DOF eyes P1.4-B spending in first quarter for economic recovery

The government plans to spend P1.4 billion in the first quarter of 2026 to support economic recovery, Department of Finance (DOF) Secretary Frederick Go said on Friday.

“It’s P1.4 billion for primary spending for the first quarter,” he said after meeting with officials from various government agencies last week to discuss the expenditure plan.

Primary spending refers to total expenditure for a certain period, excluding payment for government liabilities.

Go said the meeting included officials from the five largest spending agencies this year: Department of Education, Department of Public Works and Highways, Department of Health, Department of Transportation and Department of Agriculture.

“I’m constantly coordinating with the DBM (Department of Budget and Management) on the release of these funds because we need them to circulate in the economy,” he said.

Acting DBM Secretary Rolando Toledo said the government plans to spend P1.3 trillion in infrastructure outlays for 2026, adding that the DBM adjusted its spending target downward from 5.1 percent to 4.3 percent of gross domestic product (GDP) in 2026.

Keeping momentum

Despite the cut, Toledo said the government remains committed to prioritizing high-impact projects, including school buildings, disaster-resilient infrastructure and social services.

The DBM emphasized that the 2026 budget contains no “ghost projects” and is fully specified, supporting timely implementation. Officials anticipate a catch-up in public works spending in the first quarter to offset prior delays, with the goal of sustaining economic momentum.

The government also aims to keep the fiscal deficit at 4.3 percent of GDP by 2028, supported by disciplined spending and revenue growth, while maintaining debt levels at 58 percent of GDP—within sustainable limits.

The move follows slower economic growth of 4.4 percent in 2025, down from 5.7 percent in the previous year, amid factors such as the flood control corruption scandal, weather disturbances and global economic uncertainties.

For 2026, the target has been revised downward to 5 percent to 6 percent, and for 2027, it remains at 5.5 percent to 6.5 percent, according to the Development Budget Coordination Committee.

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The Bangko Sentral ng Pilipinas and the World Bank project growth of 5.4 percent in 2027, suggesting the target may only be met by 2027.

Speaking on the sidelines of the Philippine Life Insurance Association (PLIA) officers’ oath-taking ceremony in Makati City.

Go assured PLIA members that the country’s economic fundamentals remain strong.

“None of the macroeconomic fundamentals have changed. So, we should get back on track this year,” he said.

Monetary authorities said inflation, or the rate of increase in the prices of goods, would also likely stay within the government’s target band of 2 to 4 percent. In 2025, inflation averaged at 1.7 percent.