Coverage
- Applies to all active officers and enlisted personnel of the AFP.
- Includes cadets of the Philippine Military Academy, officer candidates, and candidate soldiers.
Policy Statements
- RA 9166 mandates increase in base pay for AFP personnel and prescribes equivalent Salary Grades (SGs).
- Base pay increase to be implemented in three phases:
- 20% increment effective October 1, 2002.
- Additional 30% increment effective January 1, 2003.
- Last 50% increment effective January 1, 2004.
- First phase funded by appropriations savings of Major Services and KBUs; second phase funded under FY 2003 GAA with allocation of P2.9 billion for both first and second phases.
- RA 9206’s FY 2003 GAA effectivity set for June 1, 2003, with prior January to May 2003 funding charged against RA 9162 re-enacted.
Implementing Rules
- Base pay for salary adjustment refers to pay as of December 31, 2002, per NBC 483 Interim Salary Schedule.
- Adjusted base pay rates effective January 1, 2003 as per Second Interim Salary Schedule (Annex A of this Circular).
- New salary rates serve as bases for longevity pay, year-end bonus, retirement benefits.
- Allowances and collateral benefits remain unchanged.
Prohibition
- The Secretary of National Defense cannot grant salary adjustments beyond authorized amounts without law or executive order.
Funding Source
- January-May 2003 funding:
- 20% from AFP Major Services and KBUs appropriations savings.
- 30% from Miscellaneous Personnel Benefits Fund under RA 9162 (reenacted).
- June-December 2003 funding from FY 2003 GAA allocation.
Responsibility of Commanders
- Major Services and KBU commanders are liable for any unauthorized salary adjustments.
- Excess payments must be refunded by concerned personnel.
Saving Clause
- Uncovered cases to be referred to the Secretary of Budget and Management.
Effectivity
- The Circular takes effect on January 1, 2003.