Indian Express 01.02.2010
Rs 21,000 cr: BMC bounces back with big budget plan
This year’s municipal budget will be worth Rs 21,000 crore, larger than last year’s Rs 19,931 crore, and a sign that the country’s richest civic body has recovered from the after-effects of the global slowdown.
The larger outlays have been triggered by a reassuring recent performance of the money-spinning departments: octroi, property tax and development charges. Part of it will also be thanks to a large chunk of internal loans from various funds maintained by the Brihanmumbai Municipal Corporation (BMC), like last year.
However, there will be a rider: allocations will be towards completing existing infrastructure projects; no new project will be started for now.
“We were worried whether the departments would be able to achieve targets in the light of recession. However, that is a possibility now and it will accordingly reflect in the budget,” said a senior official.”
“The focus is on completing ongoing projects: Middle Vaitarna, MSDP, BRIMSTOWAD. The government has so far allowed us to take loans from internal funds, so we will bank on that for next year too,” the official said.
The targeted revenue from octroi, best indicator for the budget, is Rs 4,750 crore in 2010-11. Though set back by the slowdown, the department hopes to achieve the 2009-10 target of Rs 4,300 crore.
“Octroi earning will always surpass the target, with the collection at least 20 per cent higher than the earlier year’s. For 2009-10, however, we will be barely able to reach our targets,” said an official.
Though last year’s trend had made the civic administration revise targets for octroi, property tax, no such changes were made for the next budget. The property tax department’s current income is Rs 1848 crore, a .83 per cent increase from last year’s. The target for the coming financial year’s budget has been increased from Rs 2,450 crore to Rs 2,800 crore.
The capital value-based property tax structure had been expected to swell the kitty by 25 per cent, but its non-execution this year has raised doubts on the high targets for the coming year. “It seems very difficult to achieve the target of Rs 2,800 crore in 2010-11. We will increase the penalty for defaulters and also try to recover the pending dues from the government. If not, the targets will have to be revised at the end of the year,” said a senior official.
The construction industry’s failure to recover fully from the slowdown has had an impact on the BMC’s income from the development plan department, which has the third highest earnings, from development charges on new projects. Following a revision in the current target of Rs 925 crore, the department now has to collect a total of Rs 1,200 crore.
“We have so far collected around Rs 800 crore and since the realty market is picking up, we will try to reach the target,” said chief engineer (development plan) V Joshi. The target for receipts from the department in the coming financial year, too, is Rs 1,200 crore.
