Budget 2026-27: Social Sector Analysis
The Budget 2026-27 for the social sector is notable for the absence of new flagship schemes, continuing the trend of neglect in actual allocations.
Neglect of Vulnerable Sections
- Allocations for schemes like the National Social Assistance Programme (NSAP), SAMARTHYA, PALNA, PM POSHAN, and Saksham Anganwadi remain low.
- Allocation increases range from 0.2% (NSAP) to 5.2% (Saksham Anganwadi) in nominal terms.
- Revised estimates (RE) for 2025-26 are lower than budget estimates (BE), indicating underutilization of budgeted funds.
Health and Education Sectors
- Budget allocations for health and education increase by 6.4% and 8.3% respectively over 2025-26 BE.
- Even these increases are affected by the RE for 2025-26, which fall below BE by 3.7% and 5.2%.
Decline in Major Sectors
- Significant declines in RE for sectors like Urban Development (41%), Rural Development (20%), Development of the North-East (24%), and Social Welfare (17%).
Flagship Schemes
- Jal Jeevan Mission's allocation fell from ₹67,000 crore in 2025-26 BE to ₹17,000 crore in RE.
- PMAY-Grameen and PMAY-Urban also saw reduced RE compared to BE, yet allocations in 2026-27 remain the same as previous years.
Centrally Sponsored Schemes (CSS)
- Total CSS allocations decrease from ₹5,41,850 crore in 2025-26 BE to ₹4,20,078 crore in RE, with 2026-27 BE at ₹5,48,798 crore.
Capex Focus and Economic Challenges
- Over ₹12 lakh crore allocated for capital expenditure to boost the economy.
- Challenges include lack of gainful employment, low productivity, and poor purchasing power.
Shift of Welfare Spending to States
- Post-2015 reforms, cost-sharing norms shifted more spending to States.
- States are now responsible for implementing welfare schemes, but face funding constraints.
- Centre’s tax revenue receipts increasingly rely on cesses and surcharges, reducing States’ share to around 34% (below the recommended 41%).
- Finance Commission’s grants to States decreased from ₹1,32,767 crore in 2025-26 BE to ₹1,29,397 crore in 2026-27 BE.
In conclusion, the analysis raises questions about the capacity of States to manage welfare spending and what implications this has on public access to social services.
