ISLAMABAD - President Mamnoon Hussain will extend the seventh National Finance Commission (NFC) Award for another year within next few days after the government failed to develop a new resource-sharing formula between center and provinces.

“President will extend the 7th NFC Award on the advice of prime minister for one year before June 30,” said an official of the Ministry of Finance while talking to The Nation. The 7th National Finance Commission Award is expiring on June 30. The Constitution is very clear that the president has to extend the existing award till a fresh consensus is achieved, he added.

The federal government has so far been unable to formulate the eighth NFC award. Finance Minister Ishaq Dar has held provinces responsible for delaying the award. Two provinces (Punjab and Sindh) had waited until April to nominate new members for the commission, which hampered the federal government’s efforts in proceeding with the resource distribution under the NFC.

On the other hand, provinces especially Sindh and Khyber Pakhtunkhwa are continuously protesting the delay in the new NFC award. MNAs of Sindh and KP in their budget speeches in the parliament had criticised the government on this issue. Opposition leader Syed Khursheed Shah said that federal government was violating the Constitution by not announcing the eighth NFC award. Previous NFC award has been expired and federal government is violating rights of other provinces, he added.

The government had constituted the finance commission on April 24 last year and it held its first meeting on April 28. It had decided to constitute four working groups to undertake thematic studies and submit their recommendations to the commission. However, no more meeting of the commission could be held since then.

Under the present (7th NFC) award (2009) which is operative, financial autonomy of the provinces was strengthened by increasing their share in the divisible pool (taxes) from 50 per cent to 56pc in the fiscal year 2010-11 and to 57.5pc from 2011-12 onwards.

The provincial governments get shares from the federal government under NFC Award as per the said formula. Punjab gets 51.74 percent, Sindh 24.55 percent, Khyber Pakhtunkhwa 14.62 percent and Balochistan 9.09 percent.

The government would transfer Rs2.135 trillion to the provinces against Rs 1.9 trillion transferred during the outgoing year, showing growth of over 15 percent. The federal government would transfer Rs1045.01 billion to Punjab in the fiscal year 2016-17 as compared to Rs894.524 billion of the outgoing fiscal year. The Sindh province would get Rs 547.84 billion against Rs 482.956 billion of the outgoing year. Similarly, Khyber Pakhtunkhwa would get Rs346.18 billion as compared to Rs301.26 billion of the outgoing year. Khyber Pakhtunkhwa would get one percent additional amount due to war on terror. The Balochistan province would get Rs196.84 billion against Rs171.2 billion of the outgoing fiscal year 2015-16.