The Governance Commission for GOCCs (government-owned and –controlled corporations) or GCG is targeting to reduce the number of state-run firms to 85 by 2020, from 98 currently, under a rationalization program.
The number will be cut to 94 starting next year, said Cesar Villanueva, chairman of the GCG that acts as a central advisory, monitoring, and oversight body with the authority to formulate, implement and coordinate policies among state-owned firms.
The GCG, which aims to transform the sector into a tool of the state in the attainment of inclusive economic growth and development, has set a focus on rationalizing firms in the financial sector.
“Some of them would have to do with the financial sector … There are about 14 GOCCs now where they have been in the subject of evaluation and recommendation to the President [Benigno Aquino 3rd],” Villanueva said.
For example, he said they were looking to merge the subsidiaries of Land Bank of the Philippines and the Development Bank of the Philippines (DBP) with their mother companies.
Prior to talks of a possible merger by the two state-owned banks, he said the GCG had wanted to fold in subsidiaries that were performing private sector activities such as insurance broking.
“Since there was a decision actually to merge the two, we postponed that plan. But now that it seems the merger is not being pursued, then there about 12 subsidiaries of both
DBP and LandBank that should actually fold back into their mother companies,” Villanueva said.
Implementation will likely be started by the next government, he said, with only six months left to the Aquino administration’s term.
Earlier this year, the GCG said GOCCs continued to contribute substantially to government revenues last year.
The GOCC sector handed over checks totaling P36.85 billion the national government in 2014, higher than the P32.31 billion recorded a year earlier.
GOCCs are required to declare and remit at least 50 percent of their income as dividends to the national government.