Subsidies granted by the national government to state-owned firms swelled in the first three quarters of the year, driven by the additional funding support sought for programs on universal healthcare, housing and electrification.
Documents from the Department of Finance showed that the government spent P35.4 billion from January to September in subsidies to state-owned firms, up year-on-year by 92 percent.
The biggest beneficiary for the period was Philippine Health Insurance Corp. (Philhealth), which got P11.97 billion, or a third of the total spending for subsidies.
The substantial subsidies granted to Philhealth came along with the government’s universal healthcare program, under which the government-run firm is tasked to continue increasing the coverage of its health insurance service to cover all Filipinos.
The four other state-owned firms that made up the top 5 beneficiaries of subsidies for the three quarters were the National Housing Authority (NHA), the National Electrification Administration (NEA), the National Food Authority (NFA) and Philippine Deposit Insurance Corp. (PDIC).
NHA, which is tasked to provide housing for the poor and relocation to some informal settlers, got P8.26 billion. NEA, which was directed to service the remaining barangays that do not have electricity, got P4.28 billion. NFA got P2 billion, while PDIC received P1.57 billion.
In September alone, the government spent P1.64 billion for subsidies to state-owned firms, down year-on-year by 47 percent.
The higher spending for subsidies came despite the government’s push for state-owned firms to be more financially independent.
Finance officials said that ideally, state-owned firms should be self-supporting. However, they said some of these firms were not designed to generate profit but were mandated to provide vital social services even at a loss.
The NFA, for instance, is tasked to ensure ample supply of affordable rice even if this meant buying imported rice at a higher cost and selling at a lower price.
The increased subsidies were consistent with the trend of rising overall spending of the government. Documents from the DOF further showed that total spending by the national government in the first nine months of the year amounted to P1.37 trillion, up year-on-year by 12 percent.
With revenues for the same period hitting P1.27 trillion, the government incurred a budget deficit of P101.2 billion.
The budget gap in the first nine months was down by 3 percent from a year ago.