PESHAWAR: Advisor to Chief Minister on Finance Muzzammil Aslam termed Khyber Pakhtunkhwa Budget for Fiscal Year 2026-27 a “historic” financial plan under which the provincial government set own priorities while keeping in view situation of the province.
Speaking at a post-budget press conference along with provincial information minister Shafi Jan and senior officials of finance and other departments concerned here on Saturday stated that the provincial government had asked the federal government to allow consultation with the party leadership. He said discussions on PSDP and other financial issues are ongoing.
Muzzammil Aslam said the National Finance Commission (NFC) is the only legal forum for financial distribution. He added that the National Economic Council is not the correct platform for such matters.
He said the federal government collects Rs5,260 billion through the FBR and then distributes it among provinces. The CM aide on Finance stressed that provinces’ funds cannot be reduced without constitutional changes.
He said federal policies directly affect the common people. He added that provincial budgets help stabilise the economy and support citizens.
He also pointed out a Rs121 billion deficit in the budget of merged districts. He said only Rs95 billion was released out of Rs180 billion allocated by the federal government.
Muzammil Aslam said most of the budget is spent on salaries. He added that education, health, and police have been given priority. He said no new taxes were imposed last year and very few changes were made this year. He said reforms were aimed at simplifying the system.
He announced that the minimum wage has been increased to Rs45,000. He said private sector employers are expected to follow this decision.
He also said Rs125 billion has been allocated for the Sehat Card programme. Rs14.5 billion has been set aside for police procurement. Rs6 billion has been allocated for BRT. He added that Rs20 billion has been reserved for interest-free loans for talented students. He also announced Rs50 crore for public free Wi-Fi in Peshawar.
Muzzammil Aslam said they are not confronting the federal government, rather they have decided our own priorities keeping in view the situation in the province. The Advisor said that the total budget for the financial year 2026-27 was Rs. 2170 billion as compared to 2025-26 that was Rs 1962 billion.
He said that the total development budget for 2026-27 was Rs. 524.3 billion and the provincial settled Annual Development budget was Rs. 235 billion with an increase of 21 percent.
He told the media that settled tehsil ADP budget was Rs. 47 billion showing an increase of 21 percent and ADP of merged districts in 34.8 billion with an increase of 13 percent.
The CM’s aide told that new initiatives that were incorporated in the budget 2026-27 include Ehsas Kissan Ka, endowment fund for minorities, interest free loans for university students, interest free loans for overseas immigrant workers, Insaf Female and Orphan education card, Free Public Wifi for Peshawar, interest free loans for E-Bikes and E-Rikshaws, Ehsas Internship Program and public sector transport initiatives.
He told the media that ongoing initiatives that are part of budget 2026-26 include Good Governance initiatives, Police Procurement Plan, Police Monthly Operational Support and purchase of BRT vehicles.
To a question, he said that Rs 80 billion had been earmarked for Medical Teaching Institutes (MTIs) against demand of Rs. 112 billion adding that they plan to strengthen primary healthcare facilities and District Headquarters Hospital to ease load on MTIs.
He said that the provincial government has also spent an excess amount in merged districts as compared to received allocation.
Meanwhile, Khyber Pakhtunkhwa Information Minister Shafi Jan has said that the province has presented a deficit budget. He said no grant will be given to the federal government. He made the remarks during a press conference in Peshawar alongside Adviser to Finance Muzammil Aslam. He said the KP budget is more important and widely waited than the federal budget and called it a “historic” financial plan.
KP Information Minister said the government initially planned a three-month budget. However, legal complications forced a change in the approach. Shafi Jan said that grant-in-aid matters are linked to a meeting with PTI founder Imran Khan. He added that no budget cuts will be accepted until this meeting is arranged. He also said that the PTI founder has not been allowed to meet his family for seven months. He urged authorities to arrange a meeting between the KP Chief Minister and the PTI founder.
Copyright Business Recorder, 2026
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