THE supermajority or 216 members of the House of Representatives have co-authored the proposed Maharlika Investment Fund (MIF) Act which, they said, would help fast-track economic development and provide better public services for Filipino people.
Quezon Rep. Mark Enverga, one of the leaders in the House of the Nationalist People’s Coalition (NPC), said, “this proposal has become contentious, but it is important to recognize that the country needs the MIF to fund its needs.”
“So we see the importance of this measure, and we support it, particularly for the reason that it will increase national revenues,” Enverga said.
House Bill 6608 or the bill creating the MIF is currently undergoing plenary debates in the lower chamber. The Office of the Speaker said the authors of the bill are now around 216 lawmakers.
Deputy Speaker Aurelio Gonzales Jr. said he supports the planned creation of the sovereign wealth fund initiated by Speaker Martin G. Romualdez that would tap investible government resources to maximize their profitability for the benefit of future generations of Filipinos.
San Jose del Monte City Rep. Florida P. Robes, another PDP-Laban stalwart, said the House intends to put enough safeguards in the MIF bill to prevent possible abuse, corruption and dissipation of the funds.
Romblon Lone District Rep. Eleandro Jesus Madrona, a Nacionalista Party leader, said investing government assets for optimum profit for their population is what 49 countries with sovereign wealth funds are doing.
Quezon City Rep. Marvin Rillo, a member of the Lakas-Christian Muslim Democrats (CMD), said “the Philippines, in creating a sovereign wealth fund, should learn from the best practices of countries with successful investments and avoid the mistakes of others.”
Rep. Margarita Ignacia Nograles of party-list group PBA said the House under Speaker Romualdez listened to the suggestions of the public on the proposed MIF by adding safeguards against corruption, fraud and other potential acts of wrongdoing.
“The most important of these are the penalty clauses or provisions. We want to avoid possible graft and corruption and scandals, which the public is afraid of. So we want the penalties to be at par with those contained in the Corporation Code,” Nograles, who is a lawyer, said.
She said another feature added to the bill is the earmarking of 20 percent of MIF profits for social projects.
Northern Samar Rep. Paul Daza, who belongs to the minority, said he was inclined to support the MIF bill after the House leadership introduced improvements.
Upon the instruction of Speaker Romualdez, the House removed the Social Security System and the Government Service Insurance System from the list of potential MIF contributors.
Marikina Rep. Stella Quimbo, a vice chairperson of the appropriations committee, said the MIF would rely on national government dividends from the Bangko Sentral ng Pilipinas.
According to House Committee on Banks and Financial Intermediaries Chairman Irwin Tieng, the sovereign fund measure has undergone multiple revisions.
Tieng said at least 20 percent of the net income of Maharlika Investment Corp. (MIC) will be remitted to fund the social services of the national government.
Tieng disclosed that the 15-man board would have four, instead of the original two, independent directors.
According to Tieng, his committee has approved the penal provisions proposed by Albay Rep. Joey Sarte Salceda providing that any director, trustee, or officer who willfully or maliciously violates investment guidelines set by the board of directors or whose acts of gross negligence, willful misconduct, fraud, actions in breach of any investment agreement, and in a loss suffered by the fund shall be liable for all damages resulting therefrom suffered by the corporation.
He said stockholders or members and other persons shall be punished by imprisonment of not less than one year but not more than five years, or a fine of not less than P50,000 but not more than P2 million, or both at the discretion of the court.
Tieng said his committee formally adopted the removal of the Government Service Insurance System (GSIS) and the Social Security System (SSS) as fund contributors.
Under the bill, the BSP will now be a fund source of the MIF, joining the LBP and DBP. The LBP will contribute P50 billion, while the DBP will contribute P25 billion.
At last Friday’s hearing, BSP Deputy Gov. Francisco Dakila Jr. proposed a flexible set-up wherein the BSP will contribute from its declared dividends to the MIF’s start-up fund.
Dakila assured the congressmen that their proposal would not affect the country’s international reserves.
BSP lawyer Leila Rivera explained to the House panel that BSP declares dividends in the amount of 50 percent of their income.
Rivera said that for the year 2022, their estimated income is P60 billion to P70 billion, which would translate to dividends of P30 billion to P35 billion.
The Philippine Amusement and Gaming Corporation (Pagcor) is also mandated to contribute 10 percent of its online gaming proceeds to the MIF.
Representatives from the Land Bank, the DBP, and Pagcor formally expressed their support for the creation of the MIF during the hearing.
Meanwhile, the Department of Finance secretary will replace the Philippine president as chairman of the board of governors in the approved unnumbered bill.
The proposal also excluded the General Appropriations Act (GAA) as one of the mandatory sources of funding for the MIF.
Image credits: Robinson Ninal Jr./Malacañang Presidential Photographers Division via AP