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Marco Luis Beech - The Philippine Star
January 7, 2026 | 12:00am
In a memorandum released late Monday night, the DBM stated that the 2027 budget aims to capitalize on the gains made, with the goal of accelerating inclusive and sustainable economic growth through continued infrastructure investments.
STAR / File
MANILA, Philippines — The Department of Budget and Management (DBM) has called on heads of departments and agencies to start preparing their budget proposals for the next fiscal year, following the signing of this year’s outlay.
In a memorandum released late Monday night, the DBM stated that the 2027 budget aims to capitalize on the gains made, with the goal of accelerating inclusive and sustainable economic growth through continued infrastructure investments.
“Given the limited available fiscal space, agency budget proposals will be carefully evaluated in terms of value for money, performance metrics and alignment with the government’s fiscal consolidation strategy,” the department said.
Latest DBM data showed that the national government’s infrastructure spending fell for the fourth consecutive month in October last year, as concerns over reports of corruption in flood control projects continued to weigh on disbursements.
Philippine Institute for Development Studies senior research fellow John Paolo Rivera said infrastructure spending is one of the most effective levers for the gross domestic product because it has a high multiplier by creating jobs, and raises long-run productivity by cutting logistics costs.
When asked about the main risks that could slow economic spending, Rivera cited procurement and right-of-way delays, stricter governance and approval processes, early-year budget execution bottlenecks and capacity limitations among agencies and contractors.
“External risks, like higher global borrowing costs or Philippine peso weakness, can also raise project costs. Key is predictable rules, faster permitting and stronger project management, so spending translates into actual on-the-ground builds,” he said.
From January to October last year, spending on infrastructure and other capital outlays decreased by 13.7 percent to P943 billion from P1.09 billion in the same period in 2024, primarily due to the onset of flood control issues that resulted in the delay of progress settlement billings.
Meanwhile, Rizal Commercial Banking Corp. chief economist Michael Ricafort said further infrastructure development is crucial for attracting foreign investments and tourists, improving the flow of imports, exports and domestic trade in boosting overall economic productivity.
“Catch up spending plan, including infrastructure by the economic team, hinged on improved good governance standards, anti-corruption measures and other related reforms. If these are taken seriously, it would help improve economic growth and infrastructure spending,” Ricafort said.
He added that infrastructure projects offering the highest economic and social returns, such as mass transit and rail systems, airports, seaports, bridges and toll roads, can boost productivity and reduce time lost to traffic congestion.
DBM, in the memorandum, reaffirmed its sustained commitment to infrastructure development under the Build-Better-More Program, prioritizing Economy and Development Council-approved flagship projects.
