PESHAWAR: The Khyber Pakhtunkhwa government has informed the federal government that it wouldn’t accept any extension of the seventh National Finance Commission Award without making the funding for merged tribal districts part of the province’s share in the federal divisible pool.

In a letter, KP Chief Minister Ali Amin Khan Gandapur has requested federal finance minister Mohammad Aurangzeb to ensure that any future iteration of NFC arrangements should duly reflect the post-merger province and include its complete geography and population.

“Any further extension of the seventh NFC Award without addressing this essential issue will not be acceptable and will constitute a continued violation of our constitutional rights,” he noted.

Mr Gandapur added that it was crucial to emphasise revision of the NFC Award was not merely a matter of choice but a constitutional obligation.

Calls for revision of NFC Award as constitutional requirement

“The merger of Fata with KP in 2018 fundamentally redefined the province’s geography and demographic composition, but the seventh NFC Award continues to disregard this constitutional transformation. This omission undermines the constitutional framework and principles of federalism, depriving 6.4 million residents of merged districts of their rightful share in national resources,” he said.

The chief minister said that the presidential orders for extending the seventh NFC Award were inconsistent with the Constitution, as they failed to recognise KP in its current post merger form.

“Such extensions are not only discriminatory but also ultra vires of the Constitution, undermining the principles of equity and fairness,” he noted.

Mr Gandapur insisted said that from 2019 to 2024, the federal government had paid the KP government its share in NFC Award at a rate of 14.62pc, amounting to Rs3.046 trillion.

He, however, said that based on the revised NFC share of 19.64pc, the province’s share amounted to Rs4.092 trillion, resulting in a shortfall of Rs1.046 trillion.

“After accounting for the federal grants of Rs437 billion provided for the merged tribal districts during this period, the net shortfall exceeded Rs609 billion over the last six years,” he said.

In another letter to Mr Aurangzeb regarding bridging financial needs of merged tribal districts, Mr Gandapur highlighted the critical financial challenges faced by the provincial government in delivering essential services to tribal districts, which, he said, have accommodate an additional 6.4 million people.

He said Fata’s merger with KP was a transformative step towards national integration, introducing substantial administrative and legal reforms.

“These reforms extended critical services including policing, judiciary, education, health and local government, to historically marginalised regions. However, the financial burden of implementing and sustaining these changes has placed immense strain on KP resources, threatening the fulfillment of merger commitments,” he said.

The chief minister pointed out that towards the cumulative shortfall of Rs568 billion under the Accelerated Implementation Programme against the federal commitment of annual Rs100 billion over 10 years as part of the Tribal Decade Strategy to bridge development disparities in the merged tribal districts.

He said that since 2019, the KP government had spent Rs372 billion on operational expenditures in the region, while the federal government had released Rs331 billion, leaving a deficit of Rs41.4 billion.

“These financial shortfalls severely limit the province’s ability to sustain critical service delivery and fulfill its obligations to the people of the merged areas. Addressing these gaps is essential to consolidating the gains of the merger and ensuring socio-economic progress in the region,” it noted.

Published in Dawn, January 25th, 2025