ISLAMABAD: Sindh and Khyber Pakhtunkhwa have urged the federal government to announce a new National Finance Commission (NFC) award at the earliest, fearing that the delay would promote a sense of deprivation among the smaller provinces.

Finance Minister Ishaq Dar, however, has announced that the government had no plans to change the NFC formula. “We want to establish the next NFC award before the end of this fiscal year,” he told the media on Tuesday after a meeting to discuss the first bi-annual monitoring report on NFC award.

As no province objected to data and figures related to the federal accounts and total collections, the report for the July-December 2015 period was given formal approval.

The meeting, chaired by Mr Dar, was also attended by Sindh’s Chief Minister and the Finance Minister Syed Murad Ali Shah, and finance ministers and secretaries of all the provinces.

Mr Dar said that the ninth NFC commission has already been constituted. He acknowledged that the establishment of the eight NFC award has been delayed, but insisted that “we are on way to streamline the process”.

The federal minister added that accounts for the second half of the current fiscal year, ie from January-June 2017, will be approved by December 2016.

After the clearance on Tuesday, the report will now be forwarded to the National Assembly secretariat on Wednesday (today) for further perusal.

According to the report, total collections by the Federal Board of Revenue (FBR) stood at Rs1.449 trillion during the period, whereas the gross divisible pool stood at Rs1.415tr during July-December 2015.

Giving details about the distribution, the report said that out of the total divisible pool Punjab received 51.7 per cent of funds during the period under review, followed by Sindh (24.55pc), KP (14.6pc) and Balochistan (9.09pc).

In addition, KP was provided with Rs14.02 billion for “war on terror” whereas Balochistan province was also given Rs5.47bn in the same head.

It was decided that both quarterly and biannual meetings would be held simultaneously and the next meeting is expected to be held in October this year.

The meeting decided that the NFC secretariat should be further strengthened and all the provinces should get data from there.

Meanwhile, the Punjab’s provincial review meeting of NFC would be held in Lahore on Sept 5.

After the Tuesday meeting, Chief Minister of Sindh Mr Shah and KP Finance Minister Muzzafar Said told the media that the delay in the establishment of eighth NFC award was not fair for the federation. “We have concerns over it and the new NFC award should be established as soon as possible,” the KP finance minister said.

Mr Shah stressed for a time line in this regard and said that the new NFC award should be established by Dec 31, 2016.

Published in Dawn, August 31st, 2016