STATE subsidies to nonfinancial government-owned and -controlled corporations (GOCCs) inched up in the first 10 months, data from the Bureau of Treasury showed.

The amount extended to those entities reached P14.5 billion at end-October, 4.5 percent higher than the P13.9 billion in aid the national government extended in the same period last year.

In October alone, subsidies dipped 37.6 percent to P1.9 billion from last year’s P3.14 billion. Bulk of subsidies that month went to Local Water Utilities Administration (LWUA) at P1.5 billion.

LWUA has recently developed a new lending product with the support from the United States Agency for International Development, through its Environmental Cooperation-Asia regional program. Dubbed as the Efficiency Improvement Program Loan, this lending scheme is specifically designed to support LWUA’s new mandate under Executive Order 279.

According to LWUA, one of the key issues facing both LWUA and local utilities has been the inadequate supply and inaccessibility of funding. Because of the lack of funds, access to finances by smaller less creditworthy utilities had been limited since and the agency needed safeguard its own financial position by keeping a tight reign on its lending to viable water districts.

This funding problem and skewed allocation of resources had been critical factors in constraining development of the sector, particularly in the lower income areas of the country outside the major urban centers.

LWUA also has a special loan for watershed management and emergency purposes, like making inactive water supply to work and repair rehabilitation of system damaged by typhoons or other calamities.
The national government, meanwhile, extended another P151 million in subsidies to the National Housing Authority (NHA), while the National Livelihood Development Corp. got P139 million.

The NHA is in charge of the development and implementation of a comprehensive and integrated housing program, which entails housing development and resettlement, sources and schemes of financing, and delineation of government and private sector participation.

The fourth biggest recipient of financial support was the People’s Television Network Inc. with P100 million, while the Philippine National Railway received P53 million.

These subsidies form part of the national government’s expenditure program for the year.
Excluding interest payments, total expenditures for the 10-month period went up 15.1 percent to P1.2 trillion from last year’s P1.03 trillion.

For October alone, public spending rose 12.3 percent to P114.1 billion from last year’s P101.6 billion.
The growth in expenditures was offset by the 20-percent reduction in interest payments for the month mainly because of lower interest rates. Year-on-year interest payments dipped 1.1 percent to P249 billion from last year’s P252.3 percent.

Lailany P. Gomez