Government cuts GOCC subsidies to P7.6 billion in February

MANILA, Philippines — The government reduced its budgetary support to state-run firms by 40 percent to just P7.6 billion in February, with the bulk of the subsidies meant to fund irrigation projects.

Data from the Bureau of the Treasury showed that subsidies to government-owned and controlled corporations (GOCCs) went down by 40.4 percent to P7.57 billion in February from P12.72 billion in the same month last year.

During the month, budgetary support for major non-financial government corporations plunged by 67 percent to P3.24 billion.

On the other hand, subsidies for other government corporations more than doubled to P4.27 billion from P1.9 billion a year ago.

The remaining P63 million went to government financial institutions, particularly SB Corp.

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

For February, more than 40 percent of the total subsidies went to the National Irrigation Administration at P3.16 billion.

However, this was a 56-percent drop from the P7.09 billion it received in the same period last year.

The Bases Conversion and Development Authority secured the second highest subsidy at P1.94 billion, while the Philippine Fisheries Development Authority came in third with P975 million.

Other top subsidy recipients during the month include the health sector through the Philippine Heart Center, National Kidney and Transplant Institute and the Philippine Children’s Medical Center.

The agriculture industry also secured subsidies via the Sugar Regulatory Administration.

For the two-month period, subsidies slipped by six percent to P11.96 billion from P12.72 billion.

In February, the government reverted back to a budget deficit of P171.4 billion after a quick surplus of P68 billion in January as spending outpaced revenue collections.

During the month, overall government expenditures rose by 8.9 percent to P423.2 billion while revenues only grew by 12.4 percent P251.8 billion.