Budget 2026–27: Higher welfare outlays mask poor spending efficiency

By A Representative 

The Union Budget 2026–27 presents a mixed picture for welfare spending, with higher allocations for several social sectors but continuing concerns over reduced actual expenditure and weak implementation, according to an analysis by the Pathey Budget Center. 

The study, authored by budget analyst Mahender Jethmalani, compares budget estimates for 2026–27 with revised estimates for 2025–26 across key welfare categories including the Gender Budget, Child Budget, Scheduled Caste Plan and Tribal Sub-Plan.

The analysis shows that revised estimates for 2025–26 were substantially lower than the original budget estimates across most social sectors, indicating a rollback in spending on programmes meant for women, children and marginalised communities. 

The Gender Budget Part A, which includes schemes with 100 per cent allocation for women and girls, recorded the steepest cut, with revised estimates lower by ₹30,158 crore, a reduction of nearly 29 per cent. Only about 71 per cent of the allocated amount was likely to be spent, with major cuts seen in housing schemes such as PM Awas Yojana in both urban and rural areas, as well as Mission Shakti.

The Child Budget Part A also saw a reduction of ₹8,735 crore in the revised estimates for 2025–26, amounting to a cut of around 10 per cent. Key schemes related to education and nutrition, including PM SHRI Schools and PM Poshan, were affected. 

In contrast, the Scheduled Caste Plan and the Tribal Sub-Plan showed relatively strong spending efficiency, utilising 96 per cent and 95 per cent of their allocations respectively, despite facing cuts of over ₹7,000 crore each at the revised estimate stage.

Commenting on the findings, Mahender Jethmalani said the trend highlights a growing gap between budgetary intent and actual delivery. “While the Budget Estimates for 2026–27 indicate increased allocations for most social categories, the critical issue remains execution. Repeated reductions at the revised estimate stage dilute the impact of welfare commitments,” he said.

The analysis also points to serious underutilisation in certain tribal-focused programmes. The Dharti Aaba Janjatiya Gram Utkarsh Abhiyan spent only 36 per cent of its allocated funds, while the Pradhan Mantri Janjatiya Adivasi Nyaya Maha Abhiyan utilised around 63 per cent. 

Despite an overall increase in allocations for the Scheduled Caste Plan and Tribal Sub-Plan in the 2026–27 Budget, the Pradhan Mantri Janjatiya scheme is the only category to witness a significant reduction compared to the previous year’s budget estimate.