DBM ready to adjust under reenacted budget

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December 19, 2025 | 12:00am

MANILA, Philippines — The Department of Budget and Management said it is fully prepared to undertake all necessary fiscal and administrative adjustments in the event that a reenactment of the proposed 2025 national budget becomes necessary.

Noting its continued trust that the legislative branch remains united with the executive, Budget Undersecretary Goddes Hope Libiran expressed confidence that the national budget will ultimately be enacted in due course.

“The concept of a reenacted budget, as enshrined in the Constitution, is intended to ensure the continuity of government operations in the event that a new General Appropriations Act is not passed,” she told The STAR.

The bicameral conference committee (bicam), composed of senators and House representatives, concluded the nearly week-long process of reconciling differences at past 2 a.m. yesterday, paving the way for the enactment of the P6.793 trillion 2026 budget.

Senate committee on finance chair Sen. Sherwin Gatchalian said that the bicam report is expected to be signed on Dec. 28 and will be ratified by both chambers of Congress on Dec. 29.

“The DBM trusts that the legislative branch stands united with the executive in ensuring that a national budget will be enacted,” Libiran said. “However, should a reenacted budget become necessary, the DBM is fully prepared to make the appropriate adjustments.”

Rizal Commercial Banking Corp. chief economist Michael Ricafort said that a reenacted budget could reduce economic growth by 1.6 percentage points.

“A reenacted national budget in past administrations has led to slower economic and gross domestic product growth,” he said.

Meanwhile, Reyes Tacandong & Co. senior adviser Jonathan Ravelas said that a reenacted budget effectively puts the economy on autopilot, as it can slow growth and stall job creation, among other effects.

If the 2026 national budget is not passed by Dec. 31, a reenacted budget will take effect, with the 2025 budget automatically becoming the operating budget for the current year.

The bicam increased the funding for so-called “soft pork barrel” items, among them AICS or Assistance to Individuals in Crisis Situations to P63.89 billion, up from the proposed P26.9 billion. Also, the Medical Assistance to Indigent and Financially Incapacitated Patients has been allotted P51 billion.

Ravelas warned that bigger subsidies may provide short-term relief, but patronage spending fosters dependency rather than productivity.

“Bigger subsidies may ease pain now, but patronage spending breeds dependency instead of productivity. If we want real impact, shift funds to infrastructure and small and medium enterprises credit,” he said. “These create jobs, build confidence and drive long-term growth.”

Meanwhile, Ricafort said that assistance programs should aim to lift people out of poverty and help them graduate from aid, except for those unable to support themselves. Otherwise, perpetual subsidies, especially those used for political gain, risk exacerbating the budget deficit.

“It should be an investment and developmental approach given the limited government financial resources and the penultimate objective is the greatest positive and developmental impact for the poorest of the poor,” he said.