Gov’t releasing funds faster for ‘appropriate’ projects — Palace
Malacañang said the government is accelerating the release of infrastructure funds for projects that pass stricter screening, aiming to support growth while preventing misuse of public money. The Department of Budget and Management (DBM) is spearheading measures to clear backlogs from delayed outlays and to keep reforms in place.
Faster disbursement with safeguards
Palace Press Officer Clarissa A. Castro said agencies are moving funds more quickly once projects are proven appropriate and well-justified, but not at the expense of due diligence. Evaluations and compliance checks remain in effect to ensure projects meet standards before money is released. She did not specify the exact pace of the improved release process.
According to the Palace, the pace of disbursements had been a concern for President Ferdinand R. Marcos, Jr., as spending last year slowed when agencies prioritized protecting funds over greenlighting projects that lacked sufficient basis. That caution, while necessary, contributed to weaker growth. The administration now aims to ramp up public spending—particularly on infrastructure—under close monitoring and with a balanced approach to risk.
Oversight and implementation capacity
An ad hoc subcommittee on project implementation and results monitoring for infrastructure is operating to strengthen oversight, while the Infrastructure Committee (InfraCom) is expected to help ensure contracts go to suitable and capable contractors. The President has also acknowledged that some agencies’ limited absorptive capacity has constrained efforts to accelerate spending.
Castro noted that the government deliberately slowed certain disbursements last year to safeguard public funds, especially amid the review of projects following the flood control corruption scandal. While deemed prudent, those delays weighed on economic activity.
Economic backdrop and targets
Gross domestic product grew 2.3% year on year in the second quarter, the weakest since 2021, bringing first-half growth to 2.6%. Construction contracted by 14.8% in the second quarter, and investment fell 9.2%, according to the Philippine Statistics Authority.
Reflecting the softer outlook, the government cut its 2026 growth target to 3.5%–4.5% from 5%–6% previously, while maintaining a 5%–6% goal for 2027 to 2030. The 2026 national budget totals P6.47 trillion (21.2% of GDP), while the proposed 2027 budget is P7.2 trillion (21.7% of GDP).
For 2026, P1.556 trillion is allocated to the Build Better More program—about 5% of GDP—supporting the objective of keeping infrastructure spending within 5%–6% of GDP.
Clearing backlogs and fixing bottlenecks
The government faces a backlog of delayed infrastructure projects, raising concerns about whether agencies and contractors can handle both overdue and newly approved projects slated for 2027 and beyond. The DBM’s 2027 budget priorities call for tackling “implementation constraints and institutional bottlenecks,” improving execution rates, and prioritizing the timely completion of flagship and ongoing high-impact projects.
To help minimize delays, the government released P46.22 billion in April for 1,743 infrastructure projects, a move meant to speed up work on public construction and reduce administrative lags.
Fiscal stance and spending outlook
The infrastructure push is part of a broader medium-term strategy to revive growth while maintaining fiscal discipline. Under the updated fiscal program, the budget deficit is projected at 5.4% of GDP in 2026, narrowing to 4.8% in 2028 and 3.5% by 2030.
Officials expect public spending to accelerate in the second half of the year, after expenditures were about 7% below the previous year’s level at the end of the second quarter. The administration aims to make up the shortfall by the fourth quarter, with a particular focus on moving “appropriate” infrastructure projects forward without compromising oversight.
