Budget 2026: Health allocation falls short of expectations

The proposed budget for the 2025-26 fiscal year offers little in the way of bolstering the health sector.

Not only has the allocation barely increased, but the recommendations of the Health Reform Commission have also been overlooked.

Experts fear the full allocation may once again go unused, as has been the case in previous years.

Finance Advisor Salehuddin Ahmed presented a budget of Tk 7.90 trillion for FY26 on Monday.

In the new fiscal year, Tk 419.08 billion has been allocated for the health sector, which is 5.30 percent of the total budget and 0.67 percent of the GDP.

In the fiscal year 2024-25, the allocation for health was Tk 414.08 billion. This year, it has increased by Tk 5.01 billion compared to the previous year.

The Ministry of Health failed to spend its full allocation in the outgoing fiscal year.

As a result, the revised health budget was reduced to Tk 279.25 billion, which is 3.75 percent of the total revised budget for FY25 and 0.50 percent of the GDP.

This year, the proposed allocation for the health sector of the Ministry of Health includes Tk 312.22 billion for the Health Services Division and Tk 108.86 billion for the Family Welfare Division.

Of this, the operating expenditure is estimated at about Tk 243.88 billion and the development expenditure is about Tk 175.20 billion.

In his budget speech, Finance Advisor Salehuddin said: "To bring all the citizens under universal health coverage by 2030, special emphasis has been given on expanding the scope of services, infrastructure development and recruitment of skilled human resources.

"To fill the vacancies in the health sector, the recruitment of doctors, nurses, technicians, pharmacists and health assistants has been accelerated, and an integrated plan has been taken to create necessary posts."

The proposed spending plan also extends the existing duty and tax exemptions on the import of raw materials for the pharmaceutical industry.

It proposes further reductions to customs and taxes on the import of machinery and equipment for the establishment of all hospitals with more than 50 beds, in addition to referral hospitals.

Bangladesh Association of Pharmaceutical Industries Secretary General Dr Md Zakir Hossain told bdnews24.com, “This facility in the pharmaceutical industry was supposed to end. Its extension will benefit Bangladeshi patients a lot.

“This facility is scheduled to be provided until 2030. If highly sophisticated cancer drugs are manufactured in Bangladesh, the price is cut down to 25 to 30 percent. It will bring great relief to cancer patients.

Since cancer treatment lasts a long time, patients need to take various types of medication, he noted.

“If we receive tax benefits on the raw materials used in medicine production, we will be able to compete with any multinational company.”

Public health expert Dr Lelin Choudhury expressed disappointment that the budget did not include health sector reform plans.

"For the past few years, the health allocation in the budget has been below 1 percent. The reform commission's recommendation was to increase it to 5 percent.

“The health ministry cannot use the budget allocation to develop the health sector and bring about a people-friendly pace. We expected some changes through which a new trend would be created in the health sector of Bangladesh.”

He continued, “Since independence, there has been no complete service delivery plan in the health sector, but that was in the reform commission’s report.

“There was an opportunity to prepare this year's health budget accordingly, but that did not happen.”

Bangladesh Doctors Foundation founder Dr Nirupam Das called for the full utilisation of the funds allocated for the health sector.

“Every year, the money allocated in the budget is returned, not spent. We want it to be spent correctly, in the right place, and for the benefit of the public.

“Train health administrators to ensure the utilisation allocation for the health sector.”

Professor Syed Abdul Hamid from Dhaka University’s Institute of Health Economics added that the government must not slash the health budget mid-year.

"We must identify the reasons behind the underutilisation of budget funds and take appropriate action. The Ministry of Health must identify why it is unable to spend the allocated funds. The government should begin addressing this from Jul 1.

“It is essential for the ministry to investigate the causes, understand the obstacles, and take steps to resolve them.”