Drop in collection of property tax, loss of octroi revenue, the absence of any new tax, and the lingering burden of implementing the Seventh Pay Commission have all impacted the Brihanmumbai Municipal Corporation's (BMC) budgeting exercise. The civic body had to dig into its reserve funds to cover expenditure for the second year in a row, as commissioner Ajoy Mehta tabled the 2019-20 Budget on Monday with an estimated outlay of Rs 30,693 crore, 12 per cent more than last year.
Cash-strapped BEST suffered a net expected loss of Rs 1,022 crore, but received a meagre fillip of Rs 34 crore for capital investment and Rs 10 crore for employee welfare.
The Budget hasn't announced any big new infrastructure projects for the city, and is instead focusing on pushing forward those projects which have already commenced and commissioned. Growth in inflation rate has not been commensurate with the increase in BMC's revenues.
Compensation in lieu of octroi was again the main source of BMC's income, while drop in property tax and development planning department's receipts are major worries. On the other hand, awarding Seventh Pay Commission pay hikes and increase in hiring will add a further burden of Rs 2,000 crore.
"Expenditure will increase due to the Seventh Pay Commission and big projects. A real estate slowdown and change in share of premium rates of fungible FSI have led to a decrease in property tax and DP department's collections," said Mehta.
As compensation, the commissioner proposed levying extra service charges and entry fees to access various BMC facilities like Byculla zoo, Shilpgram garden and viewing galleries to augment income. However, he also stressed that the amount would be negligible as compared to revenue loss.
As per the 2019-20 Budget, the BMC will withdraw Rs 5,199 crore from the reserve fund, up from the Rs 2,619 crore it had withdrawn in 2018-19. This fund will be used for coastal road, sewage treatment plants, waste to energy plant, and upgradation of hospitals. The BMC also laid additional emphasis on IT-enabled services and the IT department. It announced that 82 services have gone completely digital. It has set a June 2019 deadline to the other 53 services. This apart, strengthening the ease of doing business, geographical information system, hospital management information system, vehicle tracking and control room for solid waste management are also on the cards under IT reform.
The civic body has increased its budgetary allocation to health by 15 per cent, while roads and bridges and storm water drainage departments also got more funds than they did in 2018-19. Overall, 370 kms of roads, including the JVLR, Link Road, Ghatkopar-Mankhurd link road, LBS Road, etc. are all proposed for improvement. The BMC has allocated Rs 100 crore for footpaths. Redevelopment work on MT Agarwal hospital, Shatabdi Govandi hospital and Bhagavati hospital is expected to begin soon. There is also a Rs 1 crore provision for build a new house for mayor near Shivaji Park. The BMC also allocated Rs 3,323 crore under various heads to procure land reserved for amenities under the Development Plan 2034.
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Compensation in lieu of octroi was again the main source of BMC's income, while drop in property tax and development planning department's receipts are major worries. On the other hand, awarding Seventh Pay Commission pay hikes and increase in hiring will add a further burden of Rs 2,000 crore.
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