Mumbai: BMC to hire private consultant to help resolve financial woes

The civic body, burdened by the pandemic, has been facing a lot of money issues; the expert firm will look at the income sources and is expected to recommend where and how to get revenue

With its income sources taking a hit, the Brihanmumbai Municipal Corporation (BMC) is looking at involving a private consultant to study its financial position and recommend changes. The BMC is currently struggling to recover property tax that was estimated for this year along with a dip in premiums received from the developers. It has also been slashed by 50 per cent leaving no chance for the civic body to increase its revenue.

The private consultant firm will look at the detailed history of the income sources and recommend where and how to get revenue. While the BMC already has an 8 per cent increase in water bills every year, the new estate policy which was to yield an addition of about R200 crore to R300 crore, is yet to be implemented. The interest on Fixed Deposits too is depleting. A few years back there were discussions about levying charges for giving services such as Solid Waste Management (SWM), etc. but the plan never materialised.

Bharatiya Janata Party (BJP) leaders at BMC have been questioning the administration about their plans to increase the income. Appointing a private consultant is likely to be the answer to these questions, revealed sources.

BMC questioned
Bhalchandra Shirsat of the BJP said, “The expenses are going up but the BMC administration has no plan to increase the sources of income. It is only the compensation from GST in lieu of octroi that has come to the civic body on time, while everything else has not yet been received. The income from the Development Plan department which is brought in through premiums is hardly 14 per cent of the expected revenue, and the property tax bills itself were given late. How will the recoveries be done? The BMC is taking money from the reserves which will only lead towards bankruptcy.”

‘Looking at options’
The administration claims a lot of issues exist because of the pandemic but it admits that there is a need to look at options to increase the income sources. An official from the Accounts Department said, “There is a need for us to look at different revenue models and the consultant can do that for us. We hope that all the concessions are just for one year (2021-2022) and not beyond that. Already our income from DP department was reducing as the real estate industry took a hit, and now the 50 per cent slashed rates in premium are causing us more trouble.”

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