Khyber Pakhtunkhwa Chief Minister Sohail Afridi wrote a letter to Prime Minister Shehbaz Sharif on Monday, highlighting the persistent failure of the federal government to release constitutionally guaranteed funds allocated for his province. Afridi has repeatedly accused the federal government of stalling the release of such funds, particularly those committed for the merged districts under the National Finance Commission (NFC).
Since taking office as the provincial chief executive in October last year, Afridi has emphasized that KP’s budget for fiscal year 2025-26 was framed and approved “strictly on the basis of clear constitutional entitlements,” including net hydel profit, oil and gas royalties, post-merger NFC shares, and regular monthly releases under the NFC. These were not discretionary assumptions but binding fiscal obligations.
The KP CM stated that federal releases have consistently fallen short of budgeted levels, leading to an acute fiscal crisis for his province. He noted a particular concern over the withholding of routine monthly NFC transfers, which find no sanction in the Constitution and represent a significant breach of cooperative federalism principles. The shortfall amounted to Rs658.4 billion allocated under the NFC, with only Rs604 billion received so far.
This financial gap has severely impaired cash management and disrupted budget execution across critical sectors of governance, most notably in the merged districts where development interventions are acknowledged national priorities. Despite a provincial allocation of Rs292 billion, federal releases amounted to just Rs56 billion. Afridi stressed that this severe and continuing gap has undermined essential public services and development activities in these historically marginalised areas.
The chief minister also pointed out that fiscal constraints were emerging at a time when the province was on the frontlines of counter-terrorism efforts, while simultaneously shouldering extraordinary and unavoidable expenditures arising from flood response and rehabilitation, as well as managing the support for temporarily displaced persons. These responsibilities are national in nature but continue to be disproportionately borne by the province.
Given these circumstances, Afridi requested immediate corrective action from the federal government, including the full and unconditional release of all outstanding federal dues, particularly routine monthly NFC transfers, net hydel profit, oil and gas royalties, and allocations for the merged districts. He emphasized that this must be done strictly in accordance with constitutional provisions and agreed fiscal arrangements.
Afridi warned that any further delay will only exacerbate the province’s financial stress and weaken governance capacity at a critical juncture. He urged the prime minister to take urgent personal attention to address these matters of national importance.