MANILA, Philippines - Government subsidies to state-owned companies jumped to P66.32 billion in the first 11 months of 2014, nearly three-fourths more than the amount disbursed in the same period the previous year.
Data from the Department of Finance showed that P35.31 billion or more than half of the total subsidies granted to state-run firms went to the Philippine Health Insurance Corp. as the Aquino administration stepped up its investments in healthcare.
In June 2013, President Aquino signed a law that expands the coverage of the national health insurance program to include the needy and the informal sector. The law is intended to ensure that all Filipinos, especially the poorest of the poor, will get health insurance coverage from PhilHealth.
The National Housing Authority received the second biggest financial support at P9 billion, which covered the relocation of informal settlers living in danger zones in Metro Manila.
The relocation program is a major component of the national government’s flood mitigation efforts.
Among those identified as priority “high-risk zones” are those living near waterways such as rivers, esters and creeks.
The third biggest recipient of government subsidy was the National Electric Administration, which got P5 billion. The money was used by NEA to energize off-grid communities as part of the Sitio Electrification Project (SEP).
Rounding up the top five recipients of government aid were the National Food Authority which got P4.25 billion and the Philippine Deposit Insurance Corp. (P2.79 billion).
In November 2014 alone, subsidies granted to government-controlled corporations amounted to P2.68 billion, 15.4 percent lower than the P3.17 billion extended in the same month a year ago.
Subsidies form part of the government’s total expenditures. They are 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.