Budget Secretary Amenah F. Pangandaman has approved the release of ₱1.64 billion to cover the fiscal year (FY) 2023 performance-based bonuses (PBB) of over 110,600 personnel of the Armed Forces of the Philippines–Philippine Army (AFP-PA).

“This release highlights our commitment to recognize and reward the men and women in uniform who carry out their duties with excellence,” Pangandaman said in a statement released on Wednesday, Sept. 24

Under the approved release, each eligible AFP-PA official and employee will receive a bonus equivalent to 45.5 percent of their monthly basic salary as of Dec. 31, 2023.

Employees in the first, second, and third levels are required to obtain at least a “very satisfactory” rating under the Civil Service Commission’s (CSC) performance management system or the career executive service board’s prescribed system.

According to the Department of Budget and Management (DBM), the funds will be sourced from the Miscellaneous Personnel Benefits Fund (MPBF) under the 2025 General Appropriations Act (GAA) or national budget.

It can be noted that the 2025 allocation for the MPBF was reduced by 33.2 percent to ₱109.1 billion from the ₱163.3 billion originally proposed under the National Expenditure Program (NEP).

Since it was Congress who slashed the proposed budget for the MPBF, “Congress is in a much better position” to explain the rationale behind the reduction, DBM Undersecretary Goddes Hope Libiran told Manila Bulletin.

“This substantial decrease may constrain the fund’s capacity to cover payments for personnel-related requirements, such as PBB and PS [personal services] deficiencies,” the DBM said in a circular letter released on Tuesday, Sept. 23.

Personal services refer to budget allocations for salaries, wages, and other compensation of permanent, temporary, contractual, and casual employees of local government units (LGUs).

To address this, the DBM has released a circular, which takes effect immediately, prescribing the guidelines for processing requests to cover PS deficiencies in 2025.

Under Section 53 of the general provisions of the 2025 national budget, agencies must first tap available PS allotments from unspent compensation and benefits, such as savings from vacant positions, employees on leave without pay, delays in assumption of duty, or disciplinary sanctions. Agencies may also use unreleased PS appropriations for 2025.

If these remain insufficient, agencies and state universities and colleges (SUCs) may file a special budget request with the DBM for a special allotment release order (SARO).

Requests must be consolidated at central offices for decentralized departments, while SUCs and other agencies will submit to their respective DBM counterparts.

As per the circular, the DBM will only process requests supported by reports on PS deficiencies consistent with financial accountability reports, justifications for the deficiency, and other required documents.

Agencies are also required to ensure their requests cover needs for the remainder of the year.