DBM: UA allow execution of foreign-aided projects

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January 12, 2026 | 12:00am

MANILA, Philippines — Foreign-assisted projects that miss the government’s budget cut-off are placed under unprogrammed appropriations, the Department of Budget and Management (DBM) said. This allows implementation once loan agreements with development partners are finalized.

In a radio interview, Budget Acting Secretary Rolando Toledo explained that the lengthy approval process for foreign-assisted projects often means that some programs are not included in the initial program appropriations.

“We have a loan agreement, it would be a shame if we couldn’t implement it this year given the already perfected loan. That’s why, we are looking at a cut-off before we put it into the program appropriation for our foreign-assisted projects,” he said.

President Marcos vetoed several items under the 2026 unprogrammed appropriations, totaling P92.5 billion, leaving only three of the original 10 items retained in the budget.

Those retained in the outlay were support for foreign-assisted projects with loan agreements expected to be finalized during the year (P97.3 billion), risk management provisions for unforeseen contingencies (P3.6 billion) and the revised Armed Forces of the Philippines modernization program (P50 billion).

With the veto, the total unprogrammed appropriations dropped to P150.9 billion, marking the lowest since 2019.

Toledo stated that some foreign-assisted projects, which initially lacked program appropriation, are placed under unprogrammed appropriations, allowing for their implementation once loan agreements with development partners are finalized.

“Now during the budget preparation, there are programs or projects from the foreign-assisted project that have not yet been approved. Because we have a cut-off for program allocation, for program appropriation as far as the foreign-assisted project,” he said.

The DBM’s Budget 101 document states that budget preparation begins with the issuance of the budget call, followed by program convergence with line departments between January and February and second-round hearings reviewing proposed budgets from March to April.

Between June and July, the DBM consolidates the proposed national budget, secures the president’s approval and submits it to Congress for deliberation and eventual passage, completing the annual budget cycle and setting the spending priorities for the next fiscal year.