The BGA Philippines Team, led by Managing Director Victor Andres Manhit, prepared an update for clients on the Philippines’ 2027 budget.

Context:

  • The Philippine Department of Budget and Management presented President Ferdinand Marcos Jr. with the final version of the 2027 National Expenditure Program August 10. The proposed PHP 7.2 trillion ($117.4 billion) national budget is approximately 6 percent higher than the approved 2026 national budget of PHP 6.8 trillion ($110.9 billion) and is equivalent to 21.7 percent of the country’s gross domestic product.
  • Anchored on the theme, “People-Centered Growth for an Inclusive and Resilient Future,” the proposed budget prioritizes education, health care, livelihood, national security and community empowerment. Amid an increasingly complex global environment marked by geopolitical tensions, climate-related disasters, technological disruption and evolving economic conditions, the budget is intended to support sustained growth while safeguarding the welfare and long-term interests of present and future generations.

Significance:

  • Social services continue to receive the largest sectoral allocation at PHP 2.5 trillion ($40.1 billion). The allocation covers education, culture, human development, social security and welfare, employment and health. Key programs include the Pantawid Pamilyang Pilipino Program, the National Health Insurance Program and the Universal Access to Quality Tertiary Education Program.
  • Consistent with the Philippine constitution, the education sector received the largest allocation at PHP 1.3 trillion ($20.4 billion), or 16.6 percent of the total budget. This covers the Department of Education, Commission on Higher Education, Technical Education and Skills Development Authority, state universities and colleges and other education-related programs. The education sector is followed by infrastructure, covering the Department of Public Works and Highways and the Department of Transportation, at PHP 895.5 billion ($14.6 billion); defense at PHP 452.5 billion ($7.4 billion); and health at PHP 365.8 billion ($6 billion).

Implications:

  • Marcos’ budget message framed the fiscal year 2027 budget as a strategic investment in the Filipino people and the country’s future, rather than simply a government spending plan. The proposed budget prioritizes education, health, infrastructure, food and energy security, social protection and resilience. The president emphasized the need for government agencies to focus on measurable outcomes, eliminate inefficient expenditures and ensure that public resources generate meaningful value. He said the proposed budget seeks to modernize public institutions, improve productivity and competitiveness, attract greater investment, create quality jobs and strengthen the government’s capacity to deliver faster, more responsive and citizen-centered public services.
  • Overall, the budget aims to balance economic expansion, inclusive development and fiscal responsibility. The president also emphasized the need to maintain fiscal discipline amid global uncertainties, including geopolitical tensions, inflationary pressures and volatile energy prices. The proposed budget is intended to sustain public investment while keeping expenditures aligned with the government’s fiscal consolidation agenda.

We will continue to keep you updated on developments in the Philippines as they occur. If you have any questions or comments, please contact BGA Philippines Managing Director Victor Andres Manhit at vmanhit@bowergroupasia.com. 

Best regards, 

BGA Philippines Team 

A small ginko leaf

Managing Director

Dindo is recognized as one of Manila’s most well-connected and savvy advisers on developments in government and business in the Philippines. Concurrent with his role as managing director for the BGA Philippines office, he is also the founder and managing director of the Stratbase Group and president of its policy think tank, the Stratbase Institute for Strategic and International Studies.  Since 1991, Dindo has served as a member of the faculty and is the former chair of the Political Science Department and a senior fellow of the La Salle Institute of Governance at the De La Salle University, Manila. He has authored numerous papers on good governance, political, electoral and educational reform. He specializes ... Read More