The Chief ministers of four provinces on Wednesday signed the historic 7th National Finance Commission Award, marking a great step forward to the strengthening of the federation. The ceremony at the picturesque Gwadar, in the Balochistan province, was witnessed by Prime Minister Yousuf Raza Gilani and members of the Cabinet. The venue was specially chosen to reflect the desire of all the provinces to end years of deprivation of the largest province of the country.
The Award was inked by finance ministers of the four provinces in the presence of Punjab Chief Minster Shahbaz Sharif, Sindh Chief Minister Qaim Ali Shah, NWFP Chief Minister Ameer Haider Hoti, Balochistan Chief Minister Aslam Raisani, and Finance Minister Shaukat Tarin.
The new Award would come into effect from the next financial year and marks the agreement by all the federating units over the distribution of financial resources among the provinces by the federal government on annual basis. Under the award, the population will be given 82 percent weightage, poverty 10.3 percent, revenue collection 5 percent (2.5 percent revenue generation, 2.5 percent revenue collection), and area 2.7 percent. Under the new NFC Award, the federation met the demand of the provincial governments for a greater share in the national resources.
The provincial share of the divisible pool would increase from 47.5 percent to 56 percent in the first year of NFC, and 57.5 percent in the remaining years of the Award. Under the new formula, Punjab would get 51.74 percent from the divisible pool, Sindh 24.55 percent, NWFP 14.62 percent and Balochistan 9.09 percent. In the new award, Punjab has given up 1.27 percent, Sindh 0.39 percent and NWFP 0.26 percent, while Balochistan has gained.