House approves Maharlika Investment Fund bill

Metro Manila (CNN Philippines, December 15) — Voting 279-6, lawmakers approved on third and final reading on Thursday House Bill 6608 creating the Maharlika Investment Fund (MIF).

The passage of the controversial bill came after President Ferdinand "Bongbong" Marcos Jr. certified the proposed fund as urgent.

Congress is scheduled to adjourn on Dec. 17 for the holidays.

Lawmakers who voted negative raised “red flags” on the immediate passage of the sovereign wealth fund, explaining that its creation must be carefully considered amid the current economic conditions and the country's susceptibility to corruption.

This development came barely two weeks after the bill was filed on Nov. 28 by House Speaker Martin Romualdez, presidential son and Ilocos Norte Rep. Sandro Marcos, and four other lawmakers.

The number of co-authors rose to 279 out of the 312 lawmakers after Marcos expressed support for the bill.

Romualdez also approved the motion to immediately transmit the MIF bill, along with other proposed measures approved on third and final reading on Thursday, to the Senate.

Further changes have been introduced to the bill. A broader set of offenses was added which includes collusion, intermediation for and tolerance of graft and corrupt practices, and retaliation against whistleblowers.

Penal provisions were also added. Higher penalties were imposed for fraudulent actions connected to the Maharlika fund, such as imprisonment of up to 20 years.

To protect retirement benefits of pensioners, proponents accepted the amendment proposed by ACT Teachers Party-list Rep. France Castro to insert a line providing that pension funds shall not be requested or required to contribute to the MIF.

The adopted amendment said no part of the funds of the Government Service Insurance System (GSIS), Social Security System (SSS), and the Home Development Mutual Fund shall accrue to the MIF.

Castro also appealed for an increase of the percentage of Maharlika Investment Corp.’s net profits remitted to the national government for subsidy of the poor families. Lawmakers compromised with 25% instead of just 20%.

Abuse of power?

After sailing smoothly at the House, more debates are expected on the proposed creation of the Maharlika fund at the more cautious Senate.

In a message to reporters, Senate Minority Leader Koko Pimentel asked the President not to certify the MIF bill as urgent.

“[W]hat emergency or calamity is there now present which the Maharlika Fund is intended to be able to immediately address, help, or alleviate?” Pimentel asked.

“If the President issues the certification then this is clearly an abuse already of presidential prerogatives and powers,” he said.

Pimentel vowed a thorough examination of the bill once it is transmitted to the Senate and deliberations start as soon as sessions resume in January next year.

Sen. Joel Villanueva, who supports the establishment of a sovereign investment fund, also said further discussions are needed in the Senate to safeguard proper management, transparency, and accountability.

“We also need to pinpoint and clarify the investment objectives and strategies for the fund so that it will be well spent for the betterment of the Filipino people,” he added.

The Senate minority bloc earlier said the MIF was weak, stressing the proposal “hasn’t been thought out well and was rushed.”

RELATED: Senate waiting for final Maharlika Investment Fund bill from House

The MIF, previously named Maharlika Wealth Fund, attracted controversy by initially including the SSS and GSIS as initial sources of its seed capital.

As public concern rose, Marikina 2nd District Rep. Stella Quimbo, one of the bill's principal authors, told a press briefing that they will remove SSS and GSIS funds from the initial investment and replace them with dividends from the Bangko Sentral ng Pilipinas.

Opposition to the MIF also comes amid the country's huge trade deficit, record-high national debt, and soaring prices of basic goods.

Albay Rep. Edcel Lagman cautioned against rushing the passage of the MIF on Wednesday's session, saying House members must consult with their constituents on pros and cons of the bill during the Christmas break of more than one month.

Many in the business sector were also against the sovereign wealth fund, with the country's largest business group, the Philippine Chamber of Commerce and Industry, wary that it may affect the country's credit standing.

CNN Philippines correspondents Xianne Arcangel and Eimor Santos contributed to this report.