Business Recorder Editorial July 16, 2020

NFC ruction

Strange indeed are the ways of the Pakistan Tehreek-i-Insaaf (PTI) government. On July 13, 2020, Senator Muhammad Ali Saif of the ruling coalition’s Muttahida Qaumi Movement (MQM) attempted to move a Constitutional Amendment Bill in the upper house to amend Article 160 (3). The Article in question bars reduction of the share of the provinces in the National Finance Commission (NFC) Award. After a heated debate, the Bill was not allowed to be moved by a vote of 25-17 in the Senate. For some time now, the government and its allied parties have been raising a ruckus about the 18^thConstitutional Amendment and the NFC Award. Essentially all this wailing was on two points. The first was that the 18^thAmendment is not a perfect document and needs amendment. When the opposition (particularly the Pakistan People’s Party) raises objections to this line of thinking, the ‘good cops’ of the government assuage them by saying no such thing is being contemplated since in any case the 18^thAmendment cannot be changed without a two-thirds majority in both houses of parliament, an advantage the PTI-led coalition clearly lacks. Why this impeccable logic does not then quell the government’s tilting repeatedly at this windmill is beyond comprehension if examined on the touchstone of its own ‘good cops’ narrative. Second, the government is even more peeved about the current NFC Award dating from 2010 that holds the field since no Award could be agreed since. This Award gives 42.5 percent of the federal divisible pool to the Centre, and 57.5 percent to the provinces. The federal government’s complaint is that this allocation to it is insufficient to meet debt servicing, military expenditure, development and administrative functions. However, the underlying logic of the NFC Award was tied to the 18^thAmendment’s devolution of 17 Concurrent List subjects to the provinces (the original intent of the framers of the 1973 Constitution after a period of 10 years, it might be added, which passed long ago). The recipient provinces, however, maintain that the devolved subjects were precisely the reason for increasing the share of the provinces in the NFC so that they could be funded. The federal government on the other hand retained these ministries/departments, thereby unnecessarily burdening its non-development expenditure. Further, the federal tax collection through the Federal Bureau of Revenue (FBR) was to increase at least one percent of GDP per year. That, unfortunately, has not come to pass and the percentage stubbornly clings to its present around 11 percent. In short, neither did the federal government divest itself of the devolved ministries/departments under the 18^thAmendment (it could have simply delegated these subjects’ coordination to the federal Inter-Provincial Coordination Ministry), nor did it follow through in any meaningful sense to raise the tax-GDP ratio as envisaged. For it therefore to now cry hoarse that it is financially hamstrung is one more instance of self-inflicted wounds.

What the PTI government seems incapable of understanding is that issues such as constitutional amendments and NFC Awards can only be resolved through dialogue, conferring with the opposition, and forging a consensus cutting across party lines. That seems a far cry given the strident tone and derogatory language regarding the opposition that is recognised as the leitmotif of this government. In the polarised atmosphere created by this manner of discourse inside and outside parliament, is it possible to conceive that unanimity (in the case of the NFC Award) and consensus (in the case of amendments to the 18^thAmendment), the necessary conditions for both objectives, are at hand? If the government genuinely wants its case sympathetically and objectively heard, for which there are indeed justifiable grounds, it will have to reverse its manner of speaking to and about the opposition if it really desires to achieve its objective. Unfortunately, however, there are no signs that the government is contemplating a departure from its ‘container-type’ harangues. Hence the chances of unanimity on the NFC Award and consensus on reform of the 18^thAmendment are akin to a snowball residing in hell.