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Pakistan’s National Finance Commission (NFC) Awards – A tool to exploit Sindh

By Naseer Memon (English Translation by: Khalid Hashmani)

[Backdrop: As the Pakistani establishment including their new political party partners mull over the upcoming NFC award, the people of Sindh have dug their heals and want that the awards be fair and follow the best practices of other similar countries such as India. The grass-root political workers from all political parties in Sindh who have long criticized the inequalities of NFC award are joining hands to bring an end to the exploiting aspects of the award. In this backdrop, SaeeN Naseer Memon has once again written a timely and detailed analysis of the exploiting nature of current NFC awards. He urges the ruling party that as the inequities in the form of NFC started after 1973 constitution when PPP was in power; the time has come for PPP to play its role in correcting this historic form of exploitation and restore fairness to all provinces. It is hoped that the information in this article would enable those who are engaged in lobbying and advocacy activities on behalf of Sindh to get it in front of decision makers and influencers. ]

Basic inequities of Current NFC Awards

The critical inequities of the NFC award lie in three areas – first it is distributed solely on the basis of population, second it covers almost all of the revenue generation in Pakistan, and third it enables the federal government to keep a lion’s share for itself.

How Pakistan and other countries collect and distribute revenues to Provinces?

In 1974, 1979, and 1990 NFC awards, provinces received 80% of total revenue collected and 20% was kept by the federal government. However, starting 1996 during the rule of an interim government headed by PPP’s Miraj Malik and when the Chief Minister was Mumtaz Bhutto, the federal share was drastically increased to 62.5% leaving only 37.5% for the provinces.

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