Agreement reached on hydel profit formula: NFC Award arbitration panel set up

The informal meeting of the National Finance Commission (NFC) on Saturday agreed for the new formulation of five-member arbitration committee to resolve the issue of hydel profit between the NWFP and Water & Power Development Authority (Wapda).
Federal Finance Minister Shaukat Aziz chaired the meeting of the provincial finance ministers and provincial NFC members.
Meanwhile, NWFP Finance Minister Sirajul Haq said that the NWFP would only sign the final sixth NFC draft after the Centre would provide assurance that the issue of net hydel profits between the NWFP and Wapda would be amicably settled.
After the meeting, he sounded optimistic about an amicable resolution of the issue.
The NWFP and Wapda would nominate three representatives each to mutually select two from each side. For chairman, three names would be given to the federal government after consensus.
The federal government would then appoint the head, making odd number of members including the chairman to have a resolution since even numbers could create a deadlock if they go for voting.
"The government had agreed to our demand of arbitration committee with equal representation from both the NWFP and Wapda and no member from the federal government," Haq said.
Earlier, the government had proposed nine-member committee.
Haq hoped that the issue of net hydel royalty would be settled by June this year.
He said two names, each would be forwarded to the Prime Minister by three parties out of the three names, would be finalised for the committee.
The meeting also discussed size of the federal divisible pool and its distribution formula among the provinces.
The mechanism for the distribution of Gas Development Surcharge (GDS) was also discussed.
The provincial finance ministers and provincial NFC members shared views in an amicable manner in exhaustive session, which led to a course of convergence to evolve consensus to finalise the sixth NFC award on schedule.
The federal government would seek help form the Prime Minister to bring chief ministers on agreements if the finance ministers do not agree on a formula. This would be done informally.
The Centre also told the provinces that higher revenue collection has also increased the available amounts for them. As from last one year, they got extra 10 percent due to growth in revenue collection. It also asked them to enhance their own revenue.
It was further agreed that the 6th meeting of the reconstituted 6th NFC will be held in Quetta from March 30 to 31.
Two ministers from Balochistan, Maulana Abdul Wasi and Mire Abdullah Jamali, attended the meeting on special invitation.
The provincial finance ministers, federal and provincial finance secretaries, provincial NFC members and senior officers of the ministry of finance attended the meeting.