Education, health, agri, industry: ‘Higher spending yet to translate into visible improvements’

LAHORE: The federal government and the Punjab government have unveiled their budgets for fiscal year 2026-27, raising total outlays at both levels even as economists cautioned that higher spending has yet to translate into visible improvements in education, health, agriculture, and industry. The two budgets have been presented at a time when Pakistan’s economy appears to have regained a degree of stability after several turbulent years, with inflation declining, foreign exchange reserves improving, and concerns regarding an immediate balance-of-payments crisis easing. At the federal level, the government has presented a budget of approximately Rs 18. 77 trillion compared with Rs 17. 57 trillion in FY2025-26, with revenue targets increased to Rs 15. 26 trillion. Debt servicing continues to consume more than Rs 8 trillion annually, while defence expenditure has increased to approximately Rs 3 trillion. Commenting on the budget, prominent economist and Advisor on political and economic affairs to President Pakistan Peoples Party Central Punjab Rao Babar Jamil said the continuation of programmes such as the Benazir Income Support Programme, with allocations approaching Rs 845 billion, reflects the government’s recognition that many households continue to face significant economic hardship. He observed that while inflation has slowed, prices have not actually fallen, meaning the relief felt by ordinary citizens remains limited. Punjab, meanwhile, has announced a budget of approximately Rs 5. 9 trillion compared with roughly Rs5. 3 trillion in FY2025-26. Notably, the province’s Annual Development Programme has fallen from approximately Rs 1. 24 trillion to around Rs752 billion, a decline that has raised questions regarding the government’s development priorities going forward. In this context, the question Punjab’s citizens are entitled to ask is a simple one: where is the performance? If education spending continues to increase every year, it remains unclear why millions of children are still out of school, why parents increasingly rely on private schools despite the existence of a vast public education system, and why employers continue to complain about the quality of graduates entering the labour market. Similarly, despite substantial healthcare allocations, government hospitals remain overcrowded, and many citizens continue to rely on costly private healthcare out of necessity rather than choice. Agriculture and industry are also areas that observers believe deserve far greater attention than they have received. Punjab’s farmers continue to face rising input costs, uncertain crop prices, water shortages, and increasing climate-related risks, and the budget could have done more to support farmer productivity through water-efficient irrigation, wider adoption of agricultural technology, crop insurance, and stronger income protection mechanisms for growers. Punjab remains Pakistan’s largest industrial province, yet businesses operating there continue to grapple with high energy costs, regulatory complexity, limited access to finance, infrastructure bottlenecks, and weakening international competitiveness. Artificial intelligence and digital transformation represent another area where the Punjab government has yet to demonstrate meaningful progress. Analysts argue that the province should be investing aggressively in AI research centres, technology parks, university-industry partnerships, digital skills training, startup incubation, and innovation-driven entrepreneurship if it hopes to remain competitive in the coming years. Greater emphasis is also needed on water security, groundwater recharge, wastewater treatment, and the modernisation of irrigation systems across the province. At the same time, local governments should be strengthened so that municipal services can be delivered more effectively to citizens at the grassroots level. Ultimately, the prevailing view among economic observers is that governments should be judged not by how much they spend but by how effectively they spend it. The debate, they argued, must move from budgets to performance, from announcements to delivery, and from spending to results. Copyright Business Recorder, 2026

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