Manila: The bicameral conference committee has successfully realized PHP20.7 billion in savings from the PHP529.6-billion 2026 budget of the Department of Public Works and Highways (DPWH) following the application of updated construction cost adjustments across thousands of infrastructure projects, Senate Committee on Finance Chairperson Sherwin Gatchalian announced early Thursday.

According to Philippines News Agency, the majority of the savings have been redirected to address a funding shortfall in the national government's contributions to the Philippine Health Insurance Corporation (PhilHealth). The required remittance for 2026 stands at PHP69.7 billion, but only PHP53.2 billion was initially provided, leaving a gap of approximately PHP16.5 billion. Gatchalian confirmed that PHP16.2 billion of the savings will be allocated to PhilHealth.

The remaining PHP4.2 billion from the savings has been transferred to the National Disaster Risk Reduction and Management Fund. This allocation aims to support communities affected by typhoons and earthquakes, aligning with the bicameral committee's final deliberations on the proposed PHP6.793-trillion national budget for the fiscal year 2026.

Gatchalian explained that the savings were a result of the DPWH's revised submission of adjustment factors that now include logistics, hauling, indirect costs, and other expenses, leading to more realistic project estimates. "In the DPWH's new submission, they already included logistics, hauling costs, and other expenses, making it closer to actual cost," Gatchalian stated.

These revised adjustment factors were applied to all covered projects, totaling 20,000. The implementation of these adjustments resulted in the PHP20.7 billion savings. "We applied these to all 20,000 projects, resulting in savings of PHP20.7 billion," he mentioned.

Gatchalian expressed confidence in the revised budget, asserting, "I am confident to say that there are no more overpriced materials in this budget."