of RSBS is terminated. Their mandate is to identify which assets will be liquidated first, the manner of its disposal and ensure the best price for the sale and to ensure the refund of the member’s contributions.
The BOL will exist until the corporate life of RSBS is terminated. Their mandate is to identify which assets will be liquidated first, the manner of its disposal and ensure the best price for the sale and to ensure the refund of the member’s contributions.
19. Can we share in whatever profits that RSBS may derive from the sale of its assets over and above the refund of contributions plus 6% interest?
No. Residual assets of RSBS after the refund of all contributions and accrued interest to members shall be turned-over to the new entity.
No. Residual assets of RSBS after the refund of all contributions and accrued interest to members shall be turned-over to the new entity.
20. Is there a guarantee that we can still refund our contributions when we retire,say ten (10) years from now?
- As provided for in Executive Order 590 and 590-A, refund of contributions is guaranteed by the National Government.
- Our assets, which we are presently liquidating, can fully cover the funding requirements of refund of member’s contributions.
- Management, in coordination with GCG, may recommend the acceleration of refund of member’s contributions once funds from sale of assets become available.