Maharlika investment fund passes House in record time; few media organizations question proponents
This Week in Media (December 12 to 18, 2022)
THE MAHARLIKA Investment Fund (MIF) bill (HB 6398) was widely criticized when it was first reported by the media. What most concerned some sectors was the bill’s proposed use of SSS and GSIS pension funds as seed money; the governance and corruption issues that hounded the funds of other countries such as Malaysia; and the Philippines’ lack of excess funds that other nations typically use for sovereign wealth funds, as they are called elsewhere.
Speaking for her co-proponents, Marikina Rep. Stella Quimbo admitted on December 8 that the proposal “started on the wrong foot,” announcing as the first amendment to the bill the delisting of pension funds as investment sources. But Raul Fabella, National Scientist for Economics, said the bill is “beyond repair.” He reiterated his view that it should be scrapped entirely or at the very least scrutinized in the Senate during the December 12 episode of ANC’s Market Edge.
Also on December 12, the House opened sponsorships for HB 6608, which replaced the original bill. Media reported that more than 200 representatives co-authored the substitute bill, which included amendments and added provisions such as the removal of the GSIS, SSS and the national budget as seed money sources; the addition of penal provisions for those who mismanage the fund; the removal of the President as chair of the corporation that would manage the fund; the requirement that all pertinent documents be posted on a transparency website; the allocation of 25 percent of the earnings to social welfare services; and the increase in the number of independent members of the MIF’s board.
Citing its proponents, news reports said the MIF would only use “investible funds” of the Landbank of the Philippines and Development Bank of the Philippines, and the dividends of Bangko Sentral ng Pilipinas (BSP). This clarification was issued in response to criticism that the MIF would only be funded by money from government financial institutions, as these have no actual surplus funds.
The initial capital for the MIF would total PHP 110 billion, which is not even half of the original proposal of PHP 250 billion. The new amount does not yet include the contribution of the Philippine Amusement and Gaming Corporation (PAGCOR), which the bill requires to give 10 percent of its gross revenues.
President Ferdinand Marcos Jr. certified HB 6608 as urgent on December 15, after it was approved on second reading. The bill passed the third and final reading on the same day, with 279 voting in favor and six against. CNN Philippines, news.ABS-CBN.com and Rappler listed the reasons lawmakers voted no, among them the corruption and investment risks, the current economic challenges the country is facing, and the apparent railroading of the bill without proper consultation with stakeholders.
Some media also reported the public forum of pro-democracy coalition 1Sambayan on December 16, during which former Supreme Court Justice Antonio Carpio, former BSP Deputy Governor Diwa Guinigundo, and former Commissioner of Audit Heidi Mendoza pointed out why the bill remains flawed despite amendments and supposed safeguards.
Anchors pose critical questions
Despite the many criticisms from within and outside the House that have already been reported, House reporters have not indicated in their stories how well or how often they directly questioned the MIF’s proponents, and whether they were sufficiently answered. Notably, the proposal breezed through the House within a mere 17 days, but reports did not say whether there were other bills in the past that have passed with similar speed.
CMFR notes the efforts of anchors of public affairs programs and cable newscasts to solicit from proponents and supporters their reasons for pushing for the bill. Their questions were all valid and anchored on public concerns, but the answers of the interviewees still left much to be desired.
Rep. Paul Daza, Deputy Minority Leader who originally disapproved of the bill, told Ho now was “a good time as any” to invest, especially since the substitute bill had enough safeguards anyway. Rep. Irwin Tieng, chair of the committee that deliberated on the bill, had the same answer for Davila, saying the country’s infrastructure needs demands it.
Asked by Domingo whether it would “have hurt” to spend more session days discussing the MIF, Daza admitted he personally would have wanted that, but the bill has already gone through a lot of amendments, some of which were suggested by the House minority. Rep. Margarita Ignacia Nograles also told Domingo that the bill has been discussed extensively and that it was already certified as urgent by the President. Nograles added that the bill is now with the Senate, seemingly implying that the Upper Chamber has to do more work on it.
To Domingo’s question of whether the swift approval meant Congress was just the President’s rubber stamp, Daza said no, claiming that the majority’s accepting the suggestions of the minority disproves it.
Davila and Pinky Webb of CNN Philippines’ The Source pointed to the mandated contribution of Pagcor, emphasizing that its current revenues are already allotted for other social welfare service providers such as Philhealth. Daza told Webb that getting funds from Pagcor was more acceptable than getting them from pension funds or the national budget, which was the provision in the original bill.
Roby Alampay of One News’ The Chiefs pointed out to Tieng that the rule of law is weak in the Philippines, and government institutions have a poor track record in managing the public’s money. Alampay added that even stolen wealth takes a long time to be recollected. Tieng merely reiterated that the bill has enough safeguards, and that the proponents put in provisions that would designate the best-equipped individuals to handle the fund. Tieng added that MIF is a totally different case as it does not involve “stolen wealth.”
The media must keep this sharp questioning up, and Senate reporters must be prepared to do the same once legislative sessions open next year.