Increasing unprogrammed funds not in line with reform push, analysts say

By Chloe Mari A. Hufana, Reporter

THE bicameral conference committee’s move to increase unprogrammed appropriations (UA) to over P243 billion is inconsistent with Philippine President Ferdinand R. Marcos, Jr.’s push for transparency, analysts said over the weekend, amid a widening corruption scandal.

The renewed reliance on unprogrammed funds sits uneasily with the government’s reform narrative, even if such allocations are legal and long embedded in the budget process, Ederson DT. Tapia, a political science professor at the University of Makati, said.

“Transparency is not only about reporting after the fact,” he said via Facebook Messenger. “It also involves predictability, traceability, and clarity at the moment funds are authorized.”

“From this perspective [or the] expansion of unprogrammed appropriations, particularly after repeated public assurances of reform, weakens the credibility of a governance agenda that claims to move away from opaque fiscal practices,” he added.

The proposed General Appropriations Act (GAA) for 2026 has been the subject of more scrutiny following allegations that billions of pesos of UA were inserted into this year’s national budget.

The debate places Mr. Marcos at strategic crossroads as he weighs whether to assert a stricter interpretation of the GAA or tolerate discretionary mechanisms in the interest of administrative flexibility.

A tougher stance could help the President recapture public trust in state financing after a year of fiscal controversy and distinguish his administration from rivals in the Duterte political camp, where discretionary spending has also drawn criticism, said Hansley A. Juliano, political science lecturer at the Ateneo de Manila University.

The Budget department defined UA as “those that provide standby authority to incur additional agency obligations for priority programs or projects when revenue collection exceeds targets and when additional grants or foreign funds are generated.”

Unprogrammed appropriations are typically justified as contingency mechanisms, activated only when revenue targets are exceeded, or financing becomes available. But their lump-sum and conditional nature limits public visibility at the stage when scrutiny is most critical, Mr. Tapia said.

Despite earlier assurances from lawmakers that UA would be eliminated, the bicameral conference committee agreed to reinstate the standby funds on Dec. 17, largely in line with the House’s proposal.

The Senate-approved General Appropriations Bill had trimmed UA to P174.55 billion, about P68.66 billion lower than the P243.22 billion allocation approved by the House, a move that initially appeared to curb the controversial funding mechanism.

The Senate’s position was later reversed as budget talks reached final stages. The bicameral panel restored UA to the House level and approved a slightly higher allocation, undoing the earlier reduction.

POLITICAL COMPROMISES
The development underscores the political compromises shaping the budget process, particularly in Congress, where longstanding preferences for flexibility and discretion continue to outweigh reform commitments.

Mr. Tapia said the decision reflected the persistence of institutional habits that have survived successive administrations.

“Yes, it reflects political compromise, and that compromise has implications,” he said. “Coming after corruption controversies linked to discretionary and weakly scrutinized funds, the restoration of a sizable unprogrammed allocation sends a mixed signal.”

He warned that anti-corruption messaging risks losing force if institutional practices remain largely unchanged.

“If certain expenditures are genuinely urgent or strategic, they should be clearly programmed, debated, and itemized in the regular budget,” he said. “Placing them under unprogrammed appropriations may be expedient, but it reinforces the perception that fiscal discretion remains negotiable behind closed doors.”

Mr. Juliano said the bicameral panel’s move showed “visible inconsistency” with the administration’s transparency claims.

“As much as our finance and budget managers insist on ‘needing’ leeway, this tends to smack of the faulty tendency of many of them to say that private discretionary financial structures (like in companies) should be employed in public financing in the name of flexibility (when flexibility can be achieved within structures, not outside),” he said via Facebook Messenger.

He compared it to the Disbursement Acceleration Program, which compromised the credibility of the Aquino administration.

“It’s functionally the same mistake,” he added.

Congress targets ratifying the reconciled version of the 2026 budget on Dec. 29, giving President Marcos a short window to review the spending plan before its planned signing by yearend.

Mr. Marcos earlier ordered Congress to livestream the bicameral conference committee proceedings, which was widely seen as an attempt to restore confidence in the budget process and address longstanding complaints about opaque dealmaking.

This followed accusations that billions of pesos in UA were inserted during the bicameral panel discussions last year.