Philippine president signs law on fiscal discipline for state owned firms

08:09, June 07, 2011      

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Philippine President Benigno Aquino III signed on Monday a law that aims to prevent fiscal abuses in government-owned or -controlled corporations (GOCCs).

The GOCC Governance Act of 2011 mandates that all GOCCs shall be covered by a compensation and position classification system to be developed by a Governance Commission on GOCCs.

The newly enacted law mandates the creation of the Governance Commission for Government-Owned or Controlled Corporations(GCG) composed of five members to be headed by a chairman with a rank of Cabinet secretary and two members with the rank of undersecretary and to be appointed by the president.

The secretaries of the Department of Budget and Management and Department of Finance shall sit as ex-officio members.

The law also prescribes "certain limits" to the compensation, per diems allowances and incentives of the members of the Board of Directors and Trustees of GOCCs.

Aquino called for the passage of the law after he discovered shortly after he assumed the presidency that GOCCs were made as milking cow by some appointed officials.

This was deemed as part of the efforts of the Aquino Administration to fight against corruption in the Philippines.

Source: Xinhua
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