MANILA, Philippines — The administration is working double time to adjust its plans for 2025 following one of the most contentious national budgets in recent years, raising questions about where agencies are sourcing funds to address budget cuts.
The Marcos administration has recently faced allegations from former President Rodrigo Duterte of mishandling the budget, specifically claims of leaving blank spaces in the budget to be filled later.
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President Ferdinand Marcos Jr. has been meeting with Cabinet secretaries to discuss the budget and plan adjustments following budget cuts from Congress. Marcos has ordered that some of these cuts should be compensated.
The executive branch, however, is unable to reallocate funds arbitrarily, especially if Congress deems certain cuts necessary. Lawmakers sometimes believe that an agency has used its budget inefficiently or that funds would be better allocated elsewhere.
So where is the Department of Budget and Management (DBM) sourcing funds to cover these budget cuts for priority projects?
Savings
Budget Secretary Amenah Pangandaman explained that agencies can use savings—unreleased funds from programs or projects that were either completed without exhausting their budgets or abandoned altogether.
“There are different reasons for savings—when you bid it out, it turned out cheaper; second, you no longer want the project and decided to abandon it because it is no longer a priority. These savings can be used for augmentation,” Pangandaman said in Filipino at press briefing on January 24.
For this process, the agency must seek approval from the Office of the President.
This approach was applied to the Philippine National Police (PNP) under the Department of Interior and Local Government (DILG).
Interior Secretary Jonvic Remulla said that savings from other areas, such as for IT services and additional P500 in intelligence funds, would be redirected to fund the PNP’s 911 emergency hotline system.
“These savings will be allocated to the launching and bidding process for the integrated 911 system across the Philippines. From intelligence funds to 911—that’s what we will do. It will be a fully audited system subject to rigorous bidding,” Remulla said in Filipino at a previous briefing.
Unprogrammed appropriations
The government has access to P363.24 billion in unprogrammed appropriations (UA). Initially, the executive branch requested only P158.67 billion, but Congress approved P531.67 billion. However, Marcos vetoed P168.24 billion, citing inconsistencies with his administration's priorities.
Pangandaman said that such unprogrammed appropriations can also augment funding as these are budget items without ready allocations.
“There are triggers required to use UA funds. Excess revenues certified by the Bureau of Treasury are necessary,” she said.
Under Marcos, the administration’s unappropriated funds have swelled. Critics argue that thisreflects a lack of commitment by the government to dedicate budgets for priority projects.
For instance, in 2024, a significant portion of the Department of Transportation’s (DOTr) budget was placed under unprogrammed funds. Similarly, in 2025, funding for major railway projects and foreign-assisted initiatives under DOTr was again classified as UA.
Contingent fund
The Contingent Fund, part of the General Appropriations Act’s special purpose funds for 2025, is designed to finance “new or urgent activities or projects” of the government.
“For new and urgent projects, department heads can request this fund. Necessary documentation will be required. Ultimately, only the Office of the President can approve contingent fund usage,” Pangandaman said.
For example, after a P400 million cut in its marketing budget, the Department of Tourism was directed by Marcos to have its budget restored using money from the Contingent Fund. The country’s Contingent Fund for 2024 amounts to P13 billion.