The Times of India         23.11.2010

Crisis hurting BBMP projects too

BANGALORE: The political crisis in the state is hitting fund-starved Bruhat Bangalore Mahanagara Palike hard -- it's still waiting for the special grant of Rs 1,300 crore from the government.

Not a single paisa has come into BBMP's kitty, admit members of the tax and finance committee. During the last council meeting, mayor S K Nataraj announced that the chief minister would be at the BBMP council on November 22 to announce the government's special grant. But, on Monday, CM B S Yeddyurappa was in Delhi, trying to save his own seat. When contacted, the mayor said: "I cannot talk now.''

BBMP's ambitious revised budget of over Rs 8,800 crore for 2010-11 is largely dependent on the grant. According to BBMP sources, at least Rs 400 crore was raised in the budget without any proper fund source. With no clarity on Akrama-Sakrama yet and poor prospects of JN-NURM funds, the BBMP was banking on this special grant.

The future looks bleak, considering the revised budget sent to the government for approval took at least 20 days. The approval had come in with a note from the urban development department that the BBMP would have to manage funds on its own and that no special grant will come in from the government. The mayor's announcement last month was a ray of hope.

There's no mention of the grant in the state budget. So, if there's a change in CM, there's little he can do to help.

There seems little progress on works as well. The programme of works (POW) for all 198 wards was duly submitted in the council last month. Till date, none has been approved. According to senior councillors, this is perhaps the longest delay ever. "There is no legal provision for this approval in the Karnataka Municipal Corporation Act but it's a customary practice that takes just 2-3 days,'' they said.

Though pothole filling work started across many wards, the actual POW for it is yet to be formally approved. This was one of the three POWs announced by commissioner Siddaiah in the council last month. Others include silt and tract (taking silt with tractor) and desilting of storm water drains.

Revised estimates

Receipts: Rs 8,857.97 crore

Expenditure: Rs 8,849.39 crore

BBMP'S REAL LIABILITIES FOR 2010-11

Pending bills: Rs 1,700 crore

Ongoing 3,925 works: Rs 2,244 crore

Towards loan repayment: Rs 592 crore

General administration: Rs 500 crore

Health (Including SWM): Rs 336 crore

Welfare: Rs 600 crore

Capital investment works: Rs 4,878 crore

RESOURCES FROM

JN-NURM: Rs 195 crore

State Finance Commission (SFC): Rs 403.69 crore

Special grant from state government: Rs 1,300 crore

13th finance commission grant: Rs 122 crore

TROUBLED FUTURE?

* By a realistic estimate, BBMP's total liability for 2010-11 will be around Rs 3,390 crore. Of this, 2,504.13 crore will be spent on completion of 15,301 works taken up during 2009-10 and at least Rs 895 crore on loan repayments

* Budgetary allocation for past year was only Rs 1,857 crore. More than half the amount came through loans. BBMP is already neck-deep in loans

* BBMP's latest borrowal was Rs 1,000 crore from three nationalized banks to clear outstanding bills as on November 2009 for works that year. Borrowal permitted by government order of March 6, 2010 based on resolution passed by BBMP administrator on January 6, 2010

* Loan was in addition to earlier amount borrowed Rs 959.7 crore from IDBI and Rs 500 crore from Internal Extra Borrowing Resources. All to clear work orders worth Rs 4,188 crore issued in 2009-10