President Ferdinand "Bongbong" Marcos Jr. officially enacted the national spending plan for 2026 on Monday, January 5, 2026, by signing the General Appropriations Act (GAA). The historic budget, valued at P6.793 trillion, marks a significant shift towards empowering local governments with unprecedented financial resources.
Record-Breaking Allocations for Local Empowerment
During a press briefing, Acting Department of Budget and Management Secretary Rolando Toledo unveiled the cornerstone of local government funding: a National Tax Allotment (NTA) exceeding P1 trillion. This massive allocation is designed to bring governance and public services closer to the people. Toledo emphasized that this core fund is supplemented by over P31.7 billion in special shares from the national coffers and an additional P1.41 billion sourced from fire code fees.
Further bolstering local autonomy, the Local Government Support Fund sees a dramatic increase, more than doubling to P57.87 billion for 2026. This fund is critical for strengthening basic services and providing targeted aid to far-flung, low-income, and resource-constrained municipalities across the archipelago.
Enhanced Disaster Response and Fiscal Flexibility
Recognizing the frontline role of LGUs in calamities, the 2026 budget earmarks a substantial portion of the National Disaster Risk Reduction and Management Fund (NDRRMF) for direct local action. Out of the total P39.82 billion NDRRMF, a dedicated P15.33 billion is allocated specifically for LGU-led rehabilitation and construction projects.
To ensure swift action during emergencies, P10.685 billion is set aside for the Quick Reaction Fund (QRF). Toledo outlined a responsive replenishment mechanism, stating that this emergency fund can be restored once LGUs have utilized 50 percent of their initial QRF allocation.
A Philosophy of Localized Solutions
Secretary Toledo framed the budget's local government focus as a fundamental governance philosophy of the Marcos administration. "The administration's belief is simple and straightforward — if the problem is local, the strategy or decision should also come from the local government," he stated in Filipino.
He elaborated that the 2026 fiscal plan goes beyond merely increasing funds. "So in 2026, we not only increased the funding for LGUs, we also changed the very way the budget is allocated," Toledo added. "The role of local government is clearer, their powers are stronger, and their accountability is more defined." This strategic overhaul aims to accelerate national development by decentralizing decision-making and empowering local leaders to address their communities' unique challenges directly.
