DBM: Doubling teachers’ pay bad for fiscal health

BUDGET Secretary Benjamin Diokno on Wednesday said he is not opposing the salary increase of teachers but said doubling their pay would negatively impact the

“The DBM [Department of Budget and Management] recognizes the important role of teachers. We are not strictly against the salary

“I understand the crucial role teachers have in nation-building and I do believe they should be rewarded accordingly,” he said.

Diokno noted that the takehome pay of teachers has already increased this year with the implementation of the Third Tranche of Salary Standardization Law (SSL).

Currently, he said, an entry-level public school teacher ( Teacher 1), having Salary Grade 11 under Tranche 3 of the SSL earns a monthly salary of P20,179.

“Annually, he/ she enjoys bonuses and allowances of P74,358. This rounds up the monthly compensation packages of teachers to P26,375,” according to Diokno.

The Budget chief said that by 2019, the monthly salary of an entry-level teacher will increase to P20,754 and the total annual bonuses and allowances will increase to P75,508, rounding up their monthly compensation package to P27,046, or P671 more per month.

Meanwhile, Diokno cited budgetary impact as the reason behind previous statements in which he cautioned against the doubling of teachers’ salaries.

He said President Rodrigo Duterte’s instruction is “to look into increasing their salaries, not doubling them.”

Diokno added that estimates show that doubling the salaries of teachers this year will require an additional P343.7 billion recurring cost for the national government. “Financing this P343.7 billion 3 percent of GDP [gross domestic product] to 5 percent of GDP, and it may put at risk the excellent in- Duterte administration has built over the past 18 months,” he said.

The DBM chief added that “un- also result in credit rating downgrade for the Philippines.

The Philippines currently enjoys an investment credit rating from major international credit ratings agency Moody’s Investors Service, Fitch Ratings and S& P Global Ratings.

“[A downgrade] means, we will face higher interest rates in the future and greater debt service payments when borrowing from In other words, such policy will endanger our prudent medium-

“Alternatively, we may raise more taxes or reduce other expenditure items,” Diokno added.

“Raising P343.7 billion is a monumental task,” he said.

“Consider that Package 1A of Train [ Tax Reform for Acceleration and Inclusion Act] is expected to deliver about P90 billion in revenues, yet this is only about one- fourth the amount of salaries of teachers,” the DBM secretary added.

On the other hand, he cau- for other budget priorities such Build Build Build infrastructure program, free college tuition, Marawi City rehabilitation and cash transfer programs of the government, among other things.

“We must think and prioritize long- term solutions for our country’s development and for the people’s general welfare,” Diokno said.