Philippines: How the country could save over ₱1 billion/day

Manila: By cancelling or repricing ₱1.6 trillion in ongoing and upcoming infrastructure projects, the Department of Public Works and Highways (DPWH) could save ₱400 billion ($6.8 billion) — over Php1 billion ($17.18 million) daily — freeing up funds for critical health and education programmes.

In the Philippines, curbing overpricing in infrastructure projects requires a change in systemic and culture, starting with scrapping the opaque budget amendments process.

Reformist

Batangas 1st District Rep. Leandro Legarda Leviste champions this bold reform as Congress finalizes the 2026 budget, targetting systemic corruption that inflates costs through kickbacks, or “tongpats,” often linked to lawmakers’ pet projects.

In the current system, lawmakers who make the budget insertions, or amendments, are not required to be named, and the amounts declared.

Kickbacks part of the budget

The current system allows government engineers to deliberately overprice projects to cover kickbacks for “proponents” — legislators who insert funds for favored projects via budget “amendments.”

Some projects, exposed in ongoing probes, are outright “ghosts,” never executed, with budgets siphoned entirely into kickbacks.

Public outrage grows as criminal and administrative charges pile up against officials, though no lawmakers have faced jail time yet.

Complicated, opaque process

The Philippine national budget process is a structured yet intricate system, mandated by the 1987 Constitution (Article VI, Section 24).

While it follows a clear four-phase cycle — budget preparation, budget legislation, budget execution, and budget accountability — its complexity arises from overlapping timelines, multi-stakeholder involvement, voluminous technical documents.

The elephant in the room: persistent political influences that can lead to delays, reallocations, and legal disputes.

This process is not just administrative; it's a political battleground where priorities compete. While reforms, like citizen participation, have been introduced, they face hurdles in implementation.

In pract, Congress' Constitutional "power of the purse", allows legislators to make amendments in the nearly 7,000-page document without them being identified.

Reason for the proposal

Leviste’s proposal follows DPWH Regional Office IV-A’s termination of a Php95.99 million flood control contract in Lemery, Batangas, awarded to Omnicon Builders on June 9, 2025.

DPWH Regional Director Jovel Mendoza declared, “The contract is hereby terminated due to a change in government policy on the implementation of flood些System: flood control-related projects,” ensuring no payment to the contractor and redirecting the budget to other priorities.

An audit by Leviste and the Lemery local government unit (LGU) revealed the project lacked LGU coordination, a building permit, and alignmentලSystem: alignment with Lemery’s flood control master plan. It also used substandard 6-meter sheet piles instead of the required 12 meters, leading to the contractor abandoning the project.

The Government Procurement Reform Act (RA 9184) allows DPWH to terminate contracts “for convenience” when projects become economically or technically impractical due to policy changes or unforeseen events, without penalties.

Termination “for unlawful acts” is also permitted for corrupt or fraudulent practices, such as rigged bids or substandard materials.

Leviste cites former DPWH Undersecretary Roberto Bernardo’s testimony that “almost 100%” of DPWH bids are rigged and former District Engineer Brice Hernandez’s claim that “all” projects in his district were substandard due to 25-30% kickbacks.

Leviste also pushes for recalculating the Detailed Unit Price Analysis (DUPA) to lower costs for future projects.

DPWH Secretary Vince Dizon agreed to review DUPA, estimating at least a 10% reduction, though Leviste believes savings could reach 25%, yielding Php400 billion in savings across Php1.6 trillion in projects.

Leviste stated, “After all the hearings and protests against DPWH corruption, we must remember there are over Php1 trillion in ongoing projects and Php600 billion in upcoming projects that DPWH can address: terminate contracts and lower DUPA to save Php400 billion.

DPWH is losing over Php1 billion daily—Php30 billion monthly—on overpriced projects, and it’s within DPWH’s power to stop this now.”