Kerala Unveils People-Focused Budget for 2026-27 with Major Welfare Initiatives
Kerala Finance Minister K N Balagopal on Thursday presented a comprehensive, people-oriented budget for the fiscal year 2026-27, making significant allocations toward social security, employee welfare, and development projects. This budget comes at a crucial time as the state prepares for upcoming Assembly elections, positioning it as a document aimed at addressing citizen needs and sustaining Kerala's growth momentum.
Major Financial Boost for Social Security and Community Programs
Presenting the sixth budget of the second Pinarayi Vijayan-led government in the Legislative Assembly, Balagopal announced a substantial Rs 14,500 crore enhancement specifically designed to support social security pensioners and fund new community initiatives. "This budget is crafted to ensure equitable compensation and financial stability for government employees while maintaining Kerala's progressive development trajectory," the finance minister stated during his address.
Key Announcements for Government Employees and Pensioners
The Kerala Budget 2026-27 introduced several critical measures for public sector workers:
- Formation of 12th Pay Revision Commission: Continuing the state's established practice of revising government employee salaries every five years, a new commission will be constituted and expected to submit its report within three months for prompt implementation.
- Clearance of DA and DR Arrears: All pending Dearness Allowance and Dearness Relief arrears for government employees and pensioners will be settled. One installment will be paid with February salaries, with remaining dues disbursed alongside March salaries. The House Building Advance for employees will also be reinstated.
- Assured Pension Scheme Replaces NPS: Balagopal formally announced the Assured Pension Scheme, which will substitute the National Pension System for eligible employees. Retirees will receive up to 50 percent of their last drawn salary, including Dearness Relief. Current NPS participants will have the option to transition to this new scheme, with detailed guidelines to be issued by April 1.
Wage Increases for Various Worker Categories
The budget proposed substantial honorarium and wage hikes for multiple workforce segments:
- ASHA and Anganwadi workers: Monthly increase of Rs 1,000
- Anganwadi helpers: Monthly increase of Rs 500
- Pre-primary teachers and literacy mission motivators: Monthly hike of Rs 1,000
- School cooking staff: Daily wages increased by Rs 25
Enhanced Welfare and Social Security Allocations
Significant welfare provisions were announced, including a Rs 3,700 crore allocation for the Chief Minister's Stree Suraksha Scheme. The budget also provided an additional Rs 1,000 crore for rural employment schemes compared to previous years.
Other notable announcements encompass:
- Life and health insurance schemes covering all population categories, including school children
- Free degree education in arts and science colleges
Infrastructure and Regional Development Focus
In terms of infrastructure advancement, the budget earmarked Rs 100 crore for preliminary works related to the Regional Rapid Transit System from Thiruvananthapuram to Kasaragod, which received in-principle approval from the state cabinet on Wednesday. Additionally, approximately Rs 150 crore has been allocated for coastal development, while over Rs 250 crore has been designated for forest and wildlife protection initiatives.
This comprehensive budget reflects Kerala's commitment to balancing immediate social welfare needs with long-term developmental goals, setting the stage for both electoral considerations and sustainable state progress.
