Cash-rich BMC to rely less on government grants in 2011-12

The Brihanmumbai Municipal Corporation (BMC) has presented a budget estimate for 2010-11 based on rise in revenue from the octroi, development plan and licence departments. Given the surplus, it has shunned the option of raising fund through internal loans and will rely less on grants from the government.

Municipal commissioner Subodh Kumar released a budget of Rs21,096 crore on Friday, a rise of Rs679.25 crore over the previous year.

BMC had planned to raise Rs3,000 crore through internal loans in last year’s budget, but Kumar now claims there is no need for it.

“BMC has sufficient funds to carry out capital works without the loan. The revision in capital expenditure is due to ample revenue surplus of Rs2,291 crore,” he said.

The revenue expected in the coming year is Rs11,501crore, while the estimated expenditure is about Rs869.86 crore. The surplus will be transferred to the capital account. The income from revenue for 2010-11 is Rs9522.99 crore.

Octroi alone bestowed BMC funds of about Rs5,000 crore in the last fiscal, while the development plan provided nearly Rs1,311 crore, and the licencing fees fetched Rs106 crore.

“Due to octroi expected to yield Rs5,045 crore in the coming fiscal, state grants this year will stand at Rs159.07 crore,” Kumar said.

The civic body receives grants from the government for education, road maintenance and entertainment. In last year’s budget estimates, the BMC received government grants of Rs446 crore.

This year’s budget estimates shows that BMC will use the funds generated from the interest of its staff’s pension fund.