The National Government has instructed all government owned and controlled corporations (GOCCs) and financial institutions (GFIs) to advance dividend payments for 2009.

The Department of Finance (DoF) said the emerging budget deficit this year could be as high as P300 billion or 3.8 percent of gross domestic product, and P233 billion for 2010. As of end-October, the budget gap stood at P266.1 billion, exceeding the full-year ceiling of P250 billion.

Sources said Finance Secretary Margarito B. Teves, either verbally or through a formal notice, has informed all GOCCs and GFIs that they deposit required dividends as soon as possible to help plug the deficit.

For 2009, the DoF and the budget department dividend program is P10 billion. Undersecretary Jeremias N. Paul said this amount has been exceeded in September by more than P1.5 billion.

Next year, the expected dividend amount is lower at P4 billion. In 2008, total dividend payments amounted to P6.78 billion.

The Bangko Sentral ng Pilipinas (BSP), which did not remit dividends for 2007 since it incurred losses of P87 billion for that period, remitted P6 billion in July as dividends on its 2008 income.

Based on DoF papers, they expect BSP to remit at least P1 billion for its 2009 income, which as of end-August was P8.65 billion. But based on a Commission on Audit report, the BSP actually owe the NG P16 billion more in back dividends because of miscalculations in the past.

GOCCs and GFIs deposited more than P11 billion to the Bureau of the Treasury as dividends as of end-September.
This amount was higher compared to what was remitted the same period last year of P5 billion.

GOCCs are required by law to remit 50 percent of their yearly income to the NG. However the central bank is required to remit higher dividends of 75 percent of their income for a given year.

Dividend payments are considered non-tax revenues under fees and charges. The DoF expects fees and charges to reach P60 billion this year and P55 billion in 2010.

Despite efforts to limit financial assistance, the NG as of end-October released subsidies to GOCCs of P14.52 billion, exceeding the full-year program of P13 billion. Including net lending or advances to GOCCs and equity, the total disbursements amounted to P26.53 billion in the first 10 months, from P23.3 billion as of end-September.

The budget support ceiling for this year is P32 billion. Next year is higher at P36 billion. These are subsidy, equity and net lending.