Marcos: No intention of using pension funds as seed funds for Maharlika

President Ferdinand "Bongbong" Marcos Jr. on Wednesday guaranteed that the national government has no intention of using state pension funds as “seed fund” for the proposed Maharlika Investment Fund (MIF).

In an interview with reporters, Marcos, however, said pension funds themselves could invest in the proposed sovereign wealth fund if they think it is "good investment."

"Of course, ah no, I agree. We have no intention of using… kukuha tayo ng pera ng pension fund," Marcos said.

"We will not use it as a seed fund. However, if a pension fund, which is what pension funds do, is they invest. If the pension fund decides that Maharlika fund is a good investment, it's up to them if they want to invest in it," he added.

Government Service Insurance System President and General Manager Jose Arnulfo “Wick” Veloso said in a separate interview that even before, discussions were made that pension funds will not be utilized for the sovereign wealth fund.

"Noon pa hong a-dose ng Disyembre, ang mga pension funds katulad po ng GSIS ay di na po kasama. Hindi ho natin alam kung ano pang mga diskusyon na nangyayari sa mga bagay na 'yan," Veloso said.

(As early as December 12, pension funds like the GSIS are no longer included as source of seed funds. We don't know the present discussions regarding that matter.)

"Isa lang ho ang gagawin natin, kung ano po ang desisyon ng mga mambabatas sapagkat sila'y nakikinig sa ating taumbayan, eh 'yun po ang susundin natin. Kami po ay nakapatnubay lang kung anong bibigay na direksyon sa amin," he added.

(We will just follow the decisions of our lawmakers because they listen to the concerns of the public. We will follow that. We just follow the direction that will be given to us.)

During the bicameral conference committee meeting Wednesday, the House of Representatives adopted the Senate version of the Maharlika bill.

“In behalf of the Congress (House) panel, we accept the Senate version in principle, subject to style,” Manila Representative Irwin Tieng said in a video provided by Senator Mark Villar's office, the principal author of the measure in the Senate.

Following marathon deliberations, the Senate approved early Wednesday the proposed measure seeking to establish the sovereign wealth fund.

The bill states that the MIF would be created through the funds THAT will be sourced from:

• Land Bank of the Philippines (LBP): P50 billion
• Development Bank of the Philippines (DBP): P25 billion
• National Government: P50 billion

Meanwhile, the contribution from the national government will come from the following sources:

• Bangko Sentral ng Pilipinas' total declared dividends
• National government's share from the income of PAGCOR
• Properties, real and personal identified by the DOF-Privatization and Management Office
• Other sources such as royalties and/or special assessments

Among the major amendments introduced to the bill was the absolute prohibition of the use of funds of the Government Service Insurance System (GSIS), Social Security System (SSS), Philippine Health Insurance (PhilHealth) corporation, Pag-IBIG, Overseas Workers Welfare Administration (OWWA), Philippines Veterans Affairs Office (PVAO) in the capitalization and investments in the Maharlika fund.

On Monday, Senator Risa Hontiveros raised what she called a "backdoor provision" in the MIF bill, which provides that "other government financial institutions government-owned and -controlled corporations may invest into the MIF, subject to their respective investment and risk management strategies and approval of their respective boards."

The SSS and GSIS are both GOCCs or government-owned and -controlled corporations.

Hontiveros, who voted against the passage of the bill, said the backdoor would work if the GSIS board would change its investment strategy and "gamble" the over a trillion-peso fund of the GSIS in the MIF.

Finance Secretary Benjamin Diokno earlier said board members of state pension institutions should not be "precluded" from deciding on possible investments in proposed sovereign wealth fund. —KBK, GMA Integrated News