PENSION FUNDS. President Ferdinand R. Marcos Jr. joins the Government Service Insurance System’s (GSIS) 86th anniversary celebration at the GSIS Head Office in Pasay City on Wednesday (May 31, 2023). In a media interview, Marcos said the state pension funds will not be used as “seed fund” for the proposed Maharlika Investment Fund. (PNA photo by Rey Baniquet)

MANILA – The state pension funds will not be used as “seed fund” for the proposed Maharlika Investment Fund (MIF), President Ferdinand R. Marcos Jr. assured the public on Wednesday.

Marcos gave the assurance on the sidelines of the 86th anniversary celebration of the Government Service Insurance System (GSIS) in Pasay City, as the Senate’s version of the MIF bill was adopted by the House of Representatives during a bicameral conference held Wednesday.

“I perfectly agree. We have no intention of using ang pera – kukuha tayo ng pera ng pension fund (get the money from the pension fund). That’s not the (intention). We will not use it as a seed fund,” Marcos told reporters, when quizzed about the possibility of using the state pension funds as funding source for the proposed MIF.

Marcos, however, noted that pension funds may invest in the MIF, if they consider it as a “good investment.”

“If the pension fund decides the Maharlika Investment Fund is a good investment, it’s up to them if they want to invest in it,” he said.

“GSIS, this is precisely what they have been doing. They are making sure they are very solid, that they are very stable so that all the payments that they need to give out. So we have to differentiate those two things,” Marcos added.

The MIF bill, which was earlier certified as urgent by Marcos, was approved by the Senate at past 2 a.m. on Wednesday following more than 12 hours of deliberations. The House of Representatives, on the other hand, approved its version of the bill in December 2022.

During the bicameral conference committee meeting, the House of Representatives agreed to adopt Senate Bill (SB) 2020.

The Senate's version of the bill orders the absolute prohibition of the use of funds of the GSIS, Social Security System (SSS), the Philippine Health Insurance Corporation, Home Development Mutual Fund (Pag-IBIG), the Overseas Workers Welfare Administration and the Philippine Veterans Affairs Office in the capitalization and investments in the MIF.

Under SB 2020, the proposed Maharlika Investment Corporation (MIC) will act as the sole vehicle for the purpose of mobilizing and utilizing the MIF for investments in transactions to generate optimal returns on investments.

Budget Secretary Amenah Pangandaman said the latest move would bring "long-term" progress in the Philippines and sustain the country's economic growth.

Pangandaman also backed the Senate’s version of the MIF bill for having "a lot of safeguards against possible abuse," making the proposed state wealth fund more acceptable to the Filipino people.

She said the MIF's funding sources include the Landbank of the Philippines, the Development Bank of the Philippines, privatization proceeds, the Philippine Amusement and Gaming Corporation and Bangko Sentral ng Pilipinas dividends.

The proposed MIF is an independent fund that adheres to the principles of good governance, transparency and accountability and shall be sourced from the investible funds of select government financial institutions (GFIs), from contributions of the national government, declared dividends of the BSP and other fund sources.

Under the scheme, the MIF shall be used to invest in a strategic and commercial activities in a manner designed to promote fiscal stability for economic development and strengthen the top-performing GFIs through additional investment platforms that will help attain the national government’s priority plans. (PNA)