Sindh's local bodies await Provincial Finance Commission Award

Government failed to prepare formula for distribution in 12 years, last award given in 2007

KARACHI: The distribution of the Provincial Finance Commission (PFC) Award is a legal requirement, according to the Sindh Local Government Act. However, Sindh's municipal councils have not received the award for the past 12 years as the Pakistan Peoples Party (PPP)-led provincial government has failed to distribute resources among the districts. Rural and urban areas in the province have been facing a myriad of problems in the absence of the new award.

Clause 112 of the Sindh Local Government Act states that it is compulsory for the provincial government to issue the PFC award every four years and distribute financial share to all districts and local government agencies from provincial revenue as per the formula. However, the provincial government has failed to finalise the procedure for distribution of provincial revenue in the past 12 years.

The new award has not been issued to the metropolitan corporation, district councils, district municipal corporations, municipal committees and town committees in the past 12 years. There are around 1,500 union councils and union committees in Sindh's rural and urban areas and they too have not been issued the award.

The PFC award was last issued in 2007. The procedure for the distribution of the Sindh government's financial resources was decided but even in its third term, the provincial government did not issue the award during any fiscal year. Around 55 per cent of the province's revenue was supposed to be distributed under the last PFC while the remaining 45 per cent was to be kept by the Sindh government.

In 2017, PPP selected members for the Provincial Finance Commission. The commission also held a few sessions but neither did it manage to prepare a formula for the distribution of resources nor was the PFC award issued to any of the above-mentioned bodies.

Under the PFC Award 2007, financial resources were distributed among cities on the basis of population, service infrastructure, development needs, area and performance. The formula was constituted as 40 per cent, 35 per cent, 10 per cent, 5 per cent and 10 per cent respectively.

"The Sindh government does not want the fair distribution of financial resources. It was to keep all the resources with the authority," said Muttahida Quami Movement-Pakistan (MQM-P) Rabita Committee Member and former MPA Faisal Sabzwari while speaking to The Express Tribune. "We have demanded the government of Sindh to issue the PFC award several times but no action has been taken in this regard," he added.

Opposition Leader Firdous Shamim Naqvi said that the Chief Minister Murad Ali Shah has not contacted anyone regarding the formation of the commission. "The constitution guarantees security of citizens not security of the government. Something must be done if people are not getting their fundamental rights," he said while speaking to The Express Tribune. Naqvi added that Karachi has the largest population and contributes to 90 per cent of the tax collection. "Karachi could receive up to 40 per cent funds from provincial tax revenue through the PFC award."

Published in The Express Tribune, September 23^rd, 2019.