ODA principals not spared

The simplest solution to ending the outrage over the corrupted flood control projects was precisely President Ferdinand Marcos Jr.’s directive to halt the projects that are not coordinated with foreign financiers.

The directive has affected P225 billion for flood control projects in the proposed 2026 national budget that will be redirected to education, health, and “other pressing needs.”

The ongoing investigations have delayed the implementation of the 2025 flood control budget of P350 billion, making the 2026 allocation unnecessary, according to the President.

The juggling of flood control funds started in 2022 when, based on government data, the final amount in the General Appropriations Act for regular flood management programs was increased by P17.68 billion, while foreign-assisted project (FAP) loan proceeds were slashed by P11.13 billion.

Government counterpart funds were also cut by P8.7 billion, resulting in a reduction of P2.15 billion.

Piecing together the process from start to finish, ending up with the transfer of the funds from FAPs to fill the gap for legislators’ pet projects, the Official Development Assistance (ODA) projects were not exactly defunded, but were placed under the unprogrammed allocations (UA), which are conditional items that needed extra revenues or borrowings to download the funds.

The data showed that principal amounts already made available for the projects were bumped off as provisional, while the ready financing was applied to pet projects.

Without the counterpart financing, the government could not draw from ODA funds.

The reallocation of ODA funds, thus, is a double whammy for development, as not only are the amounts ready for well-structured projects denied, but also the future drawdowns, since the government’s commitment is not made available.

Diverting flood control funds to pork barrel projects also results in a loss of confidence by lending institutions.

Typhoons will not stop as a result of the scandal engulfing the nation. Still, the ongoing scandal has placed the concessionary loans in peril.

For instance, the ODA-funded Metro Manila Flood Management Project and Pasig-Marikina Channel Improvement Project are flagship initiatives aimed at mitigating these risks.

Underfunding the projects could exacerbate flooding, leading to loss of lives, property damage, and economic disruption.

ODA projects involve bilateral or multilateral agreements with foreign governments or institutions.

Failing to allocate funds as agreed on could strain diplomatic relations and reduce the ability to secure future foreign assistance, according to a financial sector veteran.

In the 2023 allocations, local flood projects were increased by P73.2 billion, while FAPs were decreased by P19.2 billion.

By 2024, the increase in locally funded projects reached P50.6 billion, while FAPs decreased by P21.6 billion.

In 2025, the GAA showed a P13.9-billion increase, while P18.7 billion in FAPs were removed, resulting in a total slash of P4.5 billion.

In 2026, the NEP projects were reduced by P5.55 billion while FAPs grew by P6.6 billion.

The data that Davao City Rep. Sid Ungab provided indicated that not only counterpart funds that the government needed to raise to unlock the foreign assistance, mainly from ODA, but also the loan proceeds were reallocated to fund the increase in local works, which were mostly the pet projects of legislators.

Most of the amounts in the reduced FAPs went to financing the increases in the number of locally sourced projects, which is a mirror of the hundreds of billions of pesos worth of flood projects.

The callousness of greedy politicians is nowhere more tangible than in derailing development projects in favor of pork barrel percentages.