MANILA, Philippines - State subsidies to government owned and controlled corporations (GOCCS) and government financial institutions (GFIs) in April declined by a hefty 40%, in line with attempts by the national government to rein in spending.

In April, subsidies stood at P1.11 billion, significantly lower than the P1.86 billion released to state-owned firms a year ago, data from the Bureau of Treasury showed.

The biggest recipients of these subsidies were the National Telecommunications Commission with P1.03 billion, Center for International Trade Expositions and Missions with P13 million and the Cottage Industry Technology Center with P1 million.

The Department of Finance has adopted a policy of reducing subsidies in favor of equity infusions to force GOCCs and GFIs to be more self-reliant and create their own revenue-generating programs.

From January to April, state support to GOCCs/GFIs stood at P4.44 billion, 8% higher from a year ago.

For 2010, the DoF allotment for subsidies was cut by 19% from a year earlier to P14.1 billion.

The national government is mandated to support capital-challenged state controlled companies through equity, subsidy and net lending.

Such support to ailing firms however, have over the years added to the government's fiscal deficit.

Some of the problematic companies include the National Food Authority, Home Guaranty Corporation, National Electrification Administration, National Development Company, Philippine National Railways and the Land Rail Transportation Authority.

Last year, subsidies to GOCCs and GFIs fell 23% from a year ago to P17.44 billion. Those that enjoyed the biggest capital infusion were the NFA, NHA, the Local Water Utilities Administration and Philippine National Railways.