In the campaign for next year’s Presidential elections, Vice President Noli de Castro is using his accomplishments at Pag-IBIG as his launching pad.
Skirting the law against premature electoral campaigning, he says that the full-page multi-colored ads in the major newspapers, the radio and TV talk shows – the so-called infomercials – are only meant to tell the Filipino people of the wonderful things that have happened at Pag-IBIG since Noli took over the helm.
In the Senate hearing last week, VP Noli was able to fend off the questions of Senator Loren Legarda, who did not ask the right questions.
Let us take a close look at those accomplishments. Noli trumpets the low-cost housing loans, more than P18 billion by last report, bigger than ever before. But the reason for the huge amount is the 6 percent yearly interest over an extended period (I have seen no specifics as to the term, but my guess is, it could be as long as 30 years). I caught on radio yesterday a borrower saying that, for a 40-square meter housing unit, he was paying only P1,800 monthly.
Good for the borrower, but terrible for the member, especially anyone who has not borrowed and has no intention of borrowing from Pag-IBIG.
What Noli seems to forget is that Pag-IBIG is the mutual fund of government and private sector employees. A mutual fund is run on the principle that money can be invested more safely and profitably when pooled under professional, not political, management.
Contribution to the Pag-IBIG is P200 monthly per member, shared equally by employer and employee. A member can choose to cash in his investment after ten, fifteen or twenty years. I cashed in my investment some 20 years ago, and I was quite happy with the return.
Now that Noli is lending out members’ money at 6 percent a year, and spending P170 million for those infomercials alone, how much net earnings are left to the members? Probably as low as 3 percent, a pathetic return by any standard.
Also, VP Noli is ominously silent on what the repayment rate on these low-cost housing loans is.
Low-cost housing is the worst investment. The books of accounts of the Social Security System (SSS) and the Government Service Insurance System (GSIS) are awash with long-overdue low-cost housing loans which can no longer be collected.
The private sector insurance companies do not invest in low-cost housing loans. In fact, the Insurance Commission does not allow it.
Finally, VP Noli will flunk grade-three arithmetic. At P400,000 per unit, a loan portfolio of P18 billion, is only 45,000 home buyers. He sacrifices the safety of millions and millions of members for his presidential ambitions. Does he really think it is smart politics?
For a supposedly smart politician, VP Noli is, oh, so generous with money that is not his.
When the vast majority of Pag-IBIG members chooses not vote for him in next year’s elections, he will find himself, pardon the cliché, in the dustbin of Philippine history.
Noli’s presidential campaign will blow up at the launching pad.
By the way, the middle initial in my name stands for “de Castro,” my late mother’s surname. But VP Noli and I are not related, not even remotely. Lucky, lucky me.