While the cost of living is on the rage, raising salaries can be one’s glimmer of hope.
President Benigno Aquino III has just endorsed a bill that increases the basic salaries of government employees by up to 27%, says the Department of Budget and Management.
The proposed “Salary Standardization Law of 2015” was endorsed to Congress on 9 November, which mandates a “4-year P226-billion compensation increase for the national government’s 1.53 million civilian and military and uniformed personnel.”
The endorsed bill includes the following perks:
- Salary increase
- Enhanced performance-based bonus system
- Midyear 14th month pay
According to DBM Secretary Butch Abad, the adjustment of government salaries is in accordance to the Joint Resolution No. 4 of Congress of 2009, which “laid down for a review of the compensation and position classification system after 3 years from the last year of the adjustment (1 June 2012)/”
“The competitiveness of government pay in relation to the private sector and the compensation strategy to bring government pay closer to market rates,” adds Abad.
“The bill aims to increase the basic salary of covered employees on the average by 27% while the 14th month pay will further raise compensation by 8%,” he says during the announcement. “The 14th month pay will further raise compensation by 8%, while the enhanced PBB is equivalent to 1-2 months’ salary or an average 10% increase in salary. Government personnel who play a greater role and carry a heavier responsibility in improving government performance, will receive a higher bonus.”
In its press release, the DBM said:
“As a consequence of RA 10653, which raised the amount of benefits exempted from tax to P82,000, for majority of civilian employees, those belonging to Salary Grades 1-11, and who are only receiving the existing tax-exempt 13th month pay, the cash gift, and the productivity enhancement incentive (PEI), their full 14th month pay and full PBB will also be exempt from tax. For those belonging to Salary Grades 12-16, who also are only receiving the existing tax-exempt 13th month pay, cash gift, and PEI, only their full 14th month pay will be exempt from tax.”
The perks of this new bill, when pushed into a law, will take effect on 1 July 2016.