To: Regional Directors
Schools Division/City Superintendents
Heads, Public Elementary and Secondary Schools
All Others Concerned

1. Per our request to the Department of Budget and Management, the following budgetary items reflected as nationwide lump-sums under Republic Act No. 9336 as reenacted are to be pooled to give certain degree of flexibility in allocating the said funds:
   1. Salary adjustments based on approved Equivalents Record Form (ERFs);
   2. Conversion of teaching items to Master Teacher positions;
   3. Reclassification of positions; and
   4. Payment of step increments (prospective)
2. All requests pertaining to the above-mentioned expenditures shall be properly evaluated and indorsed by the Schools Division Offices to the DepED Regional Office concerned which will subsequently transmit such to the Regional Office of the Department of Budget and Management (DBM).
3. Pertinent documents such as Plantilla Allocation Lists, copies of approved ERFs, updated Service Records and others, as the case maybe, shall be submitted to the concerned Regional Offices of the DBM to serve as their bases in the evaluation and/or action of the said requests.
4. Equivalents Record Form (ERF)
   The cut-off date for the approved ERFs is hereby waived. However, the requests for salary adjustments of teachers with ERFs approved in the prior years which have remained unimplemented to date shall be given top priority.
5. Step Increment for Implementation in 2006
   The requests for release of funds for payment of salary step increment shall be supported by a certification on non-availability of personal services savings.
6. Reclassification of Positions
   In view of the meager amount provided for the reclassification of positions, priority shall be given to reclassification of teaching and teaching-related items such as Teacher-in-Charge to Head Teacher, Head Teacher to Principal, etc.
7. Funding for the Recurrent Cost of Salary Upgrading Approved in 2005
   The funding requirement for the second year implementation of salary upgrading (ERF, MT, Reclassification of Positions, Step Increments) approved in 2005 shall be sourced from savings generated during the current year. In case of non-availability of savings, such adjustments shall be charged from the lump-sum allocations herein referred to.
8. The effectivity date for the implementation of salary upgrading due to ERFs, conversion to MT items, and reclassification of positions is not retroactive but upon the approval by the DBM-ROs. Salary step increments, however, are effective on the date an employee becomes entitled to such benefit in pursuance to existing DBM and CSC rules and regulations.
9. Attached herewith is the regional distribution of the subject lump-sum fund.
10. Immediate dissemination of this Order is desired.

Encl.: As stated
Reference: DepED Order: No. 40, s. 2005
Allotment: 1—(D.O. 50-97)

To be indicated in the Perpetual Index under the following subjects:
FORMS
SALARY
TEACHERS

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