Lawmakers to remove SSS, GSIS as funding sources in Maharlika Wealth Fund bill

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Metro Manila (CNN Philippines, December 7) — The Maharlika Wealth Fund (MWF) bill will be amended to remove major pension funds as funding sources, Marikina Rep. Stella Quimbo said Wednesday.

In a press statement, Quimbo — one of the bill’s authors and vice chairperson of the House appropriations committee — said the proposed sovereign wealth fund will utilize profits of the Bangko Sentral ng Pilipinas (BSP) instead of sourcing it from the Social Security System (SSS) and Government Service Insurance System (GSIS).

Under House Bill 6398 creating the fund, proponents identified the initial investment of ₱250 billion to come from the GSIS (₱125 billion), SSS (₱50 billion), Land Bank of the Philippines (₱50 billion), and Development Bank of the Philippines (₱25 billion).

Quimbo said the decision to amend the bill was a result of legislators' meeting with economic managers Wednesday morning.

"The discussions on the amendments shall be taken up by the Committee on Appropriations on Friday upon the instruction of (House) Speaker (Martin) Romualdez," she added.

SSS and GSIS officials earlier allayed concerns over the initial plan to invest a combined ₱175 billion, saying the income will benefit the country.

READ: GSIS, SSS allay concerns over ₱175-B investment in Maharlika Wealth Fund

Various groups had protested against the proposed fund, with some arguing that pensioners were not consulted.

According to Quimbo, public concerns over the nature of investment that the SSS and GSIS will make prompted lawmakers to remove them as contributors to the MWF.

She added, however, that the state pension funds are still welcome to invest "if they deem it appropriate in the future and obviously on a voluntary basis."

"It's not going to be closed doors for them as long as we set up the fund and it becomes a going concern at makikita naman na mataas ang returns [and there would be high returns], why not?" Quimbo said.

Quimbo also said the exact amount that the BSP will contribute will be decided on this Friday.

For Senate Minority Leader Koko Pimentel, the planned amendments showed that the measure was not well thought out, and should be returned to the authors.

Speaking to CNN Philippines' Politics as Usual, Pimentel said senators are "lukewarm" to the idea, and will only study the bill once submitted properly.

"Siguro balik na lang tayo sa talagang problema ng ating bansa, 'yung inflation, kakulangan sa pagkain, kahirapan," Pimentel added.

[Translation: Maybe we should just focus on the real problems of the country: inflation, lack of food, poverty.]


Quimbo assured the public that lawmakers will put safety nets in place as they tackle the Maharlika Wealth Fund bill.

The Bureau of the Treasury also said it supports calls to study the measure, but noted that there are already eight measures that will safeguard the fund's integrity.

"We agree that we need to ensure that all these safeguards are in place for the protection of the funds of the people," National Treasurer Rosalia de Leon said in a statement Wednesday.

"However, with the proper safety measures, I believe we should be able to proceed with the Maharlika Wealth Fund as this will ultimately benefit our people," she added.

De Leon also said internal audit is ensured in the bill  with an internationally recognized auditing firm to stand as the fund's external auditor, along with the Commission on Audit.

An advisory body composed of various secretaries will likewise assist the Board of Directors in formulating policies for investment and risk management.

"The Advisory Board will be sought for consultation in case of transactions that will affect Balance of Payments and monetary aggregates, especially those which impact domestic liquidity and reserve money," De Leon said.

Also, a Joint Congressional Oversight Committee will be tasked to oversee, monitor, and evaluate the implementation of the Maharlika Wealth Fund Act.

De Leon further pointed out that there is a specific provision to prevent unnecessary withdrawals from the fund.

"Section 15 of the bill states that no withdrawals of equity shall be made before 2028 and that, thereafter, equity withdrawals shall be made in accordance with the guidelines prescribed by the Board or the implementing rules and regulations of the Act," De Leon stressed.

CNN Philippines correspondent Xianne Arcangel and digital producer Faith Ragasa contributed to this report.