TUCP rejects Pag-IBIG plan to hike contributions

MANILA, Philippines – Trade Union Congress of the Philippines, the largest labor group in the country, rejected yesterday the proposal of the Home Development Mutual Fund (Pag-IBIG) to increase its membership contribution rate, saying the move would be an additional burden to the housing fund’s 7.4 million members.

“Offhand, the contemplated increase in contribution rates is uncalled-for. It should be studied extensively. There should be adequate public consultations on the matter,” TUCP secretary-general and former Senator Ernesto Herrera said in a statement.

He said instead of increasing its membership fee, the state-run mutual fund should aggressively expand its membership to strengthen its financial capability.

Last week, Pag-IBIG chief executive officer Jaime Fabiaña announced that the fund would raise its contribution rates to increase loan amounts
for members, and support the higher borrowing packages under its housing finance program, while still ensuring the long-term stability of the fund.

Under Republic Act 9679 or the Home Development Mutual Fund Law of 2009, the Pag-IBIG Board of Trustees can set the members’ contribution rate.

Pag-IBIG members contribute two percent of their monthly earnings, with the salary ceiling fixed at P5,000. Thus, members contribute only P100 monthly whether they are earning P5,000 or P50,000 every month. –Mayen Jamaylin (The Philippine Star)