Strengthening the federation

By Mohammad Jamil

In a federation like Pakistan, the only way to eliminate a sense of alienation amongst the smaller provinces and to guarantee unity and stability in the country is to ensure provincial autonomy, socio-economic justice, and devolution of power. Only then will the people of all the provinces find a true sense of participation. Unfortunately, for a greater part of its history, the federation has lived under a unitary form of government with absolute concentration of powers in the hands of the Central government. The formation of One Unit and the principal of parity in the 1956 Constitution contributed to a sense of deprivation amongst the smaller provinces. Although the matter of provincial autonomy has always been a festering sore all along, the imposition of Martial Laws created a crisis of confidence between the Centre and the smaller provinces. However, politicians, the military and the bureaucracy created conditions that were conducive to Martial Laws.

In a society imbued with democratic traditions and values, no one looks towards the army for resolving conflicts between political parties. However, when a feudal culture permeates all strata of society, when political parties conduct political affairs in an undemocratic manner, when the state apparatus falls victim to personal whims and self-aggrandizement and plays havoc with the treasury and other institutions, people start pinning hopes on someone who promises to emancipate them from misery, want and repression. The people of Pakistan have seen military governments, as well as civilian and elected regimes, but they could not differentiate between the two dispensations. They do not buy the idea or the cliché that the worst type of democracy is better than any other dispensation; which is why they are not willing to come out onto the streets against the president’s uniform. It should be remembered that Hitler and Mussolini were also elected representatives who were responsible for death and destruction unparalleled in the history of mankind.

A year before the 1958 Martial Law was imposed in Pakistan, Professor Keith Callard in his Political Study of Pakistan observed: “If representative government collapses it will be because the legs are not strong enough to sustain the body…It is too early to say whether those institutions are likely to mature.” It means that on the decadent infrastructure of feudalism, the superstructure of democracy could never be built. Meanwhile, internecine conflicts between the political parties and rows in the Assembly unnerved the bureaucrat-president Iskandar Mirza, who then asked General Ayub Khan to impose Martial Law. Ayub Khan introduced the system of ‘basic democracies’, and remained in the saddle for more than ten years. An alliance was then cobbled together to remove him from government and the reins of power were handed to General Yahya Khan.

In 1970, General Yahya Khan held elections on the basis of adult franchise and under a joint electorate system. Awami League in East Pakistan, and Pakistan People’s Party in West Pakistan with thumping majorities. Although Awami League had won an overall majority, the verdict of the people was rejected, leading to the disintegration of the country. The PPP formed the government as it was the majority party in the remaining Pakistan. The Constitution of 1973 attempted to resolve the issue of provincial autonomy and a compromise formula was evolved whereby the Concurrent List of subjects was to revert back to the provinces after a period of 10 years. Late Ziaul Haq’s coup in 1977, however, postponed its implementation for an indefinite period, and so the Concurrent List is still in existence even today.

Distribution of the federal divisible pool has been another source of contention between the federation and its units. The provinces require financial resources in order to maintain the social and physical infrastructure needed to provide basic services to their people. Since the bulk of the provincial resources come from the taxes of the federal government, they are dependent on the latter.It is, therefore, imperative to ensure an equitable distribution of financial resources between the federation and federating units, otherwise social and economic disparity between the provinces would grow and fan greater provincial disharmony. As regards the revenue sharing formula, the basis for all previous finance awards has been population. But in a federation where the federating units differ widely in terms of per capita income, population density, administrative infrastructure and the ability to raise taxes, the revenue sharing formula purely on the basis of population would not be fair. Therefore, appropriate weightage has to be given to factors such as revenue generation, backwardness and neglect in the past.

In 2002, just before the October elections, the National Finance Commission (NFC) was constituted with the then finance minister Mr. Shaukat Aziz as its head, including provincial finance ministers as its permanent members and the federal finance secretary along with four non-statutory members representing their respective provinces. The Commission finalized the proposals for the Sixth Award, but the final agreement was deferred till the establishment of a democratically elected government. Nevertheless, the Award worked out by the bureaucrats was not acceptable to the elected representatives. In 2003, President General Pervez Musharraf promised reconstitution of the National Finance Commission and finalization of the Award in pursuance of Article 160 (1) of the Constitution, but the bureaucracy continues to delay the Award on various pretexts.

During his marathon interaction with media men in February 2005, President Pervez Musharraf had asked the government to finalize a new National Finance Commission Award on 50:50 basis for sharing the federal divisible pool between the federation and the federating units. The announcement consoled the smaller provinces that have been demanding not less than 50 per cent share for the provinces.

Though the Financial Award has to be finalized by the Commission, the President’s advice should be paid heed to, as it would remove a major irritant in its finalization. The President was also reported to have said that he was a proponent of maximum provincial autonomy, and observed that the Concurrent List should be abolished, as it had given rise to Centre-provinces disputes and inter-provincial discord. Unfortunately, nothing has been done so far, and economic advisors and bureaucrats continue postponing the issue. One advisors came out with a formula of 47 per cent share for the federating units, thus nullifying the impact of this good gesture of the President.

During various meetings of the NFC, many fundamental differences between the Centre and provinces surfaced with regard to the criterion for sharing resources. Balochistan wanted the allocation on the basis of area, Punjab on the basis of population, and NWFP on the basis of backwardness. Sindh governments in the past have been persistent in their demand that the revenue sharing formula be based on revenue collection. But this arrangement would put NWFP and Balochistan provinces at a disadvantage. The fact remains that they had suffered from the lopsided development during the British Raj. Even after independence, no government in the past made any substantial allocations for the development of these less developed regions. In view of its importance as a port city, most industrial units were set up in Karachi, where entrepreneurs from all over Pakistan invested. And it should be borne in mind that when a port city or any region is developed with the funds of the federation, all the other federating units have equal right to the revenue collected from that region or province.

With a view to ensure distribution of resources equitably, the NFC should have a permanent secretariat with sufficient financial resources to conduct independent economic surveys to work out provincial GDPs. Secondly, Provincial Finance Commissions should also be set up for resource distribution to the district governments, as equitable sharing of resources at all levels is important. Otherwise the impact of devolving powers to the provinces and districts will be of little consequence. The government should also try to resolve differences over royalties on electricity and gas with the provinces. The Council of Common Interests should also be reconstituted, and it should be obligatory to convene its meetings twice a year to resolve inter-provincial as well as Province and Centre differences.

The writer is a freelance columnist. The Post