ISLAMABAD: The Khyber Pakhtunkhwa (KP) government has sharply escalated its criticism of the federal government’s handling of National Finance Commission (NFC), warning of legal action and calling for urgent constitutional measures to rectify what it terms “illegal” fiscal arrangements.
In a strongly worded communication to Prime Minister Shehbaz Sharif, KP Chief Minister Sohail Afridi highlighted serious constitutional concerns, particularly focusing on systemic violations in the NFC process and prolonged delay in updating the revenue sharing formula.
The letter underscores that the constitutional requirement of revisiting the NFC Award every five years has been effectively ignored, with the current arrangement stretching far beyond its intended constitutional duration. It alleges that repeated annual extensions were made without the constitutionally mandated consensus among the provinces, undermining the spirit of federalism. Unlike formula revisions made in 2015 under Article 160(6), there were repeated acts of omission for not invoking the same mechanism for the share of Fata. Moreover, the province contends that a “patchwork of illegal actions” has replaced clear constitutional procedures, rendering the current fiscal transfers questionable. It further argues that the so-called provincial “shares” since 2018 lack legal standing, are non-shares and should not be treated as legitimate allocations.
Taking the matter a step further, KP has warned that it is prepared to approach the Supreme Court or the Federal Constitutional Court. The province intends to seek judicial intervention on multiple fronts, including whether delays in updating the NFC formula after five years violate constitutional time limits and to compel the federal government to issue a fresh Amendment Order under Article 160(6), update the horizontal formula in compliance with the Constitution and assign the share of Fata as a national priority to consolidate peace and governance on the western border. It also plans to challenge the legality of revenue distributions since 2018 and demand recovery of funds allegedly diverted from the erstwhile Fata share.
As part of its proposed “way forward,” the KP government has urged immediate federal action to bring the NFC process back within constitutional bounds. It called for the issuance of a long-overdue amendment order to update provincial shares in line with post-Fata merger realities. Pending such action, the province suggested interim financial arrangements through equitable federal grants to all the provinces. Additionally, it emphasised the need to convene an NFC meeting without delay to restart formal deliberations on a new award.
The letter signals a deepening rift between the Federation and KP over fiscal rights, with the province framing the issue not just as financial, but as a fundamental constitutional dispute that could soon land in the country’s top court.
