SEC ordered to stop unauthorized pay hikes

MANILA, Philippines - For the third straight year, the Commission on Audit (COA) has directed the Securities and Exchange Commission (SEC) to stop granting unauthorized salary increases to its officials and personnel.

In a 2014 report released yesterday, state auditors said the agency’s unauthorized wage increases have ballooned to more than P267.419 million.

Despite previous years’ recommendations for the salary increases to stop unless approval from Malacañang is secured, COA said the SEC still granted a pay hike of P93.128 million.

“This observation is a reiteration of the previous years’ audit observation on the Commission’s failure to secure the approval of the President on the compensation plan approved by the Commission before implementing the salary increase,” state auditors noted.

The Annual Audit Reports (AARs) for 2012 and 2013 for the SEC already questioned unauthorized salary increases totaling P92,740,109.10 and P81,551,010.25 for the two years, the COA report said. 

In 2014, state auditors said the agency continued to grant salary increase totaling P93,128,229.56 even if such grant was not approved by the President.

“This resulted in excessive payment of personnel services for three years in the aggregate amount of P267,419,348.91. Likewise, the Commission also continued to source out the fund for the payment of said increase for personnel services for CY 2014 from its retained income contrary to Section I, Special Provisions of RA 10633 (2014 General Appropriations Act),” they said.

In defense, the SEC told COA that it has obtained the favorable recommendation of the secretary of the Department of Budget and Management (DBM) for the grant of salary increase now pending approval of the President.