TALK of amending the National Finance Commission (NFC) award is gathering pace once again.

For several years, policymakers associated with the finance ministry, as well as political actors across different parties at the centre, have spoken about revising revenue transfers to the provinces to improve the federal government’s financial position.

Such a revision would have most certainly happened earlier had it not been for the compulsions of centre-province politics (especially the PPP’s strength and position on the matter) and the constitutional protection accorded to the provincial share under the 18th Amendment.

Article 160-3A currently states that “the share of the Provinces in each Award of National Finance Commission shall not be less than the share given to the Provinces in the previous Award”. The current share is 57.5 per cent.

There are no clear workarounds available at the moment. The centre managed to take out the lucrative petroleum levy from the divisible pool by calling it a developmental levy rather than a tax (which it is in all but name). However, any further change would require amending the Constitution — either by doing away with Article 160-3A that places a floor on the downward transfer, or by amending Article 160-3 to take out transferrable revenue sources. The former is more likely than the latter.

What are the political prospects of this change?

The recent reconfiguration........

© Dawn