Key facts
- President Ferdinand Marcos Jr. proposed a 7.2 trillion-peso ($118.1 billion) budget for 2027.
- The proposed budget is 6% higher than the current year's allocation.
- Education will continue to receive the largest share of the budget at 1.15 trillion pesos.
- Healthcare funding will decrease by 21% to 353.8 billion pesos.
- Defence spending is set to increase by 7.6% to 328.8 billion pesos.
- The government anticipates a fiscal deficit of 1.7 trillion pesos for 2027.
Philippine President Ferdinand Marcos Jr. has submitted a proposed budget of 7.2 trillion pesos ($118.1 billion) to Congress for the year 2027, marking a 6% increase from the current year's allocation. This move comes as the administration seeks to revitalize economic momentum following a significant slowdown in growth and a corruption scandal that has impacted infrastructure spending.
The Philippine economy experienced its weakest growth since 2021 in the second quarter, expanding by 2.3% year-on-year, primarily due to a slump in construction and softer domestic demand. This brought the first-half growth to 2.6%, falling short of the government's target range of 3.5% to 4.5% for the year.
The proposed spending plan for 2027 is equivalent to 21.7% of the gross domestic product, according to the Department of Budget and Management (DBM). Education is slated to receive the largest portion of the budget with 1.15 trillion pesos, although this represents an 11.5% decrease from the previous year. Healthcare funding is set to be reduced by 21% to 353.8 billion pesos, and agriculture funding will see a 13% decrease to 261.7 billion pesos.
In contrast, the Department of Public Works and Highways, which has been at the center of an infrastructure scandal, is allocated 644 billion pesos, a 22% increase from 2026. Defence spending is also proposed to rise by 7.6% to 328.8 billion pesos. The DBM noted that nearly four-fifths of the budget increase will cover mandatory obligations, such as salary adjustments for military and uniformed personnel.
Budget Secretary Kim Robert De Leon stated that total disbursements are expected to reach 6.9 trillion pesos in 2027, with projected revenues of 5.2 trillion pesos, resulting in a fiscal deficit of 1.7 trillion pesos to be financed through borrowing. The government has set a GDP growth target of 5.0% to 6.0% for the period between 2027 and 2030.