Pag-IBIG salary step increments above board

EXECUTIVES of Pag-IBIG Fund clarified that the pay raise for its officers and employees was not an increase in salary rates, which require approval from Malacanang – but merely salary step increments to address years of inflation, in accordance with Pag-IBIG’s Compensation Plan.

This, in response to the observation issued by the Commission on Audit on the general increase implemented by the Fund last year.

Secretary Eduardo D. del Rosario, Chairman of the Housing and Urban Development Coordinating Council and of Pag-IBIG Fund’s Board of Trustees, said that they did not increase the salary rates of officers and employees in 2018 but merely granted salary step increments similar to those implemented by government agencies covered by the Salary Standardization Law (SSL).

He added that while step increments among employees of other agencies are granted automatically every three years on the basis of longevity of service, the step increments granted to Pag-IBIG employees were intended to address the effects of inflation over the years.

The grant of such step increments is within the powers of its Board based on Pag-IBIG’s Compensation Plan. Since there was no increase in salary rates nor new benefits granted, Presidential approval is not required.

“I want to assure the public that the grant of step increments in 2018 was proper, done according to the right process and, most importantly, was not excessive. We have only adjusted the salaries of Pag-IBIG Fund officers and employees to be, more or less, on the same level of SSL4, which is currently being received by employees of other government institutions. We would like to assure all, our members in particular, that we continue to adhere to the directive of President Rodrigo Roa Duterte in safeguarding the workers’ fund,” Secretary del Rosario said.

He added that the Fund also adjusted the salary rates of all covered contractors and job order personnel to be comparable with positions in government and granted them a premium rate of 20 percent, in compliance with the Joint Circular (JC) No. 1 issued in November 2018 by COA, the Civil Service Commission, and the Department of Budget and Management.

In complying with the circular, the Pag-IBIG Fund Board agreed with the rationale of the three agencies calling for equal pay among permanent employees and job order personnel in government, pegged at the prevailing rates of the fourth tranche of the SSL4.

Del Rosario said Pag-IBIG Fund Board had the same intention in granting the step increments to employees and officers of Pag-IBIG Fund last year, even while the step increments applied to the salaries of a majority of its employees still resulted to a lower rate than the prevailing rates of the third tranche of the SSL4.

Pag-IBIG Fund CEO Acmad Rizaldy P. Moti also clarified that the agency’s Board went through all the requisite processes and ensured that all conditions were met prior to the granting of the step increments.

“The Board considered all bases when the step increments were granted in 2018. The intention behind the grant of step increments under the Compensation Plan of Pag-IBIG Fund was not to raise the salaries of officers and employees – but rather to maintain the purchasing power and value that they had in 2009 or 10 years ago when the Fund’s Compensation Plan was first adopted,” Moti said.

He added that the granting of the step increments last year was long overdue. The decade-old compensation plan was no longer competitive to attract personnel that will allow the Fund to serve its growing membership and their increasing needs.

Reckoned from 2009 when Republic Act (RA) 9679 (Home Development Mutual Fund Law) was passed into law, two compensation reviews should have already been conducted by this time – the first review should have been in 2013, while the second should have come in 2017.

These reviews did not materialize in light of the efforts of the Governance Commission for GOCCs (GCG) to develop a Compensation and Position Classification System (CPCS) for all GOCCs, which include Pag-IBIG Fund.  In 2017, however, the CPCS was suspended.  As a result, the salaries of Pag-IBIG Fund employees remained at the same level as it was in 2009, except for a one-step increment in 2013.

“We have to put things into context here. The step increments were granted, in strict accordance with existing rules, to employees of the Pag-IBIG Fund who are occupying permanent positions. The members of the Board who approved the grant, which include myself, were not covered by the step increments because we are presidential appointees. The grant went to career employees and officers who worked hard in order to achieve record-breaking feats and made 2018 the best year ever for Pag-IBIG Fund,” Moti said.

Pag-IBIG Fund had a banner-year in 2018 as it achieved highest-ever figures in net income, housing loan takeout, housing loan payment collections, member savings collections and total amount of dividend earnings for its members.