By Edg Adrian A. Eva, Reporter

EMERGING TECHNOLOGIES such as blockchain and artificial intelligence (AI) are being advanced as key tools to improve transparency in the national budget process, following controversy over anomalous flood control projects that congressional hearings say may have siphoned off billions of pesos from public coffers.

While digital systems promise better tracking of government spending and infrastructure implementation, experts and civil society groups caution that technology alone will not eliminate entrenched corruption.

Information and Communications Technology Secretary Henry Rhoel R. Aguda said blockchain could serve as a digital backbone for public finance by placing all components of the national expenditure program, and once enacted, the General Appropriations Act (GAA), on an immutable ledger.

“Everything has track changes,” he told BusinessWorld. “You cannot alter it. At the same time, if you want to make it transparent, it becomes easy to publish.”

By recording entries in a tamper-evident system, blockchain could make budget allocations and revisions easier to trace, reducing opportunities for unauthorized changes once documents are finalized.

Brian Daniel P. Llamanzares, a party-list representative and chairman of the Global AI Council, said AI could improve access to government data and reduce manual processing.

“It cuts down the amount of human intervention that’s necessary, and it expedites the delivery of transparency to our institutions,” he said on the sidelines of a BusinessWorld forum in November.

The push for digital oversight comes against the backdrop of large-scale losses attributed to corruption. The National Blockchain Whitepaper 2025 estimates that systemic corruption costs the Philippines more than P700 billion annually, citing watchdog groups and Commission on Audit (CoA) findings. These losses are linked largely to procurement fraud and project mismanagement.

That figure represents roughly 5% of gross domestic product, funds that could otherwise finance classrooms, hospitals and climate-resilient infrastructure.

‘MODERN TOOLS’
Over more than a decade, foregone resources may have reached P15 trillion to P31 trillion, according to estimates by the World Bank and Asian Development Bank. Such amounts could have supported expanded healthcare, free education and disaster mitigation projects.

Given the scale and complexity of the national budget, the Advanced Science and Technology Institute (ASTI) under the Department of Science and Technology (DoST) said digital tools are needed to monitor spending effectively.

“You really need to rely on modern tools and technology to keep track of what’s been happening along the way,” Elmer C. Peramo, ASTI senior science research specialist, said via Zoom.

He added that these systems must be integrated at the start of the budget cycle, rather than used only after irregularities are uncovered.

One proposal seeking to institutionalize digital transparency is the Citizen Access and Disclosure of Expenditures for National Accountability (CADENA) bill.

Filed by Senator Paolo Benigno “Bam” A. Aquino IV, Senate Bill No. 1506 was approved on third reading on Dec. 15. The measure was included in President Ferdinand R. Marcos, Jr.’s priority legislative agenda. The House of Representatives has passed a counterpart bill — House Bill No. 6761.

Mr. Aquino described the bill as a response to public outrage over the flood control controversy.

“If these investigations were not happening, I think this bill would have had no chance,” he said in a privilege speech in Filipino. “But because the public is now focused on changing the systems that allowed this kind of corruption, it has a chance to pass.”

The measure requires government agencies to disclose budget, procurement, contract and expenditure documents through a centralized public digital platform. The system will use a secure, tamper-evident framework, potentially including distributed ledger technology, to ensure uploaded records cannot be altered without trace.

Agencies that fail to comply may face administrative penalties for late or incomplete submissions, and criminal charges for hiding or falsifying information, in addition to prosecution under existing anti-graft laws.

Under the proposal, the Department of Budget and Management (DBM) will manage the platform, the Department of Information and Communications Technology (DICT) will provide the digital infrastructure, and the CoA will integrate audit functions.

Mr. Aguda expressed support for the bill, saying the DICT would fulfill any role assigned under the measure.

DoST-ASTI also supports the initiative but said it should remain “technology-neutral,” allowing flexibility in choosing systems that meet transparency goals.

Civil society groups welcomed the bill in principle but stressed that implementation would determine its impact.

“The real test is whether it results in timely, complete, standardized machine-readable releases that let citizens, media, and oversight groups compare versions and understand what changed, not just view documents,” Eunice Gayle Tanilon, a technical analyst at the People’s Budget Coalition, said in a Viber message.

She warned that previous transparency portals have sometimes become compliance exercises, with data that are technically public but difficult to analyze.

While blockchain can secure records, it cannot verify whether the data entered is accurate or complete. DOST-ASTI officials said AI could help flag anomalies, unusual spending patterns or inconsistencies.

“That’s the power of combining transparency with AI technology,” said March T. Tulali, ASTI science and research specialist I, said via Zoom. “These are the guardrails we can put in place if someone tries to input false data.”

Large language models (LLM) could also help the public query budget data more easily. Mr. Aquino said the CADENA platform would be interoperable with digital systems, including widely used LLMs.

DoST has developed its own model, iTanong, which Mr. Peramo said could be adopted across agencies and made accessible to citizens.

Beyond blockchain and AI, experts point to satellite imagery, drones and geotagging as tools for monitoring infrastructure projects.

Project DIME (Digital Imaging for Monitoring and Evaluation), launched in 2018 by DoST and DBM, used such technologies to track high-value projects. The program lapsed in 2021 after its agreement expired but was revived in 2023 in partnership with the Philippine Open Government Partnership.

The initiative drew renewed attention after hearings revealed that some flood control projects were reported as completed and paid despite limited or no physical progress.

By combining digital imaging with hazard mapping tools such as the University of the Philippines’ NOAH program, agencies aim to strengthen oversight of projects in remote or disaster-prone areas.

Despite optimism about digital reforms, stakeholders said technology cannot substitute for political will and institutional discipline.

“There are limitations, which is why it’s crucial to monitor the proper implementation of the bill to ensure it delivers results,” Ms. Tanilon said.

Mr. Peramo described full implementation as a “Herculean task,” noting that many agencies are at varying stages of digital readiness and might require capacity-building.

The People’s Budget Coalition added that in the Philippine context, even basic machine-readable datasets such as complete CSV (comma-separated values) files remain a challenge.

If agencies continue to rely on scanned PDFs or partial disclosures, they said, advanced tools like AI or blockchain will have limited impact.

“Technology only becomes a reform when it strengthens the full chain of transparency, participation, and accountability,” Ms. Tanilon said.

Ultimately, experts agree that digital systems can improve oversight, but sustained public engagement, clear rules, and consistent enforcement are crucial. Without these foundations, transparency efforts may lose momentum once public scrutiny fades, she added.