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9th NFC holds first meeting, agrees on division of resources in line with 18th Amendment

The ninth National Finance Commission (NFC) held its first meeting in Islamabad on Wednesday in order to discuss the financial position of the centre and the federating units and set the agenda for negotiations on the distribution of the divisible pool for the next five years, RadioPakistan reported.

The participants of the meeting, which was chaired by Finance Minister Asad Umar, agreed that the division of the NFC award should be in accordance with the 18th Amendment of the Constitution.

Six groups have been formed to prepare recommendations for the distribution of resources among provinces, negotiating Fata’s affairs, improving ease of doing business as well as addressing macro-economic issues.

The NFC is to meet every six weeks from the first meeting.

During the meeting, the federal finance secretary briefed the participants on the current financial situation of the country. Provincial representatives also informed the participants about the financial state of their respective provinces.

The meeting also discussed recommendations for improving the distribution of resources among provinces and smooth communication between the centre and provincial administrations.

The ninth NFC has been deadlocked since July 2015.

Because of resistance from the provinces, the previous PML-N government had thought it better to delay discussions on the new award until after the 2018 general elections. The Pakistan Tehreek-i-Insaf (PTI) government recently reconstituted the commission to start negotiations afresh. Finance Minister Umar had last week said that the government would enter the NFC negotiations with “an open mind”.

“We’re not starting discussions from a ‘fixed position’,” he said in reply to a question whether the federal government planned to ask the provinces to give up seven per cent of their share from the pool. “We will explain to the provinces the economic and financial issues confronting the country and try to reach a consensus on the points that need to be addressed in the next NFC award,” he added.

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The last NFC award was signed in December 2009 and has been effective since 2010-11. The award is often described as historic as it was agreed upon after a lapse of 20 years and drastically increased the combined provincial share from the pool that, under the Constitution, could not be revised down.
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