GOCC subsidies rose to P154.2B as of end-Oct

The national government gave out a total of P154.2 billion in subsidies to 61 state-owned and -controlled corporations in the 10 months ending in October, rising by 2 percent compared to the same period of 2021, when the cash position showed a narrower budget deficit.

Data from the Bureau of the Treasury show that the amount of subsidies given out in the January-October period this year rose from P151.1 billion last year.

Most of the subsidies given out in the nine months went to health care, food production and sourcing and housing initiatives, with Philippine Health Insurance Corp. (PhilHealth) receiving the largest amount at a total of P64.1 billion.

Among the top five recipients of subsidies were the National Irrigation Administration (NIA) with P36.4 million; National Housing Authority or NHA (P13.7 billion); National Food Authority or NFA (P6.64 billion); and National Power Corp. or Napocor (P6.1 billion).

In October alone, the government spent about P40 billion on subsidies, more than six times the P6.3 billion given out in the same month last year.

PhilHealth received the month’s largest amount at P19.2 billion while the NIA got P6.9 billion; NHA, P4.7 billion; Napocor, P4 billion; and NFA, P2 billion.

During the 10-month period, the national government’s budget deficit was pegged at P1.1 billion, lower by 7.6 percent from P1.2 trillion in the comparative period of 2021.

The government’s plan for the full year is to spend P1.7 trillion more than its means, which is about the same deficit level recorded in 2021.

As of the end of September, the national government’s debt stock reached a new record of P13.52 trillion, representing 63.7 percent of the domestic economy.

The Marcos administration’s economic team has set a goal of reducing the debt-to-GDP ratio to 52.5 percent by 2028 or the end of the President’s term, below the 60-percent threshold of what is internationally accepted as a “prudent” level.

Finance Secretary Benjamin Diokno said what matters is the sustainability of borrowing, which depends on the cost of debt and the ability to pay it off.

“The government’s prudent strategy over the years, which was expressed in the country’s strong credit ratings amid a sea of ratings downgrade globally during the pandemic, enabled the government to meet its financing needs at the lowest possible cost, consistent with a prudent degree of risk,” Diokno told reporters.