Improved revenue collection is expected to follow suit as early as the first quarter of 2026 once the Philippine government succeeds in prosecuting individuals involved in the misuse of the flood control budget, recouping lost funds, and reforming practices in public works.

Finance Secretary Frederick D. Go told reporters last week that the government’s move to prosecute those who directly dipped their hands into public infrastructure funds, coupled with efforts to restitute misused funds, is part of the Marcos Jr. administration’s response to public scrutiny over alleged large-scale corruption within the government.

Go said the ultimate objective is to overcome and get past this “hump,” or the challenges tied to the deepening probe into the flood control fiasco. He explained that the speed at which Filipinos address the matter affects the outlook for revenue collection.

He said the sooner Filipinos allow the issues to be put to rest, the more beneficial it will be for the expansion of the country’s gross domestic product (GDP), as the extent of resolution affects the country’s revenue earnings.

Growth averaged five percent in the first three quarters of the year, largely due to dampened business sentiment stemming from local governance concerns. This fell short of the government’s GDP growth target of 5.5 to 6.5 percent.

Meanwhile, the government is targeting ₱4.52 trillion in revenues in 2025, accounting for 15.9 percent of the country’s expected full-year output. This is expected to rise by 10.2 percent to ₱4.98 trillion, or 16.2 percent of GDP, in 2026.

According to the Finance chief, restitution of foregone funds from the individuals involved will reach approximately ₱12 billion.

As of Dec. 19, the Anti-Money Laundering Council (AMLC), the country’s financial intelligence unit, has frozen over ₱20 billion worth of assets owned by or linked to government contractors.

AMLC reported that a lawmaker was included in the latest freeze order issued last week. Asset freezing was first carried out on the infamous spouse contractors Sarah and Curlee Discaya, as well as the “Bulacan Group of Contractors.”

To date, 6,538 bank accounts, 367 insurance policies, 255 motor vehicles, 178 real properties, 16 e-wallet accounts, and three securities accounts have been frozen.

For its part, Go said the Department of Public Works and Highways (DPWH) has also implemented reforms, including trimming the unit costs of the projects it is set to undertake. Transparency—via videoconferencing—on how contractors secure particular projects is now also being practiced.

Apart from the DPWH, President Marcos’ chief economic manager also said other agencies have received directives mandating them to review how they could cut costs in the projects they implement.

For the upcoming year, Go stressed the importance of exercising fiscal discipline, or the agencies’ approach to managing their funds, noting that government agencies should prioritize channeling resources into projects that generate higher-quality outputs.