Recto: Gov’t cleanup from flood control mess to lead to faster growth

Finance Secretary Ralph Recto on Tuesday expressed confidence that the Philippine economy will see a faster growth “over the next few months” resulting from the government’s bureaucratic cleansing in relation to the ongoing flood control scandal probe.

During the Senate hearing on the Department of Finance’s (DOF) proposed P38-billion budget for 2026, Recto highlighted that “things will only get better from here, as we have laid down the foundations for long-term growth,” citing the ongoing investigation of the alleged anomalies in flood control contracts procurement.

“We only see upside over the next few months as the major government cleanup concerning the flood control controversy will lead to stronger institutions, better governance, and faster growth,” the Finance chief said.

“Now that we’re plugging growth leaks and reallocating funds to high-impact investments, we will only grow faster,” he added.

The Finance chief, however, said there would be an expected slowdown in growth in the third quarter resulting from slower government disbursements and weather-related disruptions.

“To mitigate this, we have prepared a catch-up plan that prioritizes the accelerated implementation of projects with high multiplier effects,” Recto said.

“We are supporting the rehabilitation and reconstruction of damaged infrastructure, as well as providing temporary employment to those displaced or affected by recent calamities. Top priority projects also include education, agriculture, health, and ICT,” he said, adding that the government’s “anticipatory approach” would ensure that available fiscal space is directed toward high-impact, fast-disbursing projects to counteract the potential growth slowdown.

The Finance chief, moreover, that the government is making efforts to restore integrity in public spending with the Independent Commission for Infrastructure (ICI) as well as “strengthening governance and accountability mechanisms, digitalizing procurement systems, and ensuring full transparency at every level of government.”

“The controversy has revealed that not all capital expenditures were translating into growth. And now that we’re plugging those leaks and reallocating funds to high-impact investments—such as education, healthcare, agriculture, and digitalization—we will only grow faster,” he said.

The Philippine economy has so far grown at an average rate of 5.9%—among the highest in the region.

As of August 2025, employment reached 50.1 million, with wage and salary workers accounting for 64.4% of total employment or 32.3 million Filipinos.

Recto also reaffirmed the DOF’s commitment to protect “every peso of the taxpayers’ money by ensuring that their taxes are spent on the right things, at the right price, by the right agency, and at the right time.” — BM, GMA Integrated News