LIVE | Pagpapatuloy ng pagtalakay ng Maharlika Investment Corp. sa Senado #News5 (May 30, 2023)

but it cannot be all of the above because it is simply impossible to be all of the above because these different types of

investment

s, business activities and business transactions require and demand different types of experience for democracy, but under a democratic system, people can demand that Their policymakers need to be realistic, according to the president of the Foundation for Economic Freedom, they are investing blindly, they don't even know what the business plan is and yet they are investing, so that is really a problem, It is not very clear what it is actually used for. I am concerned that the Maharlika Investment Corporation will attack the independence of the Central Bank.

This move turns the Constitution on its head as it denies the independence of the BSP. Article 12, section 20 of our Constitution establishes that Congress has established an independent Monetary Central. Authority, the members of the physical burning board must be natural-born Filipino citizens of recognized poverty, integrity and patriotism, the majority of whom will come from the private sector. They will also be subject to such other qualifications and disabilities as may be prescribed by law. The Authority shall provide policy direction in the areas of monetary banking and credit, shall have supervision over the operation of the banks and shall exercise the regulatory powers established by law over the operations of financial companies and other institutions that perform similar functions, then the water if this microphone is indeed created. then the BSP will be tied to it for a long time, if not forever.

The PSP dividends will go to the microphone as a capital contribution from the national government. Dividends come from profits and the BSP makes profits from its operations. Imagine the BSP, which is a mentioned government agency. in the Constitution you will now be considered to work for the microphone, if this was the new function of the bsp, to earn money for the microphone, we should relieve the bsp of the pressure of making money, since this is the list of their concerns, another point observational. The BSP, our central bank will be capitalized at 200 billion pesos. The MIC will be capitalized at 500 billion pesos.

Foreign capital. The BSP was created on July 3, 1993 as an independent central monetary authority of our country. It applies two of the constitutional provisions. which I just read and the Republic Act number 7653 or the new application of the Central Bank on February 14, 2019 ra11211 was approved amending ra 7653 the amendments to the statutes strengthen the ability of the bsp to safeguard price stability and stability of the financial system the modifications were made to provide policy direction in the areas of banking and credit money and also to maintain price stability conducive to balanced and sustained growth of the economy and employment according to article 1 of the ra11211 capital of the Central Bank will be 200 billion pesos that will be fully subscribed by the government of the Republic of the Philippines.

It provided that the increase in capitalization will be financed only with the dividends declared by the Central Bank in favor of the national government; For this purpose, each and every dividend declared by the Central Bank in favor of the national government will be deposited in a special account. in the general fund a reserve for the payment of the capitalization increase of the Central Bank, said payment will be released and distributed immediately and will continue until the capitalization increase has been paid in full. Article 51 of the proposed measure establishes that a part of the national government's capital contribution will come from the BSP dividends corresponding to the first and second fiscal years.

As of the entry into force of the measure, the B has a special limit of 100 percent of the total of its dividends declared to the National Government, but for the purposes of the capitalization of the MIC in the In the following years the ba limits special 50 of the total of its declared dividends to the national government for the capitalization of the MIC and the remaining 50 to the national government to finance the increase in the capitalization of bsp in accordance with the law Mr. President and my dear colleagues Only a few years after the enactment of RA11211, we are now reviewing the capital accumulation method of the BSP to accommodate this Maharlika Investment Funds Act,

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Can the BSP maintain its mandate of price stability conducive to balanced and sustainable growth of the economy? and employment in the next two years that it is going to remit 100 of its total declared dividends to the national government for capitalization of the mic, are we consciously changing our mind whether the BSP needs this capital or not? I thought about the timeline of the law increase the greater peace Capital was important, Mr. President, in the same way, in the proposed measure, the microphone, in any form or device, is prohibited from investing in areas that are explicitly prohibited according to the existing laws and convention that the Philippines is a party to, unfortunately not a single law or convention.

As mentioned, then everyone can argue about what should be considered a prohibited

investment

. I have observed that there is also no maximum limit on the fees and charges incurred in the establishment and effective management of MIF maximum limits is important because it avoids unfair advantages. and the charging of exorbitant fees and charges; however, third party fees and all charges related to the establishment and effective management of the IMF, such as Costo Divis transaction fees, clearing fees, and management fees payable to fund managers, will be charged to the proposed measure. external. against the homeless mif the sky is the limit, mr president, and this might lead some to conclude that it would be good to be friends with the people who handle the microphone.

I am also not comforted by the statement that there are auditors, I understand that. Auditors play an important role in ensuring transparency and accountability in the proposed measure. The banking committee decided to include the hiring of an external and internal auditor as one of its safeguard measures. However, I am not comfortable with the idea of ​​an external auditor. Let's let it go. Let's go back to our experience with Pagkor, which is another government-owned or non-controlled

corp

oration. Parkour failed big time in this external auditor mandate. Parkour hired global.com RCI as external auditor for Philippine offshore gaming operators pogos under a 10-year term 6 billion peso contract the Senate Ways and Means Commission was necessary, under the eagle eye of our president Mr.

President, to find out that this external auditor headed by parkour was not qualified and not doing his job was practically a fly-by-night operation that presented falsified bank certifications, Mr. President, so, Mr. President, dear colleagues, from this scandal of parkour we can learn that the presence of an external auditor does not absolutely guarantee the protection of our interests. I am also curious about the penal provisions. From the beginning I asked myself why. We are putting this MISF Why are we touching the LBP and DBP funds that are already on their balance sheets and managed by their own risk management teams and boards of directors?

Foreign provisions do not provide for prison sentences. What is indicated in the bill seems enormous on paper, the fine amounts to the tremendous amount of 5 million pesos; However, if we realize that investment scheme frauds can amount to billions of US dollars, then the amount of our fines will now seem insignificant. of a fine of 5 million pesos dissuade Mente Criminal from taking advantage of an illegal payment in the amount of five million dollars 50 million dollars I want to state for the record that I am not interested in sending people to jail especially when it is unnecessary for Al no By turning this unjustified, unnecessary and necessary idea into law, we eliminate the temptation and opportunity to commit financial crime.

Let us avoid scenarios that make possible the criminal violation of an unnecessary law. Also, I think it's the best policy to disable it. Legislators belonging to the Congress that passes this bill and each and every subsequent Congress will benefit from this

maharlika

law. Lawmakers should be disqualified from working directly or indirectly for the microphone. Invest directly or indirectly with the Mi mic slash mif. invest directly or indirectly in

corp

orations and other institutions linked to legislators directly or indirectly. I emphasize the phrase directly or indirectly nothing and why include future congresses in the ban because there is a joint congressional oversight committee, the MIF JCOC, we have also noted, Mr.

President, that many of the details are left to the irr or to the rules and implementing regulations. It is well established that rules and regulations that are the product of a delegated power to create new or additional legal provisions that have the effect of law should be within the scope of the statutory authority granted by the legislator to the administrative agency should not be the other way around. , that the irrs be greater than the law, the proposed measure allows the elaboration of powerful implementing rules and regulations capable of making the following examples first in the rewards and incentives the criteria for the granting of rewards and incentives will be determined in the irr including the formula for computing any amount we award that will be awarded to officers of the board of directors, employees and personnel of the second microphone in the duties and qualifications of the chief investment officer and chief operating officer, the CIO will be appointed by the board of directors and dismissed for a period as provided in the irr, there is something wrong with the physiology Mr.

President, I am quoting the finance bill itself fixed with the advice of the council in accordance with the relevant provisions of the measure and its irr other is about the appointment, election and termination of membership in the board which will also be provided for in the irr. It is interesting to note that the treasurer of the Philippines, in consultation with the founding GFI, will be the one to promulgate the rules and regulations necessary for the implementation of this measure. I thought the treasurer was supposed to simply be a member of the Advisory Board. Mr. President, the irr should never be more than the According to the law, this would amount to undue and invalid delegation of legislative power and then another worrying point, Mr.

President, about the GSIS and SSS funds, this

maharlika

fund proposal started with the left foot and the proponents were forced to suffer a retreat that their first versions wanted to attack. GSIS and SSS coverage as a source of Maharlika's initial capital When the fund owners objected to this proposal, the proponents agreed to eliminate them, a smart move in opposition to the GSIS and SSS contributors who are government workers and employees of the private sector decreased while eliminating the force contribution of gsis and SSS inserted a sentence that would allow these funds to invest in maharlika voluntarily provided that their boards of directors agree to the last paragraph of section 6 of the proposed measure States under no circumstances, the goc provides social security to government employees, workers and employees of the private sector and other sectors and sub-sectors, such as, but not limited to, government service, insurance system, social security system and household development mutual fund. to the microphone, however, section 12 of the Measure allows voluntary investment, mentions that other IGFs and GCCs may invest in the MIF subject to their respective investment and risk management strategies and the approval of their respective boards of directors.

Additional investments may also come from Investments from reputable private and state financial institutions and corporations in such manner and under such terms and conditions as the board of directors may prescribe Naman. I thought they listened to the public's concerns, but they executed a smart move and the danger is still there. The conservatively managed pension and retirement funds of our government and private sector retirees will be entrusted to the maharlika investment fund for riskier placements or, in other words, for gambling. Mr. President and my dear colleagues, I have reached the point where I share My conclusions, Mr.

President, although the MIF has been presented to us as an attractive proposal with the noble intention of boosting investment and growing our money, it carries significant risks that the Philippines does not can afford to take, the overall risk is too great to outweigh any potential benefits of the measure, if any, given our current fiscal and economic situation, we cannot afford to make a $500 billion mistake. pesos or even an error of 75 billion pesos. This will be a costly mistake that will pay off. with the hard-earned money of our people representing their Blood, Sweat and Tears, although a mistake like this can also allow others to

live

a luxurious lifestyle.

If you know what I mean,The implications of the proposed Maharlika investment fund are simply too great for us not to do. anything that can stop it, the following are good reasons to reject the maharlika investment fund and these are the reasons why the Philippines should not establish a sovereign fund or a state investment fund or a state-initiated investment fund or a national investment fund or whatever We might want to call it number one: The Philippines is a developing country with a large and growing population and we have a number of pressing economic and social challenges that need to be addressed.

Establishing a sovereign wealth fund or the MIF would require the government to divert resources from these more immediate priorities, such as poverty and hunger, quality education and health care, too many jobs, and reducing inequality and injustice, among others. others. Number two, the Philippines is not a major exporter of natural resources like oil and gas, which are the main ones. sources of income for many sovereign wealth funds, this means that the Philippines would need to find other sources of financing for its sovereign fund or the MIF, which could be difficult and potentially involve taking on more debt number three, no surplus, no budget surplus, no trade surplus, there is no unexpected income or profit of anything that can be useful. as financing for this MIF we cannot even point to the underlying asset of this MIF because none exists.

The Philippines is the fourth country. The Philippines has a history of corruption and mismanagement of public funds, raising concerns about the transparency and accountability of its sovereign wealth fund. or this mif there have been numerous cases of government officials misusing public funds for personal gain and there are concerns that the sovereign fund or this mif could be used as a means to disguise or hide corrupt activities. number five, the Philippines is already facing major economic challenges including a large and growing budget deficit high debt levels a weak currency and high inflation our fiscal space has been reduced food production is very low but smuggling is very rampant establish a fund sovereign wealth or this MIF could further strain our country's financial resources and increase our dependence on external financing, which could make us more vulnerable to external economic shocks and market fluctuations number six, we should finance the budget instead of the MIF Now that I think about it, the MIF bill is, if not an insult to Congress, then an indictment of the budget process Proponents of this MIF bill would prefer that an unelected board of nine people meet behind closed doors in a conference room that the Filipino people cannot freely enter and decide on the approval and financing of high-value mega infrastructure projects instead of elected members of Congress whose proceedings are open to the public covered by the media. communication and even broadcast

live

on the microphone can change the panorama of our country without the participation of the elected representatives of the people.

Why should we allow this to happen in Congress? Number seven, the current version of the IMF. It has too many inherent inconsistencies not to mention the very difficult to understand paragraphs and sections of bill number eight, too many details are left to the irr, therefore we have no idea what the mif will ultimately look like and what it will be like. governed number nine the creation of the MIF could undermine democratic principles in the management of funds and weaken democratic institutions for transparency and accountability are committed in the MIF we cannot forget that transparency and accountability are the bases that allow democracy to thrive since the IMF will invest domestically and can partner with private business interests, the MIF can, in fact, choose who will be the winners in our demonstration in our national economy, therefore we must always be watch out for favoritism, chronic capitalism, and equal treatment in violation of the Equal Protection Clause. of Constitution number 11 I maintain that before we can decide on the establishment of the MIF we have to first answer the damaging questions that I have raised before, such as number one, is it economically viable?

Number two, having the Land Bank of Philippines and the Development Bank. The Bank of the Philippines has been subjected to sensitivity tests and number three is whether we are proceeding with the proposed merger of the land bank and the Development Bank number 12. Whether the MIF is really being established for the Filipino people, including the future generations and proponents. are so confident that the expected high returns will be realized and truly rehabilitated for the benefit of the Filipino people, then I proposed that the law establishing the maharlika wealth fund be presented to the Filipino people through a referendum, in short, the creation of the maharlika investment fund. financing the MIF will be more harmful to our economy, the countries and our future than if the fund had not been created or when it would not be created in the first place, Mr.

President, my dear colleagues, the decision to allocate billions of pesos to the creation of this MIF or the maharlika investment fund is a matter that we must carefully consider and review, it is important to consider the potential risks associated with this measure, we must not rush into the consideration of this bill, let me quote the president, no to the Senate. president the president of the Republic when he was interviewed about the MIF a foreign message we have to do it right to do it wrong would be a very serious mistake those are the words of the president so my dear colleagues in the Senate of the Philippines President bongbong Marcos addressed that message to the President of the US, so in closing, Mr.

President, thank you for the time you have given me and Mr. President to close, according to a former high-ranking central banker, okay, Maharlika Investment Fund or the MIF proposal is the The madness of some people I dare to oppose the proposal to create the MIF or the maharlika investment fund. It comforts me to think that the Filipino people know another meaning for the letters m and f and that is that this madness does not last forever or before. I conclude, Mr. Chairman, I propose that the measure under consideration, the bill attached to the committee report, be referred or recommitted to the appropriate committee, which is the committee on government corporations and public enterprises, so thank you, Mr.

Chairman , and your colleagues for your time and attention, Mr. President, I would like to put on record that this representation is objecting to the motion on the floor, Mr. President, before we have an objection, but acknowledge to the senator, Mr. President, a matter of order, Mr. Speaker, before we act on the motion while I sympathize with our minority leader, Senator Pimentel, regarding his desire to have this bill referred to another committee. The period within which to request a reconsideration of the plenary decision has long passed, so although the vote will most likely be approved by the majority, it may not serve as a good president, Mr.

President, your honors, yes, bill. I know what I did, Mr. President, so we were discussing it on a theoretical level. We are now discussing a very specific bill. That's what the motion is about. It is a very specific bill attached to the committee report, Mr. Speaker, but just to respond briefly, to give a brief statement, many beers are addressed in certain committees once they are passed, committee reports are finalized even by substitution , there's no need. For example, what could have been a tourism bill, after going through several amendments in committee, now becomes an economic zone with tourism potential.

I mean, and of course you can. No one has objected to this particular first referral, so a majority leader, Mr. Speaker, there was a motion, just summarize, Mr. Speaker, there was a motion put forward by the minority leader to which this representation objected and the distinguished gentleman from the province of Sorsogon, raised a point of order, Mr. President, so I think, Mr. President, that uh, with the indulgence of the body, the appropriate thing, uh, uh, uh, of course, in this time is for the President to provide the point of order, Mr. President, from the point of order, uh, Mr.

President, before he rules on the distinguished gentleman's point of order. From the source of God, I would also like to reiterate for the record, Mr. Speaker, as we take note of the Minority Leader's objection to the committee's referral of the Maharika Bill. This matter has been sufficiently deliberated, debated and voted on by the body on January 25.

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and to remind you, Mr. President, this bill was referred to financial institutions and comic bank currencies because its purpose is to create an individual and independent investment fund, so I just want to put it on the record before you speak on the point of order raised. by the Lord of God's fountain who will recognize first uh uh senators of the verse while I would also like to reserve myself to interpolate the tourno meeting of the minority leader I would also like to second the motion of the minority leader Mr.

President yes uh foreign foreigner that is I moved everything for the previous questions the president yes on the position of uh on the point of order made by senator scudero the point of order is well taken and uh to respond to the demonstration or the request of Senator Coco to return it to the committee, the matter for the record has already been previously discussed and resolved at that time, so that is the president's decision. The senator is recognized, as I said before, Mr. President. This refers to a very specific bill, different in content. than the first so yes I appeal the president's ruling if you appeal the children's ruling by the house Mr.

President then those who are in favor of Senator Coco's appeal to remind the committee to inform your committee, please raise your Sorry to remind the committee the committee of the good governor the committee of government corporations that is correct, yes, okay, so those are in favor of the appeal of the gentleman from Cagayan De Oro and zambales, uh, please , raise your hand, uh, uh, Mr. Mr. President, yes, I'm sorry that you're in the middle of a vote, sir, I know, but I would like to raise another point of order. We should vote on the president's decision regarding the point of order of that race that the motion is not appropriate, okay, and not on Senator Pimentel's motion, he appealed, the point is that we already ruled on the motion Yes, and I understand that Senator Pimentel appealed the president's ruling, it is the ruling of the president's terms that we are in. voting right now ah okay we tie I will withdraw the initial vote because it is the president's decision those who support the chair decision please raise your hands those who do not support the chair decision please look at yours so that there are two two votes against my decision and 16 votes in favor, so it seems that Missouri is lost, Mr.

President, yes, to be consistent with my vote, uh, for the record, when I rephrase the motion as the motion, uh, uh, the president's decision, right, I raise my hand. It is an honor because I want to support the presidency, but otherwise I would have abstained if I had followed a different path, because the committee on gocc is chaired by my brother, Senator Allah, and to be consistent with my vote a few months ago , I also abstained in reference to because I know that he would have very much liked to also hear this bill with no, no, uh, without making any comments on anything else, that's all, Mr.

President, but my vote is only for explain coherence. That is a good way, Mr. President, to remind you. we that she was the only one who abstained Mr. President during the time at that time yes but she voted with us today yes Mr. President yes thank you Mr. President Mr. President take advantage of the remaining hours uh I think there are 10 minutes left uh the deputy To the leader of the minority would like, uh, yes, another country's speech to be given, Mr. President, our senior deputy leader of the minority employees, is recognized, perhaps, perhaps, recognize the deputy minority leader, Mr.

President, as I mentioned, the deputy floor minority leader is recognized, I would have liked it, uh, if it is allowed to interpolate the meeting of the minority leader, but that is not possible. 10 minutes before starting. Yes, we will ask you to reflect on that on the watch. Could you put 10 minutes on the clock? Thank you, of course, Majority Leader. Hours left. In any case, for Mr. President, I will simply leave out of the record some of the many questions that he would have posed to the minority leader ininterpolation starting with this. He would have told the minority leader that the sponsor disagrees with you and tells us. that maharlika will not generate more debt;

On the contrary, the sponsor says that the capitalization we would put into the MIF would be the basis and could be leveraged to attract and deploy more resources for our development needs. How can we understand this great divergence of thought between two obviously very intelligent people? Are you the minority leader? He is simply pessimistic, does not pay attention to Opportunities or is suspicious of the experts who would be recruited to lead maharlika. My second question to the minority leader, Mr. Speaker, would have been this. I appreciate the sponsor's sincerity when I revealed it. yesterday's information that it was the gsis president himself who originally proposed the maharlika fund to president dahil paul sr. president, the sponsor basically said what's wrong with that and explained that high returns often have to be secured through exposure to higher risks and success in such ventures are ensured by having the guidance of the brightest technocrats.

He reminded us in his turn meeting with a minority leader that the first version of the Maharlika bill sought the largest contribution from the gsis, a whopping 75 billion pesos, and what happens? With that minority leader, would you agree that it would be unpatriotic of us if we did not use our pension fund money in service of our national infrastructure development and business objectives? And then, Mr. President, I would have asked the minority leader what he cited on page four of his tour that there is a recent development that is also procedurally objectionable based on the Constitution when he cited that there is a power granted to the president under article 6 section 26 open parenthesis to close parenthesis of the 1987 Constitution which reads as follows and in part except when the president certifies the need for its immediate enactment to meet a Calamity or public emergency and then the minority leader He said that in reality there is no Calamity or public emergency before our very eyes that can be addressed by the Mahali Kabil, how could the fund with the promised benefits that will be felt within 10 to 20 years be the answer to a calamity or emergency existing public? that power given to the president under article 6, section 26.

Mr.President would then have asked the minority leader for his own opinion on whose idea the maharlika investment fund was. Where did this idea come from? Is it possible that we are doing this as a favor to a businessman who has access to the ears of the powers that be? whose business or results have been affected by the slowdown of the global economy and would therefore need a new client and expressed the hope that, hopefully, we will learn the identity of this great influencer in due time to finally respond to this persistent question. This idea really comes from the next Mr.

President. He would have asked the minority leader many follow-up questions about his descriptions of where the money for the sovereign wealth funds comes from; First of all, he cited oil-rich countries such as Norway, Russia and Middle Eastern countries, which contribute their FRS with money from oil sales, he cited Kuwait, which created its Fund in 1953 and currently manages more than 500 thousand million dollars in assets. He further cited the Abu Dhabi funds and the Saudi Arabian funds, which also established his funds. cited that Norway found oil in its EEZ in the Echo Fisk field in 1969 and only 12 years later or around 1981, after a dozen years of discussion, established its SFS, described that Norway's SWF is supervised by its Central Bank and Parliament, the legislative branch supervises the election of a mother of the administrators and that the fund invests very conservatively and only outside of Norway, perhaps the most important thing for us, Mr.

President, as an Asian legislator, the minority leader narrated how China Hong Kong and Singapore also have sovereign wealth funds, but they obtained their financing from their excess reserves thanks to the boom in Asian exports. In short, they had and continue to have trade surpluses. Why is this important, Mr. President? Because just a few pages later, a minority leader described our situation in the Philippines as not an export boom or a trade surplus, but our goods trade deficit, which amounts to between $40 and $60 billion a year, Mr. President , right now China, Hong Kong, Singapore, sovereign wealth funds and then, um, our trade deficit. was the minority leader said that $58.3 billion for 2022 is more than double the $24.6 billion recorded in 2020, so the downward trend in terms of our trade deficit may again be the opposite direction in which we should move China, Hong Kong and Singapore.

Sovereign funds and therefore they were allowed to establish those sovereign funds after Mr. President, the minority leader, cited that the Singapore temask managed the windfall profits he made from the properties left behind by the former colonizer of Singapore. Britain, the classic windfall, Mr. President, of any property left to us by our former colonizers. no Spain no United States and speaking of the United States Mr. President the minority leader mentioned that the state of Alaska has the Permanent Fund created in the 1970s when they found oil something that we still have to do even in our exclusive economic zone in the Sea of the Western Philippines, then Mr.

Speaker, the minority leader cited Chile's FRS funded by the sale of mineral resources mainly copper from Africa and Kanilang's FRS backed by the sale of diamonds. None of these fortunate circumstances that Mr. President gets in the Philippines right now as we contemplate establishing up the maharlika Mr. President ah Mr. President uh I will send a final statement in the sorry Mr. President I need to pause for about a minute and I think at minority leader would like to intervene in my uh use of your remaining 10 minutes, mr. president, mr. president, uh, my minority colleague posts some questions, uh, according to the rules, am I supposed to answer the question of Who is the president, majority leader, Mr.

President? I have yet to see anything, uh, according to the rules that the lathe and the country are subject to interpolations or asking questions and that is the main reason why when we finish the period of interpolations, we are aware that the next part of the procedure is open the period of general debates and now we are internal in condom, Mr. President, and after the turn of contrast speeches, we will consider whether someone is going to speak on behalf of the uh, a measure that is being deliberated. I present to you, Mr. Speaker, since there are no members who wish to speak on behalf of the measure so we close, Mr.

Speaker, take off your gloves, yes, I may have one minute left of the minority's 10 minutes, I will simply close the use of your 10 minutes in the tuna in the contract, yes, ma'am, thank you, Mr. President. For all the reasons stated by the minority leader in the story and the questions we were able to raise to the sponsor in tween, I also come before you to express my deep concern and opposition, as well as to the maharlika bill, specifically the Senate Bill 2020, which aims to create a sovereign wealth fund for our nation, although the intentions behind this bill may seem noble.

I think it is crucial to further examine the possible consequences and implications of such a fund before proceeding, as mentioned yesterday, with the creation of the maharlika. fund will outlive us first of all let us consider the issue of transparency and accountability the creation of a sovereign fund as proposed in the maharlika bill raises questions about proper management and supervision of the funds the supposed existing mechanisms are not sufficient to protect the billions of public funds that will be used for this purpose without robust safeguards there is a risk of mismanagement, corruption and misuse of public funds we must prioritize transparency and accountability in any financial effort of this magnitude the establishment of a sovereign fund diverse resources from pressing domestic needs, as our esteemed minority leader emphasized and with which I agree, our country faces numerous challenges that demand immediate attention and investment, such as education, healthcare, infrastructure development and poverty alleviation by channeling a significant portion of our national wealth into a sovereign wealth fund we risk neglecting these urgent priorities and failing to address the urgent needs of our citizens we must prioritize the well-being of our people over the accumulation of wealth, furthermore , it is important to consider the economic impact of the maharlika bill While a sovereign fund can provide some long-term economic benefits, we should not overlook the potential risks and disadvantages, the sudden injection of large sums of money into the economy can generate inflation that erodes the purchasing power of the average citizen. distort market dynamics and create imbalances that could have unintended consequences for our economy as a whole.

We must carefully evaluate the potential risks and compare them with the perceived benefits before committing to such a drastic measure. We must act with caution and consider the possible consequences of such a measure. We must prioritize transparency, accountability and the immediate needs of our citizens. The creation of a sovereign wealth fund should not come at the expense of neglecting urgent domestic needs, risking economic stability or compromising our international standing. Let us pursue policies that promote the well-being of all Filipinos and ensure a sustainable and prosperous future for our nation, Mr. President, thank you very much, our distinguished colleagues, Majority Leader, yes, Mr.

President, Mr. President, they are doing uh uh no more speeches about uh and Contra. I propose that we close the period of a general debate, Mr. President, there are objections to the motion, Mr. President, before continuing with the period of amendments. I propose that we recognize the distinguished gentleman from the great province of Fuente de Dios. They are serious colleagues, Senator Francis Jesús Lamb. He recognizes himself. Thank you, Mr. President, Mr. President, I rise to make a statement through Amicus curate to, as a friend of the Senate and Congress, record perhaps fatal procedural and substantive errors that we may be committing but that we can still correct Before final approval of this measure by both houses of Congress, let me begin, Mr.

President, by recording the provision cited above in committee hearings and debates. Article 12, section 16 of the Constitution states that Congress shall not accept provisions of general law. the formation, organization or regulation of private corporations, government-owned or controlled corporations may be created or established by special statutes in the interest of the common good and subject to the test of economic viability. I propose, Mr. President, that the creation of any gocc has three requirements number one it must be through an act of Congress number two it must be for the common good and number three it must pass the test of economic viability now Mr.

President, until now especially Being a special that has a special Charter that is clearly fulfilled by a law of Congress, number two should be approved, which is for the common good. This was discussed, Mr. President, in the debates in which someone asked if it is okay to organize a controlled corporation and government owned that will compete with the private sector or should we. limit government-owned and controlled corporations to only performing those functions that the private sector is unable or unwilling to perform and that have a stated public purpose, such as providing public services or public services or social services that the private sector does not considers appropriate. profitable enough for them to do it themselves, Mr.

President, it is clear that the intention of this sovereign fund is to perform functions that the private sector is already performing now, but it still has a government function, but it might have to be clarified in the provisions of the measure and third Mr. President, your honor, the economic viability test must also be passed, Mr. President, I would like to record in the minutes of the concom debates regarding this phrase that was inserted by the then delegate of the concon, Uplay, when he described it saying Goccs cannot be created as a rule, but only as an exception and must pass the test of economic viability.

I specifically explained and cited that Congress must evaluate and be able to decide thatIndeed, the creation of the GOCC passed the test of economic viability. I would like to put on the record as well, Mr. President, the entire Russia case and dissent of 2006. MIAA versus CA case for reference now Mr. President, um, I submit that documents that supposedly meet an economic viability test do not meet the demands and requirements of the Constitution. Al or the minority trader previously said that it is a scam, it is a harmful issue. My position, Mr. President, is that he is a conditional president before we vote, approve and create this government.

I would also like to record at a certain place in the minutes, Mr. President, for reference, the three-page document submitted in purported fulfillment of my demand to submit an economic viability test titled business proposal for maharlika investment fund along with a letter of presentation dated February 21, 2023 addressed to the Honorable Marque Villar signed by the treasury of the Philippines Rosalia v um de Leon Mr. President, your honor, I maintain that you are not obedient because all you talk about is investment in securities and stocks, when the secretary of dbm in the lawyer newspaper said that they will invest in the 194 emblematic infrastructure projects of the administration, then clearly this document is already insufficient, incomplete because it does not discuss the economic aspects. viability of investments in these infrastructures Flagship programs that may not generate any return on investment (ROI) let me now state for the record, Mr.

President, what exactly is meant by proof of economic viability, if I may cite the term proof of Economic viability which refers to a method of assessing the financial viability of a given business idea or project, this test assesses whether a particular project has the potential to generate sufficient revenue to cover its cost and operate profitably. Typically, proven economic viability involves analyzing market demand, competition, profit margins, operating costs, and other affecting financial factors. the success of the proposed business the test of economic viability is often used by investors, lenders and other interested parties in our case, Mr.

President, a requirement imposed by the Constitution, I submit, Mr. President, that it is insufficient because the business proposal um for the maharlika fund do not even include in the calculation the two percent of the overall microphone costs to continue running the fund, Mr. President, if I may quote the meaning of the economic viability test for a sovereign fund the test of Economic viability for a sovereign fund refers to the assessment of whether the funds' investments and operations are financially sustainable and profitable in the long term, this involves assessing the fund's ability to generate returns that meet or exceed its financial obligations, such as paying dividends. to the government or support the country's economic development objectives, as I said in my interpretation. interpolation before what is the rate of return of the government agencies in charge that we require to invest in this fund to continue Mr.

President, the feasibility test usually involves analyzing various factors such as the next size of the fund, investment strategy, governance , diversification, risk management and its performance. We should also take into account the size of our economy compared to other economies so that we can know exactly if it will be economically sustainable and viable. Mr. President, I believe that there is still time for us to comply with the constitutional requirement to avoid constitutional scrutiny in the possibility of this law being repealed for failing to comply with the conditional precedent required and enshrined in our constitution. I do not blame anyone, Mr.

President, your It is an honor because it is a new provision inserted by the drafters of the 1987 Constitution and not found in the previous constitutions of 1935 and 1973. Frankly, there are only two cases that made mention to this but they didn't even define exactly what it should contain. The government has the opportunity, Mr. President, to define it, not only define it, but also specify who is supposed to prepare it. The document presented, Mr. President, is not even signed, although it has a letter of introduction, it is not even signed and, although I am our national. Treasurer Mamlia is competent in what she is doing.

I doubt our office will be the one to make this proven economic viability without the Nether itself or even through the Neda ICC. From now on, Mr. President, when we create another government, we would be asking the same questions. and it will be appropriate, I suppose we resolve this so soon. I'm not going to be the one to go to the Supreme Court to challenge this, Mr. President, but if someone did, I think I see it as an opportunity. clarify that provision of the Constitution so that the Senate and this Congress can be guided accordingly regarding their future actions and we should now begin creating new government-owned and controlled corporations.

Thank you, Mr. President, I present, thank you very much, we take note of your statement put on record thank you Mr. President Mr. President at this moment I propose to open the period of amendments so move Mr. President there will be a period of objections to amendments the amendments are open individual can petition the president uh with no committee amendments I propose that we open the individual amendment period for the president to be the president at this juncture a measure that we recognize the sponsor of the measure, the distinguished Deputy Majority Leader, Senator Mark Villar, for his participation in the amendments.

The deputy majority leaders were recognized. And can I ask the secretary to give me a copy of the report? The session was suspended for a minute because we are requesting documents with line numbers. These particular ones don't have such a special session. foreign foreign foreign foreign foreign foreign foreign foreign foreign we will do this the way we have been doing it for the last three congresses, which is basically we will start with the amendments page by page, so those of you, my dear colleagues, who have amendments, please make sure We are looking and making sure that the page has the number and the line so that if the sponsor does not read it, if you sent the amendment to the sponsor and by mistake or for any reason it is not fed, but it is a sponsor , you can get up and propose the amendment, but we will go page by page of the amendments that are still in the room, please come back to the room so we don't have to go back to the pages that were already approved, so leader of the floor majority, should we acknowledge that it is, Mr.

President? I proposed the previous question, Mr. President, since we have already opened the period for individual amendments. I proposed that we recognize the distinguished sponsor of the measure, our deputy majority leader, Senator Mark Villar, our distinguished deputy majority leader and sponsor of the measure. Senator Mark Villard Mr. President, before presenting my individual amendments, I would like to thank our colleagues for their helpful and fruitful participation in refining your provisions of the proposed Maharlika Investment Fund Act, 2023. as a result of our interpolations and after From further individual scrutiny of our substitute bill reported in our committee report, this representation would like to submit the following as my individual amendments to the bill in the first paragraph of the First Amendment of section two on Statement of Policy in page one line three in section two on the Policy Statement, after the word two and before the word create, insert the phrase generate, preserve and grow the national wealth so that the new first paragraph of section two read as follows: Section 2 Policy Statement is the policy of the state to generate preserve and grow national wealth create jobs promote trade and investment Encourage technological transformation strengthen connectivity expand infrastructure and achieve energy, water and food security ISO moves its honor if there is objection to the promotion the amendment is approved our Second Amendment is in the third paragraph of section two on Policy Statement, your honor, this is the amendment of our colleague senator legarda on page 1, line 11 , insert a new paragraph stating that the state further recognizes the country's natural capital and its role as the basis of the economy, therefore, they need to ensure its integrity and measure its contribution to the national income account in national income accounting to improve decision-making and investments in the conservation and protection of natural resources and biodiversity the old third paragraph of section 2 will now become the new fourth paragraph of the same section ISO move Your Honor, are there any objections ?

There is none. The emotion is approved before moving on to the next amendment. I would just like to remind the Secretariat to take note of this and, if possible, as soon as we leave the page, print it so that we can have a clean copy immediately once all pages have been read and approved, all Amendments have been read and approved so that we have a clean copy for everyone to review. uh, continue, the sponsor, thank you, your honor, Third Amendment, Section 3 in the definition of terms inclusion of the definition on divestment on page 2 line 11 insert a new section 3C that will read as follows C divestment is the transfer of title or alienation of interest in property by voluntarily waiting one second this is on page two a section three of the definition of terms page two line eleven okay so are there any more amendments on page one?

I just have to be sure and clarify if there are any more amendments on page one. There is none, so let us proceed with the honor of him, thank you. honor so uh on page two line 11 insert a new section 3C to read as follows C divestiture is the transfer of title to or alienation of interest in property by voluntarily, completely and actually depriving, or dispossessing, of its right or title on it in favor of a person or persons other than its relatives and relatives, the former section 3C which refers to the financial institutions of the founding government will be renumbered accordingly.

I show you, your honor, is there any? Oh, there is style, did I hear right? Mr. Sponsor, you said that the word is is that divestment is yes, so for consistency, all of your definitions indicate that they refer to, so if you want to be consistent, I recommend that I suggest that you use the word refer to a or refers to Yes, uh, because everything is referred to thank you if it is subject to style something that we take note of there is some objection to the amendment by Mr. de Las Pinas there is uh Senator Angarez acknowledged no there is no objection in fact I support the amendment Mr.

President but No? It would be better if we indicated the degree of relationship, whether it is consanguinity or affinity and to what degree, when you say family or relatives, because that is very general, I don't know, maybe something, something, I am supporting you, Mr. Sponsor. but maybe it's better if you decide what your fourth degree of concern is Community you are the lawyer your owner maybe we ask you about the legal terminology in terms of marriage the reference point is the fourth degree if that is Anyone I think even when it comes to uh Provisions that are conflicts of interest, it's up to the fourth degree of maybe we can check your honor and if I may suggest that we go back to that, let's review banking laws and the like.

Yeah, I think we need to finish this page too because why don't we pick a number for fourth grade? But some researchers check what is the common usage in front of me, I mean, in front of me is a battery of lawyers. then these lawyers or the degree of consanguinity and affinity what is that of the Constitution yes consistently courts and the Constitution is fourth degree of consanguinity and affinity language for this within the fourth civil degree no the language of the will not be accepted that Amend your Amendment yes , we accept the amendment Style, the Fourth Amendment is accepted section three on the definition of terms in parentheses inclusion of the definition of regular director on page two line 17 insert a new section 3E that will read as follows regular director refers to a director appointed by the President of the Philippines, who shall serve on the board full-time and shall hold no other public office during his term of office, unless otherwise provided in this law.

The former section 3E, which refers to the maharlika investment corporation, will be renumbered accordingly. Your Honor, there have been objections to the approved amendment, Mr. President, yes, no, not about this amendment, but I noticed that we showed it. Can you type if it is long? So maybe give us a copy if it's short because it's like I missed the I have a meeting with me the list of them and the master that you're reading let me give it to thegovernment institutions mentioned by Senator Rafi in the section referred to in our other colleagues' amendments, below, what is the pleasure of?

The body, there is a Senator Tolentino is acknowledged, yes, thank you, Mr. President, before we make this proposal, uh, transportable, Mr. President, may I ask the proponent of the amendment, Senator Tulfo, uh, with permission from uh yesterday, the mention of the and other social governments, uh, Mr. President? uh and the aforementioned Mr. President of any other government social welfare entity. Could we know the exact meaning of this for clarity? We will include uh pcso, are there other government agencies involved in social welfare activities? Thank you Mr. President, anything that contributes to the social welfare fund and PCSO, yes, it is included, you know, so maybe we could also name or specify such entities for clarity purposes, PCSO, there are other courses, but is that I think they are, I think the financial managers wanted to use the investable income from the Sparta Pack course so that you can.

I know there is no objection from my majority leader because the gaming agency obviously funds, so do you want to limit your honors to SSS for EB gsis? He owes our funds and then one mentioned that his pension is the Philippines. office of the veterans affairs fund agencies of the office of pension funds if that is acceptable to the agency, we do not have to add the word and other social governments and other government social welfare funds could be limited to those governments, so the states were in this section six per line 28 to 30. we would like to recognize the sponsor of the amendment Rafi Tulfo Center I think you are going to make an amendment to your amendment okay, Mr.

President, I'm just going to undo or delete the word and others governmental social welfare entities yes please yes uh I accept subject to the style the topic is accepted thank you Mr. President thank you senator okay uh on page three line 33 after the word thereof insert the statement for this purpose a single private sector The Shareholder interest includes direct or indirect interests in MIC held by the shareholder, as well as those held by the corporation, its subsidiaries, affiliates and related parties that are owned or controlled directly or indirectly by the shareholder, so the new Article 62 will remain as follows: two preferred shares of 1,250 million equivalent to 125 billion pesos that will be available for subscription by the national government, its agencies are goccs or gfis instrumentalities as well as financial institutions and private corporations of good reputation yes yes if i ever mentioned yes except uh gsis veterans fund so we have to include that in your amendment.

Yes, so what can we do when you read the paragraph, your honor, my dear sponsor? Maybe you can limit it to the line you are modifying without having to read the entire paragraph. because we are going back on yes and then you are missing the author's amendment so repeat the amendment on line 33 or line 30 yes so we will repeat the amendment uh for this purpose a single private sector Shareholders' interest includes holdings indirect from the director and the microphone helped by the shareholder, as well as those who own the corporation, its subsidiaries. Affiliates and related parties that are owned or controlled directly or indirectly by the shareholder.

I present your honors and then incorporate the modifications that exist. There have been evidentiary objections, the object is that it is subject to passage, okay, page four, your honor, this is our colleague Senator Angara's amendment with amendments, this is on page four, yes, this is on page four lines, ask my colleagues, no more amendments for page three, okay. so, page four, continue with pages, sorry, on page four, lines 2 to 16 after the word dividends, delete the entire section of lines 2 to 16, starting from the word four and ending with the word guarantee , replace it with a new paragraph that Will read as follows for the first and second fiscal year after the entry into force of this law, 100 percent of the total deterred dividends of the BSP calculated according to number ra 7653 modified by number ra 11211, also known as the new Central Bank law, will be sent to the national government for the capitalization of the micro for an amount that does not exceed that of the initial subscription of 50 billion pesos of the national government to the capitalization that could be seen under this section provided that the monetary board may recommend to the president of the Philippines the reduction of the dividend contribution of the bsp to the mic whenever economic conditions justify it, the dividends of the bsp shall be remitted to the national government to finance the increase in capitalization of the bsp in accordance with Article 2 of RA number 7653 modified by RA number 11211.

ISO moves your honor, it is the same paragraph, Mr. President, except mine is to eliminate the bsp, Mr. President, so to be more precise in my proposal , Mr. President, on page four lines two to six, delete uh, lines 2 to 16, delete starting with the phrase Bank. Central and Philippines to the semi-colon and remember accordingly, Mr. President, and let me just mispresent with your permission, let me justify my proposal, Mr. President, to ensure that the BSP is increasing capitalization is fully realized as soon as possible to strengthen the institution given the growth of the banking industry over the years, this is also to maintain the credibility of the BSP, since when RA1121 was approved, Congress was made to believe the urgency of increasing capitalization, diverting funds that were supposed to finance the capitalization of the microphone. sets a bad precedent for future legislation when it comes to the BSP, further recapitalization of the BSP may be necessary in the course of various cycles of monetary policy easing and tightening, so we must ensure that the financial position of the BSP remains being strong going forward.US Fed and BSP easing conditions and US recession uh next main session for a minute foreign state is um oh sorry session suspended from the state is that there was a proposal in uh on line two or on page four by the good. sponsor and the amendment to Senator Cotalian's amendment which was basically to eliminate the entire section, eliminate the entire section.

I would later recognize the minor as the majority, Mr. President, this is just a retort and as part of our interpolations on this particular measure. this representation reminded the body that we voted on our one one two one one, which is the new amended Central Bank law that increases the capitalization of a BSP from 50 billion to 200 billion. The reason for the increase, Mr. President, is to enable the Central and Philippine Bank to deal with crises, Mr. President, so I just wanted to put this on the record, Mr. President, that for consistency, we just wanted to put on record that this It is also our position and we submit to wisdom. from the distinguished sponsor of the measure, thank you perhaps as a sponsor for responding, yes, your honor, we discussed, I appreciate the comments and we discussed this issue during the interpolation and the bsp and you have already said that.

There they can, they are willing to defer and this is acceptable to them and their economic team has already expressed that dividends it is a priority for them that the dividends received from the BSP are used for the Maharlika Investment Corporation. so I do not accept the amendment, so we think we thank the gentleman from Venezuela for an earlier motion, but the sponsor does not accept it and I am also happy that the gentleman accepts it. Thank you, so let's proceed, donors, next amendment. Yes. um, may I, your honor, may I ask what that was? Sorry, we just amended Philippine Dividend Section I to line two to 16.

So what's your next amendment, your honor, overseas, we're now on page five. so there are no more amendments on page four, are there any amendments on page four, my dear colleagues, Senator legarda, Senator um, Senator angara, there are no amendments on page four, if there are none, we proceed to page five , yes, section six of the Ninth Amendment on capitalization, initial financing, uh on page five delete the Provision in lines one through five that states that the previous contribution will be subject to automatic review by the Secretary of Finance every five years taking into account consideration of the sufficiency of the fund in relation to the objectives of this law. fiscal condition of the national government the condition of investing in IGF in relation to its exposure to the fund and the general economic environment ISO asks the Honorable Member to remove this, it seems like a protective measure to me, but I may not be following it well.

It was during the deliberations that uh uh this provision is questioned by I don't remember so it's an amendment by who can you ask Is it a proposal by a colleague from Arts to eliminate first discuss uh your honor your honor this was discussed during the interpolations while, but I try to understand who it was, but someone said that this is necessary. I remember if my memory serves me correctly. The argument was that this is unnecessary. Why they wondered why it is necessary every five years. This fund will probably have been fully funded long before the five years are up, so this may be unnecessary.

Any comments for my dear colleagues, if not, we will accept it. Yes, there is a comment from our dear colleagues. Senator Legardo uh foreign foreign foreign foreign foreign foreign foreign foreign I believe that on page five the provision of lines one to five should be deleted and I first proposed the deletion, your honor, there are no objections to the motion to delete, none were accepted motion. I think there is a proposal to replace it with another provision later. because we are still in section seven and there are previous proposals, your honor, we are still on page five, so please continue, we are now on page five, line 23. the Tenth Amendment section. 6 9 23 there are no subsequent amendments, so nine twenty before 9 23.

I mean, there are several competing with their hands one by one, we will start with the baton of Senator De la Rosa, lord of the sideline. This concerns uh Mr. President, uh page five blinds 13 to 14 You already mentioned line 20, so yeah, I have to sound that they need to buy one. Yes, it's okay with a good sponsor. On page five, lines 13-14, last paragraph of section six, replace any praise requested or required to contribute. with the praise used to finance how the Tweet will be funny, sir, yes, read the line, how will it be page five, lines 13 to 14.

Then you will respond from section six, yes, yes, Mr. President, I just have to confirm with Senator Lauren. because we have a similar amendment that I am used to funding, in fact, Mr. President, can we ask for a one-minute adjournment because you proposed an amendment on the same line, on the same page, Mr. President, just to consult among ourselves maybe yes Maybe they can harmonize? thoughts of each one special suspension Mr. President