Malacañang on Thursday said government agencies initially sought a combined P11 trillion for 2027 before President Ferdinand Marcos Jr. ordered the proposed national budget trimmed to P7.2 trillion to focus spending on priority programs and projects.

Presidential Communications Office Undersecretary Claire Castro said the figure was based on information from the Department of Budget and Management (DBM).

“According to the DBM, the real supposed-to-be budget is P11 trillion. But President Marcos ordered that those that should be prioritized should be prioritized; that is why it went down to P7.2 trillion,” Castro told reporters during a Palace briefing.

Castro made the statement as she rejected ACT Teachers Party-list Rep. Antonio Tinio’s characterization of the proposed 2027 national budget as “anti-poor” and “anti-people.”

Tinio had criticized reductions in allocations for some social services while funding for defense, infrastructure and anti-insurgency programs increased.

Palace explains UP, PGH cuts

Castro also addressed the proposed P2.95-billion reduction in the University of the Philippines System's budget under the 2027 National Expenditure Program (NEP).

UP's proposed allocation declined from P29.47 billion in 2026 to P26.53 billion in 2027, while the Philippine General Hospital faces an P805-million reduction.

Citing the DBM, Castro said UP and PGH received higher allocations in 2026 partly because of projects that have since been completed.

“For example, a building. If it was already finished, then the DBM will not put budget on it anymore. That’s the reason why some budget allocations are lower or increased,” Castro said.

The proposed P7.2-trillion national budget, anchored on the theme “People-Centered Growth for an Inclusive and Resilient Future,” is equivalent to about 21.7 percent of gross domestic product and is 6 percent higher than the 2026 budget.

According to the DBM, part of the increase reflects mandatory expenditures and existing government commitments, including a higher National Tax Allotment for local governments, the fourth tranche of salary adjustments for civilian government employees under Executive Order 64 and salary adjustments for military and uniformed personnel.

Social services would receive the largest share at P2.456 trillion, covering education, health care, social protection, employment, housing and other programs.

Economic services would receive P1.833 trillion, P277.3 billion higher than the current year's allocation, to fund infrastructure, agriculture, transportation, water resources development and other programs.

The consolidated health sector budget is proposed at P1.06 trillion, equivalent to 3.19 percent of GDP, up from 2.68 percent this year.

Infrastructure investment under the Build Better More Program, meanwhile, is proposed at P1.467 trillion, equivalent to 4.4 percent of GDP and P178 billion higher than the 2026 General Appropriations Act level.