Government cuts GOCC subsidies by half

MANILA, Philippines — The government reduced its budgetary support to state-run firms, cutting by 50 percent to just P6.2 billion in November last year, as overall spending was slashed during the period in review, according to the Bureau of the Treasury.

Data from the Treasury showed that subsidies to government-owned and controlled corporations (GOCCs) in November last year dipped by 50 percent to P6.17 billion from  P12.33 billion a year earlier.

During the month, budgetary support for major non-financial government corporations reached P2.99 billion, also down by nearly 50 percent, while subsidies for other government corporations also declined 52 percent to P3.18 billion from P6.55 billion a year ago.

The government grants subsidies to GOCCs as a way to cover operational expenses that are not supported by their own revenues.

For November last year, a third of the total subsidies went to the National Irrigation Administration (NIA) at P2.04 billion.

Same period in 2021,  the NIA got a slightly higher subsidy from the government at P3.97 billion.

The Philippine Health Insurance Corp. secured the second highest subsidy at P1.35 billion while the Civil Aviation Authority of the Philippines came in third with P490 million.

During the month in review, GOCCs that did not get any subsidy are the National Home Mortgage Finance Corp., Local Water Utilities Administration, National Electrification Administration, National Power Corp., and the Bases Conversion and Development Authority.

Also included are the Duty Free Philippines Corp., National Tobacco Administration, Philippine Crop Insurance Corp., Philippine Fisheries Development Authority, Social Housing Finance Corp. and the Sugar Regulatory Administration.

For the 11-month period, subsidies slightly went down two percent to P160.34 billion from P163.41 billion a year ago.

From January to November last year, budgetary support for major non-financial government corporations reached P68.69 billion, up 10.5 percent, while subsidies for other government corporations declined nine percent to P91.33 billion.

Government expenditures went up by 10.2 percent to P455 billion in November last year while revenues improved by 17 percent to P331.1 billion.

The budget deficit during the month eased to P123.9 billion.