The federal government has decided to extend the seventh National Finance Commission (NFC) Award, as reported by Express News.
Sources from the Ministry of Finance stated that the NFC must issue a new award before July 1 while the current NFC Award needs to be extended.
Sources indicated that the extension of the NFC Award is recommended by the government and enacted by the President.
The current NFC Award allocates resources based on 82% population and 10.3% poverty, with an additional formula of 5% based on revenue collection and 2.7% based on area.
Under the seventh NFC Award, the provinces are to receive 57.5% of the divisible resources, while the federal government is allocated 32.5%.
An NFC Award is issued for a period of five years. If a new award cannot be finalised, the government has the authority to extend the current award. Since 2011, the distribution of divisible resources between the provinces and the center has continued under the existing award.
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