Advance dividend payments from 57 government-owned or-controlled corporations (GOCCs) can help fund the rehabilitation of provinces ravaged by Typhoon Odette, Surigao del Sur Rep. Johnny Pimentel said on Wednesday.
“Malacañang can require covered GOCCs to pay in advance a portion of the cash dividends that they are meant to remit to the national treasury out of their net profits this year,” Pimentel said.
“There’s no question the government will need a lot of additional funding to reconstruct mangled public infrastructure such as farm-to-market roads, irrigation systems, bridges, and school buildings,” Pimentel said.
“The government will also have to extend cash aid to affected families to help them rebuild their homes and livelihood,” according to Pimentel, whose home province is one of several now under a state of calamity after sustaining heavy damage from the catastrophic late-season storm.
P80B EXTRA GOV’T INCOME
Meanwhile, Pimentel has thrown his support behind House Speaker Lord Allan Velasco’s bill seeking to compel all covered GOCCs to declare up to 75 percent of their annual net profits as cash dividends payable to the treasury, up from 50 percent as mandated by a 28-year-old law.
“Our estimate is that the bill, once enacted, can easily provide the government an extra P80 billion in recurring dividend income every year, possibly more once the economy has fully recovered from the COVID-19 pandemic,” Pimentel said.
Under Velasco’s House Bill 9349, covered GOCCs may also be obliged to declare additional cash dividends out of their accumulated earnings.
“There’s really no need for GOCCs to pile up a lot of retained earnings, unless they have specific high-value economic projects for which they have appropriated some capital spending,” Pimentel said.
Pimentel noted that some of the best-managed private corporations listed on the Philippine Stock Exchange are already distributing up to 75 percent of their prior year’s net earnings as cash dividends to shareholders.
Allowing covered GOCCs to amass too much of their earnings would only encourage wastefulness, Pimentel, House good government and public accountability committee vice chairperson, said.
“For instance, there are GOCCs still spending millions of pesos for public relations and advertising, and yet they are virtual monopolies in the markets that they serve, so there’s really no need for them to promote their products and services,” Pimentel said.
A total of 57 GOCCs paid an aggregate of P157 billion in cash dividends to the treasury in 2020, based on DOF records.
The top 15 dividend contributors were the Bangko Sentral ng Pilipinas (P40.53 billion); Philippine Deposit Insurance Corp. (P17.98 billion); Philippine Amusement and Gaming Corp. (P17 billion); Tourism Infrastructure and Enterprise Zone Authority (P12 billion); Civil Aviation Authority of the Philippines (P6 billion);
Manila International Airport Authority (P6 billion); Philippine Ports Authority (P5.05 billion); Philippine National Oil Co. (P5 billion); Philippine Reclamation Authority (P4.4 billion); National Power Corp. (P4 billion);
Philippine Charity Sweepstakes Office (P2.27 billion); PNOC Exploration Corp. (P2 billion); Philippine Economic Zone Authority (P2 billion); Bases Conversion and Development Authority (P1.17 billion); and Clark Development Corp. (P1.13 billion)