Government employees will start receiving a P5,000 Productivity Enhancement Incentive (PEI) from December 15, 2025, as authorized by the Department of Budget and Management (DBM). This forms part of the Total Compensation Framework to boost productivity and motivate staff. It was signed by DBM Acting Secretary Rolando Toledo on December 17, 2025.
On December 17, 2025, DBM Acting Secretary Rolando Toledo signed Circular Letter No. 2025-13, authorizing the release of the Productivity Enhancement Incentive (PEI) for fiscal year 2025. This follows the rules of Budget Circular No. 2017-4 and is part of the Total Compensation Framework. The incentive aims to "improve productivity and motivate government employees to meet performance targets by rewarding exemplary civil servants and well-performing public institutions."
President Ferdinand Marcos Jr. authorized the DBM to issue guidelines while the Performance-Based Incentive System (PBIS) and Results-Based Performance Management System (RBPMS) remain suspended and under review since June 2024. Each qualified employee—regular, casual, or contractual—receives a uniform P5,000. This covers staff in national government agencies, state universities and colleges, GOCCs under DBM, local government units (LGUs), and local water districts (LWDs). It also includes military and uniformed personnel from the Armed Forces of the Philippines, Philippine National Police, Bureau of Fire Protection, Bureau of Jail Management and Penology, Philippine Coast Guard, and National Mapping Resource Information Authority.
Exclusions apply to consultants, laborers on job contracts or piecework, student workers, apprentices, or those hired via contracts of service or job orders. Eligibility requires being in government service as of November 30 of the current year and rendering at least four months of satisfactory service, including paid leave. The PEI is pro-rated for shorter service, including part-time employees across multiple agencies. For permanent transfers, the new agency grants the PEI, while the parent agency handles those on temporary assignment.
Retirees with approved service extensions as of November 30 qualify if meeting other criteria, as do employees with pending administrative or criminal cases—though they must refund it if later found guilty. GOCCs under Republic Act No. 10149 follow separate guidelines from the Governance Commission for GOCCs. Funding comes from each agency's budget: appropriations or the Miscellaneous Personnel Benefits Fund for national agencies, local funds within Personal Services limits for LGUs, and corporate operating budgets for GOCCs without borrowing extra government funds. Officials face personal accountability for any incorrect payments.
