Govt to give MCDs Rs 5,326 cr

Govt to give MCDs Rs 5,326 cr

Move will help bridge budget deficit

The Delhi cabinet on Monday decided to give Rs 5,326 crore to the MCDs to bridge their budget deficit. It also asked the new MCDs to increase their revenue collection in order to make it commensurate with the increase in expenditure.

The cabinet also decided to gradually phase out country liquor by introducing ‘Delhi medium liquor’ in the capital. 

“To overcome the teething problems of the new MCDs, the government has decided to give Rs 5,326 crore. The amount includes budgetary allocation of Rs 1,724 crore (non-plan) and Rs 1,771 crore (plan) for 2012-13,” said chief minister Sheila Dikshit.

“The decision has been taken in view of our commitment to promote democratic decentralisation and strengthening of local bodies,” said Dikshit.

She said the government expects the new corporations to exercise fiscal and financial prudence in incurring expenditure and take initiative to augment its revenue resources.

There are outstanding contractors’ liabilities amounting to approximately Rs 600 crore on the MCD. This is because the increase in revenue was not commensurate with the increase in expenditure.

“We have asked the MCDs to ensure that revenue resources are adequately tapped to increase inflow. Rationalisation of the tax base needs to be considered seriously and efficiency in revenue collection also needs to be addressed,” said Dikshit.

The cabinet has also decided to gradually phase out country liquor by introducing ‘Delhi medium liquor’.

The Bureau of Indian Standards (BIS) specifications for country liquor are less strict than Indian Made Foreign Liquor, and hence the harmful effects of country liquor are more than IMFL.

“Delhi will become the first state in north India in phasing out country liquor,” said the chief minister.

“Sale and consumption of country liquor in Delhi is substantial. It is important to replace it by better-quality country liquor.

“The cabinet has decided to introduce Delhi medium liquor having 60 degree proof,” she added.

“It will involve rigorous batch testing and mandatory sampling as per standards being followed in case of country liquor,” said Dikshit.

She said Delhi medium liquor will be introduced on an experimental basis and depending upon the experience of first phase, the next phase of substitution will be undertaken.

Licenses will be granted as is being done in case of standard Indian liquor sector. Price structure may also be fixed accordingly. The new liquor is planned to be sold from 104 retail vendors selling country liquor currently.

It is expected that introduction of Delhi medium liquor may result in an additional revenue of Rs 103 lakh.

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