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Govt to expand social safety net coverage, raise allowances in FY26

The government has proposed a significant expansion of social safety net programmes in the upcoming 2025–26 fiscal year, aiming to better support the country’s poorest and most vulnerable amid ongoing economic challenges.

In his national budget speech on Monday, Finance Adviser Dr Salehuddin Ahmed announced that both the number of beneficiaries and the size of individual allowances under key social protection schemes would be increased. The initiative is intended to reduce poverty, address inequality, and improve living standards for marginalized communities.

Beginning in July, several social welfare allowances will be raised. The monthly old-age allowance will rise from Tk 600 to Tk 650. Widowed, deserted, and destitute women will receive Tk 650, up from Tk 550. The disability benefit will increase from Tk 850 to Tk 900, and the allowance under the Mother and Child Benefit Programme will rise from Tk 800 to Tk 850. Additionally, a new monthly stipend of Tk 650 has been introduced for disadvantaged communities.

“The aim is to make our safety net programmes more inclusive and impactful, especially during this time of economic strain,” said the finance adviser.

The government also plans to expand the number of people covered by these programmes, aiming for broader inclusion and greater protection for those living on the margins of society.

The proposed national budget for FY26 is set at Tk 7,89,999 crore—Tk 7,000 crore lower than the original budget for the current fiscal year. It targets a GDP growth rate of 5.6%, with a projected fiscal deficit of Tk 2,66,000 crore (3.6% of GDP). The budget includes an Annual Development Programme (ADP) allocation of Tk 2,30,000 crore and projects inflation to remain at 6.5%.

Officials described the FY26 budget as contractionary in nature, reflecting a strategy of fiscal consolidation while maintaining essential investments in social welfare.

The budget was approved during a special meeting of the Advisory Council held at the Chief Adviser’s Office in Tejgaon, Dhaka, chaired by Chief Adviser Dr Muhammad Yunus. Following the council’s approval, President Mohammed Shahabuddin gave formal consent to the budget later that day.

Notably, the FY2024–25 budget had proposed an increased allocation of Tk 136.03 billion for social safety net programmes, up from Tk 126.27 billion in the preceding fiscal year.

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