MANILA, Philippines — Philippine government infrastructure spending fell for the fifth consecutive month in November 2025, a downward spiral primarily attributed to ongoing investigations into anomalous flood control projects.
The Department of Budget and Management (DBM) report, released in early February 2026, details a severe contraction that has directly impacted the country’s national economic performance.
November Spending Data
- Capital Outlays: Spending on infrastructure and other capital outlays plummeted by 45.2 percent to just P48 billion in November. This represents a P39.6-billion decrease compared to November 2024.
- Accelerating Decline: The November drop was even steeper than the 40.1 percent decline recorded in October (P65.9 billion).
- Year-to-Date Performance: From January to November 2025, total infrastructure spending reached P991 billion, a 16-percent decrease from the P1.18 trillion spent during the same period in the previous year.
The “Corruption Probe” Effect The DBM noted that the Department of Public Works and Highways (DPWH) continues to post negative growth due to the “ongoing probe and crackdown on corruption issues.”
- Project Delays: The investigation has slowed the implementation of various projects nationwide.
- Payment Bottlenecks: Contractors have been slower to submit progress billings, and the processing of payment claims has been further hampered by intensified scrutiny.
Economic Fallout The sharp reduction in state spending has dragged down the broader economy:
- 16-Year Low: The Philippine economy ended 2025 with a 3-percent growth rate in the fourth quarter, its lowest in 16 years.
- Full-Year Miss: Full-year GDP growth for 2025 settled at 4.4 percent, failing to reach the government’s target band of 5.5 to 6.5 percent.
- Historical Comparison: State statisticians noted that the 42-percent contraction in infrastructure spending in Q4 was the worst since 2011, when outlays fell 62 percent during a similar anti-graft campaign.
Disbursements Outlook Total national government disbursements for November also fell by 9.6 percent year-on-year to P498.3 billion. However, a small silver lining appeared in the 11-month total disbursements, which reached P5.4 trillion, representing a modest 2.5-percent increase over 2024.
As the government enters 2026, economists emphasize that “pump-priming” the economy through a revival of transparent infrastructure projects will be essential to meeting the revised growth target of 5 to 6 percent.
