The Role of Government Corporations in the Philippines

B EFORE GOVERNOR-GENERAL LEONARD WOOD finally left the Philippines for the United States in I927, he wrote to the directors of the government corporations then in existence calling their attention to the previously announced policy of getting the Government out of business. He also authorized them to take the necessary steps to dispose of the government holdings under conditions which would safeguard the public interest.1 In i960 (when some of the corporations referred to by Wood thirty-three years previously had still not been sold), the President of the Philippines announced the sale of most of the existing government corporations on the ground that they had outlived their usefulness.2 At about the same time a bill passed the House of Representatives directing that sixteen named government enterprises be sold within two years.3 To be sure, this bill failed to pass the Senate, but it was indicative of strong Congressional feeling, and was only one of several similar bills or resolutions to be introduced about this time.4 These attempts to abolish government corporations show the extent of the hostility to them in the Philippines over a long stretch of time. Yet today in i96i over twenty government corporations still exist. This article seeks to examine why, in spite of such opposition, the corporations have demonstrated such a capacity for survival. The argument is, broadly, that these corporations still remain for three main reasons. (a) They attract general support because they are national (non-alien) enterprises. (b) More specifically, some of them provide services (for instance public utilities, social welfare or defense) which by their nature must be supplied by the Government, not by private enterprise. (c) Others are pioneering in nature and fill gaps in fields where it is desirable that enterprise should operate but is not in fact already operating. Two qualifications must be made about this last type. Some of the government corporations are not so completely

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