The Department of Budget and Management (DBM) has issued National Budget Circular 597, detailing the guidelines for implementing the second tranche of the updated salary schedule for government employees in 2025. Effective January 1, 2025, this move is part of the government’s commitment to ensuring a fair, competitive, and sustainable compensation system for civil servants.
Scope of Coverage
The circular applies to:
- Government personnel in the executive, legislative, and judicial branches.
- Constitutional commissions and other constitutional offices.
- State universities and colleges (SUCs).
- Government-owned or -controlled corporations (GOCCs) not covered by Republic Act (RA) 10149 (GOCC Governance Act) and Executive Order (EO) 150 (Compensation and Position Classification System).
The guidelines exclude:
- Military and uniformed personnel.
- Agencies exempted from RA 6758 (Revised Compensation and Position Classification System).
- GOCCs governed by RA 10149 and EO 150.
- Individuals working without an employer-employee relationship, funded by non-personnel services (PS) appropriations.
Funding and Allocation
The Miscellaneous Personnel Benefits Fund (MPBF) and available appropriations under RA 12116 (2025 General Appropriations Act) will cover the salary adjustments for civilian personnel. For national government agencies (NGAs) employing casual and contractual staff, funding will be sourced from their lump sum appropriations.
For covered GOCCs, salary adjustments will be funded through their Corporate Operating Budgets (COBs). GOCCs are required to ensure performance targets are met and that their programs remain unaffected by the salary increases. Borrowing to fund the adjustment is strictly prohibited.
The DBM will issue the necessary Special Allotment Release Orders (SAROs) and Notices of Cash Allocation (NCAs), which will include a detailed monthly breakdown to cover the salary adjustments and fixed expenditures.
“The amounts required to implement the salary adjustment and related fixed expenditures of casual and contractual personnel in NGAs whose salaries are drawn from the lump sum appropriations for non-itemized positions shall be sourced from the agency’s lump sum appropriations included in its FY 2025 budget,” the circular stated.
Request for Additional Funds
For newly filled positions after the December 31, 2024 cut-off, agencies can request funds for PS deficiency by submitting the necessary documentation for approval and release.
Background and Implementation
The updated salary schedule, as outlined in EO 64, was signed by President Ferdinand R. Marcos Jr. on August 2, 2024, and aims to attract, retain, and motivate skilled and dedicated civil servants. This schedule will be implemented in four tranches from 2024 to 2027.
“Any additional requirement for the newly-filled positions after the December 31, 2024 cut-off date may be included in the agency’s request for the release of funds for PS deficiency, subject to the submission of the pertinent documents required for the processing of PS deficiency,” according to the circular.
Disclaimer: The information provided in this article is for general informational purposes only and may be subject to updates or changes. It does not constitute legal, financial, or professional advice. For specific guidance, please refer to the official documents issued by the Department of Budget and Management (DBM) or consult a qualified expert.
Advertisement
