Finance department backs state firm reforms

MANILA -- The Department of Finance department has expressed its support for a Senate initiative to limit bonuses and allowances for executives of state firms.

Speaking at a public hearing Monday, Finance Secretary Cesar Purisima said a bill to reform government-owned and controlled corporations (GOCCs) is “timely and very relevant”.

He said that although there is a need to set "reasonable compensation" to attract "quality directors who can give value to the corporation", there is a need to regulate this compensation.

Purisima added the authority to grant bonuses should be taken away from the board of directors of each GOCC. Bonuses should only be given after taxes and dividends have already been paid.

The finance secretary further noted the need to rationalize GOCCs because some state firms have overlapping mandates. (Jonathan de Santos)