MANILA, Philippines – President Ferdinand Marcos Jr. said it would ultimately be up to the managers of pensions funds to decide if they should invest in the controversial Maharlika Investment Fund (MIF).

Marcos made the statement in a media interview on the sidelines of the Government Service Insurance System anniversary on Wednesday, May 31, when asked about the provision in the proposed Maharlika bill on the absolute prohibition on the use or investments of state pension funds in the Maharlika fund.

Marcos said his administration has “no intentions” of using state pension funds as “seed fund.”

Yet Marcos said it would ultimately be up to the GSIS or the Social Security System (SSS) to decide where they want to invest.

“If the pension fund decides the Maharlika Fund is a good investment, it’s up to them if they want to invest in it. So not only pension fund, but corporations. Mga fund – iyan lang ang ginagawa nila, pinapalaki nila ang pera nila para mayroon silang maibigay (That’s what they do – they grow their fund so that they have something to give their members),” said Marcos, who has been promoting the Maharlika fund as one of his pet legislations.

Whether or not the GSIS and SSS – institutions that manage pensions for government workers and private workers – should be allowed to invest in the controversial bill, is among its most contentious points.

Experts and critics have pointed out that it’s too risky to pour pension funds into the proposed sovereign wealth fund, which the Marcos administration said would be used to invest in domestic and foreign corporate bonds, commercial real estate, and infrastructure projects, among others.

Finance Secretary Benjamin Diokno, speaking to reporters on Tuesday, May 30, defended the idea of allowing the GSIS and SSS the option to invest in the fund, “Why would you prohibit [GSIS, SSS from investing]? It’s the decision of the board. While they are presidential appointees, they act in the best interest of the company,” said Diokno.

Unlike the House, the Senate adopted an amendment in the Maharlika bill that explicitly bars the SSS, the GSIS, the Philippine Health Insurance Corporation, Pag-IBIG, Overseas Workers Welfare Administration, Philippine Veterans Affairs Office, and Home Development Mutual Fund from investing in the MIF, whether on a mandatory or voluntary basis.

The 19th Congress is set to adjourn on June 3, and will resume during Marcos’ second State of the Nation Address (SONA) in late July 2023.

Marcos made no mention of the Maharlika fund during his first SONA, when a president typically spells out his priority legislation. But in late 2022, the House speedily passed its version of the bill, after Marcos certified it as urgent. He also certified it as urgent before the Senate.

Should the House adopt the Senate version – as Marcos ally Senator Mark Villar as proposed – the proposed bill will skip going through a Bicameral Conference Committee and could go straight to Malacañang to be signed into law. – Rappler.com