Sixth NFC award

A SPIRIT of “give and take” between the federal and provincial governments, as suggested by Prime Minister Shaukat Aziz, is the only way the sixth National Finance Commission award can be finalized before the next budget. The fifth NFC award, adopted in 1997, was supposed to be valid for five years but failure to reach agreement on a sixth has meant that the fifth is still in operation. The provincial governments have not been able to agree among themselves and with the federal government on the sharing of the divisible pool and on the yardsticks to be used for distributing the pool among the provinces. In February, President Pervez Musharraf had said that a 50-50 ratio of division between the centre and the provinces was possible. Since then, the government has expressed its willingness to increase the size of the pool. According to recent reports, the centre is ready to raise the provinces’ share from 37.5 per cent under the fifth award to 47.5 per cent, and eventually to 50 per cent by 2009-10 (when the sixth award, if finalized this year, would be nearing its end).

However, this still falls short of the demand of the provinces that their share be increased to 50 per cent in the sixth NFC award. Then, there is also the dispute over how the funds are to be distributed among the provinces. Punjab’s stand for a long time has been that distribution should be based on population, while Sindh wants revenue collection to be the main factor. The NWFP and Balochistan demand increased royalties for power and gas, respectively, and both also are of the view that underdevelopment should be included as a criterion for distribution. All these contentions have some justification but if one province were to insist on its position, then no agreement would be possible. Punjab might have more people than all other provinces combined but a division along this line alone would be unfair to the smaller provinces which lag behind Punjab in terms of socio-economic development. Sindh’s argument that it deserves more funds since it is the largest contributor to tax revenue does have some substance. However, this point can be countered by the fact that Sindh just happens to have the country’s only commercial port and that a major proportion of the goods on which tax is collected pass through it while in transit for upcountry or overseas destinations. Similarly, a demand by some Baloch nationalists that the share of the provinces should be increased to 80 per cent is also impractical.

A more realistic approach would be to incorporate all these criteria, by assigning them different weights. Population has to be the basic criterion for allocation of funds from the divisible pool. However, due weight must also be given to underdevelopment and revenue collection. If underdevelopment is not given its due weight in sharing of resources, the centre would be failing in its duty to improve socio-economic conditions in Balochistan, the NWFP and rural Sindh. At the same time, the federal government will have to realize that the widening of the income tax net and extending the coverage of GST are crucial in that both steps would make more funds available to be shared. It should be clear to all parties that reaching a consensus soon on a new NFC award is vital not only for economic development but also for greater inter-provincial harmony and understanding, and could do much to pacify growing discontent against Islamabad in the smaller provinces.

Picture of neglect

YESTERDAY’S issue of this newspaper carried a forlorn picture of a primary school in a Sialkot village. The caption said the school lacked basic facilities such as electricity and water. This is a picture replicated in every village and small town throughout the country. Even in the bigger cities, we have seen and heard of the neglected state of government schools. This neglect of infrastructural provisions is in addition to the deplorable standards of teaching. Reports continue to come in of lack of trained teachers or of missing teachers. In Punjab at one time, there was a great deal of uproar over “ghost” schools, schools that existed only on paper or whose buildings had been requisitioned by landlords for their own purposes. Such “ghost” schools or ghostly schools, with no teachers or teaching, continue to exist — of this there can be little doubt. The situation is particularly grim in areas that once used to be called the mofussil.

Since everything — the government, the media, NGOs — is based in the bigger urban centres, no one gets to hear much of what is happening in the rural hinterland, and few care. The new, actually now almost four years old, local government system has been unable, apart from its many other failures, to mobilize a community effort in the rural affairs that could make up for official apathy in the fields of education, health and social welfare. Unless a most determined effort is made to reverse the trend of planning for development from the top, there can be little hope of an improvement in villages, tehsils and district towns. NGOs could have supplemented government efforts in this respect, but the government establishment has made up its mind that it will not work with the NGOs because they are liberal, they champion human and civil rights and speak up for democracy. It is time somebody thought seriously about all this. For a start, coming back to our picture from Sialkot, perhaps we should set up a lower education commission.

Mobile number portability

MOBILE phone users will find some respite thanks to the proposed introduction of Mobile Number Portability (MNP) for which Pakistan Telecommunication Authority (PTA) has constituted a supervisory board that plans to implement the scheme by January 2006. A central database administration which will house a database of mobile subscriber number references is being developed to implement this portability facility. MNP, which allows mobile phone users to switch mobile phone operators but retain their existing number, is available in many countries of the world but its proposed arrival in Pakistan was being strongly resisted by two of the largest mobile operators, perhaps because they feared a loss of the market share. However, PTA was not convinced by their arguments and has gone ahead and decided that the facility will be made available next year which it believes will boost fair competition among all mobile phone operators.

This decision is one that will benefit consumers who are already frustrated by the poor service current mobile phone operators are providing. Despite certain mobile phone companies being threatened with severe legal action, not to mention heavy fines, if their quality is not improved, consumers periodically face frequent problems in connectivity, poor network services and other customer-related issues. Many who complain of such problems are hesitant to switch over to another company because they do not want to switch their number, a concern that will no longer apply once MNP comes into force. This will also force mobile phone companies to ensure better service to their customers or face losing their subscribers to better companies. Either way, it seems the customer is in a win-win situation — provided PTA is able to ensure that the implementation of MNP goes through smoothly.