PESHAWAR: The Khyber Pakhtunkhwa government has refused to accept a proposed deduction of Rs6.4 billion from the province’s federal financial transfer, saying the amount cannot be deducted without its consent or a clear constitutional and legal basis.
Chief Minister Sohail Afridi said the federal government had sought additional funds from Khyber Pakhtunkhwa before the provincial budget. According to him, if the Federal Board of Revenue (FBR) achieved its target of Rs15.26 trillion, the province’s share would amount to Rs175 billion.
He said the provincial government had linked the provision of additional funds to a meeting with PTI founder Imran Khan and his approval. Another condition was that the merged districts be given their due share under the 11th National Finance Commission (NFC).
Afridi said the federal government had accepted the demand concerning the merged districts and incorporated it into the NFC proceedings. He added that a summary and ordinance under the 7th NFC had been planned if the province did not receive its share within six months.
According to the chief minister, the provincial government did not sign a memorandum of understanding regarding the additional funds because a meeting with Imran Khan was not arranged. Consequently, the additional federal grant was not included in Khyber Pakhtunkhwa’s provincial budget for fiscal year 2026-27.
Afridi said the Ministry of Finance proposed on August 5 that Rs6.4 billion owed to Khyber Pakhtunkhwa be deducted directly. The provincial government neither approved nor agreed to the proposed deduction and formally conveyed its objection in a letter dated August 13.
The chief minister described the issue as more than a political dispute, calling it a matter concerning the province’s constitutional and financial rights. He maintained that Article 164 of the Constitution did not empower the federal government to unilaterally deduct amounts payable to a province, arguing that any such deduction required a clear constitutional or legal basis and the provincial government’s consent.
He said Finance Adviser Muzammil Aslam had immediately met relevant officials of the Accountant General Khyber Pakhtunkhwa and issued written instructions against any deduction without the province’s consent. The Accountant General of Pakistan Revenue was also instructed not to record or implement any transaction without the explicit approval of the provincial government.
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Afridi further said the Khyber Pakhtunkhwa government had already filed a petition before the federal constitutional court seeking enforcement of its constitutional rights under the NFC.
He said the provincial government would not compromise on its rights under the NFC and would pursue every available legal and constitutional avenue to protect its financial share.
“Khyber Pakhtunkhwa will defend every single rupee of its financial share,” the chief minister said.
