The federation and autonomy
Saturday, December 12, 2009
Dr Sania Nishtar
The Balochistan package, the implementation of which the prime minister envisages finalising by December 15, has been received with views on both
extremes of a spectrum. The ruling stakeholders term it as a significant milestone whereas the Baloch nationalists have rejected it outright.
A review of the package shows that the parliamentary and cabinet committee mandated with the task of developing the package has carefully gone over the
various bones of contention and has made an effort to make some allowances without disturbing the current relationship between the federation and
federating units. Hence, some additional space has been created for Balochistan in the administrative, economic and political realms, with commitments to
pay outstanding dues on account of royalties -- a major concern in inter-provincial relationships -- and an affirmation that the parliamentary committee will
review matters relating to provincial autonomy in the 18th Amendment.
If this package, as the name suggests, is the beginning of careful strategic thinking and long-term planning towards granting provinces the due share of
autonomy, then it should be considered as a step in the positive direction. In isolation, however, each of its components have their limitations, as the
objective intended to be achieved through the Balochistan package, deeply interlinked with the issue of provincial autonomy and the relationship of the
federation with its federating units. In this equation, the federal government's mandate, the fate of the concurrent list, discussions around the National
Finance Commission (NFC) award, matters relating to provincial prerogatives with regard to sharing of resources and taxation and other prerogatives
assume great importance. These must be addressed in a coordinated and step-wise manner.
First, autonomy must be defined in the context of fiscal and political federalism in Pakistan. Over the years, many calls have drawn attention to the subject,
most of them subscribing to an extreme notion of autonomy analogous to what was envisaged in the 1940 resolution, which defined Pakistan as "a
federation comprising autonomous units, which shall be completely sovereign". Views articulated in the Declaration of Autonomy of the Federating Units
signed on August 2, 1986, by the leaders of the Movement for the Restoration of Democracy, also called for an extent of autonomy in which all, except four
subjects -- defence, foreign affairs, communications and currency -- were to be delegated to the provinces. Many Baloch nationalists still subscribe to this
view. The question is, do these four subjects guarantee a viable federation for Pakistan? What else is needed by way of the federal government's mandate to
fulfill the concept of a unified Pakistan and promote equity in development across provinces? Can the desired level of provincial autonomy be granted by
implementing the five-point constitutional changes articulated in the Balochistan package, relating to abolishing the concurrent list, the Local Government
Ordinance (LGO) 2001 and Police Order 2002, and effective implementation of Articles 153-160 of the constitution? Or should we completely digress from
the quantum of provincial autonomy as endorsed by the 1973 constitution? How can we achieve the dual goals of granting the people of Balochistan the right
to self-rule and control while supporting national unity at the same time? These questions need careful thinking with a broad-based consensus on the
directions to be pursued.
Second, the federal government's mandate must be clearly defined. Many believe that the current federal system has been designed on the legacy of
centralised control -- a hallmark of the colonial period. In this arrangement, the federal government has been stretched thin with tasks that could better be
taken in the provincial fold. Many also believe that there is a major disconnect between prerogatives to generate resources and expenditure responsibilities.
It has been frequently cited that the federal government generates 93 per cent of the resources and has 72 per cent share in total expenditures; conversely,
the provinces are left with seven per cent resources and account for 28 per cent of the expenditure. Of the five expenditure heads of the federal government,
the two that are of direct relevance to the question of provincial autonomy are the Public Sector Development Programme (PSDP) and the cost of running the
civil government. There are many subjects under the PSDP, which can better be assigned to the provinces. If there is a unanimous consensus to do so, the
costs of running the civil establishment in Islamabad can be scaled down through structural institutional changes; the concurrent list can then
correspondingly be pruned and the size of the National Finance Commission award for the provinces will therefore increase.
Third, the issue of the NFC Award is closely interlinked. Out of the seven NFCs since the 1973 constitution, only four have come up with additional
measures. These although important in their own right, do not comprehensively address issues fundamental to the fiscal autonomy of the provinces, which
center on taxation rights and mechanisms to assign permanent sources of revenue, particularly with regard to control over natural resources in line with
what has been stipulated in Article 161.
Decision on the next NFC award is due later this week. Although there are inherent difficulties in balancing the varied demands of the provinces, there are
ways in which provinces can be empowered to generate and retain their own revenue, whilst reducing concentration of revenue collection at the centre
through major tax-heads, albeit without jeopardising the core functions of the federation. In addition, sensible revenue collection criteria, which indicate
economic activity in the province and hence revenue distribution can be devised and given weights in relation to criteria for distribution from the divisible pool.
This can be supplemented by other criteria -- indeed the provinces have a long-term demand to include criteria other than the sole criterion of population as
a basis of provincial allocations from the divisible pool.
Fourth, let's not forget that the core purpose of provincial autonomy is to enhance public sector effectiveness. That in turn is closely linked to how the system
of local governance will be shaped -- an area in which there is pervasive uncertainty.
It is evident, therefore, that the issue meant to be addressed through the Balochistan package needs a consensus-driven long term plan, which can be
implemented in a coordinated stepwise manner. As this requires many institutional changes, immediate implementation of drastic and ad hoc measures
should be avoided as it can lead to disenchantment in the administration particularly at the federal level, which can be detrimental at a time when the country
is undergoing many different crises.
But at the same time, the issue of provincial autonomy should not be taken lightly. In fact, the determinants of the country's split in 1971 were rooted in
negligence to the subject. It is imperative to devise a long-term solution acceptable to the provinces to ensure that the provinces have more space and
control, whilst at the same time strengthening the foundations of the federal structure and inter-provincial harmony. However, in order to get things going in a
coordinated fashion, long-term visionary thinking, strategic planning, and consistency of policy direction is needed over time. In tandem, careful and
unbiased oversight has to be ensured so that capacity development and transparency-promoting reform is pursued in the provinces in parallel with granting
of autonomy and responsibility. A package of measures, no matter how well-intentioned, has inherent limitations in achieving this long-term objective.
The writer is the founding-president of Heartfile. Email:
http://www.thenews.com.pk
Saturday, December 12, 2009
Dr Sania Nishtar
The Balochistan package, the implementation of which the prime minister envisages finalising by December 15, has been received with views on both
extremes of a spectrum. The ruling stakeholders term it as a significant milestone whereas the Baloch nationalists have rejected it outright.
A review of the package shows that the parliamentary and cabinet committee mandated with the task of developing the package has carefully gone over the
various bones of contention and has made an effort to make some allowances without disturbing the current relationship between the federation and
federating units. Hence, some additional space has been created for Balochistan in the administrative, economic and political realms, with commitments to
pay outstanding dues on account of royalties -- a major concern in inter-provincial relationships -- and an affirmation that the parliamentary committee will
review matters relating to provincial autonomy in the 18th Amendment.
If this package, as the name suggests, is the beginning of careful strategic thinking and long-term planning towards granting provinces the due share of
autonomy, then it should be considered as a step in the positive direction. In isolation, however, each of its components have their limitations, as the
objective intended to be achieved through the Balochistan package, deeply interlinked with the issue of provincial autonomy and the relationship of the
federation with its federating units. In this equation, the federal government's mandate, the fate of the concurrent list, discussions around the National
Finance Commission (NFC) award, matters relating to provincial prerogatives with regard to sharing of resources and taxation and other prerogatives
assume great importance. These must be addressed in a coordinated and step-wise manner.
First, autonomy must be defined in the context of fiscal and political federalism in Pakistan. Over the years, many calls have drawn attention to the subject,
most of them subscribing to an extreme notion of autonomy analogous to what was envisaged in the 1940 resolution, which defined Pakistan as "a
federation comprising autonomous units, which shall be completely sovereign". Views articulated in the Declaration of Autonomy of the Federating Units
signed on August 2, 1986, by the leaders of the Movement for the Restoration of Democracy, also called for an extent of autonomy in which all, except four
subjects -- defence, foreign affairs, communications and currency -- were to be delegated to the provinces. Many Baloch nationalists still subscribe to this
view. The question is, do these four subjects guarantee a viable federation for Pakistan? What else is needed by way of the federal government's mandate to
fulfill the concept of a unified Pakistan and promote equity in development across provinces? Can the desired level of provincial autonomy be granted by
implementing the five-point constitutional changes articulated in the Balochistan package, relating to abolishing the concurrent list, the Local Government
Ordinance (LGO) 2001 and Police Order 2002, and effective implementation of Articles 153-160 of the constitution? Or should we completely digress from
the quantum of provincial autonomy as endorsed by the 1973 constitution? How can we achieve the dual goals of granting the people of Balochistan the right
to self-rule and control while supporting national unity at the same time? These questions need careful thinking with a broad-based consensus on the
directions to be pursued.
Second, the federal government's mandate must be clearly defined. Many believe that the current federal system has been designed on the legacy of
centralised control -- a hallmark of the colonial period. In this arrangement, the federal government has been stretched thin with tasks that could better be
taken in the provincial fold. Many also believe that there is a major disconnect between prerogatives to generate resources and expenditure responsibilities.
It has been frequently cited that the federal government generates 93 per cent of the resources and has 72 per cent share in total expenditures; conversely,
the provinces are left with seven per cent resources and account for 28 per cent of the expenditure. Of the five expenditure heads of the federal government,
the two that are of direct relevance to the question of provincial autonomy are the Public Sector Development Programme (PSDP) and the cost of running the
civil government. There are many subjects under the PSDP, which can better be assigned to the provinces. If there is a unanimous consensus to do so, the
costs of running the civil establishment in Islamabad can be scaled down through structural institutional changes; the concurrent list can then
correspondingly be pruned and the size of the National Finance Commission award for the provinces will therefore increase.
Third, the issue of the NFC Award is closely interlinked. Out of the seven NFCs since the 1973 constitution, only four have come up with additional
measures. These although important in their own right, do not comprehensively address issues fundamental to the fiscal autonomy of the provinces, which
center on taxation rights and mechanisms to assign permanent sources of revenue, particularly with regard to control over natural resources in line with
what has been stipulated in Article 161.
Decision on the next NFC award is due later this week. Although there are inherent difficulties in balancing the varied demands of the provinces, there are
ways in which provinces can be empowered to generate and retain their own revenue, whilst reducing concentration of revenue collection at the centre
through major tax-heads, albeit without jeopardising the core functions of the federation. In addition, sensible revenue collection criteria, which indicate
economic activity in the province and hence revenue distribution can be devised and given weights in relation to criteria for distribution from the divisible pool.
This can be supplemented by other criteria -- indeed the provinces have a long-term demand to include criteria other than the sole criterion of population as
a basis of provincial allocations from the divisible pool.
Fourth, let's not forget that the core purpose of provincial autonomy is to enhance public sector effectiveness. That in turn is closely linked to how the system
of local governance will be shaped -- an area in which there is pervasive uncertainty.
It is evident, therefore, that the issue meant to be addressed through the Balochistan package needs a consensus-driven long term plan, which can be
implemented in a coordinated stepwise manner. As this requires many institutional changes, immediate implementation of drastic and ad hoc measures
should be avoided as it can lead to disenchantment in the administration particularly at the federal level, which can be detrimental at a time when the country
is undergoing many different crises.
But at the same time, the issue of provincial autonomy should not be taken lightly. In fact, the determinants of the country's split in 1971 were rooted in
negligence to the subject. It is imperative to devise a long-term solution acceptable to the provinces to ensure that the provinces have more space and
control, whilst at the same time strengthening the foundations of the federal structure and inter-provincial harmony. However, in order to get things going in a
coordinated fashion, long-term visionary thinking, strategic planning, and consistency of policy direction is needed over time. In tandem, careful and
unbiased oversight has to be ensured so that capacity development and transparency-promoting reform is pursued in the provinces in parallel with granting
of autonomy and responsibility. A package of measures, no matter how well-intentioned, has inherent limitations in achieving this long-term objective.
The writer is the founding-president of Heartfile. Email:
http://www.thenews.com.pk
