NFC Award: Miles to go before we sleep

The consensus on seventh NFC Award is indeed an historic achievement. Its a clear sign that democracy, however struggling, is finally finding a place in Pakistan, with the credit going to both the provincial lawmakers and their federal counterparts led by finance minister, Shaukat Tarin, who managed to prove most critics wrong. Yet, there are miles to go before we sleep.
Its refreshing to see the award being based on multiple criteria but both the centre and the provinces also need to appreciate the importance of other variables for a country as diverse as Pakistan in terms of geography, demography and infrastructure.
These, in accordance with the practices in developed and developing economies may include environmental consideration and the degree of sub-province distribution amongst other factors. Gradual reduction in the population weightage (currently agreed at 82%) should also be considered, keeping in mind that various developing economies assign relatively much less weightage to population.
On a related note, while the earmarking of 1 percent of total divisible pool for NWFP - being the frontline province in the war against terror - is a commendable gesture.
Similarly, the commissions decision to devolve sale tax on service to the provincial level on the pretext that sales tax on services is a provincial subject under the constitution should pave way for overall provincial autonomy - much needed to trickle down the flavour of democracy to local government systems.
The policy makers from all ends should continue their talks to decide on a systematic approach to decentralize and capacitate the provinces so they generate their own revenues and reduce their administrative and financial dependence on the centre in the long term.
And unless politicians want to go through another long-drawn marathon-style NFC agreement five years down the line, an independent technical body of experts should be set up in order to remove the perceptions of bias and ensure fairness and transparency - which is clearly the key to successful public policy decisions.
Their suggestions and critique should be publicly discussed before implementation and should be periodically reviewed in order to keep pace with changing dynamic of the economy.
Not only the politicians should consider these measures to help streamline the award-making process, but perhaps they should deliberate on these issues
ow to capitalize on the feel-good momentum and finalize a long-term mechanism before this new found air of consensus-building evaporates into thin air.

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SHARING CRITERIA IN OTHER ECONOMIES

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Country   Weight given to population (%)  Other criteria

Argentina                65            Development Gap

                                       Inverse Population

Colombia                 70            Equal Share

India                                  Income Distance Method Area

                                       Index of Infrastructure

                         10            Fiscal  Discipline

Indonesia                 0            Collection

Japan                     0            Collection

Malaysia                  0            Collection

Nigeria                  40            Minimum Responsibility of Government

                                       Social Development Sectors

Mexico                   50            Collection

Philippines              70            Land Area Equal Share

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