REJAUL KARIM BYRON

The government is set to increase the amount of allowance under the social safety net programme in the next budget to cushion the poor from the impacts of high inflation.

Inflation averaged 8.74 percent in the first eight months of the fiscal year, way above the budgetary target of 5.6 percent, according to data from the Bangladesh Bureau of Statistics.

“If inflation shoots up by 5 percentage points, we will increase the allowance by the same proportion,” Finance Minister AHM Mustafa Kamal told The Daily Star yesterday.

The amount of allowance is likely to be increased by Tk 50 to Tk 100 in different safety net programmes, as per a decision taken at the meeting of the cabinet committee on social safety presided over by Kamal.

The global economy has been impacted by the Ukraine war.

“We are struggling to move forward amid this crisis period,” Kamal said.

The government has targeted to broaden its safety net programme to cover about 8 lakh people under three programmes: old age allowance, allowance for widowed, deserted and destitute women and allowance for the financially insolvent disabled.

“Different ministries have made demands and we are addressing those with our limited resources,” he said.

Subsequently, the allocation for the social safety net programme will increase by about 15 percent to Tk 1.3 lakh crore in the upcoming budget.

The social safety net budget also includes pensions for retired government employees and their families. This took up about 25 percent of this year’s social safety budget of Tk 1.13 lakh crore.

Subsequently, the International Monetary Fund has called for excluding the pension scheme from the social safety budget as part of its $4.7 billion loan programme.

Social safety net programme is meant for the poor people only, it said.