Gov’t subsidies to GOCCs hit P34 B in April

Subsidies extended by the government to state-run corporations surged by almost seven-fold to P34.42 billion in April from only P5.12 billion in the same period last year, the bulk of which went to the Social Security System (SSS) for the provision of subsidies to small business workers affected by the coronavirus disease 2019 or COVID-19 pandemic, according to the Bureau of the Treasury (BTr).

This brought the government’s total subsidies to GOCCs to P70.57 billion from January to April, almost five times higher than the P14.42 billion recorded in the same period in 2019.

The government provides subsidies to state-owned firms to augment their funds for programs and projects as well as operational expenses.

Based on Treasury data, the SSS received the largest financial support in April, with subsidies amounting to P25.5 billion.

National Treasurer Rosalia De Leon said the amount was intended for the provision of cash aids under the government’s Small Business Wage Subsidy (SBWS) Program.

Under the program, employees of small enterprises who were affected by work stoppages resulting from community lockdowns due to the COVID-19 crisis were given cash aids for two months.

The SSS was followed by the National Irrigation Administration (NIA) and the National Food Authority (NFA), which were granted P4.74 billion and P2.82 billion in subsidies, respectively.

BTr data also showed that the Light Rail Transit Authority continued to receive budgetary support amounting to P555 million in April.

The Philippine Rice Research Institute was also given P161 million in subsidies, followed by the Philippine Heart Center with P118 million and the Lung Center of the Philippines with P117 million.

Fifteen other state-run firms also received subsidies during the month, the BTr said.

Meanwhile, the Philippine Health Insurance Corp., which usually gets the largest subsidy among GOCCs annually, did not receive any budgetary support in April, nor in the first three months.

But de Leon said subsidies amounting to over P27 billion were already released to the agency on June 8.

According to data from the Department of Budget and Management (DBM), total budgetary support to GOCCs this year is now expected to reach P190.9 billion, P5.08 billion down from the original program of P195.99 billion.

Pursuant to Republic Act 11469 or the Bayanihan to Heal as One Act, unused GOCC funds and investments, including unutilized or unreleased subsidies, were reallocated to help address the COVID-19 crisis.

State corporations were also ordered to reassess their operations for the year and determine programs, activities and projects that may be discontinued to generate savings that can be used for COVID-19 response.