PESHAWAR: The provincial higher education department has sought a grant of Rs18 billion from the federal government to resolve financial issues of most of the public sector universities in Khyber Pakhtunkhwa.

The demand of grant has been made by the department in a letter addressed to the chairman of Higher Education Commission (HEC).

“Public sector universities of KP, which educate around 200,000 students, are under sustained financial pressure that affects the quality, affordability and continuity of higher education,” said the letter titled ‘grant for stabilisation, development and endowment fund for public sector universities in KP.’

Official says frontline role in war against terrorism puts burden on resources of the province

It said that its root was largely a funding gap created during the last few years as pay and pension costs had risen faster than grants.

Funding to universities through grants remained short by Rs18.0 billion during the last decade despite provincial support, it added.

The letter stated that 26 of the 34 universities in the province were in financial deficit. The accumulated deficits of Rs5.6 billion awaited clearance and the burden was passing to students and their families through higher fees, it said.

Giving details of financial problems, the letter informed HEC that the gap was the product of grants that did not keep pace with pay and pension increases.

“The federal grant through HEC decreased by 6.3pc during the last three years while expenditure increased by more than 18pc in the same period,” said the letter of the higher education department.

It said that the increase in salary and pension had been more than 135pc since 2018-19, when increase in pay and pension accelerated where the pension alone had increased by more than 80pc.

The letter said that KP had since raised its own grant from zero to Rs11.85 billion, which narrowed the gap but not enough to fill it as most of the grant was utilised for pension liabilities of previous years.

“During the last three years, expenditure has grown from Rs40.8 billion to Rs54.8 billion while the number of universities in deficit has risen from 12 to 26 and the grant per student has fallen from Rs82,000 to Rs72,000,” it stated.

It said that over the same period, salaries had increased by 31pc against 8.5pc increase in grants, which now covered 40pc of the pay and pension bill that was 49pc earlier.

“The historical University of Peshawar carries a deficit of Rs2.2 billion, the largest one in the sector, with Rs53.6 billion pension liability for long term settlement. Agricultural University Peshawar needs Rs0.8 billion. Similarly, Gomal University Dera Ismail Khan and Abdul Wali Khan University Mardan also face severe shortfall, which goes up to Rs0.7bn for each to cover their deficits and unpaid liabilities in the current financial year,” the letter read.

The universities in KP are trying to enhance their own source revenue, mostly relying on student fees being raised by 28pc between 2024-25 and 2026-27 that cover now about 59pc to 64pc of their expenditures.

Any further increase in fees would add to financial strain on families amid the province’s current economic challenges. It will make public higher education unaffordable.

Government grants account for about 36pc to 41pc of universities’ total receipts in the province, against 69pc in the Organisation for Economic Cooperation and Development (OECD) member countries. The gap, therefore, needs to be filled by the government.

The higher education department has demanded a three-part grant of Rs18.0 billion for clearing the accumulated deficits, outstanding liabilities, development and seed money for endowment funds.

The financial implications are Rs18.0 billion, where Rs12.0 billion will create lasting assets and permanent income, reducing future calls on the Government’s budget.

Abidullah Kakakhel, the secretary of higher education department, told Dawn that KP’s frontline role in the ongoing war against terrorism placed an exceptional burden on its resources, threatening its capacity to sustain public higher education.

He said that extraordinary circumstances demanded sustained and structured federal financial support to protect educational access, preserve institutional stability and safeguard the future of the province’s youth.

Published in Dawn, November 9th, 2026