BY ANGELA CELIS and ASHZEL HACHERO
FINANCE Secretary Benjamin Diokno yesterday that while state pension funds are prohibited from investing in the controversial Maharlika Investment Fund (MIF), they can still participate in the program on a project level basis to tap better returns.
“For example, Maharlika has a big project worth P1 trillion, and the Government Service Insurance System (GSIS) or the Social Security System (SSS) wants to subscribe or invest 10 percent in the project because of its high return, they can do it. In the project, not on equity, they can do so,” Diokno told reporters in a briefing.
National treasurer Rosalia de Leon agreed when asked if this can be done through a joint venture.
“(They) can participate at the project level, not in (the) Maharlika (Investment) Corporation,” De Leon said.
Under the reconciled version of the MIF bill, government-owned or -controlled corporations or government agencies that provide social security and public health insurance services are expressly prohibited from contributing to the capitalization of the MIC, a new entity that will be tasked to oversee the management of the fund.
The agencies include, but are not limited to, the SSS, GSIS, Philippine Health Insurance Corp., Home Development Mutual Fund, Overseas Workers Welfare Administration and Philippine Veterans Affairs Office Pension Fund.
The other day, Sen. Francis Escudero said the government can skirt around the prohibition by amending the charters of the pension funds and granting them more flexibility in investing their funds.
Senate Minority Leader Aquilino Pimentel III questioned Diokno’s statement that pension funds can still “subscribe” to MIF projects.
“They are avoiding the words used in the law like initial capital, additional capital and bonds. If they say ‘subscribe’ to projects what does that mean? The GSIS and SSS will ‘finance’ the projects? Financing means advancing the money needed. Isn’t that plain and simple ‘lending’ or ‘loaning” money to the project?” Pimentel said, stressing this is tantamount to “circumventing” the intent of the law not to involve pension money for the MIF.
“The question is why are they so interested in the funds or money of GSIS and SSS? These are the members’ private funds. Government should be hands off these private funds,” he stressed.
Senate majority leader Joel Villanueva likewise said there is no room for Diokno’s interpretation as far as the prohibition on state pension funds are concerned.
He insisted that the legislation approved by the Senate and adopted by the House of Representatives is very clear in banning government agencies and GOCCs from investing, whether mandatory or voluntary, in the MIF and the MIC.
“This prohibition was even repeated three times in Section 6 (2) on the allowed investors to the preferred shares of the Maharlika Investment Corporation, as well as on the last paragraph of Section 6 which further solidifies the prohibition of these agencies to invest in the capitalization of MIC, and again on Section 12 on the investors to the MIF,” Villanueva said.
MASS ACTION
In an interview with members of the Filipino-American media in New York City, opposition Sen. Risa Hontiveros said citizens may express their opposition against the MIF bill by questioning it before the judiciary.
Hontiveros, who was the sole negative vote when senators voted to pass the MIF bill on May 31, said despite the opposition being outnumbered by administration allies in Congress, the MIF can still be questioned in court.
“In the House, there’s Rep. Edcel Lagman. But now, the ball is in the court of the President. And depending on his action, the judiciary may be called upon by our citizens to take action. So it’s never too late to either fight a current battle or to keep on fighting longer-term ones,” she said.
“Despite being just two voices in the minority, there’s also a genuine minority in the House. But more than the lawmakers, there’s our people, organized in different sectors, in different regions, who just won’t give up. That’s why we celebrate Philippine Independence,” she added.
POLITICAL CAPITAL
Pimentel said President Marcos Jr. should use his political capital to push for big infrastructure projects the way he utilized it to push for the immediate passage of the MIF bill.
“The President has so much political capital and so much support from Congress that he can request overwhelming number of votes from both houses to create the Maharlika. (He should) then use that same political capital and political influence for the bridge, for the dam, for the roads,” Pimentel told ABS-CBN News Channel.
Pimentel had earlier called on Marcos to veto the Maharlika bill, branding it as an ‘ill-conceived piece of legislation” and one that has numerous flaws.
In the same interview, Pimentel countered the projection aired by Sen. Mark Villar, chairperson of the Senate banks committee that sponsored the measure, that the MIF would generate a possible 8.6 percent return on investment or equity annually.
Pimentel said this is difficult to achieve considering the rough global economic situation.
“That projection of 8.6, that’s a very brave and positive projection but that still remains a projection and the world economy is in a bad shape,” he said.
Pimentel noted that even the manager of Norway’s sovereign wealth fund said that “in the next 10 years it is very, very difficult to generate that return.”
Norway’s sovereign wealth fund is one of the largest in the world, holding over $1.2 trillion in assets. It also holds a stake in over 9,000 companies in 70 countries worldwide.
