MANILA — The President has authorized the grant of the Fiscal Year (FY) 2025 Productivity Enhancement Incentive (PEI) at a uniform rate of ₱5,000 for each qualified government employee, the Department of Budget and Management (DBM) announced Tuesday, with payments scheduled not earlier than December 15, 2025.
The move, aimed at boosting productivity and recognizing public‑sector performance, follows a review of the government’s performance management systems after the pause of earlier programs last year. The PEI is part of the Total Compensation Framework established under Congress Joint Resolution No. 4 and is administered under existing DBM rules and Budget Circular No. 2017‑45.
Scope and eligibility
DBM guidance indicates the PEI applies to eligible personnel across national government agencies, state universities and colleges (SUCs), government‑owned or ‑controlled corporations (GOCCs) under DBM jurisdiction, local water districts (LWDs), and local government units (LGUs) where applicable. Typical eligibility requirements include continued government service and at least four months of at least satisfactory service as of November 30, 2025, though agencies will apply specific clearance and verification procedures.
Background and policy context
The PEI stems from long‑standing efforts to link personnel incentives to organizational results. Administrative Order No. 25 (2011) and Executive Order No. 80 (2012) established the Results‑Based Performance Management System and the Performance‑Based Incentive System (PBIS), which includes the PEI. Implementation of the systems was suspended after Executive Order No. 61 in June 2024 to allow a Technical Working Group to review and harmonize performance monitoring and reporting systems across government.
Funding and disbursement
Appropriations for the PEI are included under Personnel Services and will be released through the General Appropriations Act allotment mechanisms, DBM said. Agencies are expected to coordinate with treasuries and HR units to process payouts in compliance with DBM circulars. While the authorized payment date is not earlier than December 15, 2025, timing may vary by agency depending on fund releases and internal clearance procedures.
Administrative details and compliance
Agency human resources offices will verify employee status and service months as of the cutoff date and may require clearances—such as no pending administrative cases—before authorizing payment. DBM emphasized that agencies must follow prescribed policies and guidelines to ensure proper allotments and disbursement.
Reactions and practical implications
The one‑time incentive is being framed by officials as a targeted measure to recognize productive performance rather than a permanent pay increase. Employee groups and some HR observers said the PEI can help morale and year‑end household budgets but urged clear, timely guidance on eligibility, tax treatment, and release schedules to avoid confusion.
What employees should do
Eligible workers are advised to confirm status with their agency HR or finance units, retain documentation of service records and pay slips, and follow official agency channels for inquiries or dispute resolution. Agencies are responsible for payroll validation, compliance with DBM rules, and coordination with treasury for timely payouts.
Looking ahead
The grant of the FY 2025 PEI comes amid ongoing efforts to harmonize performance management across government. Officials say the PEI remains part of broader reforms under the Total Compensation Framework intended to reward high performance and strengthen accountability in public service.
