MANILA, Philippines - Subsidies extended by the government in February more than doubled compared to the previous month and reflected a marked increase compared to year-ago figures.
The government extended a total of P3.193 billion in subsidies in February, more than twice the P1.12 billion in subsidies given to state-owned firms in January, according to the latest report from the Department of Finance (DOF).
In February 2010, subsidies amounted to only P34 million, a mere drop in the bucket compared to the latest figures, data also showed.
The P3.193-billion subsidies extended in February brought the end-February disbursements to P4.316 billion.
Of the amount, the state-owned National Power Corp. (Napocor) received the biggest subsidy of P2 billion in February.
The National Housing Authority received P574 million during the month while the Bases Conversion Development Authority (BCDA) received P301 million.
Other recipients during the month include the National Livelihood Development Corp. (P250 million) and the Philippine Children’s Medical Center (P7 million). The Philippine Health Insurance Corp., the state-owned health insurer, meanwhile, received only P10 million during the month.
The Finance department is continuously reviewing the performance of government-owned and controlled corporations (GOCC) to determine which agencies may be recommended to Congress for abolition or which may eventually be privatized.
Subsidies are booked as expenses and put a strain on the governments’ widening budget deficit.
The government expects the deficit to hit roughly P300 billion by yearend, narrower than the P314.4 billion budget gap recorded last year.
The Aquino administration said it wants to address the country’s fragile fiscal position by enhancing tax administration instead of implementing new taxes.
In February, the government incurred a budget deficit of P21.5 billion, reversing the P13.4 billion budget surplus posted in January
Revenues in February amounted to P80 billion or slightly higher than the P76.7 billion generated in the same period last year, data from the department showed.
The February deficit brought the budget gap in the first two months of the year to P8.1 billion, narrower than the P70.3 billion recorded in the same period last year, data from the Finance department also showed.