Malaya

By ANGELA CELIS on July 28, 2015
Subsidies to government-owned and -controlled corporations (GOCCs) jumped 180 percent last May after the full release of P4.25 billion for rice import of the National Food Authority (NFA).

According to the latest Cash Operations Report, the subsidy to state firms in the five-month period amounted to P9.02 billion, almost three times the P3.22 billion registered a year ago.

The Department of Budget and Management (DBM) said the full release to NFA of P4.25 billion was made last May, thus the increase in cumulative subsidies, year-on-year.

The government allowed more rice imports this year to boost buffer stocks and keep local prices stable because of possible drought that will result from the El Niño.

This year, rice imports have reached 750,000 tons – 550,000 tons from Vietnam and the rest from Thailand. The NFA has permission from President Aquino to import an additional 250,000 tons if drought conditions worsen and hurt local rice production.

As Viet rice price averages at $400 per ton, the 1 million estimated rice imports will cost $400 million or P18 billion. The P4.25 billion subsidy thus covers 24 percent of total rice import for the year.

Latest government data shows local rice prices have fallen around 5 percent from a year earlier. The expectation now is for the domestic harvest to be “lean” in the third quarter before rebounding in the final three months

NFA now accounts for 47 percent of the subsidies released to state firms in the first five months of 2015.

The second biggest amount went to the National Electrification Administration at P731 million.

This was followed by the Philippine Children’s Medical Center with P607 million and the Social Housing Finance Corp. and National Irrigation Administration with P513 million and P455 million, respectively.

For the month of May alone, GOCCs received P4.55 billion, 162 percent higher than the P1.74 billion received a year ago.

Aside from the NFA, five other state firms received financial subsidies during the said month.

These are the Philippine Deposit Insurance Corp. with P166 million, National Power Corp. with P96 million and the Philippine National Railways with P26 million.

Next in the list are the Southern Philippines Development Authority and the Light Rail Transit Authority with P7 million and P1 million, respectively.

Earlier this year, the DBM reported that more than 40 percent of the dividends remitted by GOCCs to the national government will be used to fund the various housing initiatives under the Yolanda rehabilitation program.

Of the P36.9 billion remitted by the national government, P15.9 will be spent for the said program.

The GOCC remittances exceeded the P5.5 billion target and are P4.6 billion higher than remittances recorded in the previous year.

 

NFA rice ups subsidy 180%