By Derco Rosal
For the first time in 10 years, the government has increased allowances for national employees working overseas to address the rising cost of living.
On Oct. 30, President Ferdinand R. Marcos Jr. issued an executive order to update the regulations governing the payment of various allowances applicable to foreign service personnel (FSP).
Under the new EO, the base rates for the overseas allowance (OA) and living quarters allowance (LQA) will be increased by 35 percent to 40 percent, which will be implemented in four tranches.
In particular, EO No. 73 covers the following allowances: OA, LQA, representation allowance (RA), family allowance (FA), and education allowance (EA).
“For too long, the financial support provided to our diplomats has not reflected the complexities and challenges associated with their assignments, not to mention the reality of facing higher cost of living abroad and being away from their families," Department of Budget and Management (DBM) Secretary Amenah F. Pangandaman said, stressing the department’s support for the president’s decision.
Pangandaman also stressed the importance of supporting front-line diplomatic workers, noting that the allowance increase will boost their morale, and enhance their focus and dedication after a decade without adjustments.
For qualified dependents, the FA will be increased by at least $50 (around P3,000) per month.
The EO also allows for a one-time 15 percent uniform increase in the RA for eligible recipients to address rising costs of goods and services related to entertainment, contributions, flowers, and wreaths.
It also states that personnel assigned abroad may receive an EA for up to three legal dependent children under 18 years old enrolled in primary, elementary, or high school.
Among the major considerations of adjustment of allowances for the government's FSP were global inflation rates, the purchasing power of the US dollar, and United Nations International Civil Service Commission (UN ICSC) Retail Price Indices (RPI), while considering fiscal constraints, the DBM said in a statement, Nov. 4.
In the first year of implementation, funds for the adjusted allowances of qualified FSP will come from agency savings or the Miscellaneous Personnel Benefits Fund (MPBF) under the 2024 General Appropriations Act (GAA), following budgeting and auditing regulations.
For subsequent years, the funding will be included in the annual GAA, following the standard budget preparation process.
The national budget for 2025 allocates P974.98 million under the MPBF for this purpose, the DBM stated.