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EDITORIAL: Suddenly, the debate about fiddling with the 18th Amendment and NFC award formula is all the rage once again. And the fact that PML-N would stir this particular pot at this time, amid rampant speculation that it is being facilitated back into power, says a lot; even though Ishaq Dar later distanced the party from the idea.

Yet while any party that forms government and has the numbers in the house for constitutional amendments is well within its rights to revisit the amendment, there’s no denying that before doing so, it would need further debate among political parties.

This is not the first time this issue has come up, of course. Imran Khan was visibly and vocally upset about the formula when PTI was in power and openly called to change it. And now, with a caretaker setup in place, the finance minister has also spoken forcefully against the NFC formula, claiming it transfers a disproportionately high share of government resources from the centre to the provinces.

That is strange, to say the least, because a transitional setup has no authority when it comes to the constitution, except follow it in letter and spirit, so such suggestions amount to little except causing unnecessary confusion and confrontation.

There is some weight in the line advocated by sections of the press that the so-called establishment and bureaucracy favour a strong centre, no doubt, but this debate is more about money; specifically the constraints placed on the centre because of large transfers to the federating units.

Indeed, it’s this feature of the NFC formula – which increased provincial share of the divisible pool from 47.5 percent to 57.5 percent while reducing the share of the federal government by 10 percentage points to 42.5 percent – that caretaker Finance Minister called a “mistake”. This is also what Imran Khan endlessly complained about all the time when he was prime minister.

But that is only half the argument. For, even with reduced leverage and the fact that provinces never built the capacity that was needed, the federal government has also been guilty of fiscal profligacy and one reason it’s always been short of money is that it continued to run ministries on subjects, at the federal level, that have been devolved to the provinces.

In fact, it’s only recently, that too after a push from the SIFC (Special Investment Facilitation Council), that the centre finally cut the umbilical cord and left provinces to manage their finances on their own.

It’s all but certain that the 18th Amendment and NFC award formula will come under the spotlight after the next election. The right way to approach it is to initiate extensive debate among all stakeholders and then figure out which, if any, changes are really needed.

The right thing to do would be to further strengthen the process of devolution, by empowering local governments, instead of stopping or reversing it.

It would also require all parties to work in the interest of the country and the people, for which they would have to overcome their instincts of working against the interests of each other.

The 18th Amendment came about after extensive debate and long exchanges among leading political parties. Since this issue is up for discussion again, it will be important not to lose sight of the real goal.

Copyright Business Recorder, 2023


Comments are closed.

KU Nov 25, 2023 11:15am
Let's put aside the NFC proportions for a moment and talk about NFC's benefit to the economy or how has it benefitted the people. The answer won't surprise anyone because this award is for select people and certain objectives, so take a chill pill and expect the accepted script.
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