Govt to raise BISP budget by 20% to Rs716bn

ISLAMABAD, MAY 27 (DNA): The Ministry of Finance has proposed a substantial increase in the allocation for the Benazir Income Support Programme (BISP) in the upcoming fiscal year, with a proposed budget of Rs716 billion.

This marks a significant 20% jump from the Rs592.48 billion allocated in the outgoing fiscal year, signalling a strengthened commitment to social safety nets.

Expenditure figures, including social welfare programmes, have been a key point of discussion in ongoing budgetary negotiations, The News reported citing confirmation from top officials within the Finance Division.

Despite these broader financial hurdles, the funding for BISP appears poised for a near 20% boost.

This increased allocation for BISP is expected to facilitate a crucial adjustment to the Unconditional Cash Transfer (UCT) Kafaalat programme. In line with an agreement with the International Monetary Fund (IMF), the quarterly benefit is projected to rise from Rs 13,500 to Rs 14,500, beginning in January 2026.

This adjustment aims to offset anticipated annual inflation in 2025, providing much-needed relief to beneficiaries.

It will also allow BISP to maintain the total number of enrolled households at 10 million.

Ministry of Finance made a commitment to the IMF for continued annual inflation adjustments for UCT benefits to ensure that the most vulnerable households’ purchasing power remains at a minimum constant in real terms in coming years; and (ii) readjust UCT benefits upon the release of any new household surveys to continue transfers equivalent to 15% of the bottom quintile’s consumption once this threshold is reached.

The BISP is working closely with the World Bank to enhance education and health and nutrition conditional cash transfer (CCT) programmes, and with provinces to avoid overlap of BISP and provincial CCT programmes; the FY26 budget will keep spending on these programmes constant as a share of GDP.

From July to February FY25, the BISP disbursed Rs 347 billion, representing an 82.6% increase over the previous year, against a full-year allocation of Rs 592.5 billion.

Energy subsidies have been restructured to target the bottom 40% of the population, thereby ensuring fiscal savings without compromising social equity. Meanwhile, comprehensive rationalisation of public administration is underway, involving the streamlining of over 43 ministries and 400 departments

The World Bank is engaging with the Power Ministry and BISP to develop (1) a method to identify electricity consumers by income rather than consumption level and a transfer mechanism that could replace the current energy subsidy frameworks.

The BISP is working closely with the World Bank to refine its administrative systems. Efforts are underway to keep the NSER live and cover all of Pakistan’s poor; keep BISP enrollment open; and administer the regular re-declaration of BISP beneficiaries’ status on the intended three-year cycle.

The BISP will continue to gradually expand the new electronic payment model, which will allow greater choice for beneficiaries. They will have bank accounts, which will enable beneficiaries to build savings, in place in pilot districts by the first quarter of FY26.

The BISP is continuing its efforts to enrol interested UCT Kafaalat families into the two CCT programmes, as it exceeded the FY25 education CCT enrollment target of 10.4 million by 400,000, and is on track to achieve its nutrition CCT target of 2.1 million.