Up to P25.6 billion seen to be saved from cut in non-essential expenses

MANILA, Philippines — The Department of Budget and Management (DBM) said cutting non-essential maintenance and other operating expenses (MOOE) may generate up to P25.6 billion in savings as part of a broader government response to the economic shock of the Middle East war.

Acting Budget Secretary Rolando Toledo said the initial projection showed a 10 to 20 percent reduction in expenses across departments and agencies, including travel, training scholarships, supplies and materials, utilities  and MOOE, which may yield ample savings for the government.

This translates into P12.8 billion to P25.6 billion in reduction costs when the efficiency measures are implemented from March to December 2026, he said.

“We’re already drafting the budget circular to operationalize these savings to fund relevant PAPs (programs, activities and projects) and help address the impact of the Middle East crisis,” Toledo said.About P236.6 billion in funds have been identified by the DBM to address the effects of the ongoing crisis.

This initiative was aligned with Memorandum Circular 114 and Executive Order 110, which mandate that all departments, agencies and governments save at least 20 percent from non-essential MOOE.

“We are coordinating with various agencies to check their specific critical MOOE requirements to further refine our assumed exemptions with objectives of raising potential cost reduction,” he said.

Meanwhile, the Department of Finance said the Development Budget Coordination Committee has already convened and presented its recommendation to the President on the measure to suspend or reduce the excise tax on fuel.

On March 25, Marcos signed Republic Act 12316, granting him special powers to suspend or cut fuel excise taxes once the average Dubai crude oil price hits or exceeds $80 per barrel for a month.Economic managers presented their assessment to the President on April 7.

“With regards to the suspension or reduction of excise taxes, I cannot discuss it yet because it’s still subject to the approval of the President,” Toledo said.

Finance Undersecretary Karlo Fermin Adriano said the government is continuously assessing whether it needs to provide more targeted subsidies.

Meanwhile, Toledo said the government is expected to deliver targeted subsidies rather than a universal one.

“I think it’s a prudent way of giving subsidies or ayuda that we have to target really for those specifically vulnerable sectors,” he added.