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When President Benigno Simeon "Noynoy" Aquino III draws his first salary as President this month, he will be getting nearly 65 percent more than what his predecessor received when she was still in power. President Aquino’s monthly salary is pegged at P95,000/month – quite a jump from P57,750/month, which was former President and now Pampanga 2nd District Rep. Gloria Macapagal-Arroyo’s last salary as the country’s chief executive. In a way, PNoy has former President Arroyo to thank for his bigger pay. It was the latter who, just days before her term ended, signed Executive Order No. 900 implementing an increase in the basic pay in all government salary grades, including the President’s. The President’s salary is equivalent to Salary Grade 33 (SG 33) – the salary grade exclusively assigned to the highest position in the Philippine government as per the Compensation and Position Classification Act of 1989 (Republic Act 6758). Despite the raise, the President’s salary remains a paltry sum compared to the compensation of top-level executives in private firms who can earn several times more. A check of the annual report of the publicly-listed Ayala Corporation shows that its highest-ranked officers take home salaries averaging P1.3 million a month, excluding allowances. According to the Finance Office of the Office of the President, the chief executive’s salary is also subject to mandatory deductions such as withholding tax, Philhealth, Pagibig, and GSIS life and retirement insurance premiums. EO 900 was the last of a string of issuances on compensation adjustments signed by Arroyo during her term (see table). But being the incumbent President at the time they were ordered, the pay hikes did not apply to her – only to her successor, in this case President Aquino.
The 1987 Constitution explicitly states that when it comes to the President’s salary, “no increase in said compensation shall take effect until after the expiration of the term of the incumbent during which such increase was approved." The first of Arroyo’s pay hike orders came five months after EDSA II installed her to the Presidency. Executive Order No. 22, signed in June 2001, granted a five percent increase on basic monthly salaries of government personnel. SG 33 as per this salary schedule was pegged at P57,750/month. Arroyo adopted this figure as her monthly salary when she won a full six-year term in 2004. In March 2007, Arroyo approved Executive Order No. 611 further increasing the basic monthly salaries of government workers by 10 percent. Under this issuance, SG 33 increased to P63,525/month. Another 10% increase came the following year through Executive Order No. 719. This brought up SG 33 to P69,878/month. Last year, Congress passed the Salary Standardization Law III (SSL III) authorizing the President to carry out salary adjustments for government personnel in four yearly tranches. The first tranche took effect in July 2009 by virtue of then President Arroyo’s Executive Order No. 811. SG 33 under this issuance is equal to P82,400/month. EO 900, the basis of PNoy’s salary, prescribes the second tranche. The third and fourth tranches fall within PNoy’s term. By the time the last installment is carried out, SG 33 will be equivalent to P120,000/month. – HS, GMANews.TV