Health, education allocations face staggering cut

Health and education sectors have taken the major brunt of a sizeable cut in the current development budget halfway through the fiscal year.   

The ongoing Annual Development Programme (ADP) outlay for the fiscal year 2025-26 has been cut by 13.04 per cent to Tk 2.0 trillion.

With Chief Adviser Professor Muhammad Yunus in the chair, the National Economic Council (NEC) in its meeting Monday endorsed the pared-down RADP.

The size of the RADP has been reduced by Tk 300 billion from the original ADP allocation of Tk 2.30 trillion, Planning Adviser Professor Wahiduddin Mahmud told journalists.

In the trimming meant to make two ends meet, the health sector emerged as the hardest hit by the fiscal tightening. The government has withdrawn approximately Tk 134.29 billion from the original allocation, representing a staggering 73-percent cut.

The allocation for healthcare services plummeted from an original Tk 181.48 billion to a mere Tk 47.18 billion in the RADP following the deepest cut.

Health Services Division saw its budget slashed by 73 per cent while Health Education and Family Welfare Division faced a 77-percent reduction.

Major initiatives like the establishment of cancer, kidney, and heart-treatment centres in eight divisional cities and the construction of 500-bed medical college hospitals in Jashore, Cox's Bazar and Pabna may face delays or downsizing, Planning Commission officials said.

They cited "poor implementation capacity" and a "shortage of projects" as the primary reasons for withdrawing over Tk 130 billion from the sector.

Another priority sector, education, is not spared, too. Its development budget slashed by approximately 35 per cent or roughly Tk 100 billion, bringing the final figure down to about Tk 185 billion. Secondary and higher education specifically witnessed a 55-percent cut.

Prof Mahmud explains the budgetary arithmetic that determines the revised allocations. "Health and education sectors have been passing through a transition from the sectoral development-programme approach to project-based approach."

Furthermore, transport and communications sector-traditionally the highest recipient of funds-saw a 35-percent reduction. A notable feature here is the Airport-Kamalapur MRT Line-1 project faced a drastic 90-percent cut after implementing agencies failed to submit fund demand.

The highest government economic body approved cut in the allocations from government funds by Tk 160 billion (11.11 per cent) while foreign loans and grants by Tk 140 billion or 16.27 per cent.

Government funding has been reduced from Tk1.44 billion to Tk1.28 billion (64 per cent), while allocations from foreign loans and grants have been cut from Tk 860 billion to Tk720 billion (36 per cent).

Officials at the commission say demands from ministries and divisions are also lower in the revised ADP.

According to officials, the lower RADP demand is mainly due to slow implementation during the current fiscal year that witnesses spillover impacts of political upheavals surrounding the upsurge and election frays.

They say many projects are progressing slowly because of the absence of project directors and delays in appointing new ones.

The government is also reviewing several large projects, which has led to reduced allocation demands for many projects.

Additionally, as the current year is an election year, ministries and divisions have shown relatively lower demand for allocations.

According to Planning Commission data, the transport and communications sector has received the highest allocation of Tk385.09 billion, or 19.25 per cent of the total RADP.

Power and energy sector received the second-highest allocation of Tk 261.86 billion, or 13.09 per cent of the total RADP allocations.

Other major allocations include housing and community amenities with Tk227.30 billion (11.36 per cent) education with Tk 185.50 billion (9.27 per cent), and local government and rural development with Tk 15143 billion (7.57 per cent).

Social-protection sector has also faced a substantial fund cut. While Tk 20.18 billion was allocated in the original ADP, the RADP reduced the sum by 73 per cent to Tk 5.45 billion.

Planning Commission sources say allocations to the power sector have been reduced by 19 per cent, while the agriculture sector has seen a 21 per cent cut.

Among ministries and divisions, the Local Government Division (LGD) received the highest allocation, amounting to Tk375.34 billion, or 18.77 per cent of the total RADP. Its allocation is 4.0-percent lower than in the original ADP.

The Road Transport and Highways Division received the second-highest allocation of Tk 199.49 billion (9.97 per cent), although allocation got reduced by 38 per cent compared to the original ADP.

Power Division ranks third, with an allocation of Tk148.96 billion (7.45 per cent), reflecting a 27-percent reduction from the original ADP.

The Ministry of Science and Technology has received Tk120.29 billion (6.0 per cent), followed by the Ministry of Water Resources with Tk 105.32 billion, the Ministry of Primary and Mass Education with Tk 80.54 billion, and the Secondary and Higher Education Division with Tk61.90 billion.

A total of Tk 301.59 billion has been allocated under development assistance for special needs.

In addition, Tk 31 billion has been allocated for five development-assistance items under the Local Government Division, Tk5.30 billion for the Ministry of Chittagong Hill Tracts Affairs and Tk1.00 billion for special areas.

Besides, the NEC allocated Tk 89.35 billion for projects implemented by autonomous bodies and corporations through their own financing. Including these self-financed projects, the total size of the RADP stands at Tk 2.089 trillion.

The revised development budget holds a total of 1,330 projects, including 1,108 investment projects, 35 feasibility studies, 121 technical-assistance projects and 66 self-financed projects.

Planning officials say the revised ADP includes 664 new unapproved projects for implementation with government financing, 157 new unapproved projects aimed at facilitating foreign financing and 35 projects to be implemented by autonomous bodies or corporations through their own financing.

A total of 286 projects have been earmarked for completion under the RADP.