Punjab Unveils Rs5.335 Trillion Budget for FY2025-26

Punjab Finance Minister Mujtaba Shuja-ur-Rehman introduced the province’s budget for the fiscal year 2025-26 during Monday’s assembly session.

Following the federal government’s budget announcement, the Punjab government proposed a Rs5.335 trillion budget for the approaching fiscal year.

Expenditure Details

Of the total budget, Rs2.706 trillion is designated for non-development expenditure, encompassing pensions and salaries.

According to the minister, non-development expenditure has seen a 6% increase.

The provincial government has also earmarked Rs590 billion under current capital expenditure.

As the budget was presented, opposition lawmakers from Pakistan Tehrik-e-Insaf (PTI) staged a protest.

The finance minister commenced his speech by highlighting the steps implemented by the current provincial government.

The minister also extended congratulations to the political and military leadership for protecting national interests amid recent tensions.

He also reported that 6,104 projects were completed during the current fiscal year.

Furthermore, he noted the establishment of the Nawaz Sharif Institute of Cancer Treatment and Research in Lahore, with an allocation of Rs72 billion.

Record Development Budget

A substantial Rs1.24 trillion has been allocated for development in FY26, marking a 47% increase from the Rs842 billion designated in FY25.

According to the minister, this budget represents a strategic shift in Punjab’s financial history, being the highest ever development budget for the province.

Federal transfers for Punjab are estimated at Rs 4,062.2 billion under FDP for the upcoming fiscal year. The provincial government aims to generate Rs828.1 billion in own-source revenues in FY26.

The Punjab Revenue Authority (PRA) is tasked with collecting Rs340 billion in FY26.

Provincial Surplus

The Punjab government has earmarked Rs740 billion under the estimated provincial surplus (EPS) for FY26, based on an agreement between the federal government and the International Monetary Fund (IMF).

The achievement of this provincial surplus is directly dependent on the FBR’s revenue target.

Rs494 billion has been allocated for the social sector, representing 40% of the development budget.

Salaries and Pensions

Provincial government employees will receive a 10% increase in salary, while pensions will see a 5% rise for FY26.

Education

Under the development package for FY26, Rs148 billion has been allocated for education. An additional Rs661 billion has been budgeted for the non-development expenditure of the education sector.

Laptop Scheme

The Chief Minister’s Laptop Scheme has been allocated Rs15.1 billion to distribute laptops to 112,000 students in FY26.

Rs40 billion has been budgeted for the improvement of government schools. The Merit Scholarship Programme will receive Rs15 billion to support deserving students.

Special education will receive Rs5 billion for FY26, and Rs25 billion has been designated for higher education in FY26.

Health

The health budget for the province has been increased to Rs630.5 billion for FY26.

The health sector remains a top priority for the provincial government.

Under the development budget for the health sector, Rs181 billion has been allocated, which is a 131% increase compared to the last fiscal year. Furthermore, Rs450 billion has been earmarked under non-development expenditure for FY26.

The provincial government has designated Rs109 billion for establishing the Nawaz Sharif Medical District in Lahore.

Rs79.5 billion has been allocated for free medicines in government hospitals.

The Punjab government has allocated Rs411.1 billion for local bodies, with Rs150 billion and Rs20 billion provided as special grants for waste management and municipal corporations, respectively.

Social Security Package

A social security package has been proposed with an allocation of Rs70 billion.

Agriculture

For the development expenditure of the agriculture, livestock, and irrigation sectors, Rs123 billion has been allocated, alongside Rs56.2 billion budgeted for non-development expenditure.

The construction sector has been allocated Rs335.5 billion.

The upcoming provincial budget is expected to be tax-free, with no new taxes introduced, and will feature a record-breaking development outlay, emphasising health, education, infrastructure, and tourism. The new fiscal plan is estimated to be over Rs1,200 billion.

The budget will include over 850 development schemes, including the expansion of Nawaz Sharif Medical City in Lahore, with new hospitals constructed under a public-private partnership model. Additionally, extensive sanitation and clean drinking water initiatives are planned, with infrastructure development remaining a key priority.