Cuts to bring infra budget down to 4.7% of economy next year, senators told

THE infrastructure budget will account for only 4.7% of gross domestic product (GDP) in 2026, below economic managers’ target of 5%, Sen. Sherwin T. Gatchalian told the Senate plenary on Monday.

“Because of the flood control issue and the reduction in the flood control budget, we will only hit 4.7% of GDP for 2026. So as much as possible, we diverted some of the flood control projects to other infrastructure projects,” he said.

Finance Secretary Ralph G. Recto told reporters on the sidelines of the Senate session on Monday that the infrastructure spending cuts are headlined by the P255.53-billion reduction in the budget of the Department of Public Works and Highways (DPWH).

Mr. Gatchalian said the government diverted funds originally set aside for flood control projects to classrooms, airports, and seaports.

“Admittedly because of the sheer size… it has been difficult to divert (the flood control funding to) other infrastructure projects,” he said.

Mr. Gatchalian said infrastructure spending will be restored to 5% of GDP in the following year as the Department of Economy, Planning, and Development (DEPDev) and the DPWH overhaul the spending plan.

“Once the DEPDev has organized its master planning and the DPWH reforms its processes, we will revert to the minimum 5% of GDP on infrastructure spending in the following year,” he said.

In 2027, infrastructure spending is expected to hit P1.692 trillion or 5.1% of GDP. — Aaron Michael C. Sy