Centre Notifies 8 NFC Committees Amid Provinces’ Concerns Over Revenue Sharing

The federal government has notified eight sub-committees under the 11th National Finance Commission (NFC), including a key panel on national debt utilization and the transfer of expenditures to provinces, following legal backing from the attorney general in response to objections raised by Sindh. The move comes as Pakistan’s leading fiscal expert, Dr. Hafiz Pasha, highlighted a significant shortfall in provincial revenue shares. Speaking at a seminar organized by the Social Policy and Development Centre (SPDC), Dr. Pasha noted that, despite the constitutional requirement to allocate 57.5% of the divisible pool to provinces, they received only 45.8% in the last fiscal year after deductions for petroleum levies and cash surpluses. The finance ministry has constituted eight sub-groups to address critical issues for the upcoming 11th NFC award, the first major review since the 7th NFC award was agreed upon 15 years ago. The sub-groups, as detailed in the official notification, will focus on: Each sub-group includes federal and provincial finance ministers and secretaries, senior officials from the finance division, and other co-opted members as needed. The committees are tasked with making recommendations on their respective mandates, ranging from tax policy and revenue sharing to debt management and fiscal coordination. The formation of these committees follows a legal opinion from the attorney general, which supported the federal government’s authority to form a working group on expense sharing, an issue Sindh had argued was outside the NFC’s constitutional mandate. The 11th NFC award is expected to address longstanding disputes over resource allocation, fiscal responsibility, and the evolving financial relationship between the federation and provinces.