Pag-IBIG mulls deferring planned contribution hike

CEBU, Philippines — Considering the difficult plight of the business sector due to the health crisis, Pag-IBIG Fund is looking into postponing the scheduled 2021 contribution hike.

Pag-IBIG Fund Chief Executive Officer Acmad Rizaldy P. Moti made this announcement following a letter sent by several employer organizations, including the Employers’ Confederation of the Philippines (ECOP), Philippine Chamber of Commerce and Industry (PCCI), Philippine Silk Road International Chamber of Commerce (PSRICC), and the Philippine Exporters Confederation, Inc. (PHILEXPORT), which requested deferment of the monthly savings increase to a more appropriate time, in recognition to the impact of the pandemic on businesses.

Officials of Pag-IBIG Fund, led by Moti, assured the leaders of the country’s largest business organizations that it will seek the approval of its Board to postpone the agency’s January 2021 implementation of the increase of its mandatory monthly savings or contributions.

In its letter to the agency, ECOP Chairman Edgardo G. Lacson, PCCI President Benedicto Yujuico, PSRICC Founding Chairman Francis Chua, and PHILEXPORT President Sergio Ortiz-Luis, Jr. sought the deferment, stating that “this has been a most difficult time for business, especially MSMEs. About 50 percent are just re-starting under a more relaxed quarantine level, while the rest have closed shop permanently because of cost pressures and worker safety issues.”

The business groups also stated that the higher premium will be an added burden to micro, small & medium enterprises (MSMEs), which may not be able to comply with the new rates under the current circumstances.

“We are now emboldened to approach Pag-IBIG with the same confidence that despite the pandemic, Pag-IBIG remains to be stable. A delay in the additional contribution will therefore not hurt its continuous viability,” they added.

In 2019, the business sector, through ECOP, agreed to the proposed increase of the premium contribution to the Fund. This was a result of consultations premised on Pag-IBIG Fund as a well-managed institution, and that any additional contribution will benefit the members.

However, last month, Department of Human Settlements and Urban Development (DHSUD) Secretary Eduardo D. del Rosario, who also heads the 11-member Pag-IBIG Fund Board of Trustees, instructed officials of the agency to consult stakeholders and consider postponing the January 2021 implementation of the P50-increase to the current P100 Pag-IBIG monthly savings following the impact caused by the pandemic to members and businesses.