‘Maharlika tampered with’

Marcos ready to sign bill

MANILA, Philippines — The Senate leadership has tampered with the bill creating a Maharlika Investment Fund (MIF), Minority Leader Aquilino Pimentel III said yesterday as he appealed to President Marcos to veto the measure, approved in record speed by Congress in May and now being readied for transmission to the Palace.

President Marcos said yesterday he is ready to sign the bill “as soon as I get it.”

In a statement, Pimentel also denounced the “tyranny of numbers” that resulted in the swift passage of the measure despite its conflicting provisions.

“The enrolled bill being sent to the President is not the version properly and formally approved by Congress. There is a provision that was tampered with without plenary authority,” Pimentel said.

He was referring to the conflicting Sections 50 and 51 on prescription of crimes and offenses, which gave two different periods in the approved third reading bill.

The bill’s sponsor Sen. Mark Villar asked the Senate leadership in a letter to merge the two provisions and retain the 10-year period as the correct one.

The prescription period refers to the time within which an offender may be prosecuted for violating the law.

While the secretariat is only allowed to make “style changes” in the enrolled bill like typographical and grammatical errors, Senate Secretary Renato Bantug Jr. maintained that no provision was deleted, and that the conflicting provisions were “reconciled” to reflect what was discussed in the plenary for a 10-year prescription period, not 20.

The conflicting provisions were cited by critics as a result of the haste with which lawmakers approved the administration’s pet bill in time for the President’s State of the Nation Address.

“Nothing was deleted. But the two provisions were combined for economy of words,” Bantug said in a phone interview with Senate reporters on Wednesday.

Bantug brought with him the enrolled copy of the bill for Senate President Juan Miguel Zubiri’s signature during their working visit to Washington. Zubiri has not yet commented on the issue.

Pimentel said it was a “dangerous” precedent to make changes in bill that has gone through the legislative mill.

He said there is a “huge chance the Maharlika bill is unconstitutional,” as amendments to it were made outside the plenary.

“The revisions made were not just a matter of style. It showed a flagrant violation of our rules and the Constitution,” Pimentel said.

‘National embarrassment’

Pimentel, a former Senate president, said Marcos would save himself from a “national embarrassment” if he vetoes the bill.

“I call on the President to veto the Maharlika bill: it is an ill-conceived law, we do not have surplus and windfall profits; it is not timely, the world economy and geopolitical situation are bad; Congress did not give him what he wanted; this kind of a law needs more time to be discussed by the Filipino people themselves, in fairness to them,” Pimentel said in a separate message to The STAR.

Pimentel lamented what he called shortcuts done by his colleagues just to have the bill passed hastily.

“Today marks a sad day for the 108th Senate, which has stood strong for over a century as the guardian of our Constitution and the rule of law. The Constitution, the cornerstone of our nation, is no longer being read and followed. Our rules have been rendered meaningless and worthless,” Pimentel said.

“Warnings and arguments now amount to nothing. Nothing is sacred anymore,” he added.

In a separate statement, Pimentel’s only colleague in the opposition Sen. Risa Hontiveros said the errors were committed due to the “inordinate rush to pass the bill just to acquiesce to the wishes of the Executive.”

“There are several opportunities for the majority to correct this – immediately after the third reading vote, and during bicameral that wasn’t held. But the Congress leadership did not do this,” said Hontiveros, who was among the senators who stayed up all night of May 30-31 to propose amendments to the bill before its third reading approval, such as expressly prohibiting the use of pension funds as seed money.

“If history will take the legislature of the 19th Congress to task for it, then so be it,” she added.

But Senate President Pro Tempore Loren Legarda maintained no Senate rules were violated when corrections were made in the final copy of the MIF bill.

“When there are questions, go back to the transcript. They corrected it according to the transcript... In democracy, you respect other people’s way,” Legarda told Senate reporters.

Marcos Jr. Ready to sign

On the sidelines of the celebration of the 85th anniversary of the Securities and Exchange Commission (SEC) yesterday, President Marcos made it clear he is ready to sign the MIF bill “as soon as I get it.”

“I will sign it as soon as I get it. Am I happy? Well, that is the version that the House and the Senate has passed, and we will certainly look into all of the changes that have been made. And I think most of the changes that were proposed and that were eventually adopted really had to do with the safety and the security of people’s pension funds,” the President said.

He said the MIF should be shielded from politics for it to survive and flourish. “And that’s why we have made sure that it is not a government – it is independent from government,” the Chief Executive said.

Marcos said most of the proposed changes in the bill that were eventually adopted had to do with the safety and security of the pension funds, an issue that has triggered concerns among the public.

“You know perhaps we are looking in the wrong direction. The key to the success of any fund, a hedge fund, pension fund, sovereign fund, investment fund, is the management. Of course, all of these things can happen. We’ve seen them happen before because the management chose for it to happen. These are the scandals we saw in other countries,” he added.

“And so, one of the elements that makes that happen is that there is a very clear independence from the day-to-day government function. Those decisions are not made by political decisions in government. The decisions made for the fund are made by finance professionals.”

According to Marcos, one of the first changes he proposed to the House of Representatives was to remove the president and the Bangko Sentral ng Pilipinas chief from the board of the proposed Maharlika Investment Corp.

“If you put corrupt people there, the money would be lost. If you put competent people there, it (investment fund) would grow and we can use those funds... If the bill comes before me, I will sign it. But the secret to its success is who do we put in management? What is their experience? What is their reputation? What is their success rate? And we have quite a few good money managers, financial managers there that we can call upon,” the Chief Executive said.

“Sometimes I’ve been watching the discussions that have been going on on the Maharlika fund, and I say that’s all true, that’s all true. You must worry about that. But the only way to make sure that we do not get into trouble, the fund does not get into trouble is that it’s well and professionally managed,” he added.

The MIF is intended to become a vehicle for the government to invest in a wide range of outlets like foreign currencies, fixed-income instruments, corporate bonds, commercial real estate and infrastructure projects. Economic managers have been pushing for its creation, saying it is a vehicle for economic growth, as it will allow the government to diversify and explore alternative sources of financing.

They added that the fund would become an important addition to the country’s existing funding mechanisms that seek to promote socio-economic development through investments in strategic, high-return, high-impact sectors like infrastructure.

Critics of the proposed investment fund have expressed concern over its potential risks, citing the case of the 1Malaysia Development Berhad, which was tainted by graft allegations. Earlier this month, 21 economics professors from the University of the Philippines expressed their opposition to the MIF bill, saying it “violates fundamental principles of economics and finance and poses serious risks to the economy and the public sector notwithstanding its proponents’ good intentions.” They said the measure creating the fund lacked a clear focus and does not thresh out the nature of the financial and economic returns that the fund is expected to generate.

The UP professors also claimed that the proposed investment fund “poses huge risks to our already strained public coffers and is vulnerable to moral hazard.” They added that there are no safeguards that penalize the fund’s managers should the fund incur heavy losses due to poor or overly risky investment decisions. – Cecille Suerte Felipe