This increase aims to meet the IMF’s target of raising the program’s coverage to at least 15% of the poorest families’ expenses, up from the current 12%.
Islamabad: Pakistan is set to significantly increase funding for its flagship social safety program, the Benazir Income Support Program (BISP), in the upcoming budget. This move comes in response to demands from the International Monetary Fund (IMF) and aims to alleviate the financial burden on the poorest sections of society facing rising inflation.
The government is proposing a record allocation of Rs. 593 billion for BISP, a 26% increase over the current year’s budget. This increase is a direct result of discussions with the IMF, who had initially expressed dissatisfaction with the initially proposed amount.
The additional funds will be used to expand the program by adding new beneficiaries and increasing the quarterly stipend for existing ones. The number of beneficiaries is expected to rise from 9.6 million to 9.7 million, with the stipend rising from Rs. 10,500 to Rs. 13,000 per family.
This increase aims to meet the IMF’s target of raising the program’s coverage to at least 15% of the poorest families’ expenses, up from the current 12%.
While the BISP expansion is a welcome step, the news report highlights concerns about the plight of the lower-middle-income class. This group often gets squeezed by rising inflation and may not qualify for BISP benefits. The IMF’s proposed withdrawal of tax breaks and subsidies could further impact their situation.
Pakistan’s vision for BISP extends beyond immediate relief. The government aims to eventually reach 20 million beneficiary households. Negotiations are underway with the World Bank for additional loans to support this expansion and improve the program’s health and education components.
The report also acknowledges ongoing challenges with the BISP program. While reaching nearly 2 million children, around 25% of those benefiting from the conditional cash transfer program for education are still out of school.
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The increased allocation for BISP signifies its growing importance. It is projected to become the sixth largest budget program in Pakistan, after essential expenditures like debt servicing, defense, and development. The IMF, however, has proposed transferring BISP costs to the provinces under a new fiscal agreement.
This news story provides a detailed overview of the upcoming changes to Pakistan’s BISP program, highlighting the government’s response to IMF demands, the program’s expansion plans, and the challenges it faces. It also acknowledges the concerns of those who may not directly benefit from the program.
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