Egypt’s Ministry of Finance: Budget spending rose EGP 94.141 billion in July–August 2026; how did its composition change?

ENCC examines budget-sector spending by economic category: non-interest expenditure grew faster and the interest share fell, with clear limits on interpreting health and education priorities.

Higher expenditure and a changing mix

Budget-sector expenditure reached EGP 849.087 billion in July–August 2026, against EGP 754.946 billion in the same two months of 2025. The nominal increase was EGP 94.141 billion, or 12.47%. ENCC treats these figures as cumulative cash outturn for the opening two months of FY 2026/2027, reported in the Ministry of Finance’s October edition. They are neither October spending nor full-year budget appropriations. The analytical question is which categories absorbed the increase and how the relative space for services and investment changed.

Economic composition of expenditure · EGP billion
Item	Jul–Aug 2025	Jul–Aug 2026	Change	Growth %
Total expenditure	754.946	849.087	94.141	12.47
Wages and employee compensation	106.368	116.761	10.393	9.77
Goods and services	19.744	26.772	7.028	35.6
Interest	478.829	512.226	33.397	6.97
Subsidies, grants and social benefits	103.467	118.731	15.264	14.75
Other expenditure	27.065	38.609	11.544	42.65
Non-financial asset purchases (investment)	19.473	35.988	16.515	84.81

Source: Ministry of Finance, October 2026 workbook, table11, AJ/AK rows25–31. Changes and growth are ENCC calculations from original values; nominal two-month cumulative flows.

Interest remained largest; non-interest spending grew faster

Interest payments increased from EGP 478.829 billion to 512.226 billion, a rise of 33.397 billion accounting for 35.48% of the total spending increase. Non-interest expenditure rose from 276.117 billion to 336.861 billion: an increase of 60.744 billion, or about 22.00%. Consequently, the interest share fell from 63.43% to 60.33% of expenditure even as interest payments increased in pounds. This is a denominator growing faster than its numerator; it does not establish a fall in borrowing costs or outstanding obligations.

Spending shares and contributions to the increase
Item	2025 share %	2026 share %	Share change (pp)	Share of spending increase %
Wages and employee compensation	14.09	13.75	-0.34	11.04
Goods and services	2.62	3.15	0.54	7.47
Interest	63.43	60.33	-3.1	35.48
Subsidies, grants and social benefits	13.71	13.98	0.28	16.21
Other expenditure	3.59	4.55	0.96	12.26
Non-financial asset purchases (investment)	2.58	4.24	1.66	17.54

ENCC calculations. A share of total expenditure differs from a contribution to its increase; displayed percentages may not sum exactly due to rounding.

Wages, support and investment

Wages and employee compensation rose EGP 10.393 billion to 116.761 billion; subsidies, grants and social benefits increased 15.264 billion to 118.731 billion. These are separate economic categories. Adding a detailed sub-item to the category total would count it twice. Non-financial asset purchases increased 16.515 billion to 35.988 billion, growing 84.81% from a small comparative base. Their expenditure share rose from 2.58% to 4.24%. Higher investment cash payments over two months do not establish completed projects, developmental returns or total public investment across every entity.

What the economic classification can establish

Goods and services increased EGP 7.028 billion and other expenditure 11.544 billion. Together with the other categories these movements fully reconcile the expenditure increase. The economic classification describes the nature of a payment; functional classification identifies its purpose, such as health or education. Each function may contain wages, purchases and investment. An entire economic category therefore cannot be assigned to one service sector. The retained two-month material does not supply a consistent functional outturn for health and education; the report’s multiyear functional chart cannot substitute for that missing table.

ENCC interpretation and limits

ENCC considers the expansion in non-interest spending worth tracking through payment timing, spending quality and service or project outcomes, especially while interest still absorbs more than three fifths of expenditure. Subsequent monitoring should connect economic and functional outturns with delivery indicators. This comparison is nominal and may reflect prices, payment schedules and settlement of obligations. It does not establish real growth, a definitive ranking of priorities or spending efficiency. Multiplying two-month execution by six would ignore seasonality and the distribution of interest-payment dates.