Thiruvananthapuram: With senior citizens now accounting for 18.7 per cent of Kerala’s population, the 2026–27 state Budget has placed a strong emphasis on the care economy and the silver economy, marking a strategic shift in response to the state’s changing demographic profile. Kerala has also become the first state in the country to present a dedicated Elderly Budget document alongside the main budget.

In a move aimed at decentralised and targeted support, the Budget has introduced the proportion of senior citizens and urbanisation as a new criterion for the financial devolution of funds to local government institutions. This is expected to help local bodies design programmes and services tailored to ageing populations.

Presenting the Budget in the Assembly, Finance Minister KN Balagopal said the government views geriatric care and elderly welfare as a core component of Kerala’s socio-economic planning, as the proportion of senior citizens continues to rise alongside a decline in the youth population. Kerala's median age is around 37 years, far higher than that of youthful states such as Bihar, where it is about 23. Along with Tamil Nadu, Kerala is classified as an "ageing state", defined as one where at least 15 per cent of the population is aged 60 and above.

A key highlight of the Budget is the constitution of an Elderly Commission and the presentation of a separate Elderly Budget, a first in India. The move is aimed at ensuring focused policy intervention, monitoring and long-term planning for senior citizens. “Our state is facing a significant demographic change with increase of elderly population. In this context, the care economy and the silver economy are imperative so far as Kerala is concerned,” Balagopal said.

Emphasising employment opportunities linked to demographic change, the Budget outlines plans to modernise care-related sectors and promote new projects under the care and silver economy. These include initiatives that enable women to work from or near home in care services and other skill-based sectors.

The Budget also allocated ₹30 crore in subsidies to organisations and groups to establish retirement homes across the state and ₹10 crore for on-call volunteer services for elderly living alone. These facilities are expected to include community kitchens, recreational spaces, entertainment facilities and integrated healthcare systems supported by health volunteers.

To address health risks among senior citizens, the government has announced a special pneumococcal vaccination drive for elderly persons aged 60 and above from below poverty line families. An amount of ₹50 crore has been earmarked for the initiative.

The Aswasakiranam project, which provides financial assistance to caregivers of bedridden patients and the elderly, has been significantly strengthened. Monthly assistance has been increased from ₹600 to ₹1,000, while the total allocation for the scheme has been doubled to ₹100 crore.

Social security and welfare board pensions, which benefit a large section of the elderly population, have been enhanced to ₹2,000 per month. A total of ₹14,500 crore has been earmarked for welfare pensions in 2026–27.