Even a fifth-class municipality, the smallest and poorest classification of local government unit in the Philippines, receives multiple streams of funding from the Marcos administration’s proposed ₱7.2 trillion 2027 national budget, Budget Secretary Kim Robert De Leon said Saturday.
De Leon made the statement in an interview on DZRH News program Special on Saturday on September 5, as part of the DZRH SONA 2026 Series featuring the Department of Budget and Management (DBM).
He said the first and most basic stream is the National Tax Allotment (NTA), a mandatory share of national tax revenues that every municipality, city, province, and barangay receives under the law, regardless of its income classification.
“Ang isang bayan primarily ay tatanggap definitely, alinsunod sa batas, may National Tax Allotment siya, bahagi ng 7.2 trillion. Yung National Tax Allotment na nagpopondo sa munisipyo, sa municipal government gayundin sa kanilang provincial government at maging dun sa mga barangay na nakapaloob sa mga bayan na ‘yon,” De Leon said.
The President’s Budget chief said lower-income municipalities receive additional support through the Growth Equity Fund, a supplementary allocation on top of the NTA specifically designed to help fourth- and fifth-class LGUs meet the additional responsibilities devolved to them since the Local Government Code of 1991 and the Mandanas-Garcia ruling.
“Dahil yung mga 4th at 5th class na munisipyo, siyudad, at probinsya ay hindi pa rin sasapat yung kanilang tumaas na NTA, kaya meron pang konting pangtulong, pangtukod, para makahabol doon sa kanilang mga kailangang i-deliver na programa at serbisyo,” De Leon said.
A third stream is the Local Government Support Fund or LGSF, which is currently being used to provide free rice to poor communities and fund small-scale infrastructure projects in LGUs that cannot afford them on their own.
De Leon said these LGU-specific streams are separate from the national government services that residents of every town also directly receive, including public school teachers, soldiers, police officers, and social welfare programs funded by their respective national agency budgets.
He said the 2027 budget’s tagline, “Bawat Bayan Makikinabang,” is meant to capture this reality, that no matter how small or remote a community is, the national budget reaches it through multiple channels simultaneously.
