ISLAMABAD: For the first time in Pakistan’s history, household spending on education (Rs. 2.8 trillion) has exceeded government investment (Rs 2.23 trillion), according to a new report released by the Institute of Social and Policy Sciences (I-SAPS).

The finding, unveiled at the National Policy Dialogue to launch I-SAPS’s 15th annual report on ‘Public Financing of Education’ on Tuesday, signaled a major shift in the country’s education landscape, says a press release.

It said families were now bearing majority of the Rs5.03 trillion total cost of education, raising serious questions around equity, access, and the state’s responsibility in providing quality education for all, according to the findings of the report.

The report said the total education financing had reached Rs5.03 trillion.

Of this, the public sector contributes Rs2.23 trillion, making up 44pc of the total. The remaining 56pc, amounting to Rs2.80 trillion, comes directly from households. This includes Rs1.31 trillion spent on private school fees, Rs613 billion on shadow education and tuition, and Rs878 billion in other out-of-pocket costs.

“Families are financing education at a scale that raises fundamental equity concerns,” said Executive Director of I-SAPS Dr Salman Humayun.

“When household spending surpasses public investment, we must ask who is able to afford education and who is being excluded.”

Speaking at the dialogue, Education Team Leader at the Foreign, Commonwealth and Development Office (FCDO) Mazhar Siraj emphasised the need to move beyond input-heavy approaches. He noted that outcome-based financing and efficiency reforms are critical, but innovative financing can only succeed where strong data systems and governance frameworks are in place.

Senior Education Specialist at the World Bank Izzah Farrukh said the expansion of private schooling reflects the failure of the public system to meet families’ expectations. She observed that this shift represents families opting out of public schools, where responsiveness, voice, and agency have weakened over time.

Director General of the Pakistan Institute of Education Dr Shahid Soroya highlighted the importance of sustained evidence generation, and acknowledged the efforts of the federal ministry and development partners in strengthening annual education data consolidation.

Federal Secretary for Health and former finance secretary Hamed Yaqoob Sheikh praised I-SAPS for introducing analytical frameworks that support more informed resource allocation across social sectors. He stressed the importance of independent research in supporting effective policy in fiscally constrained environments.

Director Programmes at I-SAPS Ahmad Ali closed the dialogue by calling for a strong public response.

Published in Dawn, January 21st, 2026