This is not the first time the Philippine Congress passes a useless measure. It will not be the last.
With supermajorities in both chambers, Congress has passed the bill establishing a Maharlika Investment Fund (MIF). The bill was certified urgent by the Palace.
With majorities that large, it should not be surprising a bill as potentially inconsequential as this one would pass. The ruling coalition could introduce a bill claiming sovereignty over the moon and that too will pass. It does not matter that we could not enforce it.
The most important amendment to the MIF bill is the explicit banning of contributions coming from our main pension funds, the SSS and GSIS. The two funds might have been the largest source of money for the MIF.
Without the two pension funds, the MIF will now have to rely on investments to be made by the two state banks, the LBP and the DBP. This will produce a rather insignificant investment fund by global standards. Meanwhile, the two banks will have less available for development lending.
Through all the debate, supporters of the MIF never arrived at a clear statement of purpose for setting this up.
If it is to grow capital for future generations for Filipinos, then it should be primed with enough nimbleness to outwit and outmaneuver the giant institutional investors out there. It should be enabled to roam all the world’s markets scouring for the biggest returns. It must be super profitable to make it worthwhile. Then the money it accumulates from its smart operation as an institutional investor should be locked in for future generations to enjoy. In which case, it contributes nothing to our near-term development goals.
If the purpose is to serve as a source of project funding for development projects, then it must be able to offer cheaper loans than other alternatives such as official development assistance (ODA) granted by friendly entities. Remember that most ODA earn nothing but goodwill for the countries and multilateral institutions lending them out. To provide a better option for ODA borrowing, the MIF must earn nothing.
The two state banks from which money will be garnished are quite profitable as things stand. They have lent out hundreds of billions to micro, small and medium enterprises (MSMEs) – with great administrative costs that accompany all small lending. The MIF must prove itself capable of lending at better rates to spur development even as it might have to hire expensive financial experts to operate the fund. Remember: if you pay peanuts, you get monkeys.
The bill might not mandate a minimum earning level for the MIF. But that level should be implicit as it is for everyone else. If it nets less than the prevailing inflation rate, then the fund suffers from capital decay. It will be worth less as the years go by.
Perhaps, the MIF might have some use later – if we discover a rare mineral the market needs or strike oil at Liguasan Marsh. The financial windfall could then be contributed to the fund to conserve its value for future generations. Short of that, the MIF will just be a small fund with mediocre earnings but with an expensive staff to keep it going.
At the moment, our problem is the mounting national debt that is inching closer to P14 trillion. The MIF will do nothing to reduce the debt. At best, it will provide a costly source for new borrowing.
Orphaned
Nothing is sadder than the sight of orphans struggling to become normal human beings despite the childhood development challenges.
Fortunately, there are charities that support orphanages that, in turn, strive to provide the care enabling orphans to cope with their challenged life. But we cannot presume total altruism in these institutions. Government needs to be vigilant in setting standards for these charitable institutions.
Over the last weekend, the DSWD shut down a childcare facility called Gentle Hands, Inc. (GHI) for substandard operations. The shutdown must have been traumatic for the children under the orphanage’s care as they were abruptly transferred to government facilities.
The National Authority for Child Care (NACC), an attached agency of the DSWD which oversees adoption processes, had apparently received derogatory reports against the orphanage. NACC executive director Janella Ejercito Estrada revealed some of these reports adverse to the operation of this particular institution.
The NACC, says Ejercito, is investigating several disruption cases involving apparently disturbed children formerly under the care of GHI. One child attacked her adoptive parents with a knife in at least five instances. Another had to be confined in the bathroom.
These cases involve children adopted by families in the US. They will be transported back to the Philippines for mental health assessment by the DOH. The instances of seriously disturbed children raises questions about the quality of care they received at GHI.
After the DSWD’s closure of the GHI facility in Project 4, the Quezon City Fire District revoked the fire safety inspection certificate of the orphanage. The fire authorities say the facility holding scores of children is a fire trap.
The children staying at the GHI facility receive home schooling. The authorities are now assessing the adequacy of the education programs provided them.
Orphanages receive donations from charities here and abroad. The director of GHI is a Canadian with a Philippine work permit.
The least government can do is to assure the generous donors to institutions like this one that the orphaned children receive the best care and protection possible.