By JONAS ALPASAN
MANILA – Various groups opposed the apparent railroading of the Maharlika Fund, the proposed sovereign wealth fund, which critics fear is vulnerable to corruption and may be used by the current administration to consolidate the local elite for their favor.
On May 22, Ferdinand Marcos Jr. wrote separately to the Philippine senate seeking to certify as urgent the bill that seeks to create the Maharlika Investment Fund.
Marcos Jr. said there is “compelling need for a sustainable national investment fund as a new growth catalyst to accelerate the implementation of strategic and high-impact large infrastructure projects that will stimulate economic activity and development.”
In the Senate version of the bill, at least P500 Billion will serve as a seed fund through the Land Bank, Development Bank of the Philippines (DBP), Bangko Sentral ng Pilipinas (BSP), Philippine Amusement and Gaming Corporation (PAGCOR) and other government agencies.
Last year, Marcos Jr. already wrote to the Lower House also certifying the proposed measure as urgent.
This, according to human rights lawyer and former Bayan Muna partylist lawmaker Neri Colmenares, is an “abuse of the presidential power by certifying a bill urgent to circumvent the constitutional requirements that each bill must undergo three readings in three separate days with each legislator having a copy of the final bill being approved.”
“There is no emergency being addressed that necessitates the bypassing of this important constitutional requirement. This should only be reserved in cases of calamities, pandemics and other emergencies which requires the immediate enactment of a law,” he added.
Use of pension funds
Colmenares also assailed how pension funds from the Government Service and Insurance System (GSIS), the Social Security System (SSS), and Pag-ibig may be voluntarily contributed to the Maharlika fund under the current Senate version.
This was also condemned by the human rights group Karapatan.
“But this Senate version, without sufficient inputs from broad public consultations, contains vague provisions on the use of pension funds and retains the use of billions of public funds, even raising the Maharlika Investment Fund’s capitalization from P7 billion to a whopping P500 billion,” said Karapatan secretary general Cristina Palabay.
Palabay said that the interpellations in the Senate floor will be “perfunctory,” following Marcos Jr.’s pronouncement, certifying the bill as urgent. The group estimated that the Senate version may be railroaded before their break on June 3 while the House version may be passed on final reading in just one day.
“Imagine the immense monopoly power that will be vested in Ferdinand Marcos Jr. and his trusted lieutenants who will be put in charge of this gargantuan fund,” Palabay added.
KMP said the Landbank of the Philippines will deviate from its mandate if it contributes to Maharlika. As it stands, Landbank is set to contribute about P50 billion ($894.25 million) to the proposed sovereign wealth fund.
“Landbank’s mandate is to assist and provide financial assistance to farmers and to the rural population. They will be deprived of the funds intended to them if the P50 billion fund is transferred to the MIF,” said Ramos.
According to Landbank’s performance highlights report, a total of 3.406 million farmers and fishers were given assistance in 2022. The loans provided to the 20 poorest provinces also amounted to P66.54 billion ($1.19 billion).
Its 2022 report added that loans to agriculture amounted to P261.7 billion, which is 5.5 percent higher from P247.9 billion ($4.44 billion) in 2021. Of this, Landbank said that an amount of P46.6 billion ($835.3 million) directly benefited small farmers and fishers through cooperatives, farmers’ associations, and rural financial institutions.
Ramos said this may make farmers turn to loan sharks and be buried deep in debts. “Only the few and those with foreign interests stand to benefit from this MIF. It is also vulnerable to corruption by cronies and allies of the Marcos Jr. administration.”
Apart from the Landbank, the Development Bank of the Philippines is also set to contribute another P25 billion to the proposed sovereign fund.
“Landbank can help more if it will further simplify its loan processes and make its programs more accessible to small farmers and fishers,” said KMP.
‘No savings in the first place’
The farmers’ group also shared the sentiments of a former Bangko Sentral ng Pilipinas official who said that creating a sovereign fund is dangerous as the country is already burried in a P13.70 trillion ($245.41 billion) in debt.
In an opinion piece published by Business World earlier this year, Diwa Guinigundo, former deputy governor for the Monetary and Economics Sector of the BSP, said that the country has “no public savings to speak of in the first place.”
He added that the country neither has “windfall profits from asset sales” nor royalties remitted from oil, gold, or diamonds in the same way as other countries. “What we have is a chronic fiscal deficit and burgeoning public debt.”
As such, KMP said the Maharlika Fund will be “for the economic interest of local and foreign big businesses, investors, and conglomerates” and may be used by the current administration to consolidate his hold and control over local elites.
Instead of pushing for the proposed sovereign fund, Ramos reiterated the need to provide much needed subsidy to low-income and poor communities.
“We have been calling for subsidy and aid for the people. But now, workers, farmers, and government employees stand to lose from this as their social security fund will be transferred to the MIF. This is not just. We will not allow it,” said Ramos. (RTS)