Iloilo City seeks retroactive salary adjustments for LGU employees

By Mariela Angella Oladive

Iloilo City Mayor Jerry P. Treñas announced plans to appeal to the Department of Budget and Management (DBM) to approve retroactive salary adjustments for local government unit (LGU) employees, starting from January of this year.

During a press conference on Monday, Treñas said he would meet with the local finance committee to assess whether there are sufficient funds to support the retroactive increase.

“I’m not yet sure about the total funds needed. If we can afford it, we will make it retroactive as soon as possible,” he said.

The DBM’s Local Budget Circular No. 160, based on Section 325(g) of Republic Act No. 7160, limits retroactive salary increases to national government employees and requires LGUs to wait until their budgets are approved before implementing such increases.

Meanwhile, Iloilo Governor Arthur Defensor Jr. previously announced that the provincial government requires approximately P56 million to fund the retroactive salary increase for its employees. He noted that a smaller amount might be required if the increase is not applied retroactively.

“We need a supplemental budget to comply,” Defensor said, adding that the province will meet with DBM officials to discuss the implementation of the salary hike.

According to the DBM, the first of the four-tranche salary increases for national government employees would be retroactive to January 2024, with subsequent increases scheduled from January 2025 to January 2027.

LGUs will determine the percentage of the salary schedule they can implement based on their financial capacity.

For instance, special cities and first-class provinces and municipalities must pay 100 percent of the provided rates, while sixth-class municipalities may only pay 65 percent.