EXPLAINER: What was 'leadership fund' in the national budget?

Former Department of Public Works and Highways (DPWH) Secretary Manuel Bonoan bared in his testimony before the Sandiganbayan the existence of a so-called “leadership fund” for lawmakers in past national budgets.

He said this was created after President Ferdinand "Bongbong" Marcos Jr. expressed concern over the magnitude of congressional insertions in the national budget, according to Joseph Morong's report on "24 Oras."

The system was developed as an "innovative" way to curb insertions that take away from the DPWH budget, but it proved unsuccessful in what it sought to do, according to Bonoan’s affidavit, a copy of which was exclusively obtained by GMA News.

In the affidavit submitted to the Sandiganbayan Third Division, Bonoan said the problem started in 2023 when the budget for the DPWH's foreign-assisted projects was cut by as much as 88.8%, the deductions from which were "converted" to inserted projects in the General Appropriations Act.

Bonoan is the prosecution's witness against former senator Bong Revilla, who is facing a ₱92.8-million malversation case involving alleged anomalous flood control projects.

"I reported it to the President. The President was alarmed by the reduction of the budgets… it will derail the implementation of the socio-economic agenda, particularly the infrastructure program of the administration," he said.

He added that the instruction was given by the President himself during a Cabinet meeting.

'Senate leadership fund'

Bonoan said the fund was internally named "Senate Leadership Fund" meant to accommodate the priority projects of senators in the department's National Expenditure Program (NEP).

NEP is the Department of Budget and Management's proposed national budget submitted to Congress for review and approval for the upcoming fiscal year.

He said the fund was conceptualized as an "innovative way" to address the cuts in the budget.

"I recommended that if we can allot a certain amount for their priority projects which should be consistent with the core program of the DPWH, then it can deter the legislators from deducting, adjusting, or amending the budgets allocated for the various proposed programs or projects of the DPWH," the former DPWH chief said.

Up to ₱1 billion

Bonoan said the fund, being ad hoc, does not have a fixed amount for each senator, but was subject to the discretion of the Senate president.

There was a minimum of ₱500 million for each senator, while the Senate president and chairpersons of major committees had at least ₱1 billion in allocation.

In 2024, Bonoan said the Senate availed of ₱13.29 billion and more or less ₱21 billion in 2025.

He said he also consulted with then House Speaker Martin Romualdez, former House Committee on Appropriations head Zaldy Co, and other legislators about allocations for legislative districts that range from ₱120 million to ₱500 million each.

He added that the late DPWH undersecretary Catalina Cabral had proposed a parametric formula to determine how much a legislative district could get.

GMA News is seeking the side of Romualdez and the camp of Co.

However, the scheme proved to be unsuccessful as there were more budget insertions in the 2024 and 2025 budgets.

The leadership fund first surfaced during a Senate Blue Ribbon Committee hearing in September 2025, when Bonoan was questioned about how lawmakers’ proposed projects could be included in the NEP even before Congress formally deliberated on the proposed budget.

Why did Lacson question it?

Senate President Pro Tempore Panfilo “Ping” Lacson questioned why lawmakers were already influencing the proposed budget at the NEP stage.

Lacson has described the practice as allowing legislators to “tinker” with the NEP, questioning why lawmakers’ proposals were being accommodated before the congressional budget deliberations.

He said Thursday that the 2025 national budget was the last spending plan to carry the leadership fund, also referred to as “allocables.”

“Actually, sa 2026 budget wala na. Kasi creation lang naman ito ni Secretary Bonoan in collaboration with late Usec Cabral. So sa 2025, ’yun ang last na budget year. I believe sa 2026, wala na ’yung leadership fund,” Lacson said in an ambush interview with Senate reporters.

Lacson described the mechanism as improper, although he said it was not illegal, because it allowed lawmakers to identify projects during the budget preparation stage, which he said falls under the Executive branch. —LDF, GMA News