Family Cards, higher allowances, expanded disability support drive a 14% rise in social protection spending

“The objective of our social security programmes is to bring all citizens under a life-cycle-based protection framework so that poverty can be reduced and inequality narrowed,” Khosru says

Safety Net Surge

Life-Cycle protection: The budget pivots towards a "life-cycle" welfare system, aiming to build long-term economic self-reliance

Empowering women: The flagship Family Card scheme receives Tk 145bn, providing 4.1 million female household heads with Tk 2,500 monthly

Disability support widens: Disability allowance beneficiaries will rise to 3.8 million, with monthly payments increasing to a higher Tk 1,000

Free elderly travel: Over-65s secure free train travel and a 25 percent discount on metro rail fares under new mobility concessions

Rural development push: A significant Tk 413.52 billion is earmarked for local government to drive jobs, skills and digital services in villages

The government has proposed a sharp expansion of social protection spending for the 2026-27 fiscal year, increasing allowances, widening coverage and introducing new welfare measures aimed at vulnerable groups and low-income households.

In the Tk 9.38 trillion budget for fiscal year 2026-27 that he delivered on Thursday, Finance Minister Amir Khosru Mahmud Chowdhury proposes an allocation of Tk 1.44 trillion for the social security net.

That compares with Tk 1.26 trillion in the revised FY2025-26 budget, reflecting a 13.89 percent rise and a higher share of total expenditure at 5.8 percent.

The finance minister said the goal of the government’s welfare framework is to build a “life-cycle-based protection” system.

“The objective of our social security programmes is to bring all citizens under a life-cycle-based protection framework so that poverty can be reduced, inequality narrowed, and inclusive development ensured,” he said.

“The core philosophy of this framework is economic empowerment and self-reliance. Through social security programmes, we seek to build a non-discriminatory, humane and welfare-oriented state.”

Key Initiatives

The government outlined a series of measures under the proposed budget:

• Family Card expansion: Introduced shortly after the government took office, the scheme provides Tk 2,500 monthly to the female head of a household. It will be expanded nationwide in phases by 2030. For FY2026-27, Tk 145 billion has been proposed to cover 4.1 million women.
• Old-age and widow support: Existing old-age allowances and assistance for widowed and abandoned women will continue unchanged.
• Transport benefits for elderly: Citizens aged 65 and above will receive free train travel and a 25 percent discount on metro rail fares.
• Disability support expansion: The number of disability allowance beneficiaries will rise to 3.8 million, with monthly payments increased to Tk 1,000.
• Education stipends for disabled students: Coverage will expand to 100,000 students, with monthly stipends ranging from Tk 1,000 to Tk 1,400 depending on education level.
• Mother and Child Support Programme: About 1.89 million mothers and children will receive Tk 850 per month.
• Health-related assistance: One-time financial aid for cancer and five other incurable diseases will be increased from Tk 50,000 to Tk 100,000.
• Universal Pension Fund: Private-sector employees will receive 30 percent of accumulated pension savings as gratuity upon retirement.
• Freedom fighters’ benefits: Monthly honourarium remains at Tk 20,000. However, family allowances for award-winning freedom fighters will rise by Tk 5,000, setting new monthly rates at:
• Tk 40,000 for Bir Sreshtho families
• Tk 30,000 for Bir Uttam families
• Tk 25,000 for Bir Bikrom and Bir Protik families
• July Uprising victims: Families of those killed will continue receiving Tk 20,000 per month, while injured victims in categories A, B and C will receive Tk 20,000, Tk 15,000 and Tk 10,000 respectively.

Rural Development Push

Beyond direct welfare transfers, the government has also placed emphasis on rural development and economic inclusion through wider structural programmes.

These include:

• Expanding employment-generation schemes
• Promoting women’s entrepreneurship and financial inclusion
• Skill development for small farmers, women and youth
• Expanding access to affordable credit and agro-processing
• Strengthening digital service delivery in rural areas
• Expanding cooperative-based employment and self-employment initiatives

To support these measures, the government has proposed Tk 413.52 billion for local government and rural development in FY2026-27.