Opposition and pushback  

After much pushback from several groups and even some lawmakers, the controversial Maharlika Wealth Fund will no longer draw funds from the Government Service Insurance System (GSIS) and the Social Security System (SSS). Opposition and pushback “convinced” the proponents of House Bill 6398 to no longer include the two agencies for investing in high-yield projects. That’s one issue resolved. But there is one issue that concerns us all. Corruption.

?275 billion is a lot of money by any standard. There is the question of who gets to handle the fund. I hope it is not a politician. The proposal is to have a 15-person board of directors. Red flags have already been raised with the proposal that President Marcos Jr. will be chairman of the board. The president is still a victim of the past so putting him in charge may leave a bad taste in the mouth of many.

Then there is the question of where exactly the funds will be invested. No less than the president of the largest business organization, the Philippine Chamber of Commerce and Industry (PCCI) has expressed reservations as to the amount of the fund and the timing of creating it. The PCCI has since withdrawn its support for HB 6398. Other groups such as the Financial Executives Institute of the Philippines, the Makati Business Club, and the Management Association of The Philippines have made similar reservations and are asking all concerned to rethink its creation.

The 1MDB scandal in Malaysia has been brought up as an example of when too much money is given to a corrupt official or a corrupt family. While authors of the bill insist no one person will be responsible for handling and disbursing the funds as was the case in the 1MDB scandal, the country’s track record about transparency still leaves much to be desired.

The timing is also unfavorable. We have yet to recover from a pandemic that practically shut down the planet for more than a year. Our national debt as of September 2022 has swollen to ?13.52 trillion as per the National Treasury. These are unprecedented numbers even as the Bangko Sentral remains confident the country can pay off this debt. The authors of the bill would do well to carefully rethink the proposed sovereign wealth fund with all the issues and concerns about it. I can liken it to several people I know who have taken out loans to pay off other receivables. It does not end well.