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PHL to trim existing GOCCs to 100 in ongoing fiscal reform
The Governance Commission on Government-Owned and -Controlled Corporations (GCG) is set to reduce the number of GOCCs this year to 100 from 125 as part of efforts to beef up fiscal reforms.
“We are hoping that by the end of this year, 100 na lang ‘yung GOCCs,” GCG Commissioner Angela Ignacio told GMA News Online. When President Benigno S.C. Aquino assumed Office in 2010, there were some 140 state controlled companies, Ignacio noted.
Among the GOCCs immediately under review were the National Irrigation Administration (NIA) and the Philippine Veterans Assistance Commission under the Department of National Defense.
“[If these companies are] up for review, it does not necessarily mean na i-a-abolish siya. Our mandate is to access whether they are still necessary [or] performing their mandates. I-re-review naming lahat ito,” the commissioner noted.
On the other hand, NIA told GMA News Online they are aware the GCG is currently reviewing its corporate standing.
“Last week, we've had a management conference with GCG,” Pilipina Bermudez, NIA public affairs and information officer, said in a separate interview with GMA News Online. “May request na kaming changes sa structure namin to be more responsive sa clients namin,” she added.
An unregulated past
“In the past, GOCCs were created unregulated,” she said. “By monitoring… and streamlining GOCCs, [we] can influence their net income and dividends that they remit to the government,”
The GOCC watchdog was mandated to regulate state-controlled companies and promote fiscal discipline and financial viability for the benefit of the national government.
After GCG was created two years ago through Republic Act 10149, or the GOCC Governance Act of 2011, the number of GOCCs dropped to 125 in 2012.
“We are targeting [to abolish] another 15 to 20 GOCCs by the end of 2013,” said Ignacio. “It is important to streamline... [GOCCs], so we are left with the necessary and most productive GOCCs.”
According to the GCG chief , GOCCs have been abolished as “non-performing” entities that eat up government money.
“We are starting with those [corporations] that are small, relatively inactive already. Ito ‘yung may nasasayang na pera kahit maliliit lang [ang mga] ito,” she noted. “Non-performing and yet they maintain people… Sayang ang resources... if it is just an asset na puwede namang [ i-abolish o i-merge].”
Subsidiaries of Land Bank of the Philippines, National Development Corporation, and Development Bank of the Philippines were also included in the first batch of GOCCs to be shut down, she added.
“If you focus on your primary mandate, you will find that these other subsidiaries do not need to exist,” Ignacio said.
GOCCs dissolved as of 2012 were:
- Anchor Estate Inc.
- CDCP Farms Corporation
- Clark Polytechnic Development Foundation
- First Centennial Clark Corporation
- GSIS Mutual Fund Inc.
- GSIS Properties Inc.
- Inter-Island Gas Service Inc.
- LBP (Land Bank of the Philippines) Financial Services SpA (Rome, Italy)
- LBP Remittance Company (USA)
- LBP Singapore Representative Office
- Manila Gas Corporation
- Meat Packing Corporation of the Philippines
- Metro Transit Organization Inc.
- Paskuhan Development Inc.
- Philippine Centennial Expo '98 Corp.
- Philippine Fruits and Vegetables Industries Inc.
- Philpost Leasing and Financing Corporation
- San Carlos Fruits Corporation
- Tierra Factors Corporation
- Traffic Control Products Corporation
The assets of those companies were remitted either to the Bureau of Treasury or, in the case of a subsidiary, to the parent company. Employees of GOCCs that were or will be closed down, Ignacio said they would receive separation pay as mandated by law.
In 2010, the Commission on Audit released a list of GOCCs that the commission—however—noted was incomplete. The GCG thus commented that identifying government-controlled corporations has been one of its major, major task. http://www.gmanetwork.com/news/story/198228/news/nation/a-list-of-goccs-based-on-coa-records
“[The] main challenge, lalo with a new commission, [is] really identifying how many GOCCs are under us,” she said.
Abolishing or dissolving is just one approach the commission may go for in deciding on what to do with a company, as it may also recommend to the President to merge GOCCs which have have similar functions. On its own, the GOCC watchdog may streamline or approve the reorganization of a state-controlled company.
GOCCs in numbers
As of 2012, government-owned and -controlled corporations registered P5.134 trillion in total assets—compared with P4.835 trillion in 2011, Ignacio disclosed.
The net income of GOCCs totaled P224.144 billion, almost double from P127.282 billion in the same comparable period.
According to GCG’s “First 200 Days Report,” GOCCs in 2011 remitted P28.706 billion in dividends—the highest in GOCCs.
Last year, the Top 10 GOCCs that remitted dividends based on 2011 income were:
- Land Bank of the Philippines with P5 billion
- Development Bank of the Philippines, P4.012 billion
- Philippine National Oil Company (PNOC), P3.5 billion
- Civil Aviation Authority of the Philippines (CAAP), P1.362 billion
- Philippine Ports Authority (PPA), P1.2 billion
- Manila International Airport Authority (MIAA), P1.142 billion
- Philippine Amusement and Gaming Corporation (PAGCOR), P1 billion
- Bases Conversion Development Authority (BCDA), P504 million
- Philippine Deposit Insurance Corporation (PDIC), P470 million
- Philippine Economic Zone Authority (PEZA) P276.58 million
The state companies that got the highest subsidies were the National Housing Authority at P1.61 billion, the National Kidney and Transplant Institute at P1.11 billion, and the Philippine Coconut Authority at P820 million. — VS, GMA News
