Confidential and Intelligence Funds Draw Sharp Debate

Palace Defends Confidential and Intelligence Funds

Malacañang has staunchly defended the billions of pesos allocated to the confidential and intelligence funds of President Ferdinand Marcos Jr., despite growing calls from budget watchdogs to abolish these discretionary budgets. Critics argue that these funds, especially those allocated to civilian agencies and offices, are vulnerable to misuse and corruption.

Under the proposed P6.793-trillion National Expenditure Program (NEP) for 2026, submitted recently to Congress, the Office of the President (OP) stands to receive the largest portion of the confidential and intelligence funds. Budget officials reported that the OP’s share amounts to P4.5 billion, nearly half of the total P10.77 billion earmarked for these secret funds next year.

Justifying the Large Confidential and Intelligence Funds

Palace spokesperson Claire Castro emphasized the necessity of these confidential and intelligence funds. She explained, “The president is the commander-in-chief and the chief architect of national security and foreign policy. The president needs these confidential and intelligence funds to do its mandate.”

She added, “We must remember: confidential funds are not bad if they are spent properly. Confidential funds only become bad when they are used by corrupt officials.” Community members noted that this is the fourth consecutive year the OP has requested such a significant amount.

Comparing Confidential and Intelligence Funds Across Agencies

The OP’s confidential and intelligence funds are notably four times higher than the proposed P1.141 billion allocated to the National Intelligence Coordinating Agency (NICA), the government’s primary intelligence gathering and analysis body responsible for overt, covert, and clandestine operations.

Similarly, the Department of National Defense is set to receive P1.8 billion, while other key offices such as the Anti-Money Laundering Council, the National Security Council, and the Philippine National Police will share P2.292 billion. The Commission on Audit (COA) and the Office of the Ombudsman are slated to receive P10 million and P51 million, respectively.

Understanding the Scope of These Funds

According to a 2015 joint circular from the Department of Budget and Management and the Commission on Audit, confidential expenses cover surveillance activities within civilian government agencies. Meanwhile, intelligence expenses involve information-gathering operations by uniformed and military personnel directly affecting national security.

Local leaders have long criticized the opaque nature of these funds, which are lump-sum allocations typically exempt from standard auditing procedures. This exemption is intended to protect national security and law enforcement but has raised concerns about accountability.

Calls to Abolish the Office of the President’s Funds

Former Finance Undersecretary Cielo Magno urged the abolition of the OP’s confidential and intelligence funds. She argued, “The President does not need such a large amount for confidential and intelligence funds because the intelligence agencies are already under his authority.”

Magno suggested reallocating these budgets, stating, “Instead of placing it under the Office of the President, increase the intelligence budget of the intelligence agencies and civilian agencies that have intelligence work.” She is also an economics professor at the University of the Philippines.

Officials reported that the OP’s confidential and intelligence funds ballooned during former President Rodrigo Duterte’s term, rising to P2.5 billion from 2017 to 2019 and further swelling to P4.5 billion in the subsequent years, including the first four years under President Marcos.

Ethical Concerns Amid Political Rivalries

Magno also commented on political dynamics, stating, “Marcos has no moral ascendancy over Sara Duterte if he continues to request confidential funds despite the fact that these are merely being embezzled.” She further pointed out that Congress, filled with the President’s allies, “has no moral ascendancy over Sara Duterte if it continues to grant confidential funds to the President.”

However, Palace officials countered these claims, emphasizing that President Marcos is not engaging in questionable practices like those attributed to Vice President Sara Duterte. “Let us remember that if the reporting is done correctly and the CIF are used properly, this will not be questionable,” Castro explained.

She clarified, “The comparison only arises when the reporting is not done properly and certificates or various receipts are used just to claim that the confidential funds were spent—that is the difference.”

Vice President’s Confidential Funds Under Scrutiny

The Office of the Vice President (OVP) under Sara Duterte has not requested confidential and intelligence funds for the second consecutive year. This follows accusations of misusing P612.5 million during her concurrent tenure as vice president and education secretary from 2022 to 2024.

Community members recalled that a House committee inquiry in the 19th Congress found questionable disbursements from the OVP’s confidential funds, including payments to beneficiaries with suspicious names such as “Mary Grace Piattos,” “Marian Rivera,” and “Chel Diokno.”

These findings partly led to the endorsement of impeachment articles against Duterte by 215 House lawmakers in February. However, the Supreme Court later declared the impeachment proceedings unconstitutional in July due to a one-year bar rule violation.