‘WIDESPREAD BUDGETARY CRISIS’: Only 12 of 180 Iloilo City barangays have approved budgets

By Mariela Angella Oladive

Only 12 out of 180 barangays in Iloilo City have approved their annual budgets for 2026 as of the fourth week of February, leaving 168 barangays operating under reenacted budgets for the current fiscal year.

During his privilege speech at the City Council’s regular session on Feb. 26, Councilor Rex Marcus Sarabia described the situation as a “widespread budgetary crisis,” citing official data from the City Budget Office and the City Accountant’s Office.

As chairman of the committee on appropriations, he stressed that when funds are limited, local governments may adopt austerity measures or seek supplemental support.

However, he said the situation becomes more serious when a council fails to pass its annual budget and is forced to operate under a reenacted budget.

Under Section 323 of Republic Act No. 7160, or the Local Government Code of 1991, if a sanggunian fails to pass the annual appropriation ordinance before the start of the fiscal year, the budget for the preceding year is deemed reenacted and remains in effect until a new budget is approved.

This means barangays without approved 2026 budgets are legally operating under their previous year’s appropriations, with expenditures generally limited to mandatory and essential operating expenses.

“That means no new programs, no new projects, no capital outlays, no salary increases, no social services,” he said, calling it the “worst kind of budgetary crisis” because taxpayers’ money is not translated into new barangay-level services.

He added that 33 barangays did not even have approved operative budgets for 2025.

The situation is more severe among Sangguniang Kabataan (SK) councils. According to Sarabia, only two SK councils have approved their 2026 budgets, while 94 SK councils do not have approved operative budgets for 2025.

He pointed out that the City Council passes its annual budget before the end of the fourth quarter each year. For 2026, the city government approved its annual budget no later than December 2025.

Sarabia asked fellow councilors to imagine how dysfunctional the city government would be if it operated under a reenacted budget, warning that development targets and timelines could be delayed and promises left undelivered.

He said the problem goes beyond mere procedural noncompliance, arguing that “the bottom line is that the Ilonggo people have suffered hundreds of millions in unrealized projects due to this widespread crisis.”

In response, SK Federation President Jelma Crystel Implica said many SK budgets remain under review.

She explained that SK councils are dependent on barangay budgets, as their allocation is equivalent to 10% of the barangay’s annual budget. If a barangay fails to pass its budget, the SK council cannot finalize its own annual budget.

Meanwhile, Liga ng mga Barangay President Maria Irene Ong acknowledged that several barangays are encountering difficulties in meeting budget requirements.

Ong cited the City Planning and Development Office’s requirement for a six-year master plan, which some barangays find challenging to complete.

Barangays are the smallest administrative division in the Philippines, serving as the primary unit of local governance. Each barangay is headed by an elected captain and a council responsible for crafting and approving its own annual budget, which funds local programs, infrastructure and social services.

In light of the issue, the City Council passed a resolution seeking an investigation into the widespread failure to approve annual budgets and to determine possible measures to assist barangays and SK councils.

Sarabia admitted that even as a lawyer, he finds budgeting complex — raising the question of how much more difficult the process may be for barangay and SK officials.

He urged stakeholders to address the problem urgently to ensure that public funds are delivered back to communities through programs and services at the barangay level.