Colombia’s Congress approved the 2027 national budget in the early hours of Tuesday, October 20, totaling 634.9 trillion pesos (about US$201.1 billion), marking the new government’s first major legislative victory.
The spending plan under President Abelardo de la Espriella increases available funding compared with the current budget and reflects a shift in priorities, with a greater emphasis on the Defense sector and cuts to funding for some institutions established to implement the 2016 peace agreement with the former Revolutionary Armed Forces of Colombia (FARC).
The approval followed an extensive day of debate in the Senate and House of Representatives, amid concerns over the fiscal deficit and rising public debt.
The government will have to manage a budget that commits a substantial share of national revenue to debt servicing while seeking to fund its security, education, health care and infrastructure priorities and contain the imbalance in public finances.
Congress approves Government’s 2027 budget at US$201B
The Senate approved the bill late Monday night, with 57 votes in favor and two against. The House of Representatives subsequently approved it in the early hours of Tuesday, with 112 votes in favor and one against. The passage of identical versions in both chambers completed the legislative process.
The budget totals 634.9 trillion pesos, up from the 555.8 trillion pesos (approximately US$176.5 billion) allocated for 2026. The increase also exceeds 10% compared with the proposal submitted by former President Gustavo Petro’s administration, although the new government had pledged to reduce state spending.
The debate was marked by disagreements over how resources should be allocated. The Historic Pact, former President Gustavo Petro’s political movement and the main opposition force, criticized cuts to education programs and public institutions, including the National Learning Service (SENA), which provides free technical training across the country.
The discussions highlighted tensions between the executive branch’s fiscal adjustment goals and demands for funding public services, as well as divisions between the parties supporting the government and the opposition.
Finance Minister Miguel Gomez defended the bill’s approval and thanked lawmakers for their support. “The budget recognizes the revenue the country can collect and incorporates cuts to address the fiscal imbalance. Debt absorbs resources that are needed for investment: correcting course requires austerity and greater efficiency in public spending,” he told lawmakers as he urged them to vote in favor.
#PlenariaSenado | #AEstaHora la plenaria del Senado APROBÓ
en su totalidad el proyecto de ley que decreta el Presupuesto General de la Nación para la vigencia fiscal 2027. https://t.co/1JH2Lz45h3
— Senado de la República
(@SenadoGovCo) October 20, 2026
Defense gains ground as peace institutions face cuts
The Defense sector will receive 74.9 trillion pesos (approximately US$23.8 billion). The allocation reinforces the priority De la Espriella’s administration places on security and the state’s operational capabilities in confronting illegal armed groups.
By contrast, some institutions linked to the implementation of the 2016 peace agreement will face budget cuts. They include the Special Jurisdiction for Peace (JEP), a transitional justice tribunal responsible for investigating and prosecuting the most serious crimes committed during the armed conflict, and the Search Unit for Persons Presumed Missing (UBPD).
The cuts have raised concerns about their potential impact on judicial investigations, the search for missing persons and the identification of victims, including in international proceedings. In this regard, it is worth recalling the call made by the United Nations earlier this month for Colombia to uphold its commitments under the peace agreement reached a decade ago.
Nevertheless, the reduction in funding for these institutions signals a shift in public spending priorities, with potential implications for Colombia’s fulfillment of the commitments it undertook as part of the peace process.
Education, health care and debt account for major allocations
Despite the adjustments, education and health care remain among the sectors receiving the largest allocations. The budget earmarks 93 trillion pesos (approximately US$29.5 billion) for education and 81.6 trillion pesos (approximately US$26 billion) for health care, two key areas for the provision of public services and meeting social needs.
Servicing the public debt represents one of the state’s largest financial burdens. The budget sets aside 144 trillion pesos (approximately US$45.7 billion) for this purpose. The size of the allocation limits the government’s fiscal flexibility and reduces the resources available for other policies.
Changes introduced during the legislative process also affected allocations for subsidies, investment and the operating expenses of various institutions. The final distribution seeks to reconcile the executive branch’s priorities with existing legal obligations and spending commitments.
Meanwhile, the government estimates that the fiscal deficit could reach 9.4% of gross domestic product (GDP) in 2027, reflecting the gap between projected spending and revenue.
Public debt continues to rise, and the country needs to restore financial market confidence. Colombia lost its investment-grade credit rating in 2021, raising its borrowing costs and underscoring the importance of adopting credible measures to stabilize public finances.
The administration has announced a fiscal reform, known as the Rescue Law, aimed at reducing the projected deficit. However, the budget’s approval leaves the central question unresolved: how can the government finance its priorities without deepening indebtedness or shifting the cost of fiscal adjustment onto public services and social programs?
