NFC Meeting: Decision to Form Working Groups on Fiscal Matters

Islamabad: The inaugural session of the 11th National Finance Commission (NFC) held in Islamabad on Thursday, chaired by Finance Minister Muhammad Aurangzeb, concluded with the decision to establish multiple working groups to advance discussions on key fiscal issues between the federation and provinces.

The meeting was attended by the finance ministers and chief ministers of all four provinces, including Sindh Chief Minister Murad Ali Shah and Khyber Pakhtunkhwa Chief Minister Sohaib Afridi. The federal Ministry of Finance briefed participants on the national financial situation, while each province shared its own fiscal position. The three-point agenda included discussions on provincial shares and important matters linked to the upcoming fiscal year.

Finance Minister Aurangzeb emphasised that the session marked an important constitutional responsibility under Article 150. He added that Prime Minister Shehbaz Sharif had personally ensured the meeting was convened without delay. The minister noted that devastating floods in Punjab, Sindh, and Khyber Pakhtunkhwa had previously forced a postponement of the NFC session.

Aurangzeb highlighted the significance of “honest and transparent dialogue” in addressing concerns and speculation around the NFC award. He praised the provinces for signing the National Fiscal Pact, maintaining mandatory surpluses, and cooperating with the IMF implementation roadmap.

The inaugural meeting of the 11th NFC starts in the Finance Division, under chairmanship of Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb with all Members of the NFC attending the session pic.twitter.com/j0aykIAS1B

— Ministry of Finance, Government of Pakistan (@Financegovpk) December 4, 2025

Following the meeting, Sindh Chief Minister Murad Ali Shah said it was agreed that several groups would be formed to progress different financial matters. He confirmed that Sindh had conveyed its reservations to the federal government.

Khyber Pakhtunkhwa’s Adviser on Finance, Muzammil Aslam, told reporters that six to seven working groups would be created, overseen by a central supervisory group. One of these groups would examine issues related to the former FATA region.

Sources revealed that the next NFC meeting is expected to take place on January 8 or 15.

During the 7th NFC Award, KP had demanded the inclusion of former FATA and called for increasing its share in war-on-terror allocations from 1% to 3%. The province also sought a raise in its overall share from 14.62% to 19.62% and urged solutions to issues linked to Article 161 of the Constitution. Additionally, KP recommended changes to the petroleum and gas excise duty formula and requested monthly NFC session scheduling.

Sindh and KP strongly opposed any reduction in provincial shares and expressed their reservations to the federation. The session included detailed briefings on financial positions and discussions on recommendations for the new NFC Award. Formation of sub-groups and the scheduling of future meetings were also reviewed to ensure timely consultations.

Provinces reiterated their demand for receiving their constitutional shares under the NFC Award and objected to any deductions. They emphasised the need for swift completion of consultations to ensure transparent and equitable financial arrangements between the federation and all provinces.