Section 2. The functional jurisdiction of the PCGR shall encompass, as necessary, the reorganization of the national and local governments, its agencies and instrumentalities, including government-owned or controlled corporations and their subsidiaries.

It shall continue providing staff assistance and consultative advice to the President, ministries and other agencies and instrumentalities of the government on development administration relative to, among others, reorganization, decentralization and regionalization, the career executive service, and the rationalization of government corporation management and functions.

The PCGR shall also assess, evolve and define a framework of the functional relationships between the national government and its political subdivisions at the regional, provincial, city, municipal and barangay levels.

The Special Presidential Reorganization Committee created under Executive Order No. 703, dated July 9, 1981, is hereby abolished and its functions and responsibilities are transferred to the PCGR, including particularly those pertaining to the government corporation sector study provided under Letter of Instructions No. 1454, dated April 8, 1985.