Daily TribuneProponents of House Bill 6398, or the proposed legislation seeking to create a P275-billion sovereign wealth fund, initially dropped the two pension funds Government Service Insurance System and the Social Security System.
Photo by Analy Labor
In the runup to the measure being presented to the House plenary, another set of amendments will refine the Maharlika Investment Fund bill that will create the Maharlika Wealth Fund.
The House committee on appropriations has finalized the amendments, particularly the bill's funding provision contained in section 9, in response to the mounting clamor of the public, business sectors, and other legislators.
Proponents of House Bill 6398, or the proposed legislation seeking to create a P275-billion sovereign wealth fund, initially dropped the two pension funds Government Service Insurance System and the Social Security System, as mandatory contributors in the wake of public backlash saying it could jeopardize contributors' and pensioners' retirement funds.
GSIS was earlier required to provide an initial investment of P125 billion, P50 billion from SSS and the Land Bank of the Philippines, P25 billion from the Development Bank of the Philippines, and P25 billion from the Treasury of the Philippines.
But under the unnumbered bill, the Bangko Sentral ng Pilipinas will assume funding for the MWF, joining the LBP and DBP.
GSIS, SSS can invest
Although they are no longer listed as funders, the two-state pensioners may still invest in MIF if their respective boards let them, according to Finance Secretary Benjamin Diokno.
The BSP will provide dividends ranging from P30 to P35 billion for the proposed MIF. However, after the initial contribution, it would only give 50 percent of its dividends to the MIF because the other 50 percent would be used to capitalize the BSP.
During Friday's hearing, the panel added another provision, with the Secretary of Finance taking over as chair of the board in place of the President.
Likewise, the 15-member board would now have four independent directors instead of the original two, which the committee would formally adopt in the next hearing.
The bill's provision included the proposal to exclude The General Appropriations Act or the national budget spending plan.
The move by proponents of the contentious legislation to replace the President as chair person of the board with the Secretary of Finance may not come at a high cost, yet will only add fuel to the fire.
Lagman not convinced
This amendment prompted independent minority lawmaker Edcel Lagman to wonder if changing the composition of the bill's board of directors makes any difference.
"From the President to his alter ego, the Finance Secretary, to chair the Maharlika Investment Corporation — what is the difference?" he said in a statement on Saturday. "The Finance Secretary serves at the pleasure of the President and must conform to the President's bidding to retain his position."
The amendment to replace the President as chair of the board came after several lawmakers expressed concern that having the Chief Executive as Chairman of the MWF managing board may politicize it.
Should the Maharlika bill pass into law, it will be the Secretary of Finance, who will oversee the use of the MWF, which is essentially a sovereign wealth fund similar to those used by the Philippines' ASEAN neighbors.
This resurfaced after House Appropriations Committee senior vice chairperson Stella Quimbo motioned that the Secretary of Finance takes over as board chair instead of the President, which was agreed upon by Banks and Financial Intermediaries chairperson Irwin Tieng.
Tieng said his panel would take up the amendments in its next hearing. It was also Tieng's committee, which approved the measure just two days after it was filed on 28 November.
The veteran Albay legislator, on the other hand, believed that the Maharlika Investment Fund, once formally established, must be led by corporate management free of partisan control and interference.
House Bill 6398, which is now being rushed through its second reading in the House of Representatives, was authored by Speaker Martin Romualdez, Senior Deputy Majority Leader Sandro Marcos, as well as other administration allies, including Quimbo.
