PRESIDENT Ferdinand Marcos Jr., issues EO No. 73 prescribing new rates, indices for various allowances of Foreign Service Personnel (FSP).
Marcos issued Executive Order (EO) No. 73 last October 30, 2024 to update the rates, indices, rules, and regulations governing the payment of various allowances applicable to all national government employees who are assigned overseas.
Specifically, EO No. 73 covers the following allowances: Overseas Allowance (OA), Living Quarters Allowance (LQA), Representation Allowance (RA), Family Allowance (FA), and Education Allowance (EA).
Said allowances form part of the System of Allowances for the Foreign Service Personnel (FSP), as established under Republic Act (RA) No. 7157, which is also known as the Philippine Foreign Service Act of 1991.
“We welcome and support President Ferdinand R. Marcos Jr.’s decision to adjust the allowances of our foreign service personnel. For too long, the financial support provided to our diplomats has not reflected the complexities and challenges associated with their assignments, not to mention the reality of facing higher cost of living abroad and being away from their families,” Department of Budget and Management (DBM) Secretary Amenah Pangandaman said.
“It is imperative that we continue to support those who serve on the front lines of our diplomatic efforts. This development will surely help boost their morale and enable our foreign service personnel to carry out their duties with greater focus and dedication, especially that it has been a decade since their allowances have been adjusted,” she added.
The updated rates and indices resulted from the comprehensive review conducted by the Department of Foreign Affairs (DFA) and the DBM of the allowances under EO No. 156, s. 2013, which was issued more than 10 years ago.
Under the new EO, the overall rate of the increase in the base rates for the OA and LQA ranges from 35% to 40%, which will be implemented in four (4) tranches.
Meanwhile, the FA of the qualified dependents shall be increased by at least US$50 per month.
The Order also approved a one-time uniform increase of 15% in the RA for those eligible to receive such allowance to keep up with the rising prices for products and services required for entertainment, contributions, flowers, and wreaths, etc.
EO No. 73 also states that EA may be granted to personnel assigned abroad, whose legal dependent children, not over 18 years old and not exceeding three (3) in number, are enrolled in the primary, elementary, and high school levels.
Among the economic indicators considered in the adjustment in the subject allowances for the government’s FSP are the global inflation rates, buying/purchasing power of the US Dollar over time, and the United Nations International Civil Service Commission (UN ICSC) Retail Price Indices (RPI), while remaining mindful of fiscal limitations.
For the initial year of implementation, the amount needed to cover the authorized adjustments in the allowances of the qualified FSP shall be taken from the agency savings and/or the Miscellaneous Personnel Benefits Fund (MPBF) under the 2024 General Appropriations Act (GAA), subject to relevant budgeting, accounting, and auditing rules and regulations. Thereafter, funding for the succeeding years shall be provided in the annual GAA, subject to the usual budget preparation process.
In the FY 2025 National Expenditure Program, a total of P974.98 million has been earmarked for the purpose under the MPBF.