Question & AnswerQ&A (EXECUTIVE ORDER NO. 641)
The main purpose is to establish Provident Funds in government agencies to serve as savings and loan credit facilities that cater to the needs of government officials and employees, and to provide supplementary welfare benefits from the Fund.
No, membership in the Provident Fund is voluntary according to the policies set by Executive Order No. 641.
The Provident Fund is managed by a Board of Trustees with adequate representation from both the employer and employees. The agency's highest official responsible for financial affairs may be designated as Chairman of the Board.
The Provident Fund is sourced from (a) members' contributions, (b) initial government agency counterpart contributions in the form of support for reasonable operating requirements, and (c) other legal, valid, and authorized funding sources identified by the Board of Trustees.
Yes, government cash contributions sourced from savings may be authorized in the future as the government’s financial position allows, subject to guidelines issued by the Department of Budget and Management.
Key policies include voluntary membership, shared roles of employees and employers in administration, establishment of regulatory structures to ensure uniformity and integrity, equal rights for all employees without special rules for executives, prudent management by the Board of Trustees, and strong legal protections for members' assets.
The Board’s functions include promulgating and enforcing rules and regulations, identifying additional fund sources, determining loan types and terms, deciding benefits, approving membership and loans, appointing officers and staff, creating regional boards if necessary, determining sanctions, and performing other necessary functions to achieve the Order’s objectives.
Members, officers, and staff of the Board serve without compensation, except for payment of actual overtime services rendered by support staff. Reasonable expenses incurred may be reimbursed upon proper documentation.
The Provident Fund and its operations are subject to existing accounting and auditing rules and regulations. The Board of Trustees must submit an annual report on the Fund’s operation and financial condition to the members, with copies furnished to the Office of the President and the Department of Budget and Management.