838 Billion to Keep You Poor

In the third century of the Roman republic, the Senate debated for generations whether to drain the Pontine Marshes south of Rome — a vast breeding ground of malaria that had killed more Romans than most enemy armies. The project was technically achievable. Engineers had surveyed it. The cost was calculable. But the great landowners surrounding the marshes depended on the desperation that malaria perpetuated— a sick, fearful population was a tractable one, cheap to hire and too weakened to bargain. So the debate continued, the experts filed their reports, and the marshes remained for another six centuries. Pakistan’s federal budget for 2026-27 is not the story of the Pontine Marshes. But it belongs recognisably to the same genre as a document of elegant postponement, in which what is politically convenient defeats what is demonstrably necessary, and the management of human suffering is preferred — because it is cheaper and more controllable — to its elimination.

Begin with what the budget actually allocates to the foundations of human development. The federal government has set aside Rs. 53.3 billion for health — covering the Ministry of National Health Services and its PSDP component — representing an increase from the previous year’s revised figure of Rs. 14 billion, a jump that sounds dramatic until one holds it against what surrounds it. The federal allocation for higher education stands at Rs. 46 billion. These two figures — Rs. 53.3 billion for health, Rs. 46 billion for higher education — sum to Rs. 99.3 billion. This is what the federal government of a nation of 240 million people has committed to the medical survival and intellectual advancement of its citizens. And Pakistan’s total education spending, combining federal and provincial budgets, hovers at roughly 0.8 percent of GDP — against a nominal GDP of Rs. 143,604 billion, this amounts to approximately Rs. 1,148 billion nationwide, a figure that sounds substantial until one notes that UNESCO’s minimum recommended threshold for education spending is four percent of GDP, and that Pakistan sits at one-fifth of that benchmark. The building is not merely incomplete. The foundation has not been poured.

Now hold these figures against a single line in the same budget. The Benazir Income Support Programme — BISP — receives Rs. 838 billion. This one programme, disbursing cash to approximately ten million families, outspends the federal health allocation by nearly sixteen times. It outspends the federal higher education budget by more than eighteen times. It outspends health and higher education combined — Rs. 99.3 billion — by a factor of more than eight. To make this tangible without recourse to the numbing language of billions. If you gathered a hundred rupees to spend on your child’s future, this budget spends eight rupees and forty paisa on his health and schooling, and eighty-four rupees giving him cash to spend today. The cash is real. The gratitude it generates is real. What it does not generate is a doctor, a teacher, or the capacity to live without next quarter’s transfer.

The internal composition of the health allocation deepens the concern. The Rs. 53.3 billion for health is directed, per official budget documents, toward cardiovascular disease prevention, emergency care system strengthening, and tertiary hospital infrastructure. These are the visible, photographable investments of governance that provide a new cardiac wing here, a refurbished emergency ward there. What they are not is a functioning public health system. The Pakistan Medical Association has noted, with professional precision, that the programme for combating tuberculosis, HIV/AIDS, and malaria — diseases that kill Pakistanis daily and silently — receives Rs. 500 million. Pakistan carries one of the heaviest tuberculosis burdens in the world and an active hepatitis C epidemic affecting an estimated ten million people. The workforce development programme designed to defend the country against mpox, measles, dengue, and polio receives Rs. 99.9 million — not billion, million. The Drug Control Section, responsible for ensuring that medicines sold to citizens are safe and genuine, operates on Rs. 144 million. Furthermore, existing health projects carry throw-forward liabilities exceeding Rs. 121 billion, meaning future governments are already legally committed to spending they have not yet budgeted, before they have been elected or formed. Seventy percent of healthcare resources go to buildings and tertiary operations, while prevention, disease surveillance, and nutrition — the interventions that actually prevent people from needing those buildings — are allocated what remains after the bricks have been counted.

BISP’s Rs. 838 billion is not spent on brick and mortar. It is spent on approximately ten million families, each receiving a cash transfer that helps them eat, pay rent, and survive the month. No honest observer denies the immediate value of this. Poverty is not an abstraction, and the family that cannot afford flour does not benefit from a lecture on fiscal philosophy. The argument is not whether to support the poor. The argument is whether handing Rs. 838 billion to ten million families, while spending Rs. 53.3 billion on the hospitals and Rs. 46 billion on the universities those same families depend upon, constitutes a plan for ending poverty or a plan for administering it indefinitely. John Maynard Keynes demonstrated that consumption support is essential in a demand crisis. He was equally clear that consumption without commensurate investment in productive capacity is a river without a source — it flows until it does not. BISP, surrounded by a health system it outfunds sixteenfold and an education sector it outfunds eighteenfold, is the most expensive maintenance programme in Pakistan’s fiscal history, and the least likely to render itself unnecessary.

The political economy underlying this ratio has a name, though it is rarely spoken in budget speeches. A programme disbursing Rs. 838 billion annually to ten million families creates ten million families whose continued welfare depends on the continuation of the programme and, by extension, on the continued goodwill of those who administer it. The reforms associated with Athenian statesman Solon reflected an understanding that societies become unstable when survival depends upon permanent dependence. The dynamic is recognisable. A population that receives transfers rather than skills, cash rather than clinics, and handouts rather than hospitals is a population that remains, in the most precise economic sense, a managed population rather than a productive one. It votes. It receives. It does not, structurally, threaten the arrangements that keep it in need.

Pakistan’s tax architecture reflects the same preference for management over transformation, expressed from the revenue side. The Federal Board of Revenue is projected to collect Rs. 15,264 billion against a nominal GDP of Rs. 143,604 billion — a tax-to-GDP ratio of approximately 10.6 percent. India exceeds sixteen percent. Bangladesh, which in 1971 had a lower per-capita income than Pakistan and has since surpassed it on most human development indicators, has expanded its tax base steadily through exactly the investments Pakistan neglects in education and health, which produce the productive citizens whose incomes can be taxed. Pakistan’s undertaxation is not a consequence of poverty. It is a cause of it, and it is sustained by political arrangements made comfortable by the exemptions enjoyed by those with the power to preserve them.

Of the Rs. 15,264 billion projected in FBR collections, indirect taxes — sales tax, excise, and customs duties — contribute Rs. 7,651 billion, with sales tax alone accounting for Rs. 4,927 billion. The sales tax does not inquire whether you are a landowner dining in a hotel or a wage labourer buying vegetable oil. It takes the same percentage from both. Agricultural income — concentrated in precisely the landowning class with the most sustained representation in Pakistan’s legislatures — remains outside the federal income tax net. The trader who negotiates his own assessment, the property developer who declares transactions at a fraction of their market value, the professional who bills in cash. None faces the automatic extraction that takes income tax from the salaried employee before the month’s wages reach him. The fiscal burden is not distributed according to capacity to bear it. It is distributed according to capacity to resist it. Those who resist least pay most. Those who resist most pay least. It is a tax system of almost artistic consistency in its injustice.

The pension obligations recorded in this budget illuminate the intergenerational dimension of these choices with particular clarity. Civil pensions for 2026-27 are budgeted at Rs. 822,000 million, or Rs. 822 billion. Military pensions stand at Rs. 272,500 million, or Rs. 272.5 billion. Together, pension commitments approach Rs. 1,094.5 billion — eleven times the federal health budget, more than twenty-three times the federal higher education allocation, and comfortably exceeding health and higher education combined by a ratio of more than eleven to one. The retired official’s income is protected in law, charged directly upon the Federal Consolidated Fund, and adjusted over time. The student in a federal university receives the benefit of Rs. 46 billion divided across higher education institutions serving millions. The child in a public school benefits from whatever the provincial government can manage, within an overall national education spending envelope of 0.8 percent of GDP. The state is, in its budget, more faithful to those who have finished serving it than to those who have not yet been equipped to serve anything — including themselves.

The salary position of those currently in government service sits between these two conditions, pressed from both directions. Expenditure on the running of civil government amounts to Rs. 1,071,393 million, but this covers the full apparatus of civilian administration across all its functions. Real wages for individual government employees — schoolteachers, health workers, junior administrators — have been eroded across years of inflation that nominal salary increases have not matched. When prices rise twenty percent and a salary rises ten percent, the employee is poorer in December than in January regardless of what the announcement called the increase. The consequences are visible in the institutions — absent teachers in government schools, understaffed rural health units, administrative bottlenecks that make obtaining a birth certificate, a land title, or a court date an endurance test. Governance that is underpaid is governance that finds alternative compensation. This is not a moral observation. It is a systemic issue.

The subsidy architecture adds its own note of structural incoherence. Total subsidies for 2026-27 stand at Rs. 1,091 billion, the vast majority directed at the power sector through various tariff differential mechanisms. These subsidies are by design untargeted. They reduce electricity bills across the income spectrum, delivering benefits to households that require no subsidy alongside those that cannot survive without one. A precisely targeted subsidy system — one that reached only those below a defined income threshold — could deliver equivalent support to the genuinely vulnerable at a fraction of current cost, freeing resources for the health and education allocations that this budget leaves at their current ratios to BISP. Targeted subsidies, however, require administrative capacity, accurate data, and the political courage to exclude those with influence from benefits they have come to regard as entitlements. All three are chronically scarce.

The federal development budget — the Public Sector Development Programme, allocated Rs. 1,000 billion — roughly one rupee out of every twenty spent by the federal government. The fiscal deficit stands at Rs. 7,020 billion, financed primarily through Rs. 5,772 billion in government securities and Rs. 1,000 billion through national savings schemes. Interest payments on accumulated debt consume Rs. 8,054 billion — more than the health and education budgets multiplied by forty, more than BISP multiplied by nine and a half. The debt is the legacy of previous years’ deficits; next year’s debt will be the legacy of this one. What is not invested in productive capacity today becomes, in fiscal terms, a lien against the revenues of the future. Pakistan is not merely postponing investment. It is borrowing against the earnings of children who have not yet entered a school that has not yet been adequately funded.

A budget is the most honest autobiography a government writes, because it is the one document in which stated values must correspond to actual numbers, and where the gap between rhetoric and resource allocation is arithmetically visible. This budget’s autobiography is not a cruel document. It contains genuine increases in health spending. It funds a programme that keeps millions of families from destitution. It allocates to development projects that, if completed, will matter. What it does not contain is evidence of a theory of transformation — a legible answer to the question of how Pakistan’s children are to become, in twenty years, the productive citizens whose taxes will service the debts this budget accumulates. Rs. 838 billion for alleviating hardship without eliminating its causes. Rs. 53.3 billion for health. Rs. 46 billion for higher education. Education at 0.8 percent of GDP. The Pontine Marshes drained themselves for no one. The question encoded in these numbers is whether Pakistan intends to drain its own, or whether it has concluded that the marshes, properly managed, are more convenient than their absence.

The writer is a PhD scholar in English Literature, a Lawyer, and an International Relations analyst