The Sri Lankan Government has officially gazetted the Appropriation Bill for the 2027 financial year, outlining an estimated service expenditure of Rs. 4.99 trillion for state ministries and departments while placing a strict cap of Rs. 3.8 trillion on net government borrowings.
Key Highlights
- Service Expenditure: Fixed at Rs. 4.99 trillion for government ministries and departments in 2027.
- Statutory Expenditure: Estimated at Rs. 4.92 trillion, bringing total state expenditure to approximately Rs. 9.92 trillion.
- Borrowing Ceiling: Net government borrowing capped at Rs. 3.8 trillion under public financial management limits.
- Major Allocations: Public Administration Ministry and Provincial Councils account for significant spending blocks, heavily driven by public pensions.
- Legislative Timeline: First reading scheduled for 7 October 2026, followed by the Budget speech on 12 November 2026.
Published as a Gazette Extraordinary Supplement by order of President Anura Kumara Dissanayake, in his capacity as Minister of Finance, Planning, and Economic Development, the Bill seeks parliamentary sanction for state spending and borrowing covering the fiscal period from 1 January to 31 December 2027.
Alongside the Rs. 4.99 trillion allocated for public services, statutory spending—expenditure already mandated by existing legislation independent of this Bill—is estimated at Rs. 4.92 trillion. Combined, the total government outlay provided for under the legislative framework reaches approximately Rs. 9.92 trillion.
Under Clause 2 of the Bill, net borrowings raised by or on behalf of the government during 2027 cannot exceed Rs. 3.8 trillion. In compliance with Section 51 of the Public Financial Management Act, No. 44 of 2024, full details of these borrowings will be presented to Parliament in the final Budget position report.
A notable feature of the bill’s expenditure breakdown is the distinct allocation for Provincial Councils, budgeted at Rs. 659.95 billion (comprising Rs. 574.95 billion in recurrent spending and Rs. 85 billion in capital expenditure). Although Provincial Councils fall under the portfolio of the Ministry of Public Administration, they are listed as a separate block. If combined with the Ministry’s direct allocation of Rs. 651 billion, total funding for the ministry’s purview rises to roughly Rs. 1.31 trillion. A major driver of the Public Administration Ministry’s direct budget is the Department of Pensions, which alone requires Rs. 550.35 billion.
Following Cabinet approval on 15 September and subsequent clearance by the Attorney General, the Bill is set for its First Reading in Parliament on 7 October 2026. President Dissanayake will present the Second Reading and deliver the official Budget speech on 12 November, initiating a Committee Stage debate expected to conclude by 14 December 2026.