Subsidies to government owned and controlled corporations (GOCCs) and government financial institutions (GFIs) dropped 38 percent in January to P829 million from P1.147 billion in the same period last year, data from the Bureau of Treasury showed.

In January this year, state-owned firms that enjoyed hefty subsidies were the National Housing Authority with P296 million, followed by the National Livelihood Development Corporation with P124 million, and the National Labor Relations Commission with P100 million.

This year, the national government programmed P21 billion in subsidies to GOCCs and GFIs, about double the P11.25 billion programmed for 2009.

The subsidy budget this year is almost the same amount released in 2007 of P21.4 billion.

For years, the departments of budget and finance have been releasing subsidies to GOCCs and GFIs despite the fiscal deficit position. These subsidies are released to corporations with depleted capitalization.

Under the law, the Department of Budget and Management is mandated to release equity, subsidy and net lending to GOCCs and GFIs.

But the government has been attempting to reduce subsidies in favor of equity infusions to help GOCCs restore financial stability. There are four departments directly involved in managing or overseeing GOCCs, these are the DBM, DoF, the Commission on Audit and Commission of Civil Service.

The DoF has been closely monitoring problematic GOCCs including grains-agency National Food Authority, Home Guaranty Corporation, National Electrification Administration, National Development Company, Philippine National Railways and the Land Rail Transportation Authority.

In 2009, subsidies to GOCCs and GFIs dropped 23 percent last year to P17.44 billion from P21.1 billion in the previous year. NFA, NHA, the Local Water Utilities Administration and Philippine National  Railways were the state-owned firms that enjoyed hefty subsidies from the national government.

State subsidies to GFIs last year reached P900 million, while GOCCs received P16.55 billion from the national government.