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Chandigarh gets ₹520-crore fund boost this fiscal
Centre lifts 20% spending cut imposed due to Covid; fund boost will give fillip to development works of both Chandigarh administration and municipal corporation in remaining fiscal
The Centre has lifted the 20% mandatory cut on the Chandigarh administration’s spending that was imposed as part of austerity measures amid the Covid-19 pandemic last year.
The move will add at least ₹520 crore more in the UT’s kitty this fiscal, and boost development works being executed by both Chandigarh administration and municipal corporation.
The administration has recently proposed to increase the grant-in-aid (GIA) for the municipal corporation by 40% this fiscal — from ₹502 crore to ₹700 crore. The revised estimates are to be submitted with the Union government for its approval.
Confirming the development, UT adviser Dharam Pal said: “The municipal corporation has been requesting additional funds. We will consider enhanced support to them with the cut being revoked.”
The news comes with less than two months to go for municipal elections, and could work in favour of the ruling Bharatiya Janata Party.
Starting the current fiscal with a deficit budget of ₹670 crore, the MC received its full dues without the mandated 20% cut in the first two quarters. It has received around ₹250 crore so far. Meanwhile, its finances received a major setback when the administration decided to stay the hike in water tariff till March 2022. Its demand for ₹90 crore compensation for loss of revenue was also denied.
‘Will have positive impact on all projects’
Meanwhile, with enhanced spending power, the UT administration also looks forward to push its development projects.
This fiscal, there was only a marginal increase of 0.93% ( ₹48 crore) in the budget estimates from ₹5138.10 crore in 2020-2021 to ₹5186.12 crore in 2021-2022. The increase in capital expenditure by 25% in the budget was nullified because of the cut.
The 20% cut in the first two fiscals had forced the administration to focus on meeting revenue expenditure (on wages, salaries and committed liabilities), due to which most development works had come to a halt.
“(Lifting of cut) will have positive impact on all projects. More funds will be available. Monthly expenditure has gone up by 20%. In the remaining financial year, we will be able to spend more on development schemes,” said the adviser.
“We have received the circular today. In the coming week, we will examine which projects are to speeded up and which to be expanded as we have more funds with us,” he said. For instance, horticulture and engineering department works are likely to get additional support.
The administration is also working on seeking the funds cut in the first two quarters. “We may reflect it in the revised estimates to be submitted with Union government,” said Pal.
