By Atty. Howie Calleja
In a bid to sanitize the proposed bill that would create the Sovereign Wealth Fund (SWF), proponents of the proposed fund have removed state pension funds Government Service Insurance System (GSIS) and Social Security System (SSS) as mandatory contributors to the proposed SWF. Amid negative public reaction (including Bangko Sentral ng Pilipinas Governor Felipe Medalla who earlier expressed opposition to the measure) House appropriations panel senior vice chairperson Stella Quimbo of Marikina City announced this latest revision to this planned legislative measure.
As such, the seed money will now come from the state-run banks LandBank of the Philippines (P50 billion), the Development Bank of the Philippines (P25 billion), and the dividends/profits of the BSP. So, the million-dollar question remains — will this proposed “sanitation” truly wash away the “dirt” that comes inherent in this bill? Or have the “stains of corruption” hardened to the point that removing it would be next to impossible?
By the way, toying with the idea to make the GSIS and SSS contribution to the SWF purely voluntary does not lessen its illegality because we cannot commingle private funds with public funds used for public purposes knowing perfectly well that such voluntary decision to join was due to a board resolution from these corporations motivated by their appointment from Malacañang. And, why propose the increase of the mandatory contributions for SSS and GSIS members to mitigate the pension fund’s deficits and yet have the nerve to contribute to the SWF?
To begin with, whether or not we remove GSIS or SSS in the fray; the money to be used to operationalize this fund is still the people’s money, and therefore should not be trivialized or taken lightly. It is therefore of equal significance that such fund (no matter where the government sources it) is managed in the best possible manner; which means being freed from all forms of abuse and dishonesty.
Can we trust another Marcos at the helm of the SWF, when in the 1970s Marcos Sr. took out mammoth amounts of foreign currency loans that by the 1980s his administration could not repay? As a result, our economy went on a free fall whereby GDP growth dropped 5.3 percent, prices of primary export commodities fell by 50 percent, workers’ wages were reduced, and unemployment hit one-fourth of the labor force. What happened next? Well, Marcos Sr. declared bankruptcy of the Central Bank in October 1983 and sought a 90-day moratorium on principal debt payments. The World Bank provided bailout loans to avert a default but with painful conditions like cutting the government budget, peso devaluation, tariff dismantling, and ending subsidies. Now, tell me — is this the type of people we can trust with our money?
On the management side, let me stress that banks are already sustained by the savings of individuals and profitable businesses which are professionally managed to nurture new ventures. In fact, banks themselves already, prudently invest their profits to maximize profit. So why do we need to reinvent the wheel? Why not the leave the investing to the experts and not in the hands of corrupt bureaucrats? On the other hand, official development assistance and development loans from WB, ADB and EU are already coursed through government financial institutions such as DBP and LBP. So creating another fund from competently managed institutions, also monitored by BSP is really preposterous.
On the president as chairman of the fund well that gives us less comfort how can we trust a person convicted of 4 counts of violation of the tax code with a family whose pending tax and graft cases still remain uncollected unpaid and some pending in our courts. Compared to Malaysia at least they got the guts to convict their head of state. I don’t think our present leaders have the guts and the patriotism to go against the president.
Feeling Rich is far different from Being Rich. We cannot pretend to look rich when in reality we cannot even afford to give our people their minimum basic needs. This is what creation the of the Maharlika Wealth Fund means. Rich countries can afford to set aside “excess” funds for the international investment market without the “risks” it may have to its citizens but honestly we cannot. And, adding more insult to injury is when hand over in a silver platter such funds to a government with such dubious character “na para kang kumuha sariling mong bato na ipupukpok mo sa ulo mo”. Huwag naman sana!