FOURTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
1 
8 JK -2 
P fl :i14 
Second Regular Session 
1 
Introduced by SENATOR LACSON 
EXPLANATORY NOTE 
The barangay is considered as the basic political unit in our government. It is the 
most accessible forum to the public. Moreover, the barangay serves as a venue wherein 
the collective views of the people may be expressed, crystallized and considered, and 
where disputes among the constituents may be amicably settled. Verily, the punong 
barangay and the other barangay officials occupy an important position in our political 
hierarchy given the myriad of duties and responsibilities assigned to them. 
The role being played by barangay officials is indeed no easy task. This is why it 
is only fair that they should be given the right compensation as well as other benefits to 
make up for the services they have rendered to their constituents. The current law 
governing the compensation of barangay officials is the Local Government Code of 1991. 
Under this law, barangay officials shall receive honoraria which should not be less than 
one thousand pesos for the punong barangay and not less than six hundred pesos for 
other barangay officials. In 1996, then President Ramos issued Executive Order No. 332, 
which integrated the barangay unit into the Compensation and Position ClassiJication 
System under RA 6758. EO 332 created some confusion in the sense that it incorporated 
barangay officials into the Salary Standardization system when, according to the Local 
Government Code, they should only receive an honorarium and not salaries. This matter 
was, however, clarified by the Department of Budget and Management through the 
issuance of locnl budget circulars by pegging the maximum rate of honoraria for 
barangay officials at the first step of Salary Grade 14 for the punong barangay, and the 
first step a€ Salary Grade 10 for other barangay officials. Unfortunately, despite the 
issuance of said circulars, certain problems still arise with respect to the compensation of 
barangay officials. 
The purpose of this legislative measure is to finally resolve this problem through 
the enactment of a compensation system for barangay officials that will clearly identify 
the type of compensation, and other benefits they are entitled to. 
In view thereof, the early passage of this bill is earnestly recommended. 
PAN 


JUL -2 p 4  :04 
FOURTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
) 
Second Regular Session 
1 
"r: 
, 
Introduced by SENATOR LACSON 
AN ACT TO PROVIDE FOR A COMPENSATION SYSTEM OF BARANGAY 
OFFICIALS, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and the House ofRepresentatives of the Philippines in 
Congress assembled. 
SECTION 1. Short Title. This Act shall be lcnown as the "Barangay 
Compensation Act" 
SECTION 2. Statement of Policy. - It is hereby declared the policy of the State 
to develop the barangay as the basic political unit in society. The State shall endeavor to 
transform the barangay into the primary planning and implementing unit of government 
policies, plans, programs, projects, and activities in the community. Towards this end, 
the State shall also extend the necessary assistance to barangay officials being in the 
forefront of this political mechanism. It shall be the policy of the State to ensure that 
barangay officials receive a just compensation in return for the services they are 
rendering to their constituents. 
SECTION 3. Definition of Terms. - For purposes of this Act, the following 
terms shall be defined as follows: 
a. Barangay Ofjcials - refers to the Punong Barangay, Barangay Kagawad, 
Barangay Secretary, and Barangay Treasurer. 
b. Punong Bavangay - refers to the duly elected local chief executive in the 
barangay government, also referred to as the barangay captain, in accordance 
with Sec. 389 ofthe Local Government Code of 1991. 
c. Barangay Kagawad - refers to the duly elected members of the Sangguniang 
Barangay, the local legislative body in the barangay government, in 
accordance with Sections 390-392 of the Local Government Code of 199 I. 
d. Barangay Secretary - refers to the duly appointed person by the Punong 
Barangay as concurred in by the majority of the members of the Sangguniang 
Barangay, in accordance with Sec. 394 of the Local Government Code of 
1991. 
SECTION 4. Form of Compensation. - Barangay officials shall be given 
compensation only in the form of honoraria. The amount of honoraria to be given shall 
be dependent on the class of the mother unit of their respective barangays as well as the 
financial capacity of their barangay. Moreover, the following standard shall be followed 
by all barangay units in the giving of honoraria: 
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a. For Punong Barangay - the amount of honoraria shall not be less than six 
thousand five hundred pesos (P6500) or more than fifteen thousand pesos 
(P15000). 
b. For Other Barangay Oficials - the amount of honoraria shall not be less than 
five thousand pesos (P5000) or more than twelve thousand pesos (P12000). 
This honorarium shall be in addition to the cash gifts or other benefits that 
barangay officials are entitled to receive pursuant to Section 393 (b) of the Local 
Government Code of 199 1. However, barangay officials are prohibited from receiving 
other allowances such as hazard pay, Representation and Transportation Allowances 
(RATA), Personal Economic Relief Allowances (PERA), Productivity Incentive Bonus 
(PIB), and clothing allowance. 
Barangay officials are only allowed to receive their honoraria and the enumerated 
benefits in Section 393 (b) of the Local Government Code. 
SECTION 5. Exemption from the Budgetary Cap on Personal Services 
Expenditures - The budgetary limitation on personal services expenditure provided 
under Section 325 of the Local Government Code, which is,forty-five percent (45%) for 
first to third class cities or municipalities and fifty-five percent (55%) for fourth class or 
lower, shall be waived insofar as the adjustment of the minimum rates for the honoraria 
of the barangay officials are concerned. 
SECTION 6. Increase in the Rates of Honoraria for Barangay Officials -The 
maximum rates of honoraria allowed for barangay officials as specified in this Act shall 
only be increased when a general salary adjustment for all government employees is 
granted. In such an event, the Department of Budget and Management (DBM) shall be 
the agency assigned to issue the necessary guidelines in the implementation of the said 
salary adjustment insofar as barangay officials are concerned. 
SECTION 7. Separability Clause. - If any part of the provision of this Act is 
hereby declared unconstitutional or invalid, other provisions hereof which are not 
affected thereby shall continue to be in full force and effect. 
SECTION 8. Repealing Clause. - All law, executive orders, decrees, rules and 
regulations, or any part thereof inconsistent with the provision of this Act are deemed 
repealed or modified accordingly. 
SECTION 9. Effectivity. - This Act shall take effect immediately upon approval. 
Approved, 
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