The Hindu : New Delhi News : MCD seeks 800 cr. bailout package from Government

Online edition of India's National Newspaper
Wednesday, Jan 12, 2005

New Delhi

New Delhi

MCD seeks 800 cr. bailout package from Government

By Our Staff Reporter

NEW DELHI, JAN. 11. Finding itself in a "deep financial crisis", the Municipal Corporation of Delhi has sought an immediate bailout package of more than Rs. 800 crores from the Delhi Government, including an urgent release of Rs. 500 crores as interest-free loan.

The Delhi Mayor, A. R. Verma, who on Monday led an MCD delegation to the Delhi Chief Minister, Sheila Dikshit, said today that the financial crisis was caused by a sharp decline in house tax collection during this fiscal year. With less than 80 days remaining in this financial year ending March 31, the MCD has thus far managed to collect less than Rs. 500 crores against a target of Rs. 12,000 crores.

The Leader of the House, Satbir Singh, the Leader of the Opposition, Subhash Arya, and the MCD Standing Committee Chairman, Mukesh Goel, were the other members of the delegation.

Conceding that it was an hour of crisis for the civic body, Mr. Singh said that besides pleading for an immediate interest-free loan of Rs. 500 crores, the delegation also raised various financial issues with Ms. Dikshit at the meeting.

These included revival of the financial assistance of about Rs. 200 crores to MCD for providing sanitation and cleanliness in 44 resettlement colonies of the Capital. "The Delhi Government had stopped giving this grant, putting additional financial burden on us," he said.

The MCD delegation also urged Ms. Dikshit to release money for cleanliness and sanitation in unauthorised colonies. "We have now introduced house tax in these colonies, so we are now duty bound to start cleanliness here. But in the absence of any fund, we are unable to do anything," he said.

In view of the unexpected decline in house tax collection, the delegation urged the Chief Minister to increase the transfer duty from three to five per cent and ensure that it was released in time and was not delayed as being done now. With the civic body not having enough money to meet its expenses, the delegation requested Ms. Dikshit to release about Rs. 3.5 crores so that the dearness allowances (DA) could be paid to its employees.

Bringing to the notice of the Chief Minister that many times money released by the Delhi Government was only on paper and took several weeks for the funds to be realised by the civic body, the delegation urged her to ensure timely release of money to the MCD.

Mr. Singh claimed that Ms. Dikshit assured the delegation of coming out with a bail out package for the civic body. "She has convened a meeting on this issue this week. The Delhi Finance Minister, A. K. Walia, the Principal Secretary (Urban Development), O. P. Kelkar, and the Municipal Commissioner, Rakesh Mehta, have been asked to attend the meeting," he said.

The Leader of Opposition, Subhash Arya, who was part of the delegation, alleged that the financial crisis in the MCD was a creation of Congress leaders in the civic body. "Developmental works have come to standstill in the civic body. This year financial year not a single tender for dense carpeting of roads has been issued. In hospitals, medicines are not available. Our Teachers and safai karamcharis are not getting salaries in time," Mr. Arya alleged.

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