PESHAWAR: Peshawar High Court on Thursday disposed of a petition of 22 local body heads against decision of the Khyber Pakhtunkhwa government to release development funds to 56 of the total 131 tehsil councils in the province, as the government had withdrawn the said order.

A bench consisting of Justice Mohammad Naeem Anwar and Justice Kamran Hayat Khan Miankhel while pronouncing a short order disposing of the petition also directed the government to release funds to local councils in accordance with law.

The petitioners including Mardan city mayor Himayatullah Mayar, Dir tehsil council chairman Rafiullah and 20 other tehsil council mayors and chairmen, had requested the court to declare illegal the finance department’s Dec 5, 2024, order about the release of development funds to 56 tehsil councils under Provincial Finance Commission (PFC) Award.

They requested the court to direct the government to ensure that under PFC Award, an impartial release of funds should be held throughout the province including to the petitioners and other remaining tehsil councils.

Disposes of plea against local bodies funding ‘discrimination’

Through the impugned order, the government had ordered release of funds mostly to tehsil councils, which have the ruling PTI’s members as mayors and chairmen. The petition named the provincial government through its chief secretary and local government and finance secretaries as respondents.

Lawyer for petitioners Babar Khan Yousafzai said that his clients were elected tehsil council mayors and chairmen in elections conducted for local governments on Dec 19, 2021, and March 31, 2022.

He said that Article 140-A of the Constitution provided that each province should establish a local government system and devolve political, administrative and financial responsibility and authority to elected representatives of the local government.

The counsel said that Chapter VIII of KP Local Government Act, 2013, was related to local government finances and particularly and Section 30 provided for establishment of local funds in public accounts, whereas Section 31 described the operation of funds and public accounts.

He said that the Act further provided for PFC Award and fiscal transfers and it was an enactment similar to transfer of funds by the federal government to provinces under National Finance Commission Award.

Mr Yousafzai said that since the elections were held in 2021 and 2022, no funds in respect of PFC Award and even fiscal transfers had been released for development to tehsil local government.

An additional advocate general informed the bench that the government had already withdrawn the impugned order, hence the petition had become infructuous. He said that in KP budget for 2025-26, the provincial government allocated Rs56 billion for local bodies for their development.

The petitioners’ counsel argued that as per PFC Award, the provincial government was obligated to allocate 30 per cent of its share to local government in any fiscal year. He requested the bench to issue directives to the government for releasing funds to local councils as per PFC Award.

Mr Yousafzai contended that KP City and Tehsil Local Government Rules, 2022, empowered mayors and chairmen to manage affairs of their councils, which also included overseeing development within their respective tehsils.

Published in Dawn, June 27th, 2025