Subsidies to state firms jumped 60% in first half

Subsidies given away by the government to state-run firms jumped by almost 60 percent to P58.219 billion in the first half of the year from P36.59 billion a year ago, with the National Irrigation Administration accounting for the biggest share, the latest Bureau of the Treasury data showed.

The total subsidy distributed to government-owned and/or -controlled corporations (GOCCs) from January to June grew 59 percent from P36.597 billion in the same six-month period last year.

The NIA, which is the government-owned and/or -controlled corporation (GOCC) responsible for irrigation development and management, received P20.091 billion in subsidies in the first half, cornering over one-third of the end-June amount and the largest received by a GOCC to date.

In 2016, the NIA was the second biggest recipient of subsidies amounting to P16.909 billion, next only to Philippine Health Insurance Corp.’s (PhilHealth) P43.776 billion.

To recall, President Duterte during his campaign promised free irrigation to farmers.

The NIA got a higher P38.4-billion allocation under the 2017 national budget not only to provide free irrigation but also to build new systems and rehabilitate/restore existing facilities.

An additional allocation of P2 billion was intended as irrigation fee subsidy in lieu of the collection of irrigation service fees.

The NIA had been collecting P1.8- 2 billion in irrigation service fees yearly, according to reports.

As of end-June, major non-financial government corporations accounted for the bulk or P38.245 billion of the six-month subsidies; other government corporations, P19.641 billion, and government financial institutions, P333 million.

The Governance Commission for GOCCs had said that up to 90 percent of the subsidies that state corporations receive were being spent on programs and projects, while the remainder covered operational expenses.

For 2017, the government had programmed to grant P128.9 billion in subsidies to GOCCs.

Last year, the government gave away a record P103.2 billion in subsidies.