The Ministry of Finance, Pakistan, on Saturday clarified that the federal government has no outstanding liabilities under the National Finance Commission (NFC) Award to the provinces, including Khyber Pakhtunkhwa.
The clarification followed claims by Sohail Afridi, who alleged that the Centre had failed to pay Rs1,350 billion to Khyber Pakhtunkhwa under the NFC Award over the past seven years.
In an official statement, the ministry said the federal government releases provincial NFC shares every 15 days. Therefore, it stressed that no arrears exist.
The ministry explained that under the 7th NFC Award, Khyber Pakhtunkhwa receives 14.62 per cent of the provincial share in the divisible pool. In addition, the province continues to receive an extra one per cent from the undivided pool. This allocation recognises the extraordinary burden KP bore during the war on terror.
وفاقی حکومت، خیبر پختونخوا کو نیشنل فنانس کمیشن (این ایف سی) ایوارڈ کے تحت اور اس کے علاوہ بھی بروقت، شفاف اور مسلسل مالی وسائل کی فراہمی یقینی بنا رہی ہے
اس کاوش کا مقصد صوبے کی مالی ضروریات پوری کرنا، ترقیاتی عمل کو مضبوط بنانا اور دہشت گردی کے خلاف جنگ اور انضمام کے بعد درپیش…
— Ministry of Finance, Government of Pakistan (@Financegovpk) December 20, 2025Although the 7th NFC Award was originally designed for a five-year term, the lack of consensus on subsequent awards led to its extension. As a result, the existing framework remains in effect.
As a result, Khyber Pakhtunkhwa continues to receive its full share, including the additional allocation linked to counterterrorism efforts. The ministry noted that Rs46.44 billion was released to KP on December 17, underscoring the federal government’s commitment to timely disbursement.
From July 2010 to November 2025, the Centre transferred Rs5.86 trillion to KP as its share of the divisible pool. During the same period, it released Rs 705 billion specifically for war-on-terror expenses.
Moreover, the federal government paid Rs482.78 billion to the province under other heads, including oil and gas royalties, gas development surcharge, and excise duty on natural gas.
Following the merger of the former FATA into Khyber Pakhtunkhwa, the Centre also financed expenditures for the newly merged districts from its own NFC share. Since 2019, this support has amounted to Rs. 704 billion.
The ministry further stated that Rs117.16 billion was provided to KP to support Internally Displaced Persons. In addition, the province received Rs115 billion through the federal Public Sector Development Programme over the past 15 years. Between fiscal year 2016 and fiscal year 2025, the federal government also transferred Rs481.43 billion to KP through the Benazir Income Support Programme.
