Safeguards in place? Groups worry over Maharlika fund despite amendments
MANILA, Philippines — While lawmakers have made amendments in the final version of the Senate bill creating the Maharlika Investment Fund, groups still question the rationale behind its establishment as it may be prone to abuse and corruption.
Akbayan Party — where Sen. Risa Hontiveros, the only senator to vote against the measure, is a member — called on the public to “remain vigilant” as it said lawmakers had greenlighted the “country’s largest investment scam.”
“Safeguards may be in place now, but a law is only as good as its execution and we should not be lulled into a false sense of security just because these measures exist in the bill,” Akbayan said in a statement on Wednesday.
Senators passed on second and third reading the measure that establishes Maharlika in an almost 12-hour long session that lasted until early Wednesday, a week since President Ferdinand “Bongbong” Marcos Jr. certified it as urgent.
The proposal has raised worries that putting pension funds in the proposed investment fund would put retirement plans at risk. However, Marcos assured the public on Wednesday that these will not be used to for the Maharlika Investment Fund.
READ: Maharlika fund clears Senate hurdle
The final version of the Senate bill explicitly prohibits state-run pension funds such as the Government Service Insurance System (GSIS), the Social Security System (SSS), the Philippine Health Insurance Corp., the Home Development Mutual Fund, the Overseas Welfare Workers Association, and the Philippine Veterans Affairs Office from investing in Maharlika.
Funding for the P500-billion investment fund will come from the Land Bank of the Philippines, the Development Bank of the Philippines, dividends from the Bangko Sentral ng Pilipinas, and share earnings from the Philippine Amusements and Gaming Corp.
However, Akbayan said the use of GSIS and the SSS funds can be re-inserted in the final version of the bill as lawmakers from both houses of Congress are set to ratify the bicameral conference commitee report on Wednesday afternoon.
Plans for fund remain vague
Those advocating the creation of a sovereign wealth fund said itwould give the government an opportunity to invest in “key sectors” such as infrastructure, among others, to promote economic development.
Migrante International, a coalition of overseas Filipino workers’ groups and their families, pointed out that plans for the fund remain vague.
“It is not clear how infrastructure projects… can generate returns on investment. Furthermore, infrastructure financing as a way to pump-prime the economy has been the strategy of many governments but the country remains under-developed and infrastructure remains poor,” Migrante said in a separate statement on Wednesday.
“Infrastructure projects create temporary precarious jobs while infrastructure funds have always been marred with corruption.”
Sonny Africa, executive director at IBON Foundation, said that the government’s infrastructure projects could instead be financed by the national budget or through the National Development Corp. He also pointed out that there are other measures that could be more beneficial to Filipinos instead of the establishment of the Maharlika Fund.
“It’s an illusion to say that the government will earn from this fund. Priority should have been given to distribution aid or wage subsidies, giving support to farmers and fisherfolk so that their food is cheaper, or extending help to MSMEs that are struggling,” Africa said on Wednesday.
Nineteen senators lawmakers voted in favor of the bill.
Senate Minority Leader Aquilino Pimentel III and Sens. Francis “Chiz” Escudero and Imee Marcos were not present during the voting. Escudero and Marcos — the president’s sister — previously warned against rushing to pass the measure.
Sen. Nancy Binay abstained from voting. — with reports from James Relativo, Xave Gregorio, and Ramon Royandoyan
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