In keeping with its twisted austerity vow, the Aquino administration sharply cut state subsidies to government-owned and -controlled corporations (GOCCs) and government financial institutions (GFIs) in its first three months. For the millions of Filipinos who demand adequate social services from the government, this is certainly not a welcome sign.
Recent data from the Bureau of Treasury reveals that the government cut its subsidies to GOCCs and GFIs by almost half, from P4.14 billion in the second quarter to P2.21 billion during the third quarter. This amount is also smaller compared to what was disbursed during the same quarter last year which stood at P5.58 billion. The report however did not provide a breakdown of subsidies for each GOCC.
What is troubling is that such drastic cut was done in the spirit of President Benigno “Noynoy” Aquino III’s anti-corruption crusade rather than as consequence any comprehensive performance review of GOCCs. Worse, the huge cut serves as a prelude for the enactment of the 2011 budget, which contains a sharp 40.7 percent cut on allocations to GOCCs.
In his budget message, President Aquino said the reduction in allocations to GOCCs is “in view of the need to rethink government support of questionable GOCC programs.” Aquino pointed out the National Food Authority (NFA), Light Rail Transit Authority (LRTA), and Metro Rail Transit Corporation (MRTC) – which are ironically providers of basic social services – as examples of what he describes “questionable GOCC programs.”
That was not the first time Aquino put such vital GOCCs in a bad light. It can be remembered that in his first State of the Nation Address (SONA) last July, the President also put the NFA and MRTC, plus the Metropolitan Waterworks and Sewerage System (MWSS) and the National Power Corporation (Napocor), in the hot seat. Again, it should be noted that these public corporations are vital to the delivery of social services, regardless of the alleged corrupt schemes of their executives.
Dangerously enough, the Aquino administration stretched its corruption expose in GOCCs to legitimize its abolition plan of some state firms. In September, Malacañang warned that some GOCCS that are either losing money or have huge debts need to be abolished in the name of teaching them “discipline.” At least 14 GOCCs were immediately put under tight monitoring following the Palace pronouncement: Continue reading