Pakistan has narrowly missed the International Monetary Fund’s (IMF) target of spending at least Rs2.86 trillion to enhance health and education standards, with Sindh, Khyber Pakhtunkhwa (KP), and Punjab falling significantly short of their commitments.

Despite the alarming statistic that one in four children is out of school and half of grade-five students are unable to read grade-two Urdu stories, education spending remains a low priority.

The federal and provincial governments collectively spent Rs2.84 trillion in the last fiscal year, falling short of the target by Rs27 billion, according to government sources.

This figure is Rs240 billion less than the commitments outlined in memorandums of understanding (MOUs) signed by all five governments.

While the federal government and Balochistan exceeded their spending targets, Sindh, KP, and Punjab did not meet theirs by wide margins.

Poor administrative structures and low absorption capacity were identified as major factors contributing to this shortfall.

The IMF had set both quarterly and annual spending ceilings to ensure that health and education funding was prioritised over achieving cash surpluses and balanced budgets.

In May, Pakistani authorities assured the IMF they would work on improving provincial capacities in these sectors.

The IMF’s staff report highlighted a decline in Pakistan’s health and education spending since 2018.

Although all governments aimed for a modest increase to 2.4% of GDP, actual spending fell short, particularly in Sindh and KP, due to absorption issues.

Despite higher spending in the last quarter, the annual target was missed.

The five governments spent Rs937 billion in the April-June period against a quarterly target of Rs713 billion, which was nearly one-third more than planned.

However, this late surge could not compensate for earlier shortfalls.

Authorities have acknowledged the decline in non-Benazir Income Support Programme (BISP) health and education spending in recent years and committed to gradually increasing it as a share of GDP during the three-year IMF program.

In terms of internal budgetary targets, the federal government allocated Rs261 billion for health and education, surpassing its Rs248 billion target. Punjab fell short by Rs35 billion, spending a total of Rs1.15 trillion.

Punjab’s Information Minister Azma Bukhari stated that Punjab’s health budget was Rs524.8 billion, with Rs505 billion spent 96% of the target. Education spending was targeted at Rs664 billion but reached only Rs649 billion, or 98% of the goal.

Sindh, under Chief Minister Syed Murad Ali Shah, fell short by Rs153 billion, spending Rs670 billion against a target of Rs853 billion. KP missed its target by Rs55 billion, spending Rs545 billion compared to a Rs600 billion target.

In contrast, Balochistan exceeded its target by Rs25 billion, with a total expenditure of Rs206 billion.