Government Enacts Spending Restrictions in FY27 Budget Revision

Dhaka:The government has implemented measures to curb spending in preparation for the revised budget for the 2026-27 fiscal year, including restrictions on new government building construction, vehicle purchases, and government-funded foreign training.

According to Bangladesh Sangbad Sangstha, the Finance Division issued a budget circular on November 9, instructing ministries and divisions to curtail expenditures, limit development projects, and prioritize essential sectors. The revised budget expenditure is mandated not to exceed the original budget ceiling for FY2026-27, and funds from the development budget are restricted from being transferred to the operating budget.

The circular specifies a suspension on the construction of new government buildings, with exceptions for the Ministries of Education, Health, and Agriculture. Projects with significant progress may receive funding with Finance Division approval, and other urgent construction projects require separate approval. Vehicle purchases have also been suspended, with exceptions for replacing vehicles over 10 years old or acquiring essential vehicles for new government institutions. All new or replacement vehicles must be fully electric, except for ambulances and security vehicles, with some conditions relaxed for projects approved before July 8, 2026.

The government has halted funding for foreign training and events, with limited funds available for necessary foreign visits and training upon approval. Ministries are urged to practice austerity in hospitality and official events. Revised budget estimates must consider revenue and expenditure trends from previous fiscal years, and salary estimates should adhere to the National Pay Scale 2026.

The revised Annual Development Programme (ADP) will focus on projects aligning with strategic objectives and essential needs, prioritizing those involving foreign assistance and addressing human development, agriculture, and other critical areas. Slow-moving projects may face reduced funding, with resources redirected to priority projects.

Budget proposals require approval from Budget Management Committees, and ministries must update plans following approval. The deadline for submitting revised budget estimates is November 26, encompassing both operating and project estimates.