STATE auditors have flagged a multimillion-peso bonus payout to Carcar City employees as legally questionable.
The Commission on Audit (COA) questioned the release of P8.366 million in incentives to 437 officials and workers in December 2024. While the agency argues the benefit violates national salary laws, city officials maintain the bonuses were authorized by a local ordinance.
The big question
Can local government autonomy override national compensation standards when granting extra financial benefits to public servants?
Mayor Patrick Barcenas defended the payout in a phone interview on Thursday, Dec. 11, 2025, saying the City has submitted additional documents to justify the expense.
“Why would we give out these incentives if we do not have a basis,” Barcenas said.
Audit’s focus: Irregular expenditure
The audit report focuses on a one-time monetary incentive released shortly before Christmas in 2024. The mayor’s office, City Health Office, and city college were among the departments that received funds, with regular and casual employees receiving up to P20,000 each.
The council authorized this payment through Ordinance 49-24, stating the money was to recognize the contributions of employees toward the City’s various awards and citations over previous years.
However, in its 2024 audit report, COA classified the payout as an “irregular expenditure.” The agency said the bonus was not listed among the allowable benefits under Republic Act 6758, the Salary Standardization Law. This law, along with COA Circular 2013-003, specifies what incentives government workers can receive.
National law vs. local power
State auditors argued that local governments cannot create allowances that are not authorized by national law.
COA applied the legal principle of “expressio unius est exclusio alterius.” This means that because the law expressly lists allowed benefits, any benefit not on that list is automatically excluded.
The City Legal Office countered that the council has the power to determine benefits for its officials and employees. They cited Article 10 of the 1987 Constitution and the Local Government Code as the basis for their authority.
What’s next
COA has not yet issued a notice of suspension or disallowance. This indicates the matter is still under evaluation.
If state auditors determine the additional justification is insufficient, the expenditure will remain classified as irregular. Typically, when an expenditure is disallowed with finality, the officials who approved the payment and the employees who received it may be required to refund the government. The city has agreed to submit further legal basis to resolve the issue. / EHP