Khyber Pakhtunkhwa Chief Minister Sohail Afridi on Monday wrote a letter to Prime Minister Shehbaz Sharif over what he dubbed the Centre’s “persistent failure” to release “constitutionally guaranteed” funds, demanding the “full and unconditional” release of all outstanding federal dues.
Since becoming the provincial chief executive in October last year, Afridi has repeatedly accused the federal government of stalling the release of funds allocated for KP, particularly those committed for the merged districts under the National Finance Commission (NFC).
In a fresh call for the release of funds, the KP CM said: “I am compelled to place on record the deep and mounting concern of the government of Khyber Pakhtunkhwa regarding the persistent failure to release constitutionally guaranteed federal transfers.”
This failure, he added, “has now translated into an acute fiscal and governance crisis for the province”.
Afridi underscored 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,” he emphasised, adding that “contrary to these commitments, actual releases have consistently fallen short of budgeted levels”.
Moreover, “of even greater concern is the withholding of routine monthly NFC transfers, a practice that finds no sanction in the Constitution and strikes at the core of cooperative federalism”, he said.
The KP CM maintained that his province was entitled to receive Rs658.4 billion under the NFC, but it had received just Rs604bn so far, leading to a shortfall of Rs54.4bn.
“This is not an accounting variance; it represents a material breach that has directly impaired cash management, disrupted budget execution, and constrained service delivery across critical sectors of governance,” he asserted.
He added, “The impact is most stark in the merged districts, where development, stabilisation, and state consolidation are acknowledged national priorities. Despite a provincial allocation of Rs292bn, federal releases amount to only Rs56bn thus far.
“This severe and continuing gap has undermined the provision of essential public services and development interventions in these historically marginalised areas, eroding the objectives of the merger and weakening national cohesion.”
The KP CM also highlighted that these fiscal constraints were unfolding at a time when the province remained on the frontline of counter-terrorism, while simultaneously shouldering extraordinary and unavoidable expenditures arising from flood response and rehabilitation, as well as the management and support of temporarily displaced persons.
“These are national responsibilities; however, the financial burden continues to be borne disproportionately and unsustainably by the province,” he said.
In view of the above, he said, the KP government expected “immediate corrective action by 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, strictly in accordance with constitutional provisions and agreed fiscal arrangements”.
“Any further delay will only compound the province’s fiscal stress and weaken governance capacity at a critical juncture,” he warned, telling the premier that given the seriousness of the matter, it warranted his “urgent and personal attention”.
