NFC technical committee decision

Monday, September 07, 2009

ISLAMABAD: The National Finance Commission (NFC) Technical Committee on Saturday decided that vertical distribution of resources between center and provinces would be determined in the light of their expenditures benchmark. The first meeting of the committee was presided over by Secretary Finance Salman Siddique here at the Ministry of Finance and was attended by the Finance Secretaries of the provinces.

The macroeconomic framework for expenditures between the federation and provinces would also be determined for the next five years along with the NFC award. It is learnt that the meeting discussed growth rate for the future expansion of expenditures as well as vertical distribution formula between the federation and the provinces.

The new macroeconomic framework of provinces for five years would be based on the economic reports of the provinces and their future expenditures would be calculated on these grounds.

Secretary Finance Salman Siddique later talking to media on the sidelines of the launching of World Bank Pakistan Tax Policy Report, said that once the benchmarking of federal and provincial expenditures is completed, a clear macroeconomic picture would be available for determination of federal and provincial governments shares in federal revenues.

The issues before the technical committee are to determine federal and provincial expenditures, Gross Domestic Product (GDP) growth rates to be achieved in next five years and as to what should be the base for vertical distribution of resource between federal government and four provinces.

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