Severe cash crunch hits BBMP

Palike has no money to pay contractors; staff salaries not affected yet

According to BBMP officials, contractors executing nearly 200 infrastructure projects worth Rs one crore or more have not been paid their dues since September.

The revenue from property tax so far this year has been less than anticipated and has failed to provide any respite. The current revenue from property tax is placed at Rs 600 crore with another Rs 200 crore expected to be generated in the next six months, much less than the Rs 1,200 crore projected in the BBMP budget earlier this year.

The crunch, however has not affected payment of salaries to the BBMP officials. BBMP Commissioner Bharath Lal Meena told Deccan Herald: “It has always been the situation (irregular payments to contractors) everywhere. That is the way it works. But we will be able to meet the expenditure.”

The Commissioner has pinned his hopes on property tax collections going up in the next six months. This apart, for the developmental works, BBMP will be borrowing against their proposal of the Rs 22,000-crore Mega Project in the City.

The Government has already approved the borrowing to be made by the BBMP for its immediate projects.

BBMP officials state that HUDCO will be the financing agency for the projects to be undertaken in the first phase. “The government has already approved our request for projects worth Rs 2,400 crore. Another installment of projects worth Rs 3,400 crore is also being looked into by the State,” said Meena.    

However, even after this proposal, the BBMP anticipates projects worth Rs 500 crore spilling over into the next financial year, raising questions of financial stability of the Palike to begin the works proposed for this financial year.

Commissioner Meena, however is unfazed, declaring “We are not pauper, that is for sure.”