Question & AnswerQ&A (Republic Act No. 9679)
Republic Act No. 9679 is officially titled "Home Development Mutual Fund Law of 2009," otherwise known as the Pag-IBIG (Pagtutulungan sa kinabukasan: Ikaw, Bangko, Industriya at Gobyerno) Fund.
The State's policy is to establish, develop, promote, and integrate a nationwide sound and viable tax-exempt mutual provident savings system suited to employed and other earning groups to motivate them to better plan and provide for their housing needs through membership in the Fund, with mandatory employer contributions.
Mandatory coverage applies to all employees covered by SSS and GSIS and their employers, including uniformed members of the AFP, Bureau of Fire Protection, Bureau of Jail Management and Penology, Philippine National Police, Filipinos employed by foreign-based employers, and spouses managing the household may be covered voluntarily.
Employees earning not more than P1,500 per month contribute 1%, those earning more than P1,500 contribute 2%, and all employers contribute 2% of the monthly compensation, with the maximum monthly compensation for computation capped initially at P5,000.
Membership is for 20 years from the first month of contribution, totaling 240 monthly contributions at maturity, except when terminated earlier due to retirement, disability, insanity, death, or departure from the country.
Yes, members who have completed at least 15 years of continuous membership and have no outstanding housing loans may withdraw their total accumulated contributions without prejudicing their continuing membership.
Employers face a penalty of 3% per month on unpaid contributions from the due date until full payment, and heads of offices or agencies may be held administratively liable. Failure to remit does not prejudice the employee's right to benefits.
Offenders may be fined not less than but not more than twice the amount involved, imprisoned for up to six years, or both. Corporate offenders include the governing board and executives; government officials who fail to remit contributions face similar penalties.
The Board formulates policies, adopts rules and regulations, approves budgets and expenditures, condones penalties on loans and contributions, approves organizational structures, fixes compensation, and performs other powers necessary to effectively manage the Fund.
The Fund is private in character, owned wholly by members, administered in trust for their benefit. All contributions are credited individually, transferred in case of employment change, earn dividends, and constitute each member's provident fund payable upon termination or for peripheral benefits.