Kochi: In a temporary respite to the city corporation, which has plunged into a deep financial crisis, the state government has given permission to take a Rs 10 cr loan to pay arrears to contractors. With more than Rs 25 cr due to them, the contractors had threatened to stop all works.

During the council meeting on Tuesday, mayor Tony Chammany informed the members about the government nod and read out the government order. The Syndicate Bank will provide the loan on an assurance from the corporation that it will repay the loan amount. The bank had also asked for a clearance from the state government to release the funds.

Now, the road, drain, public building and other civil works may not be affected as, a part of the dues of the contractors can be settled using the loan. Meanwhile, the mayor faced stiff opposition from both the opposition councillors and a section of the ruling Congress ‘I’ members who alleged that Chammany had failed to take effective measures to resolve the financial crisis.

Initiating the discussion, development committee chairman T.J. Vinod, an ‘I’ group member, said that the mayor was not serious about the unprecedented financial crisis of the civic body. “The mayor should give a satisfactory explanation to councillors why he has failed to convene the special council meeting, scheduled for September 4, to discuss the financial situation. The councillors have the constitutional right to know details of the financial position of the corporation,” he said.

Supporting his arguments, Adv N.A. Shafeeq, CPM councillor said that it was a constitutional violation on the part of the mayor. Replying to the debate, Chammany explained that the meeting had to be postponed as the deputy mayor, who is the finance committee chairperson, had asked for more time to collect the details of revenue income, expenditure and the current financial situation. During the council meeting, it was decided that the special meeting would be convened on September 23.

Other issues debated in the council was the perennial water scarcity in west Kochi areas, lapses in implementing JNNURM, KSUDP projects, misuse of corporation vehicles and floor area relaxation for building constructions.