Smart cities: Centre must ensure transparency before levying user charges | editorials | Hindustan Times
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Smart cities: Centre must ensure transparency before levying user charges

West Bengal has shown its reluctance towards levying of user charges. Chief Minister Mamata Banerjee has said that her government didn’t believe in levying charges for basic rights like water, and has not sent any other cities for the competition after this statement.

editorials Updated: Sep 12, 2017 11:18 IST
Vice-President M Venkaiah Naidu at the foundation stone laying ceremony for a greenfield smart city project, Ranchi, September 9, 2017
Vice-President M Venkaiah Naidu at the foundation stone laying ceremony for a greenfield smart city project, Ranchi, September 9, 2017(Diwakar Prasad/ Hindustan Times)

Last week, vice-president M Venkaiah Naidu, who was the NDA’s urban development minister before his elevation, said people must be prepared to pay higher taxes or user charges for smart cities. This burden will have to be borne by the people for availing “modern infrastructure in the existing ones,” he said at a meeting in Ranchi. This may surprise many because to date the NDA has not explicitly said anything about these charges, but as things fall in place, they would probably be more open about it. The SCM document, mentions the principles for levying user charges: Where services can be measured and beneficiaries identified; user charges could be levied for maintenance; and that it would be linked to improved quality of service.

As an earlier piece in these pages mentioned, the funds for these SCM projects are raised from a variety of public and private sources; the primary part comes from the smart cities budget. The mission offers cities Rs 1,000 crore per city over five years, and this accounts for over 50% of the budget of the top 90 cities. The funding was initially imagined as seed money that could help cities venture into the debt market, however, this funding seems to be used more as a regular grant, wrote the author of the piece, Persis Taraporevala, a research associate with the Centre for Policy Research, New Delhi. Over 20% of funding for the 90 cities is sourced through a process of ‘convergence’ wherein the cities incorporate the budgets of other government schemes such as the Swachh Bharat Abhiyan and the affordable housing schemes etc into the smart city proposal budgets.

Already West Bengal has shown its reluctance towards the levying of user charges. Chief Minister Mamata Banerjee has said that her government didn’t believe in lcharges for basic rights like water and has not sent any other cities for the competition after this statement. New town, Kolkata, was selected in the top 60 but they have not created a special purpose vehicle, which means it will not get central funds for the city.

For citizens (who are already saddled with different kind of cesses), what would be of interest is the quantum of charges that would be levied on them and what is the Centre’s plan to ensure that these smart cities are affordable for all. Last but not the least, they would want the process of levying user charges and its collection to be transparent and accountable.