The Department of Budget and Management (DBM) is tightening the release of funds for year-end activities, warning agencies against extravagant celebrations masquerading as official functions.
“The Department of Budget and Management (DBM) said it would enforce strict rules on funds disbursement for year-end activities,” the agency said in a statement this week.
Speaking during the 58th Annual Conference of the Financial Executives Institute of the Philippines on Oct. 9, Acting Secretary Kim Robert de Leon said the fourth quarter usually sees a spike in spending.
“Now that we are in the fourth quarter, surely there will be a surge in utilization because there will be parties left and right masquerading to be planning sessions,” De Leon said.
De Leon added that some agencies tend to increase spending by the end of the fiscal year to exhaust remaining budgets.
Not anti-celebration — anti-waste
The DBM clarified that strategic planning and legitimate year-end activities are still allowed, but expenses must be reasonable.
“We have to admit, some of those started from a budget circular authorizing one to be conducted, and it just snowballed, and everyone loves doing strategic planning in hotels like this,” De Leon said.
The department stressed that government performance should be measured by tangible output, not budget utilization.
“Don’t just look at, ‘We spent 98 percent of budget.’ On what? We’re looking at quality of spending. You may be spending less but producing more in terms of output and even outcome,” he said.
Policy revisions will be released very soon to tighten government spending policy and ensure funds are spent wisely and for the benefit of the people.
The DBM has also reminded agencies to be prudent.
In its previous circular, it said: “All government agencies are strongly reminded to exercise judicious and prudent use of government funds in the conduct of the fiscal year 2025 year-end gatherings, celebrations and other similar activities or events,” noting that activities should promote compassion, camaraderie and unity.
To improve transparency, the DBM earlier launched its Centralized Open Monitoring Platform for Appropriations and Spending Statistics (COMPASS), allowing the public to monitor and track government funds.
What does this mean for government employees?
Good news: Your year-end benefits are NOT affected — in fact, they are being protected.
The crackdown is aimed at MOOE (Maintenance and Other Operating Expenses) for hotel bookings, lavish catering, and unnecessary venue rentals — NOT at Personnel Services where your bonuses and incentives come from.
By stopping wasteful year-end parties, DBM ensures that funds for legally mandated benefits remain intact and prioritized.
Here are the year-end benefits that remain secured for qualified government employees for FY 2026:
1. Year-End Bonus + Cash Gift
Government personnel who meet service requirements will receive a Year-End Bonus equivalent to one (1) month’s basic salary as of October 31, 2026, plus a ₱5,000 Cash Gift.
These remain governed by DBM Budget Circular No. 2016-4, as amended by BC No. 2024-3. Released with the first payroll of November. [Read 2026 Full Guide]
2. Productivity Enhancement Incentive (PEI) – ₱5,000
Granted on top of other bonuses under EO No. 201 to boost productivity in government service. Usually released in December. [Read 2026 Full Guide]
3. Service Recognition Incentive (SRI) – Up to ₱20,000
A one-time incentive for executive branch personnel including regular, contractual, and casual employees.
For FY 2025, this covered around 1 million DepEd employees nationwide — with teachers and non-teaching personnel receiving P20,000 SRI and P5,000 PEI.
Amount for FY 2026 will depend on the President’s Administrative Order.
4. Collective Negotiation Agreement (CNA) Incentive – Up to ₱10,000 – ₱30,000
For eligible personnel covered by a valid CNA, subject to savings from MOOE. [Read 2026 Full Guide]
One more thing…
#2024PBB Tracker and Updates
What agencies should do instead
DBM is not banning year end gatherings. However, agencies are encouraged to hold simple, meaningful, and cost-efficient gatherings:
- Conduct year-end activities within government offices, not luxury hotels;
- Prioritize simple fellowship that strengthens camaraderie;
- Avoid last-minute procurement just to burn funds; and
- Ensure compliance with existing rules on judicious use of public funds.
In short: Less to no spending on lavish venues, more focus on what matters — delivering quality public service and securing the benefits that government workers deserve.
FAQs: DBM Ban on Lavish Year-End Parties
What did DBM announce?
DBM said it will be strict about releasing money for year-end activities. Some agencies spend a lot in December on big parties that they call “planning sessions.” DBM said this will not be allowed anymore and new rules are coming soon.
Are Christmas parties banned for government workers?
No. Year End Parties parties (aka Christmas Parties) are not banned. What is not allowed are expensive parties in luxury hotels that waste public funds. Agencies can still have simple and meaningful celebrations.
Will my Year-End Bonus and other benefits be affected?
No. Your benefits are safe. This rule is about party expenses, not employee benefits. You will still receive:
- Year-End Bonus – 1 month salary
- Cash Gift – P5,000
- PEI – P5,000 (subject to Presidential directive)
- SRI – Up to P20,000 (also subject to Presidential directive)
- CNA – Up to P30,000 (subject to conditions and availabilit of funds)
- Gratuity Pay for JO/COS – Up to P7,000 (also subject to Presidential directive)
What does DBM mean by “lavish”?
Lavish means too expensive and unnecessary, like:
- Holding planning sessions in expensive hotels
- Costly catering and venues
- Spending just to use up the remaining budget
Why is DBM doing this now?
Every 4th quarter, government spending goes up fast. Agencies try to spend all their remaining money before the year ends. DBM said government performance should not be measured by how much budget is spent, but by the quality of work and service.
Can we still have team building and planning sessions?
Yes, you can. Planning sessions are still allowed as long as the cost is reasonable and there is a clear purpose and output. It should not be an excuse to party.
Who needs to follow this rule?
All government offices. This includes national agencies, GOCCs, SUCs, and LGUs.
Where will the saved money go?
The saved money will be used for more important things – public service and employee benefits. DBM also launched COMPASS, a website where people can track how the government spends its money.
When will the new rules be released?
DBM said the new policy will be released very soon. We will post an update once it is official.
What should I do if my office still plans an expensive party?
Remind your office about DBM’s rule on wise and careful use of public funds. Year-end activities should focus on unity and compassion, not luxury.
Disclaimer: This article is for informational purposes only and is based on DBM statements reported on October 14, 2026; GABOTAF is not affiliated with DBM, and all year-end benefits, amounts, and release dates are subject to change based on final and official DBM circulars and the Office of the President, so please always verify with the official DBM website at dbm.gov.ph for the official guidelines.