KP won’t accept 7th NFC Award’s further extension

PESHAWAR: The Khyber Pakhtunkhwa (KP) government has refused to accept any further extension of the 7th NFC Award without including funds for the merged districts, warning that such an extension would violate KP’s constitutional rights.

The chief minister emphasised that continuing the 7th NFC Award in its current form is inconsistent with constitutional provisions and undermines the principles of federalism, equity, and fairness. He criticised the presidential orders extending the award, describing them as discriminatory and outside the constitutional framework.

In a letter dated January 20, 2025, KP CM Ali Amin Khan Gandapur raised a pressing constitutional issue regarding the province’s inclusion in the National Finance Commission (NFC) award.

Addressed to Muhammad Aurangzeb, the Minister for Finance and Revenue, the letter strongly underscored the urgent need to incorporate post-merger KP into the NFC award framework, following the merger of the Federally Administered Tribal Areas (Fata) with KP in 2018. The merger of Fata into KP marked a monumental step in redefining the province’s geographical and demographic composition. However, the 7th NFC Award, originally extended under presidential orders, failed to recognise this transformation. This oversight has resulted in a significant constitutional and financial disparity, depriving 6.4 million residents of the merged districts of their rightful share of national resources.

Chief Minister Gandapur highlighted that continuing the 7th NFC Award in its current form is a constitutional anomaly. He stressed that the presidential orders extending the award are discriminatory and contravene the principles of equity and fairness enshrined in the Constitution.

In the letter, Gandapur detailed the financial repercussions of this oversight. He noted that the federal government had allocated KP an NFC share at a rate of 14.62 percent, amounting to Rs3,046 billion between 2019 and December 2024. However, based on the revised NFC share of 19.64 percent, KP is entitled to Rs4,092 billion. This creates a shortfall of Rs1,046 billion over six years. Even after accounting for the federal grant of Rs437 billion provided to the merged districts, the province still faces a net deficit of Rs609 billion. This financial shortfall has severely constrained KP’s ability to address developmental needs in the merged districts, impeding progress in critical sectors such as infrastructure, health, and education.

In a strong and direct appeal, Gandapur urged Muhammad Aurangzeb to ensure that future iterations of the NFC arrangements duly reflect KP’s post-merger reality. He emphasised that the province’s geography and population, as reconstituted on May 31, 2018, must be fully recognised. He warned that any further extension of the 7th NFC Award without addressing this critical issue would be an unacceptable violation of KP’s constitutional rights.