KP Budget 2026-27: Major allocations announced for welfare, security, infrastructure

PESHAWAR: KP Chief Minister Sohail Afridi tabled the 2026-27 budget in the provincial assembly Thursday, pegging the province’s spending plan at Rs2.17 trillion with a Rs48 billion shortfall. In his speech, the CM said the deficit will be covered from KP’s own resources, not through fresh borrowing.

Where the money is going

Total outlay for the year stands at Rs2,170 billion against expected receipts of Rs2,122 billion. Of that, Rs1,645.7 billion is earmarked for current expenses and Rs524.3 billion for the Annual Development Programme.

On revenue, the government is banking less on outside help and pushing its own collections. Federal tax share is still the biggest chunk at Rs1,240.7 billion. But KP’s Own Source Revenue target jumps sharply to Rs182.4 billion, up from Rs129 billion last year. Net hydel profits are projected to add another Rs116.8 billion.

Health, schools, and welfare get weight

Roughly half the budget is directed at health, education and security.

• Health: Sehat Card Plus gets Rs50.4 billion. Funding for Medical Teaching Institutions rises to Rs80 billion. Medicines for government hospitals see Rs14.26 billion set aside.
• Education: Rs5 billion is for out-of-school children, Rs8.5 billion for free textbooks, and Rs11.85 billion in grants for public universities.
• New schemes: The budget also introduces interest-free student loans, an “Insaf Female & Orphan Education Card”, and a “Women Economic Empowerment Endowment Fund”.

Police and roads

The police budget climbs to Rs191.39 billion, with money directed to modern gear, safe city projects and overall security upgrades. On infrastructure, Rs52.9 billion is for roads and Rs12.7 billion for clean drinking water.

Merged Districts in focus

Merged Districts remain a priority with Rs272.8 billion allocated. That breaks down to Rs179.9 billion for running costs and Rs92.9 billion for development work aimed at expanding services and infrastructure there.

Reforms and new funds

The government plans structural reforms around transparency and cash management, including digitizing revenue systems and tighter debt handling. New for 2026-27: a Disaster Risk Management Fund, a Provincial Takaful Insurance Company, and a push for Public-Private Partnerships to bring in private investment and ease pressure on public finances.