DepEd Order No. 20, s. 2017, dated April 20, 2017 and signed by Secretary Leonor Magtolis Briones, issues the Guidelines on the Implementation of the Educational Service Contracting and Teachers’ Salary Subsidy Programs in Junior High School Effective School Year 2017-2018. It explains how private junior high schools join the Educational Service Contracting (ESC) and Teachers’ Salary Subsidy (TSS) programs, how students and teachers qualify, how much is paid, how schools bill DepEd, and what penalties apply to violations.
The order is addressed to undersecretaries, assistant secretaries, bureau and service directors, the Regional Secretary of ARMM, regional directors, schools division superintendents, heads of public and private elementary and secondary schools, and all others concerned. It is useful for private school heads, ESC coordinators, teachers in ESC schools, and parents of ESC grantees.
On this page 13 sections
Key points
- ESC gives financial help to deserving elementary school graduates who want to study junior high school in a private school. It also helps decongest crowded public junior high schools.
- The ESC grant covers four years of junior high school, starting in Grade 7, as long as the grantee is promoted every year.
- TSS gives a yearly salary subsidy of PHP 18,000 to qualified teachers in ESC-participating junior high schools.
- Schools must be recognized by DepEd and certified by PEAC (at least “within standards”) or accredited by a member of the Federation of Accrediting Agencies of the Philippines (FAAP).
- Schools bill DepEd through the online ESC Information Management System (ESC IMS). Billing statements are due by the second Friday of August, and billing packages by the third Friday of August.
- Violations such as “ghost students” or “ghost teachers” can lead to refunds, fewer slots, suspension, or termination from the programs.
Legal basis
The programs come from Republic Act No. 8545, the Expanded Government Assistance to Students and Teachers in Private Education (E-GASTPE) Act. ESC is provided for in Section 7 and TSS in Section 14 of the law. RA 8545 supports Article XIV, Section 2.3 of the 1987 Constitution, which tells the State to set up subsidies and incentives for deserving individuals in both public and private schools. You can read more about these programs in our guide to the DepEd GASTPE programs.
Key terms
- Educational Service Contracting (ESC): a DepEd partnership program in which the extra capacity of certified private junior high schools is “contracted” through slots for students who would otherwise go to public schools. The slots come with subsidies called ESC grants, and the students are called ESC grantees.
- ESC-participating JHS: a private junior high school certified to take part in ESC.
- Teachers’ Salary Subsidy (TSS): a yearly government subsidy for qualified teachers in ESC-participating schools, called TSS recipients.
- ESC IMS: the online database kept by the Private Education Assistance Committee (PEAC) to track grantees, TSS recipients, billing statements, and payments.
Who does what
| Office | Main responsibilities |
|---|---|
| DepEd Central Office (interim GASTPE Project Management Office, created by DO 16, s. 2016) | Sets policies, secures funding in the annual budget, releases payments, oversees PEAC, sets research directions, monitors and evaluates, gives final approval on payrolls |
| DepEd Regional Office | Holds regional orientations with PEAC, sits in the Regional Program Committee, checks and signs billing statements |
| PEAC National Secretariat | Provides systems and controls, trains teachers in ESC schools, conducts research, monitors schools |
| PEAC Regional Secretariats | Run day-to-day implementation, guide schools, conduct field audits, training, and mentoring |
| Regional Program Committee (RPCom) | Oversees school compliance and solves problems; chaired by the DepEd Regional Director with the PEAC Regional Program Director as co-chair |
| ESC-participating schools | Meet DepEd standards, orient grantees and parents, encode correct data in the ESC IMS, prepare billing packages, undergo certification |
PEAC is the trustee of the Fund for Assistance to Private Education (FAPE), a perpetual trust fund for private education, and is contracted by DepEd to run ESC and TSS.
School eligibility and requirements
Applying schools
A private junior high school sends a letter of intent and supporting documents to the PEAC Executive Director. It must be recognized by DepEd and either certified with at least a “within standards” rating by PEAC or accredited by an FAAP member. Schools accepted by March 31 may join in the coming school year; those accepted later wait one more year. Participation depends on available slots under a queuing system.
What participating schools must do
- Attend the summer orientation on the guidelines and the ESC IMS.
- Form a School Committee: the school head (chair), a parents-teachers association representative, and a faculty association representative. The committee profiles, screens, and selects grantees.
- Open and keep a Land Bank of the Philippines (LBP) account in the school’s official name.
- Orient new grantees and their parents at the start of each school year, and keep the program and attendance sheet as proof.
- Be ready for recertification after three years (“within standard” schools) or five years (“above standard” schools).
Recertification documents are due within two months of the written notice; otherwise the school cannot accept Grade 7 grantees the next year. Schools that fail recertification get no extra slots and have one school year to comply. If they then fail the final recertification, they are phased out and may only graduate their remaining grantees. They may reapply after three years.
The ESC grant
Terms of the grant
The grant covers four years from Grade 7, even if a delivery mode makes junior high school longer. No new grants are given at higher grade levels. No maintaining grade is required within a school year; the grant continues if the grantee is promoted and enrolls in an ESC-participating school.
The grant ends if the grantee:
- drops out mid-year for non-health reasons;
- does not re-enroll the next school year;
- is not promoted or is retained in the same grade;
- is suspended for more than two weeks, dismissed, or expelled for disciplinary reasons; or
- transfers to a school that is not part of ESC.
Transfers between ESC-participating schools are allowed. If the two schools have different grant amounts, the accepting school is paid the lower amount. Grantees who drop out because of prolonged illness, accident, force majeure, or the death of a parent or guardian may be reinstated if they submit supporting documents to PEAC, such as a medical certificate from a licensed doctor.
Slot allocations
Slots are the maximum number of Grade 7 grantees a school can accept.
- Fixed slots: up to 50 for newly participating schools. Schools in good standing get at least the number of Grade 7 grantees they billed the previous year. Good standing means the school passed its latest recertification, had no adverse findings in its last monitoring visit, and has no sanctions or penalties.
- Incentive slots: for schools rated 3.0 or higher or accredited by an FAAP member.
| Certification rating or accreditation | Incentive slots |
|---|---|
| ESC certification rating of 3.00 or higher | 30 |
| Level I accreditation | 30 |
| Level II or higher accreditation | 60 |
Allocations are posted on each school’s ESC IMS account in the last week of April and are final.
Selecting grantees
Schools must give preference to graduates of public elementary schools. The School Committee selects grantees based on need.
Grant amounts for SY 2017-2018
The grant is paid to the school, per grantee per school year, and depends on the school’s location. Amounts are subject to adjustments approved by the State Assistance Council.
| Grade level | Schools in NCR | Schools outside NCR |
|---|---|---|
| Grade 7 | PHP 11,000 | PHP 8,500 |
| Grade 8 | PHP 11,000 | PHP 8,500 |
| Grade 9 | PHP 11,000 | PHP 8,500 |
| Grade 10 | PHP 10,000 | PHP 7,500 |
If the school’s total declared fees are lower than the grant, the school is paid only its total fees.
The Teachers’ Salary Subsidy
A teacher in an ESC-participating school qualifies for TSS if he or she:
- has a valid PRC license, or passes the Licensure Examination for Teachers (LET) on or before August 15 of the current school year;
- is employed by the school on or before August 15 of the current school year; and
- teaches ESC grantees for at least 180 minutes a week.
The subsidy is PHP 18,000 per teacher per year, unless the State Assistance Council approves a change. DepEd sends the funds to the school, which then pays its teachers. Teachers who resigned or retired before the funds arrive are paid in proportion to the service they rendered. Unpaid TSS funds cannot go to other teachers and must be refunded to DepEd.
Billing statements
Schools encode their data and create billing statements in the ESC IMS, using IDs and passwords from the PEAC National Secretariat. PEAC holds regional orientations in April and May.
ESC billing steps
- Update the school profile: yearly tuition, other and miscellaneous fees per grade level, LBP account details, and the contact person for ESC and TSS.
- Register new Grade 7 grantees with their complete name, Learner Reference Number, and other details.
- Update the status of Grade 8 to 10 grantees. Previous year-end status options are Passed, Failed, Did not Finish, and Accelerated; current enrollment options are Leaver, Enrolled, and Transfer-out.
- Process transferees (accepting school only) through the “Process Transfer-in” module using the ESC Student ID. Transferees encoded on or before July 15 count as, and are paid to, the accepting school; those encoded after July 15 stay with the releasing school.
- Create the billing statement by selecting enrolled grantees and clicking “Create Billing Statement.” Wrong or duplicate entries delay payment.
- Prepare the billing package: five signed copies of the statement, a Certification of Tuition, Other and Miscellaneous Fees, an LBP STI1 (savings) or IMI1 (current account) printout, and the official receipt for last year’s ESC payments.
TSS billing steps
- Register each teacher with complete name, PRC license number, and weekly teaching minutes.
- Create the TSS billing statement by selecting the teachers.
- Prepare the package: five signed copies, the list of TSS recipients, a copy of each teacher’s PRC license (or PRC claim stub for renewals, or LET Certificate of Rating for new passers), class schedules signed by the principal, last year’s TSS payroll, the LBP printout, and the official receipt for last year’s TSS payments.
Deadlines
- Create ESC and TSS billing statements by the second Friday of August.
- Submit billing packages by the third Friday of August.
Processing and tracking payments
Schools book a submission appointment with their PEAC Regional Secretariat in the ESC IMS. The package then moves from PEAC Regional Secretariat to the DepEd Regional Director for signature, to the PEAC National Secretariat, and finally to the DepEd Central Office Accounting Division, which pays the school through its LBP account.
| Stage | Handling unit | Approximate time |
|---|---|---|
| School and regional processing (On Process, On Hold, signature by DepEd RO) | School, PEAC RS, DepEd RO | 2-3 weeks |
| National processing (submitted to and received by PEAC NS, On Hold) | PEAC RS, PEAC NS | 2-3 weeks |
| Submitted to DepEd to Payment Released | DepEd Accounting Division | 4-6 weeks |
An “On Hold” status means there is a problem with the package, and the school should follow up with the office concerned.
Refunds: when DepEd overpays, the school sends PEAC NS a bank check payable to the Department of Education OSEC with a letter explaining the refund. DepEd issues an official receipt once the check clears.
Monitoring, violations, and penalties
PEAC monitoring teams make unannounced visits, and schools cannot turn them away. During a visit, the school gathers all grantees and TSS recipients for a roll call and shows the class record, DepEd School Forms 1 and 2, Forms 137 and 138, and the orientation attendance sheet.
| Violation | Penalty |
|---|---|
| Falsifying data or documents | Suspension from recruiting Grade 7 grantees for at least one school year |
| Ghost students, unqualified or ghost teachers | Return of payments and termination from ESC and TSS |
| Charging grantees more than declared fees | Return of excess and at least one year suspension from Grade 7 recruitment |
| Not reimbursing fees advanced by grantees within 30 days of DepEd payment | Reimbursement and at least one year suspension from Grade 7 recruitment |
| Grade 7 retention rate below 80% (except force majeure) | Grade 7 slots reduced by the retention rate (for example, 100 slots x 75% = 75 slots) |
| Refusing to release transfer credentials | Slots reduced by the number of grantees affected |
| Charging transferees for unattended years | Slots reduced by the number of grantees affected |
| Unresolved ownership dispute in court | Suspension until resolved; payments only with DepEd Regional Office endorsement |
| Withholding TSS from qualified teachers | Suspension from TSS until paid |
| Failing two consecutive recertifications | Termination from ESC and TSS |
“Ghost students” include many unexplained absences during a visit, grantees billed under one campus or delivery mode but attending another, grantees listed as enrolled who have not attended since the start of the semester, and grantees billed more than once.
Procedural lapses get a written warning; repeat violations can mean fewer slots and at least one year of suspension. Violations may also bar a school from other GASTPE programs, without prejudice to administrative and criminal charges.
Handling adverse findings
- The PEAC Executive Director sends the school a letter by courier or registered mail with the findings, violations, sanctions, evidence, and response period.
- PEAC NS reviews the school’s response for authentic documents and unaccounted grantees or teachers.
- PEAC NS recommends sanctions, and PEAC decides.
- PEAC informs the school within two weeks. If the school does not respond within two weeks of receiving the letter, the decision becomes final.
- PEAC submits the final List of Schools with Sanctions to DepEd.
- Grantees affected by sanctions may transfer to another ESC-participating school.
Effectivity
The guidelines take effect starting School Year 2017-2018 and remain in force unless amended or repealed. DepEd and PEAC will gather feedback and periodically review the guidelines.
Related reading
- DepEd GASTPE programs
- DepEd Basic Education Research Agenda
Frequently asked questions
How much is the ESC grant under DepEd Order No. 20, s. 2017?
For SY 2017-2018, the grant is PHP 11,000 per year for Grades 7 to 9 and PHP 10,000 for Grade 10 in NCR schools, and PHP 8,500 for Grades 7 to 9 and PHP 7,500 for Grade 10 outside NCR. If the school’s total fees are lower, the school is paid only its fees.
Who qualifies for the Teachers’ Salary Subsidy?
Teachers in ESC-participating schools who have a valid PRC license or pass the LET, are employed by the school on or before August 15 of the current school year, and teach ESC grantees at least 180 minutes a week. The subsidy is PHP 18,000 per teacher per year.
When does a student lose the ESC grant?
The grant ends if the grantee drops out mid-year for non-health reasons, does not re-enroll, is not promoted, is suspended for more than two weeks or dismissed or expelled, or transfers to a non-ESC school.
Can an ESC grantee transfer to another school?
Yes, transfers to another ESC-participating junior high school are allowed. If the two schools have different grant amounts, the accepting school is paid the lower amount.
What is the deadline for ESC and TSS billing statements?
Schools must create their billing statements in the ESC IMS by the second Friday of August and submit the billing statement packages by the third Friday of August.
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