Section 1. Short Title. — This Act shall be known as the "AFP
Modernization Act."
Sec. 2. Declaration of Policy. — It is hereby
declared the policy of the State to modernize the Armed Forces of the
Philippines (AFP) to a level where it can effectively and fully perform
its constitutional mandate to uphold the sovereignty and preserve the
patrimony of the Republic of the Philippines. Toward this end, the
principal thrusts of the modernization program under this Act shall
be:
(a) The development of a self-reliant and credible
strategic armed force along the concept of a "Citizens Armed Force";
the reconfiguration of the Armed Forces of the Philippines structure;
and the professionalization of the AFP;
(b) The undertaking of reforms in the recruitment,
training, employment and management of AFP personnel;
(c) The development, validation or modification of
AFP doctrines;
(d) The acquisition and upgrading of appropriate
technology and equipment; and
(e) The relocation, improvement, and construction of
bases and other facilities.
Sec. 3. Objectives of the AFP Modernization
Program. — The AFP modernization program shall be implemented in
accordance with the following objectives:
(a) To develop its capability to uphold the
sovereignty and territorial integrity of the Republic and to secure the
national territory from all forms of intrusion and encroachment;
(b) To develop its capability to assist civilian
agencies in the preservation of the national patrimony, including the
country's living and nonliving marine, submarine, mineral, forest and
other natural resources located within its territory and its exclusive
economic zone (EEZ);
(c) To enhance its capability to fulfill its mandate
to protect the Filipino people not only from armed threats but from the
ill effects of life-threatening and destructive consequences of natural
and man-made disasters and calamities, including typhoons, earthquakes,
volcanic eruptions, major accidents in far-flung or inaccessible
terrain or at sea and from all forms of ecological damage;
(d) To improve its capability to assist other
agencies in the enforcement of domestic and foreign policies as well as
international covenants against piracy, white slavery, smuggling, drug
trafficking, hijacking of aircraft and seacraft and the transport of
toxic and other ecologically-harmful substances taking place in or
through Philippine territory;
(e) To enhance its capability to assist the
Philippine National Police in law enforcement and internal security
operations;
(f) To enhance its capability to fulfill the
country's international commitments; and
(g) To develop its capability to support national
development.
Sec. 4. Components of the AFP Modernization
Program. — The AFP modernization program shall consist of the following
components:
(a) Force restructuring and organizational
development. — The AFP modernization program shall develop the AFP into
a compact, efficient, responsive and modern force with the capability
to engage in conventional and/or unconventional warfare, disaster
relief and rescue operations, and contribute to economic development
and other non-traditional military roles.
This component of the modernization program shall
likewise provide for the identification, organization, training and
development of reserve force and affiliated reserve units in the AFP,
especially in the Navy and Air Force.
(b) Capability, material, and technology development.
— The AFP modernization program entails the development and employment
of certain capabilities that can address the assessed threats:
provided, that the acquisition of air force, navy and army equipment
and material of such types and quantities shall be made in accordance
with the need to develop AFP capabilities pursuant to its modernization
objectives: provided, further, that the acquisition of new equipment
and weapons systems shall be synchronized with the phase-out of
uneconomical and obsolete major equipment and weapons systems in the
AFP inventory: provided, even further, that no major equipment and
weapons system shall be purchased if the same are not being used by the
armed forces in the country of origin or used by the armed forces of at
least two countries: provided, furthermore, that only offers from
suppliers who are themselves the manufacturers shall be entertained:
provided, finally, that no supply contract shall be entered into unless
such contract provides for, in clear and unambiguous terms, an
after-sales services and the availability of spareparts.
(c) Bases/support system development. — The AFP
modernization program shall entail the development of permanent bases
for land, air, and naval forces to conform with national defense
strategies and the government's socioeconomic thrusts; provide a
systematic relocation of AFP units to enhance their capability in the
performance of their mission; provide adequate support systems and
housing facilities to AFP units and personnel; provide training grounds
for maneuver and territorial forces as well as the reserve components;
and develop bases and camps along standard criteria for space
allocations, zoning and efficient correlation of land areas and
structure.
(d) Human resource development. — The human resource
development component of the AFP modernization program shall have the
following objectives:
(1) To strengthen the patriotic spirit and
nationalist consciousness of the military and respect for people's
rights in the performance of their duty;
(2) To develop and transform the AFP into a primarily
external security-oriented force;
(3) To develop a compact, effective, efficient and
responsive citizen-based force;
(4) To implement programs that will enable the AFP to
perform its role in environment/resource protection and multinational
peace-keeping operations;
(5) To convert the AFP into a service/people-oriented
and professionally united force; and
(6) To improve the quality of life of soldiers and
their families and reorient values of all personnel in the AFP.
(e) Doctrines and development. — The transition of
the AFP from an internal security-oriented force to an external
security-oriented force requires the review, evaluation and validation
of its present set of doctrines for the purpose of formalizing such
doctrines. Towards this end, the Department of National Defense and the
general headquarters, AFP shall be responsible for the generation,
evaluation, consolidation and formalization of doctrines; the conduct
of periodic review and validation of doctrines through field
application, testing and exercises; and the dissemination of approved
doctrines at all levels of command.
The Secretary of National Defense shall formulate guidelines to
implement this section in accordance with the objectives of the
modernization program enumerated in the preceding section.
Sec. 5. Development of AFP Capabilities. — The AFP
modernization program shall be geared towards the development of the
following defense capabilities:
(a) Development of naval defense capability — Given
the archipelagic nature of the Philippines, the Philippine Navy (PN)
shall develop its capabilities for naval defense, amphibious warfare,
sealift and transport, and surface warfare; naval gunfire support,
detection and maritime surveillance, search and rescue, disaster
response as well as capabilities for anti-air, anti-submarine and mine
warfare. The enhanced navy defense capabilities shall enable the AFP to:
(1) Develop its capabilities for naval defense;
(2) Conduct amphibious operations for both military
and civilian relief operations;
(3) Defend the Philippine territorial seas, all its
internal waters, as well as its 200-mile exclusive economic zone (EEZ),
from all forms of illegal intrusion or passage;
(4) Protect all submarine-based lines of domestic and
international communication;
(5) Identify all vessels and monitor all kinds of
surface and submarine passage through Philippine territorial waters;
(6) Protect and preserve, through the Philippine
Coast Guard (PCG), all coastal, near-coastal and riparian living and
non-living marine resources;
(7) Provide transportation of personnel and material
in times of natural disaster and rescue operations; and
(8) Provide, and if practicable, manufacture, through
Filipino skills and technology, its own requirements for seacraft and
infrastructure supply and maintenance.
(b) Development of air defense capability. — The
Philippine Air Force (PAF), being the country's first line of external
defense, shall develop its air defense capability by acquiring
multi-role aircraft, air munitions, avionics, point and area defense
missile system, maritime patrol and reconnaissance, and early warning
and control system, as well as capabilities for strategic and
battlefield airlift and limited ground attack in support of surface
forces. The enhanced air defense capability shall enable the AFP to:
(1) Detect, identify, intercept and engage, if
necessary, any aircraft illegally intruding into or passing through
Philippine airspace, up to areas near or around Philippine territorial
limits;
(2) Provide air support to Philippine ground and
naval armed forces;
(3) Provide airlift, search and rescue, rapid
deployment and related support in combat as well as disaster and other
civilian relief operations; and
(4) Provide, and if practicable, manufacture, through
Filipino skills and technology, its own requirements for aircraft and
infrastructure supply and maintenance.
(c) Development of ground defense capability — The
fragmented nature of Philippine land territory requires the Philippine
Army (PA) to develop its capabilities for ground defense and internal
security as well as its capability for assistance to national
development, search and rescue operations, relief and rehabilitation,
natural resources and environmental protection. The enhanced army
defense capabilities shall enable the AFP to:
(1) Locate and maintain adequate ground forces in
strategic sites in the major islands of the country capable of carrying
out independent or joint defense operations;
(2) Transport personnel and equipment rapidly through
all kinds of terrain in all kinds of weather conditions;
(3) Conduct disaster relief and civilian engineering
and construction operations;
(4) Monitor compliance with the enforcement, as the
proper government agency may require, all laws relating to the
preservation and protection of forest, wildlife and mineral resources;
and
(5) Provide, and if practicable, manufacture, through
Filipino skills and technology, its own requirements for personnel and
infrastructure supply and maintenance.
(d) Development of general headquarters capability —
The modernization of the AFP further requires the development of the
general headquarters capabilities for command, control, communications,
and information systems network.
Sec. 6. Period of Implementation. — The
modernization program under this Act shall be implemented over a period
of fifteen (15) years: provided, however, that payments for
amortization of outstanding multi-year contract obligations incurred
under this Act may extend beyond this period.
Sec. 7. Submission of the AFP Modernization
Program. — (a) Within ninety (90) days from the effectivity of this
Act, the President, upon the recommendation of the Secretaries of
National Defense and Budget and Management, shall submit the AFP
modernization program as provided for in this Act to Congress for its
consideration and approval in a joint resolution of the House of
Representatives and the Senate. The program shall indicate or show
inter alia:
(1) The size and shape of the AFP in terms of
personnel, equipment, and facilities during the various phases of the
modernization program;
(2) The modernization projects under it, including
the major weapon and non-weapon equipment and technology acquisitions
sought by the respective services and units of the AFP, any major
infrastructure construction or improvement to be made and the
particular objective(s) and component(s) under Section s 3 and 4,
respectively, of this Act to which such intended acquisition,
construction or improvements belongs; and
(3) The priorities, schedules as well as estimated
average cost of each modernization project or upgrading to be
undertaken.
(b) In the event Congress approves the AFP
modernization program, the joint resolution shall be the basis for
subsequent executive and legislative actions to implement the AFP
modernization program from year to year until its complete and full
realization.
Sec. 8. Appropriations for the AFP Modernization
Program. — The annual appropriations for the AFP modernization program
shall include the amounts necessary to support the funding requirements
for all modernization projects approved by Congress under the preceding
section.
The funds to be appropriated by Congress under this Act shall be
treated as a distinct and separate budget item from the regular
appropriation for the Department of National Defense (DND) and the AFP
and shall be administered by the Secretary of National Defense.
The proposed program shall be based on a ceiling, for the first five
(5) years, of Fifty billion pesos (P50,000,000,000.00): provided, that
thereafter, this amount may be increased commensurate to the increase
in the Gross National Product (GNP).
Sec. 9. Multi-year Contracts and Other Contractual
Arrangements. — (a) The Secretary of National Defense, pursuant to the
AFP modernization program, projects and appropriations approved by
Congress, may, subject to the approval by the President, provisions of
existing laws and regulations including those of the Commission on
Audit and under such terms and conditions most favorable to the
government, enter into multi-year contracts, lease and lease-purchase
agreements.
(b) For multi-year contracts, Congress shall, upon
certification by the President, make the corresponding appropriation
for the ensuing fiscal year: provided, that Congress shall appropriate
only such funds as may be necessary to pay any unpaid amount where such
funds mentioned in Section 11 of this Act are not sufficient or
available to meet such payment in full or in part.
(c) The Secretary of National Defense shall submit to
Congress, through the chairmen of the Senate Committees on National
Defense and Security and Finance and the chairmen of the House
Committees on National Defense and Appropriations, copies of these
multi-year contracts and other agreements/arrangements to enable
Congress to appropriate funds.
SECTION 10. Self-Reliant Defense Posture Program. —
(a) In implementing the modernization program, the AFP shall, as far as
practicable, give preference to Filipino contractors and suppliers or
to foreign contractors or suppliers willing and able to locate a
substantial portion of, if not the entire, production process of the
item(s) involved, within the Philippines.
(b) In order to reduce foreign exchange outflow,
generate local employment opportunities and enhance technology transfer
to the Philippines, the Secretary of National Defense shall, as far as
feasible, incorporate in each contract/agreement special foreign
exchange reduction schemes such as countertrade, in-country
manufacture, co-production, or other innovative arrangements or
combinations thereof.
(c) The AFP likewise ensure that in negotiating all
applicable contracts or agreements, provisions are incorporated
respecting the transfer to the AFP of the principal technology involved
as well as the training of AFP personnel to operate and maintain such
equipment or technology.
SECTION 11. AFP Modernization Act Trust Fund. — There
is hereby created a trust fund, to be known as the AFP Modernization
Act Trust Fund. Said trust fund, which shall be used exclusively for
the AFP modernization program, but not to include salaries and
allowances, shall be funded out of the following:
(a) Appropriations for the AFP modernization program;
(b) The proceeds from the sale, lease or joint
development of military reservations, as may be authorized by Congress,
including such immovable and other facilities as may be found therein,
not covered by the Bases Conversion Development Authority, as provided
for in Republic Act No. 7227;
(c) Shares of the AFP from the proceeds of the sale
of military camps provided for under Republic Act No. 7227;
(d) Proceeds from the sale of the products of the
government arsenal;
(e) The proceeds from the disposal of excess and/or
uneconomically repairable equipment and other movable assets of the AFP
and the government arsenal; i
(f) Funds from budgetary surplus, if any, as may be
authorized by Congress subject to the provisions of Sec. 8 of this
Act; and
(g) All interest income of the trust fund.
The trust fund shall be administered by the Secretary of National
Defense in accordance with existing government auditing rules and
regulations.
SECTION 12. Modernization of the Government Arsenal.
— The modernization of the government arsenal, for the development of
production capabilities to enhance self-sufficiency in defense
requirements, shall be part of the AFP modernization program. The
government arsenal shall be effectively utilized in the production of
basic weapons, ammunition and other munitions for the use of the AFP
and the Philippine National Police (PNP), and for the sale and export
of products in excess of AFP/PNP requirements. The government arsenal
may use such production facilities as it may own or be provided with
under this Act or as it may arrange, under joint venture, co-production
or similar agreements with local and foreign entities.
SECTION 13. Austerity and Use of Savings. — Effective
upon the approval of this Act, the Secretary of National Defense, shall
submit to Congress, within the first quarter of the succeeding year, a
report on:
(a) The amount of all unused or undisbursed funds,
other than unused appropriations for salaries and benefits of the AFP
personnel, remaining from all previous DND and AFP appropriations; and
(b) The amount of savings from austerity measures,
which are hereafter to be pursued by all services and units of the AFP,
generated in the previous fiscal year.
The savings generated under this section are hereby authorized to be
used to augment funds for the AFP modernization program.
SECTION 14. AFP Procurement System. — The DND-AFP
shall strengthen its systems and procedures for equipment acquisition,
taking into account new requirements under the AFP modernization
program. Contract negotiations and equipment acquisition shall be
treated as two sequential but separate steps, each requiring the
separate decision of the Secretary of National Defense. The decision
making process for equipment acquisition shall start at the appropriate
service command and submitted to the AFP Weapons Systems Board, while
contract negotiation shall start at general headquarters AFP level. In
its system and procedures for equipment acquisition, the provisions of
Presidential Decree No. 1594, as amended, and other applicable laws
shall apply.
SECTION 15. Guidance for the President. — To meet
unforeseen national security emergencies, the President, upon the
recommendation of the Secretary of National Defense, may modify the
program through substitution or revision of a component project
therein: provided, however, that he shall report such action to
Congress within thirty (30) days.
SECTION 16. Annual Reports. — Not later than the end
of the first quarter of the succeeding year:
(a) The Secretary of National Defense shall submit to
the President and Congress an annual report on the status of the AFP
Modernization Act Trust Fund, as provided for in Section 11 of this Act;
(b) The Chief of Staff, AFP, shall submit to the
President and Congress, through the Secretary of National Defense, an
annual report containing the progress of the implementation of the
modernization program under this Act to include the AFP modernization
activities implemented prior to the approval of this Act.
SECTION 17. Separability Clause. — If any provision
of this Act shall be held unconstitutional or invalid, the other
provisions not otherwise affected shall remain in full force and effect.
SECTION 18. Repealing Clause. — All laws, executive
orders, rules and regulations inconsistent with or contrary to this
Act, are hereby deemed accordingly repealed or amended.
SECTION 19. Effectivity Clause. — This Act shall take
effect after fifteen (15) days from its publication in at least two (2)
newspapers of national circulation.
Approved: February 23, 1995
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