NFC’s tough assignment

May 21 2020

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AFTER much beating about the bush, it has been admitted that the federation is broke and that it cannot make two ends meet without getting a hefty cut from the provinces’ share of the divisible pool.

All responsible citizens will be worried at the economic plight of the federation and they would wish for a fair and happy resolution of the matter so that the centre’s problems are eased as far as possible and the federating units are not deprived of resources they cannot afford to part with.

This is a serious and highly sensitive issue and every effort should be made to arrive at a fair consensus. The federation should seek a mutually acceptable settlement with the units and avoid imposing its will on them. That in any case will be disastrous as the provinces are neither the federation’s colonies nor its vassals.

The federation has generated an unnecessary though highly dangerous controversy in the way the president was advised to create a new National Finance Commission. The objection to the nomination of the adviser on Finance as NFC chairman is valid for he is not answerable to parliament. He may be a genius in financial jugglery but the Constitution wants the minister for finance to head the NFC and nobody else can replace him.

The agenda is apparently to undo the NFC Award of 2010.

Similarly, the way the provinces’ non-official representatives have been selected has given rise to misgivings. True, Article 160 of the Constitution allows the president to name a provincial representative in consultation with the governor, but the governor is required under Article 105 to act on the advice of the provincial ministry. Appointment of an NFC member is not like hiring a manservant. The correct procedure is that a resolution should be adopted by the provincial cabinet, advising the governor to recommend that so and so should be named to the NFC, and all this in writing. It is necessary to assure the people that this procedure has indeed been followed. In such sensitive matters, the federation must not only act honestly it should also be seen to have acted honestly.

Suspicions that the centre is up to harming the provinces’ interests have been raised by the new NFC’s agenda. The federation’s new or increased burdens include expenditures on erstwhile Fata as well as Gilgit-Baltistan, security and debt-servicing. The federal expenditure on the Fata districts should have come down after their merger with Khyber Pakhtunkhwa, and the expenditures on Azad Kashmir and Gilgit-Baltistan can be reduced by stopping their management by the Prime Minister’s Office.

The agenda therefore apparently is to undo the seventh NFC Award of 2010, which marked, together with the 18th Amendment, a revolutionary step towards strengthening the federation and enabling the provinces to accelerate economic progress. Under the new resource-sharing formula adopted by the seventh NFC, the share of not only the federation but also three provinces was reduced and only that of Balochistan, the least developed part, was increased.

One of the causes of the present crisis is that the centre did not accept the 18th Amendment without reservations and acted in a manner that amounted to its subversion. Power was not devolved to the provinces, federal ministries that had become redundant were retained and the size of the establishment increased. The NFC recommendations for raising the tax-to-GDP ratio and lowering the debt-to-GDP ratio were not taken seriously. The fact is that the present crisis is of the centre’s own making.

Granted that the federation can seek federating units’ help in overcoming its economic crisis, but it is only fair that before asking the units to tighten their belts it should disclose its own belt-tightening plans. Has it decided to replace profligacy with austerity? Is it prepared, for instance, to reduce the irrationally large size of the central cabinet? Should it not retire the special assistants to the prime minister whose sole job is to abuse the opposition, a task the reconditioned information ministry is performing with the zeal of a neo-convert?

The federating units are being asked to share the burden of debt servicing, of loans contracted without consulting them and unintelligently used by the centre. The provinces are also being asked to share the defence expenditure. Why should any province shirk its patriotic duty to contribute to the defence of the motherland according to a fair formula? Both these matters may be thrashed out in parliament and decided in the Council of Common interests. It is necessary to ensure that emergency cuts in the provinces’ shares are not made permanent features of the NFC Award.

The most essential point is that the 18th Amendment and the seventh NFC Award had put the country on the road to genuine federalism, national integration, and a more just inter-provincial sharing of resources. Reversal of these steps is bound to weaken the federal bonds, prevent national integration, and render the federation and the provinces both incapable of meeting their responsibilities. No NFC in Pakistan’s history had a more challenging assignment than the present one.

Tailpiece: Many apologies for backing in these columns the demand for holding parliament sessions. The idea was not to make high school debating teams happy, nor to provide the prime minister’s adviser on parliamentary affairs, Dr Babar Awan, with a justification for calling not only the session but the whole Assembly a total failure. The idea was to have a mature discussion on the pandemic. A pity that this was not possible. It seems the country is poised to surpass Gen Zia’s model of party-less democracy by moving towards a parliament-less system of parliamentary democracy. Ziaul Haq zindabad.

Potpourri: Foreign Minister Shah Mahmood Qureshi declared in the National Assembly that his party had a right to speak for Sindh because it had a mandate from its capital, Karachi. Nobody has recorded the reaction of the Punjab chief minister to the possibility of the PML-N claiming to speak for Punjab because it has a mandate from its capital, Lahore.

And what is the source of the Ruet-i-Hilal Comm­ittee chairman’s authority to ban the publication of any report from the meteorological department reg­arding the appearance of the Shawwal moon?

Published in Dawn, May 21st, 2020