1 month ago
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The country’s leading business groups are calling for sweeping reforms in the national budget process to ensure that long-term economic stability is prioritized amid controversies surrounding this year’s budget.
In a joint statement on Wednesday, Feb. 5, published on Makati Business Club’s (MBC) website, the groups urged the government to safeguard future budgets by placing importance on the short and long term needs of the Filipino people.
Among the groups that issued the statement include the Financial Executives Institute of the Philippines (FINEX), FinTech Alliance PH, Justice Reform Initiative (JRI), Management Association of the Philippines, Philippine Business for Social Progress, and UP School of Economics Alumni Association.
The groups particularly raised the alarm on changes introduced by the bicameral conference committee (bicam) in the 2025 General Appropriations Act (GAA), which embodies this year’s budget of P6.326 trillion.
They pointed out that the bicam—composed of members of the Senate and the House of Representatives—significantly reduced allocations for programmed healthcare, social services, and education projects.
Based on reports, these reductions amount to over P200 billion.
“In place of these programmed projects, the bicameral committee inserted local infrastructure projects and types of unconditional cash transfers which, we believe, promote a culture of patronage and dependency,” the groups said.
Perhaps the most controversial insertion of the bicam in the 2025 budget is the restoration of the Ayuda sa Kapos ang Kita Program (AKAP). The program was earlier deleted in the Senate version of the budget bill.
AKAP is a program under the Department of Social Welfare and Development (DSWD) that provides a one-time cash assistance of up to P5,000 to “near-poor” workers.
The business groups argued that these types of programs are “vulnerable to politicization,” especially with the upcoming election season.
They likened such moves to pork barrel practices which were already deemed unconstitutional by the Supreme Court.
With this, the groups are asking the Marcos administration to consider the recommendation of former Senate President Frank Drilon to classify all congressional amendments in the 2025 budget as “For Later Release”.
This is to make sure that such funds will not be used for “electioneering”.
Necessary changes
When the 2025 national budget was enacted, President Ferdinand “Bongbong” Marcos Jr. vetoed a total of P194 billion worth of line items not deemed consistent with the administration’s priority programs.
Included in this is the removal of P26 billion from congressional insertions of P289 billion into the budget of the Department of Public Works and Highways (DPWH).
The MBC, in particular, recently questioned the bloated funding for the DPWH given that it is higher than that of the Department of Education (DepEd). Therefore, violating the Constituion’s mandate of prioritizing the education sector in the national budget.
“But given the amounts involved, the current state of the 2025 GAA still does not address both the short and long term needs of the Filipino people, especially given that many key social services remain defunded,” the groups said.
They warned that the diversion of programmed funds will affect the Philippines’ credit standing, which would make future borrowing more expensive while also limiting the government’s ability to fund critical programs.
To ensure that future budget processes are in line with the long-term goals, the business groups called for greater transparency in the bicam process.
They are specifically calling for the discussions, which are done closed-door, to be made accessible to the public.
The groups also want more support for conditional cash transfers, such as the Pantawid Pamilyang Pilipino Program (4Ps), instead of unconditional cash transfers.
“On top of this, we urge the creation of institutional safeguards to control the use and allocation of unprogrammed funds. Unprogrammed funds should serve its main purpose which is for emergency/unexpected expenses,” they added.
Furthermore, the groups are pushing for citizen participation in the Development Budget Coordination Committee (DBCC), which reviews the government’s macroeconomic assumptions and fiscal program.
Opening the DBCC for public engagement would ensure the budget reflects the genuine needs of the people, they said.
“We stand ready to support the government in pursuing these reforms. We offer our expertise and resources to help build a transparent and accountable budget process that truly serves the Filipino people,” the groups stated.
