Provinces and political parties have opposed the proposed cut in the share of federating units in the NFC award as this step will add to the sense of deprivation of smaller provinces.

Khyber Pakhtunkhwa has been fighting for long for an increase in its share and to get arrears of the Net Hydel Profit (NHP).

When the incumbent government recently asked provinces to send names for the constitution of the 9th NFC award, KP was the first one to do so. The nationalist parties in the province were more active in demanding due share as well as the NHP arrears to run the affairs of the province in a better way, a promise that has been severely hit by terrorism.

"The 7th NFC award was agreed upon and declared by a democratic government that believed in a federal democratic system. So they corrected the wrong done during the Musharraf dictatorship by enhancing the share of the federating units in 2009," Afrasiab Khattak, senior politician and former Senator from KP tells TNS.

Then came the 18th Amendment in 2010 (implemented in 2011) under which 17 ministries were devolved from the federation to the provinces as a result of doing away with the Concurrent List. "Under an interim arrangement money for these devolved ministries was to be transferred to provinces after block allocation in the federal budget. This arrangement was to continue uptil the 8th NFC award in which financial devolution was to be regularised."

Khattak believes "the PML-N government could not come out with the 8th award because the civil and military bureaucracy was pressurizing it to bring the share of the provinces down, but even if the PML-N had wanted to do so, it couldn’t do that for two reasons: one: the current share of the provinces is protected by the Constitution and their government didn’t have the numbers to amend the Constitution, two: they knew that provinces would demand formalising the financial devolution adopted as an interim arrangement in 2011."

The 9th NFC award faces the same old problems, says Khattak, adding, "Those opposed to a federal system have launched a vicious campaign against the 18th Constitutional Amendment. They don’t realise the federal democratic system was adopted in the 1973 Constitution after the dismemberment of the country and living under a prolonged military dictatorship and a unitary system."

He says the 18th Amendment is a win-win situation for both the provinces and the federation "because the provinces have more resources for achieving development and the federation can’t be blamed anymore for lack of economic development in the provinces."

The former Senator adds that Khyber Pakhtunkhwa’s share in financial resources did increase after the 7th NFC award but the PTI government failed to look after the economic interests of the province. "They couldn’t develop the oil and gas sector in the province. They couldn’t requisition the Council of Common Interest (CCI) to raise the demands of the province in getting proper share in management and control of oil and gas fields. Now when PTI is in power in the province and also in the federation, let’s see what they are able to deliver."

Khyber Pakhtunkhwa was paid Rs6 billion NHP in 1991-92 but the amount has been capped since then despite the fact that the power tariff has been increased many times. The amount was based on the provisional profits of Wapda calculated for 1990-91. The NFC had recommended increase at the rate of 10 per cent on Rs6 billion for future years but it was never complied with.

Since there was difference of opinion about the computation of NHP between KP and Wapda, an arbitration tribunal was constituted in 2005 which decided the case in October 2006, giving an award of Rs110 billion as NHP arrears to Khyber Pakhtunkhwa. During the proceedings of the 7th NFC award, the federal government agreed to honour the judgment of the arbitration tribunal. However, this too was not complied with, forcing the provincial government to approach the CCI which, according to a report in The News by Riaz Khan Daudzai, quoting the provincial finance department, has agreed to implement the decision. The province is now entitled to receive about Rs18.7 billion per annum.

Fight for 3 per cent

Tribal districts and areas that have been merged with Khyber Pakhtunkhwa (KP) need development at a fast track to come at par with the settled areas of the country in coming years.

The task is not easy. These areas still lack basic facilities and human rights. The people of the erstwhile FATA have been considered to be the most neglected ones by the previous governments.

Even after the merger has been announced, the bureaucracy is still creating hurdles in mainstreaming tribal districts and giving tribal people their due rights.

Political parties in the area have been demanding a special package of at least Rs100billion for tribal districts so that developmental projects can be completed in different sectors in a region that was hit hard by terrorism.

According to the Federal Information Minister, Fawad Chaudhry, after the merger FATA secretariat will be abolished and the chief minister of KP will be looking after the administrative affairs of tribal districts. A delegation of lawmakers from FATA had demanded a special share for FATA in NFC during a meeting with Prime Minister Imran Khan. FATA lawmakers were unanimous in saying that only a special package by the government can end the sense of deprivation of the tribal people.

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"First of all, we need to carefully look at the 3 per cent of the NFC for the districts of former FATA and, subsequently, we also have to prepare the case for an enhanced share of the province on the basis of the new demographic reality," says Afrasiab Khattak, senior Awami National Party (ANP) leader.

"The western districts of KP should not only get their own 3 per cent but they should have priority in the allocation of funds for development so that the region can be brought at par with the rest of the provinces."

Like all the opposition parties, the ANP chief, Asfandyar Wali Khan, has expressed reservations over the proposed cut in the NFC award for FATA.

"It simply means the federal government wants to alter the 18th constitutional amendment and deprive the federating units of their constitutional right. The constitution does not allow a cut in the NFC share of the provinces. The KP should be given extra funds beyond its share in the NFC for tribal districts. The PTI government should not touch the 18th amendment in the garb of FATA reforms as this amendment was made after a great struggle for the rights of the small federating unite," says Wali in a recent statement.

Qaumi Watan Party chief, Aftab Ahmad Sherpao, addressed a press conference recently to oppose the proposed cut in the share of the provinces. He was of the view that the government is cutting the share of the provinces on the directives of the IMF to strengthen public finance management.

"There should be a mechanism so that funds for FATA are spent properly and not misused by government functionaries, bureaucracy, elected members and some so-called elders," says Kamal Ahmad, a former college teacher from KP.