WHEREAS, the country's continuing and accelerated efforts at national development and well-being require progressive and adequate technological utilization and diffusion;

WHEREAS, more rapid national development further demands a steady and expanding supply of technical manpower with expertise in the various fields of technology and engineering and an updating of existing technical manpower;

WHEREAS, a continuing interaction between government, industry and the university is mutually beneficial and in the interest of national development; and

WHEREAS, to meet the above-mentioned demands it is necessary to provide adequate support so that existing programs for the development of qualified manpower and research on technological development can be strengthened, improved, and expanded;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, do hereby order and decree:

SECTION 1. Creation of the National Engineering Center. — There is hereby and created and established the National Engineering Center (hereafter referred to as NEC in the University of the Philippines System). The NEC shall be a distinct and separate unit from the UP College of Engineering and shall absorb the UP Industrial Research Service Center, the National Hydraulic Research Center, the Training Center for Applied Geodesy and Photogrammetry, the Transport Training Center, and the Building Research Service. Purely academic functions shall be undertaken by the UP College of Engineering at a larger scale to be made possible by the financial support of the NEC.

SEC. 2. Objectives. — The NEC shall have the following objectives:

1. To provide a pool of technical experts to which public and private entities may turn for assistance in the solution of engineering problems.
2. To develop technologies that utilize local resources which are adapted to the needs of a developing country.

SEC. 3. Powers and Functions. — The NEC shall have the following powers and functions:

1. To undertake and promote research activities aimed at solving indigenous technological problems in cooperation with private industry, government entities, and other engineering schools;
2. To assist the Department of Education and Culture in formulating programs in such areas as curricula, laboratory standards, teaching materials, equipment and the like;
3. To update practising engineers on significant developments in their field by organizing seminars and offering continuing education courses;
4. To undertake studies in such areas as water resources and other natural resources development, transportation and communication, environmental engineering, building and low-cost housing with emphasis on earthquake and typhoon protection;
5. To finance research and development programs in the pursuit of knowledge and technological achievement in the various fields of engineering;
6. To develop information useful to practising engineers.

SEC. 4. Executive Director of the NEC. — The NEC shall be headed by an Executive Director who shall be appointed by the Board of Regents of the University of the Philippines System upon recommendation of the President of the University. He shall be under the immediate administrative supervision of the President of the University.

SEC. 5. Advisory Board. — The plans and programs of the NEC shall be reviewed and approved by an Advisory Board composed of:

a.	The Executive Vice-President of
	the University of the Philippines
	System	Chairman
b.	Dean, UP College of Engineering	Member
c.	The Undersecretary of Public Works,
	Transportation & Communication	Member
d.	The Undersecretary of Industry	Member
e.	The President of the UP Alumni
	Engineers	Member
f.	(2) members to be appointed by the Board of Regents of the University of the Philippines System upon the recommendation of the Dean of the UP College of Engineering who shall serve for a term of three (3) years and may be reappointed for another term of three (3) years.

SEC. 6. Services of Scientists and Technical Personnel. — The NEC may, for the purpose of its research and development activities, obtain the services of scientists and technical personnel of other units in the University of the Philippines System and of any other agency of the government of the Republic of the Philippines. Such personnel may be paid additional compensation or honoraria by the NEC. Any government retiree employed in the Center shall not be required to reimburse or refund any gratuity or pension received from the government nor shall any pension or annuity be suspended or reduced on account of his employment in the NEC.

SEC. 7. Building Construction and Equipment Purchase. — The NEC is hereby authorized to construct buildings and other facilities and to purchase equipment locally and abroad as may be necessary to carry out its functions.

SEC. 8. Operating Revenues. — The NEC is authorized to charge fees for consultancy and other services rendered, to utilize the proceeds of such fees in the conduct of the work contracted for, and to retain any surplus in a Special Account in the General Fund for use in the improvement of the operations of the NEC, including the purchase of laboratory equipment and building expansion: Provided, That, consultancy services for government agencies and corporations shall be subject to pertinent law and regulations, particularly the level of consultancy rates: Provided, Further, that the cost of personnel services, honoraria, and staff contractual fees paid from operating revenues to officials and employees of the University of the Philippines shall observe standard policy, procedure and rates as may be approved by the NEC.

SEC. 9. Position Classification and Compensation. — The position classification and compensation rates paid to the staff members of the NEC shall be the same as those applicable to the University of the Philippines System: Provided, That, honoraria and consultancy rates shall be within the limits established under the Annual General Appropriations Law.

SEC. 10. Special Auditing Rules and Regulations. — Expenditures and disbursements made by the NEC in the conduct of activities shall be subject to special auditing and accounting rules and regulations suited to the requirements of research. These special auditing rules and regulations shall be formulated by the Office of the President of the University of the Philippines System and the Commission on Audit and submitted to the President of the Republic of the Philippines for review and approval within four (4) months after approval of this Decree.

SEC. 11. Transitory Provisions. — All existing Centers in the UP College of Engineering shall become part of the NEC. Government budget allocations to the said existing Centers shall be transferred to the NEC except budgetary allotments for purely instructional purposes.

All equipment of the said existing Centers in the UP College of Engineering used for purely instructional purposes shall be retained by the College. However, arrangements shall be made to share equipment used for instructional and research purposes between the College and the NEC.

SEC. 12. Separability Clause. — If any provision of this Decree or the application thereof to any person or circumstance is declared unconstitutional or invalid for any reason, the same shall not affect the validity of the other provisions.

SEC. 13. Repealing Clause. — All acts, parts of acts, executive orders, ordinances, rules and regulations which are inconsistent with the provisions of this Presidential Decree are hereby repealed, amended or modified accordingly.

SEC. 14. Effectivity. — This Decree shall take effect immediately.

Done in the City of Manila, this 27th day of January, in the year of Our Lord, nineteen hundred and seventy-eight.

			(Sgd.) FERDINAND E. MARCOS President of the Philippines
	By the President:
	(Sgd.) JUAN C. TUVERA
		Presidential Assistant