DBM eyes lowering unprogrammed appropriations to below 5% of budget — Palace

The Department of Budget and Management (DBM) is now working on a “budgeting code,” a salient feature of which is to further reduce the share of unprogrammed appropriations in the national budget to below 5%.

At a Palace briefing on Thursday, Presidential Communications Undersecretary Claire Castro, citing the DBM, said the Budget Department is “drafting the administration’s proposed Philippine budgeting code which is intended to institutionalize key fiscal reforms including clearer parameters governing the level, scope and conditions for the release of the unprogrammed appropriations.”

“A central policy intention under the proposed reform is to ensure that unprogrammed appropriations are confined to a limited and clearly defined purpose, thereby preventing its use as a broad or discretionary funding mechanism and enforcing fiscal discipline,” Castro said.

“The draft measure will be submitted for review by the economic team, the Executive Secretary and ultimately, the President. As such, the matter remains under policy development and inter-agency consultation,” the Palace official said.

The Department of Budget and Management (DBM) defines unprogrammed appropriations as those that provide standby authority to incur additional agency obligations for priority programs or projects when revenue collection exceeds targets, and when additional grants or foreign funds are generated while appropriations with definite/identified funding as of the time the budget is prepared.

In simple terms, unprogrammed appropriations are akin to planned household purchases that may only proceed if extra money is available, either from additional income, like bonuses or from loans.

Unprogrammed appropriations were among the contentions in the controversial 2025 General Appropriations Act (GAA) amid allegations of insertions during the bicam—an issue that compelled both chambers of Congress to open the bicameral conference committee meetings to the public for the 2026 national budget.

Under the 2026 GAA, President Ferdinand “Bongbong” Marcos Jr. vetoed nearly P92.5-billion worth of line items under the unprogrammed appropriations.

“As a matter of fiscal policy direction, the DBM’s position is to adopt a more prudent and disciplined approach by setting the level of unprogrammed appropriations at a rate lower than 5% of the total national budget based on historical data and fiscal trends,” Castro said.

“The precise threshold, however, will remain subject to further deliberation and the President’s approval in the context of the proposed budgeting code,” she said.

Asked by reporters whether the President supports a below 5% of the national budget for unprogrammed appropriations, Castro responded, “Yes.” — RSJ, GMA Integrated News