NFC award
THE announcement of the constitution of the 10th National Finance Commission has come at a time when devolution of significant administrative and financial powers to the provinces under the 18th Amendment is under renewed attack from the proponents of a stronger centre. The additional agenda for the new commission — whose sole constitutional job is to divide financial resources between the centre and the provinces — is reflective of this mindset. The presidential order indicates that the centre wants the provinces to fund security expenditure, share losses of SOEs, bear the cost of subsidies and fund federal debt repayments. Islamabad is also looking to them to help finance its expenditure on AJK, GB and former Fata. Since the provincial share from the tax divisible pool cannot be slashed from the present 57.5pc under the Constitution, the federal government is attempting to bypass it by putting these proposals on the NFC table. This isn’t the first attempt to undo the gains the provinces have made under the seventh award. Back in 2015, the PML-N government had also demanded they voluntarily give up 7pc of the undivided pool for some of these federal responsibilities. The demand was rejected as unconstitutional.
The 18th Amendment and the seventh NFC award are regarded as a watershed in the country’s constitutional and fiscal history; neither can exist alone. While the amendment devolved several federal ministries and functions including education, health, women development, tourism, environment, etc to the provinces, the NFC created fiscal resources from the divisible pool and enhanced the provincial tax base by recognising the provinces’ rights over services tax and CVT on immovable property to support their new responsibilities. It also conceded the provinces’ right to their natural resources, and made some subjects like ports, electricity, water resources, national planning, census and regulatory authorities a joint provincial and federal responsibility. These steps have helped the provinces increase their incomes and spend more on development and delivery of public service to their citizens.
The increased provincial share is often blamed for increasing the federal budget deficit, which isn’t based on facts. A study by the Punjab government shows that the enhanced provincial share from the tax resource has contributed just 0.8pc to 1pc of GDP to the federal deficit. The real reason for the deficit lies elsewhere. For starters, Islamabad has failed to raise the tax-to-GDP ratio from 10pc to 15pc during the five-year life of the seventh award. It also continues to spend a lot of money to maintain structures of the devolved ministries and functions because of political reasons, and is unable to plug the massive haemorrhaging of resources by SOEs. Devolution has done much to strengthen the federation. The centre should focus on raising taxes, cutting its unnecessary expenditure and pulling out of devolved functions. It should look ahead and not attempt to reverse the progress made so far.
Shocking target
IT was a bloody Tuesday in Afghanistan — alas, one of many such blood-soaked days this forsaken country has been experiencing over the last four decades. In Kabul, a truly shocking attack on a maternity hospital resulted in the deaths of a number of people, including newborns. The pictures and footage of little bodies wrapped in blankets must have left even the most jaded of observers numb. Meanwhile, in the eastern province of Nangarhar, a suicide bomber reportedly killed over 20 people at the funeral of a police officer. Afghan President Ashraf Ghani has held the Taliban responsible for the Kabul atrocity, and the militant Islamic State group for the Nangarhar assault. The Taliban have denied involvement in both attacks. The fact is that Afghanistan is a patchwork of armed groups and insurgents, and due to a weak central government and strong militant groups, acts of mass violence are no rarity in the country.
While only a proper investigation can track down the perpetrators, there are strong clues that IS may have been responsible for the Kabul hospital attack, while the terrorist group has already claimed responsibility for the assault on the funeral. The hospital is located in an area of the Afghan capital dominated by the Shia Hazara community — a favourite target of the sectarian shock troops of IS — and the so-called caliphate has been involved in attacks on hospitals before. And while the Taliban have a history of violence, the hospital attack does not match their usual modus operandi. Apart from the shocking disregard for human life and values by the perpetrators, the attacks show that the peace process in Afghanistan may be in its death throes. For example, the Afghan president’s order to his forces to resume offensive positions indicates that Kabul has lost patience with the Taliban, while a senior Afghan security official has said “there seems little point in continuing to engage Taliban in peace talks”. Though the Americans have urged Kabul and the Taliban to join forces to bring the perpetrators of the attacks to justice, in the backdrop of such horrific violence, with the trust deficit widening between Afghan factions, this may be wishful thinking. Which is bad news for the Afghan people. Indeed, as the government and the Taliban square off, IS and others of their ilk will take advantage of the chaos and continue to perpetuate their business of death and destruction.
Palestinian anger
ON Tuesday, in an incident strangely reminiscent of the biblical story of David and Goliath, an Israeli soldier, wearing a helmet and armed to the teeth, was killed by a Palestinian whose only weapon was a stone. The incident occurred in a West Bank village which Israeli forces had intruded. According to an Israeli army spokesman, the village was “a hotspot of terrorists”, a crude cliché for freedom fighters used with equal felicity by Israel’s friends in India-held Kashmir. The latest demonstration of anger against Tel Aviv in this “revolution of sticks and stones” came on the eve of American Secretary of State Mike Pompeo’s visit to Israel with the Likud-led coalition government finalising its plans for the annexation of Jewish settlements. The annexation will merely be a formality, because the Jewish colonies have been there — and are proliferating in size and numbers — for decades in violation of several UN resolutions, besides the international treaties to which Israel and its patron, America, have been party. To recap, the existence of the Jewish settlements, their territorial expansion and the establishment of new ones violate the Camp David accord brokered by president Jimmy Carter and the Declaration of Principles signed on the lawns of the Bill Clinton White House.
With the coalition partners having agreed on the modalities of the annexation scheme, it appears rather odd that Mr Pompeo should still peddle President Donald Trump’s — in fact, Mr Trump’s son-in-law Jared Kushner’s — ‘vision’ for peace in the Middle East. The truth is that Israel never had such a pliant do-gooder in Washington. All American administrations have kowtowed to Israel, for they know the lethal power of the American-Israel Public Affairs Committee, but never has a US government been so keen to fulfil Israeli demands as the current Republican administration. Yet, no matter how much diplomatic and military power the US arms Israel with, it will not be easy to defeat an occupied people who feel they have nothing left to lose.