Higher dividend remittances from state-owned corporations may help offset a potential shortfall in the government’s ₱5-billion privatization target for 2025, according to the Department of Finance (DOF).

Speaking to reporters last week, DOF Secretary Ralph G. Recto said that the government is performing better in other areas of raking in non-tax revenues, noting in particular the recent sale of the Caliraya-Botocan-Kalayaan (CBK) hydroelectric power plants, which cost ₱36.3 billion. Collection for this asset sale is projected to come in by the end of the year.

Based on the latest Bureau of the Treasury (BTr) data, privatization proceeds reached ₱1.25 billion as of May, more than triple of the only ₱399 million generated during the first five months of last year.

When asked if the downscaled privatization target could still be met without the proceeds from the CBK power complex, Recto signaled it may fall short.

“Not necessarily through privatization. We’re doing better in other areas. There are still privatization efforts, but we’re seeing better performance, for example, in dividend collections,” Recto told reporters.

Dividend remittances from government-owned and/or -controlled corporations (GOCCs) are expected to exceed the ₱20-billion full-year target by ₱90 billion to ₱110 billion. Based on the goal, this year’s dividend collection could reach roughly ₱130 billion.

It can be noted that the unchanged target had already been exceeded in May when 50 GOCCs remitted a total of ₱76 billion.

DOF Chief-of-Staff and Undersecretary Maria Luwalhati C. Dorotan-Tiuseco disclosed to reporters that total dividend collections from GOCCs reached ₱92.3 billion as of July. This is equivalent to 71 percent of the projected collection.

Land Bank of the Philippines (Landbank) contributed the largest share at ₱26 billion, accounting for 28.2 percent of the total. It was followed by the Bangko Sentral ng Pilipinas (BSP) with ₱18.8 billion, 20.5 percent; Philippine Amusement and Gaming Corp. (Pagcor) with ₱12.7 billion, 13.8 percent; Philippine Deposit Insurance Corp. (PDIC) with ₱10.1 billion, 10.9 percent; and Power Sector Assets and Liabilities Management Corp. (PSALM) with ₱9 billion, 9.8 percent.

Completing the list of the top 10 GOCC dividend contributors were the Philippine Ports Authority (PPA), Manila International Airport Authority (MIAA), Clark Development Corp. (CDC), Philippine National Oil Co. (PNOC), and Bases Conversion and Development Authority (BCDA), which remitted a total of ₱15.6 billion to the national treasury.

Recto said earlier that total collections from GOCCs this year will surpass the more than ₱136 billion recorded in 2024.

“The amount is expected to exceed ₱100 billion by the end of the year and surpass the level in 2024,” the DOF said in May.

To recall, 52 GOCCs remitted a total of ₱136.3 billion in dividends to the BTr in 2024, exceeding the ₱100-billion full-year target and marking a 35-percent increase from remittances in 2023.

Under Republic Act (RA) No. 7656 or the Dividend Law, GOCCs are mandated to remit at least 50 percent of their net earnings from the previous year as dividends to the national government.

To recall, the DOF requested GOCCs to raise their share to 75 percent to maximize non-tax revenue. As of now, Recto said there are no plans to increase this further.

Dividends from state-run firms are a major source of non-tax revenues for the national government. These are used to finance the administration’s priority programs without the need to impose new taxes.

As for the privatization of idle government assets, the original target under this year’s revenue program was ₱101 billion. It was slashed to ₱50 billion in April and reduced further to just ₱5 billion in June.

Based on the Budget of Expenditures and Sources of Financing (BESF) for fiscal year (FY) 2025, the government is projected to earn a total of ₱210.8 billion in non-tax revenues, 48.3-percent lower than the ₱407.5-billion program in 2024.