Friday, March 9, 2012

News Update 2011 State Subsidies Reach P53.7B

MANILA, Philippines - The government's expenses in subsidizing the operations of state-owned and controlled corporations (GOCC) grew more than double last year, data from the Bureau of Treasury showed Thursday.
The Aquino government's subsidies to GOCCs from January to December last year reached P53.705 billion, higher compared with P21.005 billion it spent in the previous year, the treasury data revealed.
In 2011, bulk of government's financial aid was distributed to National Housing Authority wuth P16.197 billion, Land Bank of the Philippines with P7.932 billion, Philippine Health Insurance Corporation with P6.639 billion as well as National Power Corporation with P6.624 billion.
Other GOCCs that enjoyed finance support from the government were National Food Authority with P2.525 billion, Light Rail Transit Authority with P1.868 billion, National Dairy Administration with P1.67 billion, National Livelihood Development Corporation with P1.438 billion and National Home Mortgage Finance Corporation with P1 billion.
The finance department has been attempting to reduce subsidies in favor of equity infusions because higher subsidies run counter to its goal of making these firms self-reliant and less dependent on financial assistance from the government.
Next year, the government has programmed a P18.171 billion subsidy to GOCCs.
In December alone, the government spent P8.496 billion, almost double compared with P4.685 billion in the same month last year.
In June, President Aquino signed into law the GOCC Governance Act of 2011, which provides for the rationalization of salaries and benefits of officials and employees of government companies.
The President said bloated salaries of top GOCC officials lead to the unwieldiness of such institutions.
The new measure will create a Governance Commission for GOCCs (GCG) which shall be composed of five members - chairman with the rank of Cabinet secretary and two members with the rank of undersecretary to be appointed by the President-and the Budget and Finance secretaries as ex-officio members.
The commission shall develop a new position and classification system that will apply to all officers and employees of GOCCs, whether covered by the Salary Standardization Law or exempt from it.