An exploratory study of the performance-based incentives system (PBIS) and its effects on individual efficiency and morale of employees in selected Philippine government agencies

• Main Author: Torneo, Ador R.
• Format: text
• Published: Animo Repository 2018
• Subjects: Philippines—Officials and employees—Rating of; Performance standards—Philippines; Civil service; Incentives in industry; Employee motivation; Employee morale; Performance Management
• Online Access: https://animorepository.dlsu.edu.ph/faculty_research/12898
• Institution: De La Salle University

This scoping study examines the Performance-Based Incentive System (PBIS) of the Philippine government and does a preliminary assessment of its intended and actual effects on employees of three selected government agencies: the Department of Interior and Local Government (DILG), the Commission on Higher Education (CHED), and the Department of Education (DepEd). The PBIS was established in 2011 to harmonize and rationalize the incentives and bonuses and improve the performance of the public sector agencies and employees through the establishment of a system that orients, measures, and rewards good performance and was piloted in 183 government agencies beginning in 2012. Unlike previous systems, the PBIS stresses alignment of agency, unit, and individual goals and provides substantial incentives in the form of bonuses of up to Php35,000 for the best performing individual employees of the best performing units or bureaus that meet set performance trgets or goals. Our assessment suggests that in its third year of implementation and continued development, the effects of the PBIS on these agencies have been mixed. Overall, there is a general acknowledgment of the PBIS' rationale. Further, the interviews suggest that the SPMS integrated PBB is gaining traction in terms of compliance if not necessarily acceptance. Key informants shared instances of perceived qualitative improvements in documentation, in teamwork and supervision, and in situating their individual and unit contributions to their agencies. These are admittedly anecdotal and are not indicators of effects on efficiency or morale per se but they nevertheless suggest that the PBIS does have some positive if limited effects. The most visible challenges to the implementation of PBIS stem from concerns regarding its design, unresolved issues and concerns regarding the manner of its implementation, and limited information availability and transparency; factors that could demotivate instead of motivate. Employees at the lower end of the evaluation may be receiving less amount (i.e.. Php10,000) for more work under the PBIS compared to the automatic bonuses they received under previous systems (i.e., 12,000). Reported but unverified innovations in some agencies such as reserving the "Best" ranking for particular units or officials can potentially undermine or even diminish the effects of the PBIS. Limited information and the lack of formal forum for dialogue also tend to fuel skepticism. The fairness of the various PBIS processes and mechanisms is also an important concern. There is also a lingering question on what problem the PBIS actually solves. For national officials concerned with harmony of national goals, unification of existing performance management systems, rationality of bonuses, and rewarding performance, the need for PBIS is clear. For ordinary employees whose primary concerns are low wages and poor working conditions and not motivation, it is less so. The success of the PBIS may depend on addressing these matters.