NFC's informal session on May 13

The Finance Ministry will hold an informal session of National Finance Commission on Thursday.
The ministry is considering next week as final deadline for incorporating new formula in the budget.
It is preparing two types of budget estimates; one with 37.5 percent of NFC award based on 1997 formula and the other with new offer of 47 percent.
The Finance Minister, who has recently held meetings with the chief minister of Punjab and finance minister of Sindh, is making efforts for a resolution. However, officials at the Centre view any failure in reaching a conclusion as disadvantageous to the provinces.
They says that provincial share after enhanced size of the pie has even grown which they would lose as seven years have passed without a new formula. The previous formula was agreed in 1997 and before that in 1992 and 1975.
The resources' jump from 37.5 percent to 47 percent is substantial. However, the provinces are demanding even more than this.
The ministry has maintained informal contact with the provinces and hoped that a solution would be reached if provinces showed flexibility in their demand.
In the last meeting, the provinces were offered 47 percent from the divisible pool, while they were asking for 50 percent.
The finance ministry was shy to sanction half of the pool because it could bring risk of vulnerability to fiscal stability.