Treasury assures Maharlika fund’s integrity

Published December 7, 2022, 3:01 PM

by Chino S. Leyco

The Bureau of the Treasury assured the public that the government will impose safeguard measures to ensure the integrity of the proposed Maharlika Wealth Fund (MWF).

In a statement, National Treasurer Rosalia V. De Leon said on Wednesday, Dec. 7, that the bureau supports the establishment of a P250 sovereign wealth fund as this would ultimately benefit the Filipino people.

De Leon also said that they are open to more public consultation to improve the proposal.

“We support the calls to study the bill to ensure that risk management is in place,” De Leon said.

But as early as now, she said there are already at least eight measures that will safeguard the integrity of the Fund.

First, the MWF will strictly adhere to the Santiago Principles. Second, all financial transactions shall be governed by the applicable government laws, rules, and regulations.

Third, there will be an internal audit that includes financial reporting and audit of records.

MWF board will appoint an internal auditor who shall provide written interim financial and management reports, the treasurer said.

Fourth, there will be an internationally recognized auditing firm that will be the external auditor of the Fund.

Fifth, the Fund will be under the scrutiny of no less than the Commission on Audit.

“The books and accounts of the MWF shall be subject to the examination and audit of the Commission on Audit pursuant to Article IX of the 1987 Philippine Constitution,” De Leon said.

Sixth, there is an advisory body that will assist the board of directors in the formulation of general policies related to 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,” she said.

The advisory body is composed of the Secretary of Finance, the Secretary of Budget and Management, the Treasurer of the Philippines and the Socioeconomic Planning Secretary and Director-General of the National Economic and Development Authority.

Seventh, there will be a Joint Congressional Oversight Committee tasked to oversee, monitor, and evaluate the implementation of the Maharlika Wealth Fund Act. This will be composed of five members each from the House of Representatives and the Senate.

Finally, 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.

“We agree that we need to ensure that all these safeguards are in place for the protection of the funds of the people,” De Leon said.

“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 concluded.