The Senate on Thursday voiced serious concerns over the recent IMF report in which it proposed drastic changes in the National Finance Commission award.
Echoing statements of the senators, Chairman Senate Raza Rabbani said that the IMF cannot dictate the country on the distribution of resources among the provinces. “We are not a colony and how can the IMF dictate its terms on the distribution of resources? Chairman Senate’s question was.
Minister of State for Finance Rana Muhammad Afzal Khan pointed out that Pakistan successfully completed the IMF programme last year. During that time, we were under certain obligations but after the completion of the programme this annual review report of the IMF is not binding on us. In 2009, the PPP government had passed the 7th NFC award that devolved the highest ever proportion of the funds in the federal divisible pool to the provinces.
In one of its recent report the IMF advised the government to set up a technocratic fiscal council under the aegis of the Council of Common Interests (CCI), creation of a contingency fund under a joint supervision of the federal and provincial governments and a permanent national tax commission for widening the tax net in areas of joint jurisdictions with checks and balances. The report describes the 7th NFC award for being “unbalanced and less flexible”, and constrained the government’s ability to address macroeconomic imbalances and vulnerabilities, leaving important revenue sources underexploited, and stripping the government off any room to tackle possible economic shocks in the near-term.
Earlier during question hour, the Senate was informed on Thursday that the government will present water policy in the next ten days. Minister for Water Resources, Syed Javed Ali Shah said that a high powered meeting today discussed the water policy aimed at addressing the issue of water scarcity and the policy is being finalized in consultation with the relevant provincial authorities.