EDITORIAL
On the eve of the tenth anniversary of the Philippines' arbitral victory over China, Defense Secretary Gilberto Teodoro Jr. stood before a Manila forum and delivered a stark assessment: the country must nearly triple its defense spending — from the current 1.3 to 1.4 percent of GDP toward 2 or even 4 percent — if it is to hold its own seas. He warned of a "free-rider problem," a public unwilling to pay for its own protection. When reporters asked where the money would come from, he demurred that this was for other officials to decide.
Here is a decision, then, offered free of charge. The money already exists. It is not missing. It is being spent — on the machinery of Congress and on the theft that machinery enables.
The Arithmetic the Government Leaves Unassembled
The structural benchmark long used by the World Bank, the Asian Development Bank, and the IMF — that roughly a fifth of the national budget is lost to corruption — implies losses near ₱1.36 trillion against the ₱6.793-trillion budget for 2026. That was always an abstraction. The flood-control reckoning of 2025 made it flesh.
Economic losses from corruption in flood control projects may have averaged ₱118.5 billion a year from 2023 to 2025, the Department of Finance reported at a Senate hearing, based on accounts placing the graft in the public works department's flood projects at 25 to 70 percent of total project cost.
Finance Secretary Ralph Recto put a human price on it: the lost money could have meant 95,000 to 266,000 jobs, and without it the economy could have grown by as much as six percent instead of the 4.4 percent it actually managed in 2025 — the slowest pace in five years.
Climate Funds Bled at Sixty Centavos to the Peso
Flood control is only one drain. Greenpeace, working from figures aired at the Senate Blue Ribbon Committee, calculated that as much as ₱1.089 trillion of the government's climate-tagged spending could have been lost to corruption since 2023, including ₱560 billion in 2025 alone.
The estimate rests on a single devastating finding entered into the Senate record by Senator Erwin Tulfo: corruption cuts leave only 30 to 40 percent of a project's budget for actual construction. Sixty centavos of every peso gone before a single dike is poured.
One Congressman's Pork, Two Frigates
The theft now has faces and ledgers. Investigators found that from 2023 to 2025, then-Speaker Martin Romualdez received ₱14.4 billion in "allocable" funds, while Representative Sandro Marcos — the President's son — received the highest at ₱15.8 billion, a Philippine Center for Investigative Journalism report branded the two "pork barrel kings."
The comparison is not rhetorical. That ₱15.8-billion three-year discretionary haul is roughly equivalent to the entire ₱16-billion contract that delivered the Navy's two Jose Rizal-class frigates — the vanguard of the surface fleet. One representative's pork allocation could have bought the flagships twice over.
The 2026 Budget Continues the Pattern
Nor is this a spent scandal. Makabayan lawmakers estimate the 2026 budget still hands roughly ₱230 million in "allocables" to each House member and ₱3.2 billion to each senator. The budget also carries ₱249 billion in unprogrammed appropriations — the mechanism lawmakers say has long laundered corruption into so-called "priority" projects.
The People's Budget Coalition describes the allocables as a new form of pork barrel that crowds out equitable and accountable public spending. Above it all sits the cost of the institution itself — a House that quietly raised its own budget from ₱17.2 billion to ₱27.7 billion for 2026 even as it slashed public works funding. Former Budget Secretary Butch Abad calculated the running cost at ₱8.8 million a month for each of 315 congressmen.
The Defense Gap vs. the Corruption Gap
Set the two ledgers side by side. The Department of National Defense's 2026 budget stands at ₱305.87 billion. The gap between that and Teodoro's 4-percent target — roughly ₱1.2 trillion against a ₱30.2-trillion economy — is approximately ₱900 billion a year.
That gap is smaller than the money Greenpeace estimates was bled from climate projects in 2025 alone. It is smaller, in most years, than the combined weight of the allocables, unprogrammed funds, and flood-control graft. Re-Horizon 3, the AFP's overhauled ten-year modernization program, carries a price tag of roughly ₱1.89 trillion — about US$35 billion. The money potentially lost from climate and flood projects in a single year, 2025, would cover nearly a third of that entire decade-long cost.
The Navy has coveted two submarines for a generation. Re-Horizon 3 budgeted ₱80 to ₱110 billion for them — less than a single year's flood-control losses at the high end. The boats that would patrol Recto Bank were stolen and poured into drainage canals that were never dug.
The Real Free-Riders
This is the inversion Teodoro missed. The free-riders are not taxpayers reluctant to fund a war chest already stuffed and picked clean. The free-riders are the pork barrel kings, the contractors-turned-congressmen, the men who leave thirty percent of a dike budget standing where a dike should be. They ride free on a sovereignty they will not pay to defend — and expect the fisherman driven off Panatag Shoal to make up the difference.
The Limits of the Argument
Honesty requires naming those limits. A budget is not a piggy bank you smash and pour into frigates. Corruption is a leak, not a savings account, and plugging it is the slow work of prosecutions, procurement reform, and an Ombudsman with teeth. Defense spending is itself no sanctuary — the Jose Rizal frigate deal was tainted by allegations of political interference, and the AFP has paid pensions to "ghost" soldiers aged past a hundred. Pour clean money into a dirty pipe and you merely relocate the theft.
The claim is therefore narrower, and harder to escape: the resources for a credible archipelagic defense are not scarce. They are captured.
Ten Years After The Hague, a Paper Victory Without Force
Ten years ago, the Permanent Court of Arbitration in The Hague invalidated China's nine-dash line and affirmed the country's sovereign rights within its exclusive economic zone. Teodoro is right that the award is "beyond debate," and right that no leader who abandons it will hold the people's mandate. But a legal victory is only worth the force standing behind it, and the Philippines has spent a decade learning that a piece of paper does not turn away a coast guard cutter.
The tragedy is not that the nation cannot afford its navy. It is that it can — and has decided, budget cycle after budget cycle, to buy something else. Sovereignty is defended first at sea. It is lost first in the appropriations committee.
By the Numbers
- ₱6.793 trillion — Philippine national budget for 2026
- ₱1.36 trillion — implied annual corruption losses based on World Bank, ADB, and IMF benchmark of roughly one-fifth of the national budget
- ₱118.5 billion — average annual economic losses from flood-control corruption, 2023–2025, per the Department of Finance
- 25–70% — estimated graft rate on DPWH flood control project costs, per Senate hearing testimony
- ₱1.089 trillion — climate-tagged spending potentially lost to corruption since 2023, per Greenpeace calculations from Senate Blue Ribbon Committee figures
- ₱560 billion — estimated climate fund losses to corruption in 2025 alone
- 30–40% — share of a project budget that actually reaches construction after corruption cuts
- ₱15.8 billion — "allocable" funds received by Representative Sandro Marcos, 2023–2025, per PCIJ
- ₱14.4 billion — "allocable" funds received by then-Speaker Martin Romualdez, 2023–2025
- ₱16 billion — contract cost of the Navy's two Jose Rizal-class frigates
- ₱1.89 trillion (approx. US$35 billion) — total cost of Re-Horizon 3, the AFP's ten-year modernization program
- ₱305.87 billion — Department of National Defense budget for 2026
- ₱900 billion — estimated annual gap between current defense spending and Teodoro's 4-percent GDP target
- ₱80–₱110 billion — Re-Horizon 3 budget allocation for two submarines
- ₱230 million — estimated "allocable" funds per House member in the 2026 budget, per Makabayan lawmakers
- ₱3.2 billion — estimated "allocable" funds per senator in the 2026 budget
- ₱249 billion — unprogrammed appropriations in the 2026 budget
- ₱27.7 billion — House of Representatives budget for 2026, up from ₱17.2 billion
- ₱8.8 million — estimated monthly operating cost per congressman, per former Budget Secretary Butch Abad
- 4.4% — Philippine GDP growth in 2025, the slowest in five years, per the Department of Finance
- 95,000–266,000 — jobs that could have been created with funds lost to flood-control graft, per Finance Secretary Recto
Why This Matters
The Philippines faces a documented and widening gap between its defense capabilities and the territorial threats it confronts in the West Philippine Sea, a gap Defense Secretary Teodoro has publicly quantified and acknowledged cannot be closed without dramatically higher spending. The figures compiled from this administration's own witnesses — the Department of Finance, Senate hearing records, and the Philippine Center for Investigative Journalism — show that the annual cost of congressional pork, unprogrammed appropriations, and flood-control and climate-fund graft exceeds the estimated defense funding shortfall. The argument is not that corrupt funds can be straightforwardly redirected into warships, but that the country's sovereignty deficit is, at its root, a governance and accountability deficit — one that the current structure of the national budget actively sustains.
Photo credit: Photo from Breaking News Negros Oriental / Kenneth