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Five years after 18th Amendment

It is yet to be analysed as what would be the implications of the amendment on the delivery of critical services to the citizens and how the process of transition management could be made more informed, inclusive and result-oriented.

The 18th Constitutional Amendment was unanimously passed by the Parliament and notified in the Gazette of Pakistan on April 20, 2010. This Amendment introduced changes to about 36 per cent of the 1973 Constitution of Pakistan: 102 out of 280 Articles of the Constitution were amended, inserted, added, substituted or deleted.

The 18th Constitutional Amendment has redefined the structural contours of the state through a paradigm shift from a heavily centralised to a predominantly decentralised federation. Literature suggests that federalism was originally devised and continues to be viewed as an institutional mechanism for dividing power and sovereignty between national and regional levels of governments in order to reduce the likelihood of an authoritarian or overly centralised government. In this context, the new constitutional framework of Pakistan has reinforced a multi-level governance system by extending greater autonomy to the constitutive units (provinces) and laying down fundamentals of substantive decentralisation at the lower tiers of the local governance.

Pakistan’s Constitution delineates the extent of executive authorities of federal and provincial governments through Article 90 and 137 respectively. The executive authority of the Federation extends to matters with respect to which the Parliament holds the power to make laws, including the exercise of rights, authority and jurisdiction in and outside Pakistan, while the executive authority of the province extends to the matters with respect to which the Provincial Assembly has the power to make laws. Principally, the executive authority has been conditioned with the legislative authority at the federal and provincial levels.

The 18th Amendment has re-demarcated the jurisdictions of Pakistan’s multi-level governance at the federal, inter-provincial and provincial levels by revising the Federal Legislative List Part I and Part II and abolishing the erstwhile Concurrent Legislative List. Subsequently, the legislative and executive authorities of the federal and provincial governments have been delimited by assigning the exclusivity of 53 subjects to the federal government, 18subjects to the Council of Common Interests (CCI) and all residual subjects to the provincial governments. Further redistribution of functions at the district, tehsil and union council levels has been vested with the provincial governments in accordance with the policy framework enunciated in Article 140 (A) of the Constitution.

 Cultivating a political culture of consensus-building

The CCI discussed 105 agenda items in sixteen meetings held in the last five years. Various ministries of the federal government moved 99 summaries, while provinces have moved only 6 summaries in the last five years. Some bills and policies approved by the CCI in last five years include Private Power and Infrastructure Board Bill, 2010, Draft Securities and Exchange Commission of Pakistan Bill, 2011, Policy Guidelines for Power Generation through Small Independent Power Projects below 50 MW Capacity, Special Economic Zones Bill, 2011, Distribution of Zakat Funds to Federal Areas and Provinces and Distribution of Areas of Unutilised Zakat Funds claimed by the provinces and lastly, the 6th population housing census with a shared fiscal responsibility from divisible pool.

Provinces are not mere passive participants of the CCI. They can request a meeting through formal communication with the chairman of CCI. Provinces have also been enabled to set the agenda for the CCI meetings. In its meeting held on February 1, 2011, the CCI decided that the federal ministries/divisions initiating summaries for it should ensure their prior circulation to the provinces and their comments should be incorporated in the summary. Approval of all the bills and policies within the CCI domain has been made conditional to concurrence by the provinces.

On certain contentious issues, the CCI agreed to the provincial interpretations presented by one but benefitting all provinces. For example, in a dispute arising between the government of Punjab and the federation over the interpretation of Article 157 and an amendment in the policy of power generation projects 2002, the former prevailed bringing benefits to other provinces at large when the CCI considered the summary submitted by the government of Punjab and decided in its favour, whereby provinces were given complete authority to develop power projects of any capacity themselves or through the private sector. The CCI also decided that any remaining ambiguities may be removed through necessary amendments in National Electric Power Regulatory Authority (NEPRA) Act.

In another meeting discussing the agenda item on public debt management and supervision policy submitted by the Finance Division in 2011, the CCI directed that the policy statement containing objectives, scope, present position of domestic and external debt and medium-term macro-economic framework proposed in the different borrowing options should be made subject to consultation with the provinces. This direction has ensured parliamentary supervisory function on public debt management. The CCI observed that the current debt management is fragmented and this decision will bring cohesiveness in the documentation thereby aiding effective and efficient debt management in the country.

In another decision on the privatisation of power sector entities, it was decided by the CCI that chief secretaries of provinces shall be members of the Privatisation Board and chief ministers shall be the members of the Cabinet Committee on Privatisation. In one of the CCI meetings, the approval of the National Mineral Policy 2012 was deferred as it involved issues of constitutional jurisdiction and necessary consultation with provinces.

After the devolution of subjects related to Zakat, there has been a contest between the provinces and the federal government on collection and distribution of Zakat. The issue was resolved at the CCI with a consensus on a proposal by the government of Punjab. Punjab proposed that the collection of Zakat may remain centralised with the federal government till the next NFC Award. 7 per cent of the total collected Zakat be retained by the federal government for federal areas (ICT, FATA and GB), while the remaining 93 per cent be distributed among provinces in accordance with the pre-2008 formula: Punjab 57.36 per cent, Sindh 23.71 per cent, KPK 13.82 per cent and Balochistan 5 per cent.

Federal denials to provincial entitlements

Implementation of the18th Amendment required substantial changes in the existing legal, regulatory and policy frameworks on devolved and shared subjects. About 48 federal laws were identified which needed amendments to reflect the intent of the 18th Amendment. Rules of Business at federal and provincial levels have been amended and a number of critical issues have been resolved. However, some issues still remain unsettled because of the lack of political will, policy disconnects and the absence of evidence-based strategies hampering the pace and process of transition management.

According to Article 172(3), the oil and gas producing provinces are entitled to have 50 per cent ownership and management control on oil and gas and mineral resources in their respective regions. There is an ongoing contest of interpretation between provinces and the Federal Ministry of Petroleum and Natural Resources (MPNR) on Article 172(3). Sindh claims its exclusive right in the extension of exploration licenses to oil and gas companies, while Balochistan demands the abolition of the MPNR. The exploration of oil and gas in 50 blocks allotted to national and international oil exploration companies in different provinces two years ago could not begin due to the absence of consensus framework between federal petroleum ministry and respective provinces.

Some key subjects enlisted in the Federal Legislative List II need to be studied in order to determine as to how the policy, regulatory and supervisory control of these subjects can be governed by the CCI under the framework of shared responsibility and joint control. Provincial representations in federal regulatory authorities and mechanism for joint management of electricity, ports, national planning supervision and public debt; and defining standards in higher education are some critical issues which need in-depth policy debates and appropriate decisions. Provincial representation in the management boards of federal entities was demanded by the government of Khyber Pakhtunkhwa, which was supported by other provinces also. The matter, yet to be decided, presents another example of contest on provincial right.

With the devolution of higher education, Sindh and Punjab have established their respective provincial higher education commissions, while the Central HEC and Federal Law Ministry terms them “unconstitutional”. The CCI in its last meeting in March 2015 has established a task force to resolve the issue between central and provincial HECs.

The 18th Amendment empowered provinces to access foreign loans but up till now, required rules and limitations of loan amounts have not been framed by the Executive Committee of the National Economic Council (ECNEC). The issue was taken up by the CCI but no progress has been made so far. Other issues include: federal employees’ resettlement; Evacuee Trust Property Board (ETPB); Employment Old-Age Benefit Institution (EOBI); Workers Welfare Fund (WWF); allocation of hunting areas to Foreign Ministry; aerial survey and Pakistan Agricultural Storage and Services Corporation (PASSCO; Pakistan Sports Board; Aiwan-i-Iqbal; Pakistan Baitul Mal; National College of Arts; Pakistan Tourism Development Corporation (PTDC) and Port Authorities.

Provincial withdrawal and policy deficits

The 18th Amendment has created a balance through divisions of power between federal and provincial tiers of governance. However, the trickle-down effect of this vertical devolution has not been equitably distributed to the lower tiers by the provincial capitals. Consequently, the fiscal and policy controls have been concentrated in the provincial legislatures and executives. The legislative instrument of trickle-down decentralisation in this case could have been through the formulation of local governments with substantive devolution of fiscal and administrative authorities to local governments at district, tehsil and union council levels.

There has been no election of local government in the last nine years except in Balochistan. Being an extension of the Local Government Ordinance 1979, the existing local government laws in Balochistan, Punjab and Sindh do not devolve much in substance to districts; still the process of party-based elections at the local level can be seen as a first step towards strengthening multi-party system and deepening democracy in Pakistan. With the local government election this year, Pakistan would complete the first cycle of multi-level democratic governance.

 The way forward

The exponential devolution of legislative, executive and policy arenas from federal government to the provinces and redistribution of subjects and reallocation of attached departments within federal government was not free of contest, controversies and scepticism. Centralist tendencies in politics, bureaucracy, civil society and media remained sceptical and critical of “hurried devolution” while federalist and devolutionist tendencies remained unprepared to actualise the home-driven process of devolution with technical ingenuity to converge the legislatures’ intent of federalist devolution into a public policy and governance framework.

The federalist and devolutionary paradigm introduced by the 18th Amendment has been swinging between charged narratives of “too-little-too-late” and “too-much-too-soon”. Some viewed that the amendment has weakened while others believed that it has strengthened the federation. However, it was less studied and analysed as what would be the implications of the amendment on the delivery of critical services to the citizens and how the process of transition management could be made more informed, inclusive and result-oriented in increasing the quality and outreach of development outcomes at respective tiers of governance.

Continuous contest, institutionalised negotiation and quest for consensus-building for equitable inter-governmental relations can be the building blocks of a functional federal structure of Pakistan. Following are some indicative points for the consideration of political and policy leadership at the federal and provincial levels to further strengthen the participatory federalism and decentralisation in the country:

  • Appropriate steps to be taken to develop the institutional design and establish an independent secretariat of the Council of Common Interests (CCI) as provided by the 18th amendment. The CCI Secretariat should have equal provincial representation in the functioning and management thereof.
  • Establish a Parliamentary Commission on Civil Service Reforms with representation from provinces to implement a pending recommendation of the Parliamentary Commission on Constitutional Reforms (PCCR); and initiate a constructive dialogue between Federal Public Service Commission and Provincial Public Service Commissions for comprehensive reforms in the civil service sector keeping in view the devolved environment and principles of provincial autonomy.
  • Inter-provincial mechanisms need to be developed on devolved subjects by creating interface between provinces for experience sharing and mutual learning on effective management of devolved subjects with special reference to social sector.
  • Federal government needs to emerge as a ‘coordinating government’ facilitating the provincial governments to address regional and intra-regional disparities and create an enabling environment for equitable inter-governmental relations.
  • Provincial governments need to review their rules of business and bring amendments therein to further devolve fiscal, policy and planning authorities to the district, tehsil and union councils through elected local governments.
  • A comprehensive coordination and communication mechanism on implementation and reporting on international agreements, treatise, protocols and covenants need to be established for a consolidated reporting at international fora.

Source: The News

Byline: Amjad Bhatti

April 12, 2015

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