Solons ban GSIS, SSS, 3 gov’t firms from investing in wealth fund
Senators were poised to pass the chamber’s version of the Maharlika Investment Fund (MIF) bill last night, even as they successfully introduced an amendment that explicitly prohibits government institutions from investing in the country’s proposed sovereign wealth fund.
Sen. Raffy Tulfo proposed the amendment that explicitly prohibits agencies such as the Government Service Insurance System, Social Security System, Pag-IBIG Fund, Overseas Workers Welfare Administration, and Philippine Veterans Affairs Office from investing in the proposed Maharlika fund.
Meanwhile, the House of Representatives is “very eager” to adopt the Senate version of the MIF bill – certified urgent by President Ferdinand Marcos Jr. — once approved at the upper chamber, Majority Leader and Zamboanga City Rep. Mannix Dalipe said.
“We are waiting for the Senate [version of the bill]…but we are very much eager, [to have it adopted once approved there],” Dalipe said at a news conference Tuesday.
Both chambers will skip the bicameral conference meeting to reconcile their versions of a bill once the House agrees with the Senate’s version of such. The measure will then be considered an enrolled bill awaiting the President’s signature.
The Senate is expected to have the MIF bill approved by June 2.
The purpose of the amendment, Tulfo said, is to ensure ownership of the Maharlika Investment Corp. to be created by the bill “shall be exclusively with the government including its GOCCs (government owned and controlled corporations).”
“This way, we can allow investment from private sectors,” said Tulfo, to which Sen. Mark Villar, the bill’s sponsor, agreed.
In related developments:
* The Department of Finance (DOF) on Tuesday allayed fears the proposed Maharlika Investment Fund would bankrupt banking institutions, including Landbank, should it fail.
* Finance Secretary Benjamin Diokno also said board members of state pension institutions should not be “precluded” from deciding on possible investments in the proposed sovereign wealth fund.
* Senate Minority Leader Aquilino “Koko” Pimentel III said there should be an iron-clad provision that will guarantee that pension funds will not be touched or compromised in the MIF bill.
“If the Senate can finish it today….maybe, if there is a need for a bicam [conference committee to reconcile different versions], we can do it tomorrow and pass it, ratify it before we go on sine die adjournment,” Dalipe said.
“We are waiting, we are keeping a close watch, and we hope it will turn out fine tonight and we can have it done by tomorrow,” he added.
The House approved on third and final reading its version of the MIF bill last December.
It provides that “under no circumstance that the GOCCs providing for the social security of government employees, private sectors, workers and employees, and other sectors and subsectors, such as but not limited to the Government Service Insurance System (GSIS), Social Security System (SSS), and Home Development Mutual Fund, be requested or required to contribute to the MIF.”
The House version also states that no part of the funds of said GOCCs shall go to the MIF.
In the Senate, Pimentel said: “Our workers’ hard-earned pension should be shielded from any adverse implications that could arise from the establishment of MIF.”
“Unfortunately, the threat that MIF would dip its hands into retirees’ pension funds is still very much alive,” he added.
The earlier versions of the measure wanted to tap into the funds being managed by the country’s top social insurance institutions, namely the GSIS and the SSS as the source for the initial capital of Maharlika.
When the proposal received tremendous backlash even from executives of GSIS and SSS, the contested provision was removed.
“While they removed the forced contribution from GSIS and SSS, the current version of MIF under consideration by the Senate would allow these social insurance institutions to invest in Maharlika voluntarily as long as their boards agree,” Pimentel warned.
According to Pimentel Section 6, last paragraph of the proposed measure states that “Under no circumstance shall the GOCCs providing for the social security of government employees, private sectors, workers and employees, and other sectors and subsectors, such as but not limited to the Government Service Insurance System, Social Security System, and Home Development Mutual Fund, be requested or required to contribute to the MIC.”
However, Section 12 of the measure allows “voluntary investment”.
It mentioned “that other GFIs and GOCCs may invest into the MIF, subject to their respective investment and risk management strategies, and approval of their respective boards.”
“Such provisions within the MIF bill raise serious concerns about the safety and security of our pension system.
We should provide an iron-clad provision to shield pensions from this very financially unsound and dangerous undertaking called Maharlika Investment Fund,” Pimentel said.
Without an iron-clad provision, Pimentel said pension funds would still be used to fund the MIF.