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Philippines Economy News

GOCC subsidies plunge in August as wage subsidy tapers off 

gocc subsidies plunge in august as wage subsidy tapers off 816x445 - GOCC subsidies plunge in August as wage subsidy tapers off 

THE National Government’s budgetary support to state-run firms declined sharply in August after a pause in extraordinary measures to support employment, which peaked during the hard lockdown, but the eight-month total was still nearly twice the year-earlier level, the Bureau of the Treasury (BTr) reported.

The BTr said the government released P4.988 billion worth of subsidies to government-owned and -controlled corporations (GOCCs) in August, down 84.3% from a year earlier. The total was also 72% lower compared with the P17.9 billion released in July.

The National Irrigation Administration (NIA) received P2.606 billion, or 52% of the total. This was followed by the Philippine Crop Insurance Corp. which got P1.32 billion.

Small Business Corp. received P500 million, Philippine Heart Center P126 million, the Philippine Children’s Medical Center P95 million and the National Irrigation Administration (NIA) P83 million. Others received less than P50 million while 15 GOCCs received no budgetary support from the government that month.

Subsidies reached P192.453 billion in the first eight months of the year, up 98.83% from a year earlier, after the Social Security System (SSS) administered a wage subsidy program to encourage employers to maintain headcount.

The SSS received P51 billion over the eight months, while the National Food Authority received P37.65 billion and the Philippine Health Insurance Corp. P30.3 billion.

The government’s budget for GOCC subsidies this year was trimmed by P5.1 billion to P191 billion after state funds were diverted to support the pandemic containment effort.

The government subsidizes GOCCs to cover operational expenses not supported by their revenue. — Beatrice M. Laforga

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