NG subsidies to gov’t corporations hit P1.70 B

The share of sin tax revenues and El Niño support pushed up the subsidies granted to government corporations by more than ten-fold in January even as only two firms benefited from them.

A total of P1.70 billion in subsidies were granted by the national government in January, data from the Bureau of the Treasury showed.

The amount was way bigger than the P145 million recorded in the same period a year ago.

Broken down, the Philippine Health Insurance Corp. (PhilHealth) received the bulk of the credit at P1.44 billion, while the National Irrigation Administration (NIA) got the remaining P253 million.

“The amount for PhilHealth represents its share of sin tax revenues, while those for NIA could be for El Niño,” Finance Assistant Secretary Ma. Teresa Habitan said in a phone interview.

Under RA 10351 of 2012, incremental revenues generated from hiking excise taxes in tobacco and alcohol products are divided to support universal health care coverage and support to displaced tobacco farmers.

Specifically, 85 percent of the additional take-up went to PhilHealth, while the remaining 15 percent went to tobacco farmers.

Meanwhile, the ongoing dry spell also prompted the government to support farmers.

“The funds for NIA are for irrigation facilities at the time of El Niño,” Habitan said.

The Department of Budget and Management earlier belied claims by Vice President Jejomar Binay that it is withholding bulk of the P19-billion government budget for El Niño response.

In particular, it said it already released P2.11 billion to the Department of Agriculture to finance interventions. The department oversees the NIA.

Subsidies help support state firms’ operations. In turn, these entities, by law, report at least 50 percent of their annual earnings to government coffers.

Data on remitted dividends on the same month remained unavailable.

Subsidies form part of government disbursements, while dividends contribute to revenues.

Last year, credit to government companies declined 3.01 percent to P78.01 billion.