Senate briefing on MIF set January 30
OPPOSITION lawmaker Albay Rep. Edcel Lagman yesterday said “indelible earmarks of hasty and errant legislation” afflict the proposed Maharlika Investment Fund (MIF).
“Approve now with alacrity and reengineer later,” Lagman said in a statement, referring to the tack that the House leadership has allegedly taken in crafting the controversial measure which was approved on third and final reading last month before Congress adjourned for its holiday break.
In letter to Speaker Martin Romualdez, Lagman urged the House leadership to clarify if the House leadership has adopted the reported reengineered version of the bill as earlier claimed by Albay Rep. Joey Salceda, chairman of the House Committee on Ways and Means.
Lagman reiterated his call that there is a need to recall the plenary approval of the measure if the reengineered version was adopted “because it was not deliberated upon by the House and it is not part of HB No. 6608 which was approved on third and final reading last December 15, 2022.”
“However, if the House leadership is not adopting the so-called reengineered version, then let it be put to rest as a futile and belated attempt to revise HB No. 6608,” Lagman said in the letter.
Salceda, one of the bill’s proponents, said last Friday that a four-person team was tasked to “reengineer” the measure, which now excludes the Development Bank of the Philippines (DBP) and the Bangko Sentral ng Pilipinas (BSP) as funding sources and named Government Owned and Controlled Corporations (GOCCs) as initial sources.
President Marcos Jr. on Monday said his administration is “lukewarm” to the idea of using GOCC dividends to fund the proposed sovereign wealth fund because, apart from being against the law, this would take away funds that the government will be using for its programs and operations.
Lagman thanked the President for agreeing with his position that “GOCC dividends should not be utilized as seed money for funding because these dividends are traditionally and legally used as additional revenues to finance the GAA (General Appropriations Act or national budget), more particularly basic socio-economic services on health, education, food security, employment generation, and infrastructure development.”
“GOCC dividends must not be securitized or sequestered to fund the MIF because they are used for budgetary support to augment the sources of financing the GAA. They must not be parked in long-term investments,” Lagman said.
Moreover, he said that under the Dividends Law of 1993 (RA 7656), GOCCs are mandated to remit to the national government at least 50 percent of their annual net earnings since the remittances are used for budgetary support in the enactment of the national budget.
“With the President’s aforesaid confirmatory statement, contributions from the LandBank of the Philippines and the Development Bank of the Philippines, both GOCCs, must also be removed as funding source,” Lagman said.
Additionally, the opposition lawmaker said sovereign wealth funds “must be effectively owned and controlled by the government because they represent the state’s wealth.”
“They must not be the subject of Initial Public Offering (IPO) which could lead to private control. Government ownership cannot be limited to less than 50 percent,” he said.
SCRUTINY
Senate majority leader Joel Villanueva said economic managers are scheduled to brief senators on the merits and mechanisms of the proposed MIF on January 30.
Senate President Juan Miguel Zubiri said the Senate will heed the President’s call and start with a meticulous review of the House version and then propose “perfecting amendments” to it.
President Marcos Jr. on Monday told senators to thoroughly scrutinize the proposed sovereign wealth fund before approving it to ensure that it is not abused by scheming fund managers and its earnings not compromised due to corruption.
“We will consult with all sectors and lay the premise on why the fund is necessary and if it is, what are the proper safeguards to keep it away from corruption and mismanagement.
We will tackle this one step at a time but (we) will not delay the process,” Zubiri said.
Villanueva said he expects senators to be prepared to grill economic managers during the January 30 scheduled briefing.
“Saan manggagaling ang pondo? Ano ang objective? Ang sovereign fund, bakit may private sector? Mas mataas ang private sector na panggagalingan, hindi sovereign fund.
Securitization, malinaw ang objectives at magagawa ba natin ito without coming up with a new law? (Where will the seed money come from? What is the objective? Why will the private sector join the sovereign wealth fund? If the private sectors’ share is bigger, that is not sovereign fund. Securitization has clear objectives, but can we establish the MIF without coming up with a new law? I wanted to find these out, we are willing to work with the executive),” Villanueva said.
Sen. Mark Villar on Monday filed Senate Bill No. 1670 or an Act Establishing the Maharlika Investment Fund, the counterpart measure of the House version.
Under Villar’s proposed measure, the MIF will be sourced “from the investible funds of the Land Bank of the Philippines, Development Bank of the Philippines, National Government (from the declared dividends of the Bangko Sentral ng Pilipinas), and other sources of funds as provided in the bill.”
A Maharlika Investment Corporation shall be created to govern and manage the fund.
“The Corporation shall act as a vehicle for the purpose of mobilizing and utilizing the Fund for investments in transactions that will enable the Fund to reap optimal returns on investments, while contributing to the overall goal of reinvigorating job creation and poverty reduction,” it said.
Villar’s version also suggests the creation of a Maharlika Investment Fund Joint Congressional Oversight Committee “to oversee, monitor, and evaluate the implementation of the proposed measure” making sure that all documents of the fund and the corporation will be “open, available, and accessible to the public.”
“Graft and corrupt practices shall not be tolerated and those engage(d) in such acts shall be penalized,” it added.
The House’s final version of the proposed measure listed the DBP and the BSP as principal fund sources for the MIF, but a reengineered version of the measure as announced by Salceda has excluded the DBP and BSP as seed money, and instead listed GOCCs as initial sources.
Senate minority leader Aquilino Pimentel III said the administration should not “force” the approval of the proposed Maharlika fund if there is no compelling reason to establish it and if the measure’s proponents cannot present a fixed funding source for the MIF.
“Tama naman ang sinabi ni PBBM (President Bongbong Marcos). Pero kung wala talagang katwiran, dahilan, at puhunan para sa isang sovereign wealth fund or Maharlika Fund ay mabuting hindi na lang pilitin. Kung utang, waldas, at aksaya lamang ang magiging resulta ng Maharlika Fund, huwag na nating pag-aksayahan ng panahon (President Marcos was right [in urging senators to thoroughly scrutinize the proposed MIF]. If it there is no reason and no [clear] seed money for the creation of the sovereign wealth fund or Maharlika fund, then it is better not to force it. If the MIF would mean the government borrowing more money, then it will be squandered, let us not waste our time discussing it),” Pimentel said in a message to the media. — With Raymond Africa
