The Hindu : Front Page : Penalty waiver for local bodies' power charge arrears

Online edition of India's National Newspaper
Tuesday, Mar 20, 2007
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Penalty waiver for local bodies' power charge arrears

R.K. Radhakrishnan

Huge arrears due to heavy surcharge of 12 per cent on late payment

CHENNAI: Many local bodies in the State will be able to switch on their public lighting in a few days from now as the Tamil Nadu Electricity Board (TNEB) has decided to waive penalties on power charge arrears for local bodies.

Roads and common facilities in many local bodies have remained dark because they have not been able to foot the electricity bill. Many of them complained about wrong billing too. The TNEB, after giving one ultimatum after another, resorted to cutting power supply unofficially.

Village panchayats owe Rs.128.1 crore; town panchayats Rs. 10.95 crore; municipalities Rs.39.46 crore and corporations Rs.23.02 crore.

This issue was brought to the notice of Local Administration Minister M.K. Stalin during his district review meetings.

"In district after district this issue came up. We had to work out some solution," Mr. Stalin told The Hindu . Last week, Mr. Stalin and Electricity Minister Arcot N. Veerasamy called a joint consultative meeting of the Department of Rural Development, Municipal Administration, the Tamil Nadu Water and Drainage Board and the TNEB to find a solution.

Subsidy burden

The problem was that the TNEB had a huge subsidy burden and could not waive the entire Rs.204.63 crore the local bodies owed (as on February 28 this year).

Many local bodies are in a poor financial position, say some local body representatives. Most of the grassroots democratic bodies are hardly able to pay their staff. The huge arrears were due to the heavy surcharge of 12 per cent on late payment.

The amount paid to the TNEB is taken as payment towards interest. This meant that the current dues were not cleared. The meet suggested that the amount paid be credited towards the current bills and that the accumulated arrears, after waiving the surcharge and interest, be handled separately.

The local bodies also wanted the TNEB to remove them from the category of commercial consumers. After all, they were service providers and not profit-driven commercial enterprises. Also, the local bodies have the duty to supply drinking water and there were many public fountains. They wanted the tariff fixed at Rs.2 a unit or lower , against the present charge of Rs.5.

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