MANILA, Philippines - The government more than doubled its spending for subsidies to state-owned companies in October, driven by the additional funding support extended to the electricity program of the Aquino administration.
This was contrary to the government’s goal of encouraging state-run firms to become financially independent.
Data from the Department of Finance showed that subsidies to government-owned and -controlled corporations surged 182 percent in October to P1.43 billion. The amount was nearly three times the P507 million financial aid given to GOCCs in the same month a year ago.
The National Electrification Administration (NEA) was the biggest recipient of state subsidies which got P670 million followed by the National Power Corp. (P211 million).
Substantial funds had been released to the NEA to energize off-grid communities as part of the Sitio Electrification Project (SEP).
The NEA was directed to revise the remaining barangays that do not have access to electricity.
According to the Department of Budget and Management, a total of 16,467 sites had been completely energized through the SEP since 2011.
The three other agencies that received the highest financial support include the Social Housing Finance Corp. (P158 million) Tourism Promotions Board (P125 million), and the Philippine Coconut Authority (P119 million).
For the 10 months through October, the government spent P63.6 billion, up 77 percent from the P35.9 billion in the same period last year.
The biggest beneficiary during the 10-month period was Philippine Health Insurance Corp. (PhilHealth) which received P35.3 billion or more than half of the total spending for subsidies.
The four other GOCCs that made up the top five recipients of government aid were the National Housing Authority, NEA, Philippine Deposit Insurance Corp. and PCA.
The financial support, both subsidies and equities, granted by the national government to state-owned firms, is partly compensated by the dividends and guarantee fees collected from these corporations.
Many GOCCs are mandated by their charters to remit at least half a percent of their net income to the national government as dividends.
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