Gov’t subsidies surged to P39B as of Nov. 2013

State subsidies to government-run companies surged in the first 11 months of 2013, driven by hefty financial support for healthcare, housing and electrification programs.

Data from the government’s latest fiscal report showed that it spent P39.07 billion in January to November 2013 on subsidies, up 46.5 percent from the level spent in the same period the previous year.

The biggest recipient was Philippine Health Insurance Corp. (PHIC), which got P11.975 billion or about a third of the total amount of subsidies extended during the period.

PHIC is tasked to implement the administration’s universal healthcare program, under which all low-income households are targeted to be covered by the state’s health insurance service.

The second-biggest beneficiary was the National Housing Authority (NHA), cornering P8.26 billion of the total.

The budget department earlier said huge funding support would be extended to the government’s housing program to help relocate informal settlers from waterways and other disaster-prone areas.

The National Electrification Administration (NEA) got the third-biggest amount of subsidies at P5.88 billion, as the government aims to provide electricity to remote areas.

Other top recipients of state subsidies from January to November 2013 were the National Food Authority (P2 billion), Philippine Deposit Insurance Corp. (P1.88 billion), National Irrigation Administration (P1.51 billion), National Kidney and Transplant Institute (P1.29 billion), and Philippine Coconut Authority (P1.1 billion).

The increase in subsidies to government-run companies helped drive total public spending in the first 11 months of 2013.

Overall, government expenditures during the period rose year-on-year by 9 percent to P1.68 trillion.

Officials said the growth in public spending was meant to help maintain the pace of economic growth.

The increase in state expenditures in the first 11 months of 2013, however, was below target.

Under the 2013 fiscal program, the government set an expenditure limit of P1.98 trillion.

This means the government should have spent P300 billion in December alone if it were to maximize the expenditure program for the year.

Average monthly spending in January to November, however, stood at only about P152 billion.

The lower-than-programmed expenditure in the first 11 months was attributed to weak absorptive capacity of some government agencies.

The Department of Budget and Management (DBM) implemented the Disbursement Acceleration Program (DAP), under which funds earmarked for slow-moving projects are realigned to fast-moving ones.

The DBM, however, had to halt the program amid questions about its constitutionality.

Criticisms of the DAP came following the disclosure of the “pork barrel” scam, under which public funds earmarked for pet projects of some legislators were said to have been diverted to their own pockets and those of private individuals, led by Janet Napoles.