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Business

Subsidies to GOCCs shrink by nearly 50% in 6 months

Louise Maureen Simeon - The Philippine Star

MANILA, Philippines — The government trimmed its budgetary support to state-run firms by nearly 50 percent to P44.69 billion in the first semester, according to the Bureau of the Treasury.

Data from the Treasury showed that subsidies to government-owned and controlled corporations (GOCCs) declined 49.38 percent to P44.69 billion from P88.28 billion in the same period last year.

In June, however, subsidies picked up 48 percent to P12.33 billion from P8.34 billion a year ago.

For January to June, budgetary support for major non-financial government corporations reached P32.71 billion, up 2.35 percent, while subsidies for other government corporations plummeted almost 80 percent to P11.77 billion.

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

For the first half, the biggest or 41 percent of total subsidies went to the National Irrigation Administration at P18.35 billion, increasing by 8.9 percent from last year’s P16.84 billion.

The National Housing Authority secured the second highest subsidy at P8.94 billion, while the National Food Authority came in third with P3.24 billion.

Other top recipients during the semester also include the Bases Conversion and Development Authority with P2.17 billion, Philippine Fisheries Development Authority with P1.69 billion, and the Philippine Children’s Medical Center with P986 million.

For the first semester this year, all state-run firms got subsidies from the government as compared to five GOCCs that did not get any last year.

But for June alone, GOCCs that did not get any subsidy include the Local Water Utilities Administration, National Food Authority, National Power Corp., Bases Conversion and Development Authority, Philippine Crop Insurance Corp., Social Housing Finance Corp., and the Sugar Regulatory Administration.

During the January to June period, government expenditures went up by almost 10 percent to P2.4 trillion, even as revenues improved 16 percent to P1.73 trillion.

The government managed to narrow its deficit by 5.84 percent to P674.2 billion in the first half.

Subsidies for GOCCs dipped almost 20 percent to P185 billion last year after the government slowly removed budgetary support for state-run firms as the economy reopens from the pandemic.

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