BMC in financial crisis? Civic chief instructs officials to curb expenses

Pardeshi asks depts to use public-partnership model, CSR funds, only hire for essential posts

The Brihanmumbai Municipal Corporation (BMC), considered Asia’s richest civic body, may be facing a financial crisis. A circular from the municipal commissioner has urged the civic body to fast-track pending tax disputes and enforce cost-saving measures, including outsourcing some of its work, not hiring new employees.

HT Image

A circular dated September 30 and signed by municipal commissioner Praveen Pardeshi reads, “It is likely that the BMC will face financial crisis in the near future, due to increase in expenditure, and rapid decrease in its income.” The circular, a copy of which is with HT, also lists a six-point agenda to increase the civic body’s revenue.

Pardeshi has directed the BMC to use its existing manpower more efficiently and make new hires judiciously. Vacant posts should only be filled in essential departments, such as roads, water supply, storm water drains, solid waste management and doctors for public health services. The circular urges departments to work through the public partnership model, with area locality management groups (ALMs) and corporators; and use CSR funds to maintain gardens or community centres.

The circular also asks department heads to use existing manpower efficiently. The law department has been directed to fast-track pending court cases regarding water and property tax disputes.

NCP spokesperson Nawab Malik claimed this was an attempt by the ruling Bharatiya Janata Party (BJP) and Shiv Sena to privatise the BMC. “In this very urgent circular, the BMC has mentioned its revenue income has reduced and expenditure has increased. How come a civic body with a budget of ₹30,000 crore can face financial crisis?” Malik said, demanding details of the civic body’s expenditure.

Of late, the BMC’s kitty has taken a hit. This year, the civic body lost income from Octroi and had to pay ₹2,136 crore to bail out the cash-strapped BEST. Additionally, the seventh pay commission is set to cost the civic body an additional ₹3,000 crore to pay arrears in salaries and pensions. The state government’s recent decision to reduce premiums paid by builders toward additional floor space index will cost the civic body ₹800 crore.

According to the BMC’s budget for 2019-20, it will lose ₹189 crore from unpaid property tax dues, and ₹903 crore in the form of income of the BMC’s Development Plan department.

Reacting to NCP’s allegations, BJP state minister Ashish Shelar described Malik as “illiterate” and said, “I do not think the BMC is in a financial crisis. It has lots of reserve funds that it can use judiciously. What the BMC needs to do is improve quality of its work.”