Pag-IBIG Fund says no tax

MANILA, Philippines - The Pag-IBIG Fund’s advertisements were not political and did not cost taxpayers a single centavo, Home Development Mutual Fund (HDMF) or Pag-IBIG Fund chief executive officer Jaime Fabiaña said yesterday.

Fabiana clarified that Pag-IBIG does not rely on taxes for its operations and is a private fund owned by its members, and managed by the government through Pag-IBIG. He was referring to allegations that Vice President Noli De Castro used P500 million in public funds to promote his candidacy through the institution’s advertisements.

De Castro is chairman of the HDMF board of trustees and chairman of the Housing and Urban Development Coordinating Council (HUDCC).

“First of all, Pag-IBIG does not rely on taxes for its operations. It is a private fund owned by its members, and managed by the government through Pag-IBIG,” Fabiaña said.

“Far from diminishing the nation’s coffers, we are contributing to it through tax payments. We paid P1.27 billion in taxes in 2006 and P906.24 million in 2007,” he added.

According to Fabiaña, the P500 million figure quoted by a lawyer who is reportedly seeking a court injunction against De Castro and seven other high-ranking government officials from using public funds for their respective political campaigns is “misleading.”

“The ad campaign to promote our new housing loan program with its low interest rates and long repayment period featuring the Vice President amounted to P164.5 million from December 2007 up to May this year,” he said.

Fabiaña defended the Vice President’s appearance in the Pag-IBIG ads, saying “he is our chairman and effective endorser.”

“As we have pointed out before, we even saved on talent fees because we did not pay the Vice President for his endorsement,” he added.

As for the use of the monicker “Kabayan” in the ads, Fabiaña argued that the Vice President has been known by this nickname long before he joined politics. “Even our members know him as ‘Kabayan,’ so it’s only logical to use that name,” he said.

He also pointed out that De Castro has not signified any intention to run for public office in 2010.

“The ads do not promote the Vice President himself, his accomplishments or his advocacies. We are promoting our housing loans, just like any other company that sells its products or services,” Fabiana said.

“There is nothing illegal, unethical or even impractical about these advertising expenditures. We need to advertise to attract more borrowers. This will create more homeowners and also generate more income, and this income goes to our members in the form of dividends,” he said.

Pag-IBIG Fund’s advertising budget is also “very conservative compared to other businesses,” he added.