Press Release
August 13, 2019

De Lima eyes minimum take-home pay for state workers to help make ends meet

Opposition Senator Leila M. de Lima has proposed a Senate measure setting a minimum take-home pay for government workers in order to help them make both ends meet amid the skyrocketing costs of living expenses.

De Lima, who chairs the Senate Committee on Social Justice, Welfare and Rural Development, filed Senate Bill (SB) No. 874 which seeks to ensure that state workers bring home at least 40 percent of their monthly salary after authorized deductions.

"With the rising cost of living expenses, government employees struggle to manage their resources to make ends meet. Public sector employees, who enjoy the privilege of having security of tenure, attract loan agents who entice the employees to borrow at almost predatory rates," she said.

"As a result, the employees end up losing almost all of their receivable salaries to payment deductions. This cycle is then perpetuated as the employees are forced to borrow more to support their daily needs," she added.

De Lima noted that this problem was so prevalent that even the Department of Education (DepEd) issued Department Order No. 14, series of 2019, setting a minimum take-home pay of teachers at ₱5,000 and limiting deductions to their salaries.

According to her, it is imperative for the government to stop this unfortunate cycle in order to ensure that public sector employees maintain a decent standard of living, as well as minimize the temptation of corruption.

"Establishing a minimum monthly take-home pay mechanism coupled with basic finance management training to our government employees will go a long way towards having a better and more dignified corps of public servants," she emphasized.

Under De Lima's proposal, government employees are assured to take home at least 40 percent of their monthly salary, after authorized deductions, to help them sustain their basic needs.

"This also lowers their risks to be seriously indebted and resort to further loans or unacceptable practices that may pose a threat to their productivity and the agencies they serve," the lady Senator from Bicol stressed.

If enacted into law, SB No. 874 will prioritize authorized deductions in this order:

a. The Bureau of Internal Revenue, Government Service Insurance System, Home Development Mutual Fund and the Philippine Health Insurance Corporation;

b. Mutual benefits associations, thrift banks and non-stock savings and loan associations duly operating under existing laws which are managed by, and for the benefit of government employees;

c. Associations or cooperatives organized and managed by government employees for their benefit and welfare;

d. Duly licensed insurance companies accredited by national government agencies; and

e. Other authorized deductions as may be authorized by law.

Under the proposed measure, all government employees will have to enter into a direct payment agreement with other lending institutions if there is a deficiency in loan payments due to the mandatory minimum take-home pay.

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