WHEREAS, pursuant to the mandate of the Constitution, Presidential Decree No. 985 was issued to standardize compensation of government officials and employees, including those in government-owned or controlled corporations, taking into account the nature of the responsibilities pertaining to and the qualifications required for, the positions concerned;

WHEREAS, the said Decree authorizes the adoption of additional financial incentives for viable and profit-making corporations and those performing critical functions, to be supported from the net earnings and profits of such corporations;

WHEREAS, for purposes of rationalizing Compensation and Position Classification Systems for groups of corporations belonging to the same functional sectoral interest which presently maintain differing compensation and position classification plans, the said Decree and subsequently Letter of Instructions No. 62 created Compensation Committees to formulate and recommend policies and standards governing classification, compensation, allowances, and incentives for such groups of corporations;

WHEREAS, Letter of Instructions No. 841 directed the Compensation Committees to submit immediately for Presidential approval, adjustments in salary, allowances, and fringe benefits as may be called for by present economic conditions for government-owned or controlled corporations;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue ˜of the powers vested in me by law, do hereby instruct the implementation of the Uniform Position Classification and Pay Plan/for the Financial Institutions group of corporations;

1. Scope of the Plan - The Position and Classification Plans for the Financial Institutions group shall apply to the following corporations included under this sector:

Central Bank of the Philippines
Development Bank of the Philippines
Government Service Insurance System
Home Financing Corporation
Land Bank of the Philippines
Philippine Amanah Bank
Philippine Deposit Insurance Corporation
Philippine Veterans Investment Development Corporation
Philippine National Bank
Social Security System

2.  Position_Classification - Positions shall be classified using a Classification Method applied on the basis of the pre-determined standards/factors. The position classification plan for each of the corporations in the financial institutions group shall be determined on the basis of these standards/factors and approved ,by the Minister of the Budget pursuant P. D. No. 985.

3.  Compensation Schedule - The schedule attached to this Letter shall comprise the compensation schedule applicable to positions paid on monthly or annual basis.

4.  Salaries for Top Three (3) Management Positions - The compensation of the executive positions in a corporation shall depend upon the asset size of the corporation and upon its overall financial performance. The maximum levels of basic salary for the top positions in the largest corporation shall be as follows:

Governor/Chairman/President P96,000 Senior Deputy Governor/Vice-Chairman/ 91,200 Executive Vice President   Deputy Governor/Senior Vice President/ 84,000 Supervising Governor  

Provided,  That the Central Bank of the Philippines shall enjoy a 10% advantage over compensation received by the other institutions;  Provided  further, That salaries of subordinate positions shall be less than those of superior positions; and  Provided,  finally,  That salaries actually being received by any of the top three officials in excess of those rates may continue.

5.  Maximum Level of Allowances and Benefits - Allowances and benefits may be provided by individual corporations but not to exceed the following schedule, subject to aggregate ceilings indicated in Item No. 6 hereof:  

a. Cost of living allowance of 40% basic pay or P300 per, month, whichever is higher;

b. Children ™s allowance of 30.00 per child, not to exceed 4 children;

c. Amelioration allowance of 10% of basic pay or P50 per month, whichever is higher;

d. Meal subsidy of P3.00 per day per officer/employee;

e. Existing policy on, representation and transportation allowances shall be maintained;

f. No profit sharing, bonus payments, or increases in pension fund benefits shall be made without the approval of the Compensation Committee as provided under P.D. No. 985.

6.  Authorized Salary Increase - The Governing Boards of the financial institutions concerned may authorize a maximum three step increase fur positions, observing the position classification plan and compensation schedule approved, under this Letter and subject to items no. 4 and 7 hereof.

7.  Implementing Details - Details of implementing the Position and Compensation Plan and the step increases shall be issued by the Ministry of the Budget, which shall observe the following guidelines:

a. The increases shall be staggered within the limits of corporate financial performance. No government subsidy or equity investment shall be approved to finance any salary increase;

b. The hiring rate for positions shall be established for each corporation, depending upon its size and profitability;  

c. The implementation schedule for corporations incurring a loss in 1978 shall be prepared by the corporations concerned hand in hand with a profit plan, and shall be subject to case to case approval by the Ministry of the Budget; and

d. Any changes in the approved positions classification and pay plans, including reclassification action, shall be subject to the approval of the Ministry of the Budget.

e.  Effectivity Date - The Position Classification and Compensation Plans and step increase herein provided, shall take effect on May 1, 1979.

Done in the City of Manila, this 12th day of October, in the year of Our Lord, nineteen hundred and seventy-nine.

(SGD.) FERDINAND E. MARCOS
  President of the Philippines

By the President:

(SGD.) JACOBO C. CLAVE
Presidential Executive Assistant