Financial merger of three erstwhile municipal corporations in Delhi complete

Orders for merging the bank accounts and financial books of the three erstwhile municipal corporations were issued on Friday, and from here on, only common bank accounts of the unified Municipal Corporation of Delhi (MCD) will be operated in the name of the unified body’s commissioner, a senior municipal official said
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Published on Jun 04, 2022 12:14 AM IST
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Orders for merging the bank accounts and financial books of the three erstwhile municipal corporations were issued on Friday, and from here on, only common bank accounts of the unified Municipal Corporation of Delhi (MCD) will be operated in the name of the unified body’s commissioner, a senior municipal official said.

“After the unification of the erstwhile corporations, the finance department has opened new bank accounts for the unified municipal corporation, in the name of municipal commissioner, for various departments and payment gateways. The already existing bank accounts of erstwhile corporations will be kept active till June 5, 2022, so that online payments processed by third-party agencies and cheques in the pipeline can be credited to these old accounts,” the order issued by the central finance and accounts department said.

“The balance amounts from the three old accounts of north, south and east MCD commissioners will be moved to the new consolidated account of the unified MCD so that routine payments such as salaries and other contingent expenditure can be made without any hassle,” an MCD official said, asking not to be named.

The official said the integration will help in streamlining financial processes. Friday’s order also stated that the employee payroll system, which is currently used by the south corporation for its four zones, will be extended to all eight zones. “South corporation is using a software-based payroll system, based on a database of employees, while the other corporations are using an excel sheet based system for calculation and issuance of salaries,” the official said.

Separate zonal income accounts have been opened and the amount remitted to these accounts will be transferred to the general accounts of the MCD commissioner on a weekly basis. “MCD bank accounts have been opened for every payment gateway. This will help in easy identification of income under different heads and its reconciliation. Indian Bank is also in the final stages of developing a general provident fund and pension modules,” the order said.

Salary delays

The unified civic body will also attempt to bring the salaries of former east and north corporation employees on a par with the south municipal staff. The salary pendency in east corporation is five months while that of north corporation is about two-three months. The south corporation, on the other hand, is up to date on salaries, officials said.

The three civic bodies have total liabilities of over 16,415 crore, including loans of 3,472 crore from the Delhi government. The projected income of the unified MCD is 7,200 crore, which is still short of the current expenditure of 12,500 crore, even with grants from the Delhi government amounting to about 4,000 crore.

“We will have to take steps to bring about parity in salaries. This could translate into salary delays for the employees of the south corporation as well. North and east corporations did not have much financial resources at the time of the merger -- north had money left to pay just a month’s salary. South corporation had around 200 crore left. Parity needs to be ensured in terms of salary payments and that can cause some initial inconvenience to employees who have no pendency in salary payments until now,” a second official said, asking not to be named.

A meeting of senior municipal officials to chalk out the future course of action was called by the Union ministry of home affairs on Thursday. “During the meeting, we were told to develop our own revenue streams and reduce the dependency on grants from the Delhi government. The issue of extensive tree damage in the thunderstorm earlier this week, remedial measures and compensatory plantation was also discussed,” a third municipal official said, on condition of anonymity.

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