GOCC subsidies down 18 percent to P164 billion in 2023

MANILA, Philippines — Budgetary support to state-run firms slipped to P164 billion last year amid a tight fiscal space but the health and agriculture sectors remain the priorities for subsidies.

Latest data from the Bureau of the Treasury showed that subsidies to government-owned and controlled corporations (GOCCs) went down by 18 percent to P163.54 billion in 2023 from P200.41 billion the year prior.

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

Last year, the administration slowly cut down on subsidies as it continued its fiscal consolidation aimed at reducing both the budget deficit and overall debt.

Some 54 percent of the subsidies at P88.21 billion went to other government corporations. But this was 28 percent below the 2022 level of P122.46 billion.

Support for major non-financial government corporations reached P74.7 billion, slightly declining by four percent from P77.51 billion in 2022. It cornered 46 percent of the total subsidies.

The remaining P629 million went to government financial institutions, recording a 46 percent increase in subsidies. The entire amount was released to the National Home Mortgage Finance Corp.

Per agency last year, the bulk or 31 percent of the subsidies specifically went to the Philippine Health Insurance Corp. at P50.75 billion.

In 2022, PhilHealth also received the largest subsidies among all GOCCs but at a higher allocation of P80.05 billion as the government still dealt with the pandemic.

The National Irrigation Administration secured the second highest subsidy at P40.74 billion, almost the same as its previous allocation of P40.66 billion.

The National Housing Authority came in third with P18.27 billion which was 6.7 percent higher than its subsidies in 2022 at P27.13 billion.

Among other recipients of large subsidies last year are the National Food Authority (P10 billion), PSALM Corp. (P8 billion), Philippine Crop Insurance Corp. (P4.6 billion), Bases Conversion and Development Authority (P4.4 billion) and the Philippine Fisheries Development Authority (P3.7 billion).

On the other hand, the smallest subsidies went to the Philippine Ports Authority (P36 million), Zamboanga City Special Economic Zone Authority (P41 million), Aurora Pacific Economic Zone and Freeport (P48 million), Credit Information Corp. (P60 million), Southern Philippines Development Authority (P75 million) and the Philippine Tax Academy (P99 million).

Last year, overall government expenditures went up by three percent to P5.34 trillion while revenues improved by eight percent to P3.82 trillion.

The budget deficit eased to P1.51 trillion in 2023.