Pending the issuance of a budget circular, concerned local officials in Catanduanes are already preparing the release of the 1^st tranche of the salary increase of government works announced recently by President Ferdinand R. Marcos Jr.

In the capital town and several municipalities, local budget officers have started computing the increases in each salary grade for all LGU personnel holding permanent positions.

Virac budget officer Henry M. Quiñones, who also heads the regional association of local budget officers, told the Tribune that in anticipation of the approval of the salary hike, he has already identified funding where the needed cash for the pay adjustment as well as the medical allowance would be charged.

The allocation, however, would have to be approved by the Sangguniang Bayan through a Supplemental Budget.

Last Aug. 2, 2024, by authority of the President, Executive Secretary Lucas P. Bersamin signed Executive Order No. 64 increasing the salaries of government workers and authorizing the grant of an additional allowance to state employees.

The directive is now in effect following its publication in the Official Gazette last week.

“Given the prevailing economic circumstances, including the erosion of purchasing power due to inflation, there is a need to update the salaries and benefits of government personnel in order to maintain a competent, committed, agile, and healthy workforce, thereby promoting social justice, integrity, efficiency, accountability, and excellence, and ultimately translating to increased productivity and higher-quality public service,” Pres. Marcos said.

The updated salary schedule applies to all civilian government personnel in the Executive, Legislative, and Judicial Branches; Constitutional Commissions and other Constitutional Offices as well as Government-Owned or Controlled Corporations (GOCCs) not covered by RA 10149, or the “GOCC Governance Act of 2011” and EO No. 150 (s.2021), and the LGUs.

The updated salary schedule will be implemented in National Government Agencies (NGAs) in four tranches: the first tranche on Jan. 1, 2024; the second tranche on Jan. 1, 2025; the third tranche on Jan. 1, 2026; and the fourth tranche on Jan. 1, 2027.

As it will be applied retroactively, this means that the first tranche of implementation will be effective on Jan. 1, 2024.

Qualified government employees will also receive a medical allowance of PhP7,000 per annum as a subsidy for the availment of health maintenance organization (HMO)-type benefits.

A review of the salary schedule for the 1^st tranche shows that the national government worker at Salary Grade 1 will see a 4.08 percent increase from P13,000 to P13,530 monthly while the provincial government will see his monthly pay rise by 3.7 percent from P189,199 to P196,199.

The highest increase in the 1^st tranche is for those in Salary Grades 10 to 12, who will get an upgrade of 5.20, 5.60 and 5.28 percent, respectively.

By the time the 4^th tranche is implemented in 2027, the lowest-grade worker will be receiving a monthly pay of P15,208 while the provincial governor will enjoy a salary of P218,237.

Professionals in entry-level positions like Teacher I (SG-11) and Nurse I (SG-10) will have a monthly pay of P28,247 and P33,387, respectively.

However, the increase would be proportionally smaller in LGUs, depending on their income classification.

In Catanduanes, Virac is the only first-class municipality while San Andres and Caramoran are classified by the Department of Finance as 3^rd class.

Viga and Pandan are 4^th class towns while Bagamanoc, Baras, Bato, Gigmoto, Panganiban and San Miguel are 5^th class. The province of Catanduanes is classified as 3^rd class, the only one among the six Bicol provinces.

As a 3^rd class province, salaries of provincial employees shall not exceed 90 percent of the national salary schedule, the same level enjoyed by the LGU workers in Virac which is a 1^st class town.

The rest of the municipalities will have to abide by the following percentages: 2^nd class, 85%; 3^rd class, 80%; 4^th class, 75%; 5^th class, 70%; and 6^th class, 65%.

Capitol officials and employees, however, could become the highest paid LGU personnel on the island if Catanduanes is reclassified as 2^nd class in the upcoming general income reclassification this year pursuant to Republic Act 11964.

The law passed by Congress last year provides for the institutionalization of the automatic income classification of provinces, cities and municipalities by the Department of Finance (DOF) every three years.

Upon recommendation of the National Economic Development Authority (NEDA), the Secretary of Finance has the authority to upgrade the income classification of an LGU if it has shown growth in real per capita locally sourced revenues every year for the past three (3) years.

The income classification of an LGU serves as basis for the identification of grants and aids; determination of its financial capability to undertake programs and projects; total annual or supplemental appropriation for personnel services; compensation adjustment; creation of the new LGU; number of elective Sanggunian members; and limitation on percentage of agricultural land area for reclassification, among others.

The same law provides that an LGU whose average annual regular income falls below the income range during the first reclassification shall retain its current income status, with no official or employee to suffer any diminution of salary and benefits.

However, if its average annual income falls below the income range in the next reclassification, its income classification shall be downgraded, with the salaries and benefits of LGU workers to be affected.