What happens to P35B removed from line item in 2026 unprogrammed funds?

House budget committee chairperson Mika Suansing has said that the chamber has removed P35 billion from a line item in the unprogrammed appropriations for 2026. Does that mean that the total for UA has been reduced?

The short answer is no, at least in the House’s approved version of the General Appropriations Bill (GAB) for the upcoming fiscal year.

Unprogrammed funds have been the subject of intense scrutiny in the past months, with watchdogs calling it a shadow budget.

Some opposition House members have tried to zero out the UA in the proposed 2026 budget, but a motion forwarded by Akbayan Representative Chel Diokno in the plenary in early October lost the vote.

What happened

The National Expenditure Program (NEP) submitted to Congress by the executive, through the Department of Budget and Management (DBM), proposed P249 billion in unprogrammed funds.

The budget amendment review sub-committee of the House appropriations panel removed the special provision called “Public Health Emergency Benefits and Allowances for Health Care and Non-Health Care Workers,” supposedly intended to fund the COVID-19 allowance and compensation of pandemic medical frontline staff. The Department of Health had said the health workers have already been paid.

That means that before the 2026 House GAB underwent a second reading vote, the UA stood at P243.2 billion after subtracting P6.7 billion in COVID-19 allowances.

The executive also originally proposed P80.86 billion for what was the government’s Strengthening Assistance for Government Infrastructure and Social Programs (SAGIP).

The release of SAGIP funds, as per the law, is only authorized when the government has excess revenue collections, new revenue collections, or approved loans for foreign-assisted projects.

But in the past years, SAGIP funds have been used to fund local flood control projects, which are alleged to have been corrupted by bad actors.

Flood control projects are also supposed to fall under programmed funds, and not under unprogrammed appropriations, raising questions on whether the budget has been used properly.

After all, why are standby funds being used to finance flood control projects that could have been planned in advance anyway?

To resolve the issue, the House removed P35 billion that was originally under SAGIP, giving it a new total of P45.09 billion.

SAGIP is now called just SAGP, which means “Strengthening Assistance for Government Programs.”

Allocations under SAGP, as provided by Suansing in a press conference, are as follows. This breakdown cannot be found in the House GAB.

Where did it go

But just because SAGIP funds were reduced in the unprogrammed appropriations does not mean that UA funding has gone down to P208 billion.

That P35 billion stays, but is now under a different line item, called “Government of the Philippines Counterpart of Foreign-Assisted Projects (FAP).” The said provision was not visibly part of the NEP, and only introduced in the House GAB.

When we say visibly, it’s because according to Suansing, the “Government of the Philippines Counterpart of FAP” line item was originally under SAGIP, but the breakdown could not found in the House GAB or in past budgets. Only the DBM has the list of programs.

So what difference does it make, when the P35 billion is still part of unprogrammed appropriations anyway, just transferred from one line item to another?

“Putting the FAPS out from the former SAGIP allows us to put more stringent safeguards to ensure that it would no longer be abused,” Suansing said. “Definitely, flood control projects are prohibited under SAGIP.”

We asked Suansing: so can flood control projects be funded using the “Government of the Philippines Counterpart of FAP” provision?

She said that based on the DBM’s list, which has yet to be made accessible to the public, there are no flood control projects under that line item.

“I’ll just check with the DBM if we can share it to all because the only reason why there’s some sensitivity around it, there are development partners who do not want to publicize particular projects unless the negotiation phase is already finalized,” Suansing said.

Criticisms

Suansing and other House leaders have insisted that they cannot zero out unprogrammed funds because the Philippines will risk reneging on its international commitments.

They say FAPs under UA are there because the projects did not make it to the deadline during budget preparation. These projects could not be part of the programmed appropriations because they did not meet certain criteria, such as a finalized contract with a bilateral partner providing foreign assistance, and a NEDA board approval.

But for the People’s Budget Coalition (PBC), one of the civil society groups accredited by the House during the 2026 budget cycle, the House’s argument does not hold water.

“Prior to 2022, the number of foreign-assisted projects in the UA was not that high. So, it really is a recent phenomenon that coincides with the issue of congressional insertions,” said AJ Montesa of PBC.

“The planning phase for foreign-assisted loans and projects is long,” he added. “It’s very unlikely that the government will have [any] unforeseen foreign-assisted loan or project. In fact, it will only worsen the situation because there’s the possibility that the project won’t be funded if it’s under UA.”

The Constitution says Congress can reallocate items in the budget, but not exceed the maximum amount set by the National Expenditure Program. Some budget experts believe programmed funds are being transferred to unprogrammeed appropriations to circumvent this constitutional ceiling.

“Unprogrammed appropriations become a conduit for the insertions. So, it’s parked here…for example, PhilHealth and social programs will be cut from the programmed budget and then they will use that money to accommodate the insertions, their pork,” Montesa said.

A likely clash

The House is expected to clash with the Senate, whose leaders have indicated they want to remove unprogrammed appropriations for 2026.

Suansing has said she is open to discussions on slashing the total for UA for the upcoming fiscal year.

Any differences between the House GAB and the Senate GAB — which the upper chamber has yet to pass — will be ironed out in the bicameral conference committee, which will be streamed to the public this year.

That is amid allegations that secret insertions and last-minute amendments were made in the 2025 budget during the bicameral phase last year. – Rappler.com