Published June 19, 2026 Updated about an hour ago By Dr Omer Javed In line with the overall economic policy, the important thing for a budget is to employ its tools – revenue and expenditure – to meet both over-arching goal of enhancing sustainability of macroeconomic stability, economic growth, resilience in terms of greening the economy, and welfare. For this, it is important to prioritize both outcomes, and plan revenues and expenditures in a way that enhances productive and allocative efficiencies, and puts the burden of taxation in an equitable way. Important outcomes as per the author for Federal Budget 2026-27, for instance, include, as pointed out in my June 12 article ‘Policy philosophy correction budget–I’ published by BUSINESS RECORDER (BR) ‘…water resource management, and security, energy sustainability, poverty, unemployment, and high interest payments… fiscal federalism needs to be fixed to better match responsibilities with regard to subjects shifted under the 18th Constitutional Amendment to the federating units, with the expenditure responsibilities they should incur from the transferred resources under the National Finance Commission (NFC) award for those devolved responsibilities. That would better rationalize expenditure side, and revenue raising needs of the centre, and federating units.’ Here, the overall efficiency and equitability aspects of the budget are reflected through the ‘way’ expenditure is allocated, and before that ‘how’ revenues are collected through providing positive and negative incentives in this regard to set the direction of the overall economy. In the Federal Budget 2026-27, the first thing to realize about the budget is that it is not presented as an outcomes-based budget in terms of main goals being targeted – in particular climate change related resilience enhancing expenditure, including subsidies, and taxation – how the budget overall in terms of expenditure allocations, and domestic resource mobilization, or revenues reflects expectations. As a related point, the chapter on climate change is among the last few chapters of the Economic Survey for fiscal year 2025-26, which is strange…