Fiscal Federalism and Constitutional Accountability: Lessons from Pakistan’s 18th Amendment

Abstract

The Eighteenth Constitutional Amendment of 2010 has been one of the most significant changes in matters concerning the Pakistani constitution and fiscal history. The Amendment sought to reestablish the balance of fiscal autonomy predicted by the 1973 Constitution by abolishing the Concurrent Legislative List and devolving a large portion of powers to the provinces. It also aimed at boosting the inter-governmental level of coordination through the National Finance Commission (NFC) and the Council of Common Interests (CCI) to incorporate accountability to the federal system. However, even with this change in structure, the post-Amendment era has seen some long-standing challenges that include lack of administrative capacity, delays in fiscal grants, unequal provincial performance and institutional impunity.

This paper will discuss how fiscal federalism has changed through the seventeenth amendment of the constitution of Pakistan and following the 18^th amendment, discussing how the constitutional reform has changed the way the fiscal distribution is done, governance and accountability. Using comparative lessons in India and other countries such as Canada and the United States, it claims that sustainable fiscal federalism needs institutionalized schemes to coordinate, be transparent and economical. The research study concludes that, although the 18th Amendment established the constitutional cumulative to have cooperative federalism, the success of the 18th Amendment in the long term is pegged on the maturity of institutions, political will and the long-term culture of constitutional trust.