Intergovermental Transfer Systems

SNG continued to provide support to the Government of Khyber Pakhtunkhwa in relation to the 9th NFC, in the areas of:

  1. Analysis of the resource allocation framework at the federal and provincial levels;
  2. Assessment of expenditure trends over the last five years, and projections for the next five years and analysis of efficiency and productivity;
  3. Identification of additional new indicators for inclusion in the National Finance Commission (NFC) formula/award for improved distribution of resources;
  4. Identification of potential areas for re-prioritising and re-allocation; and,
  5. Literature review of international best practices regarding efficient allocation of public funds.

Based on technical support from SNG, the provincial government is now following a technically oriented approach to its negotiations in the NFC with the federal government. This includes completion of the preliminary work based on different simulation models employing key evidences related to enhanced burden of responsibilities in the aftermath of 18th constitutional amendment in comparison to resource transfers, the impact of war in KP, prevailing poverty and deprivation levels and a lag in infrastructure development. The current NFC Commission formed four working groups; the one related to KP entailed ‘enhancing allocative efficiency’. SNG provided technical support to this working group through the review/finalisation of its report for presentation at the NFC deliberations/forum.