KEY POINTS
- Punjab allocates Rs 1,240 billion for development, marking a 47% increase over the previous year
- Expenditure under Account-II (Food) is slashed by 88%, and internal debt servicing costs reduced by 94%
- The social sector receives Rs 494 billion (40% of ADP)
- Total revenue collection is estimated at Rs 4,890.4 billion
- Rs 764.2 billion is allocated for local governments, alongside a Rs 70 billion social protection package
ISLAMABAD: Pakistan’s Punjab province Finance Minister Mian Mujtaba Shuja-ur-Rehman presented the provincial budget for the financial year 2025-26 in the Punjab Assembly on Monday with a total outlay of Rs 5,335 billion.
The budget places a strong emphasis on development programs and social sector spending, reflecting the government’s commitment to progressive and fiscally responsible governance.
The minister highlighted that Rs 1,240 billion, or 23 percent of the total budget, is allocated to development initiatives.
This marks a significant 47 percent increase compared to the Rs 842 billion set aside for development in the current fiscal year 2024-25, signalling an ambitious drive towards infrastructural and economic growth.
A notable feature of the budget is the reduction of expenditures under Account-II (Food) by 88 percent to Rs 53.3 billion, compared to the current fiscal year.
This, according to the minister, is evidence of improved economic planning and efficient debt servicing – with internal debt servicing costs curtailed by 94 percent.
Social sector prioritized
Reaffirming the government’s commitment to social welfare, Minister Mujtaba announced a hefty allocation of Rs 494 billion for the social sector, constituting 40 percent of the Annual Development Programme (ADP).
This funding will support vital sectors such as health and education, which remain top priorities under the PML-N government.
Revenue and expenditure breakdown
Punjab’s total estimated revenue collection for FY 2025-26 stands at Rs 4,890.4 billion. Of this, Rs 4,062.2 billion is expected from the federal divisible pool under the National Finance Commission (NFC), while provincial receipts, or Own Resource Revenue, are projected at Rs 828.2 billion.
Key revenue collection targets have been assigned to various departments: the Punjab Revenue Authority (PRA) is set a target of Rs 340 billion, the Board of Revenue Rs 135.5 billion, and the Excise Department Rs 70 billion.
The budget also focuses on streamlining expenditure. Salaries, pensions, provincial finance commission transfers, and service delivery costs for government employees will total Rs 2,706.5 billion, marking a 6 percent reduction from the previous year. Current capital expenditures are budgeted at Rs 590.2 billion.
Local governments and social protection
To empower local governance, Rs 764.2 billion has been allocated under the Provincial Finance Commission (PFC) Award. Special grants include Rs 150 billion for waste management and Rs 20 billion for municipal corporations.
In alignment with Quaid-i-Azam Muhammad Ali Jinnah’s welfare vision, the government has earmarked a Rs 70 billion package for social protection programs aimed at vulnerable populations across Punjab.
Fiscal discipline amid IMF agreement
The budget incorporates Rs 470 billion as Economic Protection Support (EPS) under the ongoing agreement between the federal government and the International Monetary Fund (IMF).
Completion of the provincial surplus hinges on meeting the Federal Board of Revenue’s (FBR) revenue targets, reflecting the government’s commitment to fiscal discipline.
Terming the budget as “tax-free, progressive, and pro-business,” Minister Mujtaba Shuja-ur-Rehman asserted that the fiscal blueprint balances development priorities with prudent financial management, aiming to sustain Punjab’s growth trajectory while safeguarding social welfare.
