MANILA, Philippines - Budget Secretary Florencio Abad is opposing proposals to cap compensation for executives of government-owned and -controlled corporations (GOCCs), as well as government financial institutions (GFIs).
In an interview with ANC, Abad instead suggested a review of the pay scale of GOCCs and GFIs. He said this should be patterned after corporations in the private sector.
"Enacting a law may be too rigid. This may require them to be competitive with the private sector and therefore, if you put a legislative cap on them, it will be difficult to make changes later on," Abad said.
"But you have too look at the comparison between what do GOCC and GFI officials make in relation to their counterparts in non-government agencies, and also in relation to their counterparts in the private sector," he added.
Some senators had proposed a salary cap for state-run firms after huge paychecks, allowances, bonuses and perks of certain government officials were exposed.
In a hearing of the Senate committee on finance on Tuesday, its chairman, Sen. Franklin Drilon, recommended the creation of appropriate legislative measures to rationalize and standardize to reasonable level the compensation package of officials and board directors of GOCCs and GFIs.
Drilon said this will be done to promote public trust, and protect much-needed government funds.
“In these difficult times, when workers both in public and private sectors are clamoring for more decent pay, such reports of excessive and unwarranted benefits and privileges being enjoyed by top officials and board directors of GOCCs and GFIs only exacerbate the level of discontent on the part of our poor countrymen,” he explained.
“[This] seemingly anomalous situation has been going on for too long, primarily because of the powers vested in the boards of these institutions to determine and fix their own compensation and benefits.”
Drilon has filed a resolution directing the committee on finance and committee on government corporations and public enterprises to conduct an investigation into the excessive benefits received by top government officials.