ISLAMABAD: The federal government will form the 11th National Finance Commission (NFC) to create a new award for sharing resources, the finance ministry said it spent Rs638 billion on areas that the Constitution assigns to provinces.
According to private newspaper report, this Rs638 billion, spent in four provinces, Islamabad, and special areas, does not include development projects. It shows the federal government is spending a lot in provinces without a legal requirement.
For the first time, the finance ministry shared details of its spending on health, education, and social protection before setting up the new commission. These areas were transferred to provinces under the 18th Amendment in April 2010, giving provinces more financial and legislative control.
The ministry’s report said the federal government spent Rs638 billion last year on health, education, and social protection in four provinces, special areas, and Islamabad. This was Rs36 billion more than the previous year. Development project spending was separate and not disclosed.
On April 28, the Council of Common Interests was told the federal government is preparing to form the 11th National Finance Commission for the 8th award. Letters were sent to provinces for nominations of technical members.
Sindh nominated Dr. Asad Sayeed as its technical member, with its finance minister as the other member, as allowed by the Constitution. Each province can have two representatives: a finance minister and a technical member.
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The commission is formed for five years. The 10th Commission’s term ends on July 23 without finalizing the 8th award. The last award, from 2010, expired in 2015, and the President has been extending it yearly.
Khyber Pakhtunkhwa’s Finance Adviser, Muzammil Aslam, said the province urged the federal government to hold a 10th Commission meeting to settle issues like net hydel profit and merged districts before the budget. K-P has not yet nominated its technical member for the 11th Commission.
The finance ministry’s report showed federal spending in areas that are provincial responsibilities under the Constitution. Under the 7th award, provinces get 57.5% of resources, but the federal government still spends in provinces despite limited funds. Last year, a National Fiscal Pact was signed with the provinces under IMF guidelines, but it lacks legal backing.
Social Protection:
The federal government spent Rs466 billion on social protection last year, including Rs350 billion in four provinces. This included Rs169 billion in Punjab, Rs96 billion in Sindh, Rs67 billion in K-P, and Rs18 billion in Balochistan under the Benazir Income Support Programme (BISP). Another Rs7.4 billion was spent through Pakistan Bait-ul-Mal for poverty relief.
Health:
The federal government spent Rs45 billion on health programs last year, including Rs12 billion on staff, Rs12 billion on operations, and Rs21.3 billion on the Expanded Programme on Immunization (EPI).
The EPI, started in 1978 to protect children from diseases, spent Rs11.2 billion in Punjab, Rs5.1 billion in Sindh, Rs1.2 billion in K-P, and Rs3.5 billion in Balochistan.
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Other spending included Rs5.2 billion on Pakistan Institute of Medical Sciences (PIMS), Rs4 billion on Federal Government Polyclinic (FGPC), Rs4.9 billion on Shaikh Zayed Hospital in Lahore, and Rs3.7 billion on the Ministry of National Health Services.
Education:
The federal government spent Rs114 billion on education last year, mostly in provinces. The Higher Education Commission (HEC) received most of this as grants.
About 16% of HEC funds went to universities in Islamabad, AJK, and Gilgit-Baltistan, with the rest for provincial universities. Spending included Rs31 billion in Punjab, Rs15 billion in Sindh, Rs11.6 billion in K-P, and Rs3.7 billion in Balochistan.
