Many welfare schemes failed to take off, long-term municipal bonds proposal dropped

The Bruhat Bangalore Mahanagara Palike (BBMP) is notorious for presenting inflated budgets and not implementing many projects announced. A fact proven yet again in the Action Taken Report (ATR) on the 2012-13 budget.

Prominent among the dropped proposals is the plan to raise Rs. 1,000 crore through long-term municipal bonds. This was proposed to improve the BBMP’s financial condition. However, ironically, the programme was dropped “due to financial reasons,” according to the ATR.

Non-starters

Many welfare projects also remain unimplemented, as the BBMP, in the ATR, has claimed that “approval of competent authority is awaited.” Some of important welfare schemes that are yet to be implemented include the Mahatma Gandhi Swavalambana programme envisaged to fund 500 weavers, Badavara Dhwani to help street vendors buy pushcarts, and the Dr. V.S. Acharya Anila Samparka programme through which LPG connections were to be provided to 100 poor families in each ward. The other schemes are providing sanitary pads to girl students in BBMP schools, providing scanning facility for pregnant women in all of the BBMP’s referral hospitals, financial assistance to communities engaged in burial grounds, construction of shelters for daily wage workers and houses for economically weaker sections.

Kempe Gowda Gadi gopuras, construction of welcome arches in eight directions, installation of the 34-ft Vivekananda statue at Yediyur ward and a bronze statue of Kittur Rani Chennamma in the Chennamma playground also sank without a trace.

Given the BBMP’s track record, Opposition leaders predicted that it would once again not be able to implement many projects. They lambasted the Mayor for presenting an “inflated budget” despite the government’s direction to present a “realistic budget based on revenue generated in the previous fiscal.”

However, the outlay of this budget is smaller compared to previous fiscals. The 2010-11 budget was for Rs. 8,848 crore, while the 2011-12 budget was for Rs. 9,380 crore. The outlay of the 2012-13 budget was Rs. 9,937 crore.

The budget envisages tax revenue of Rs. 3,307.50 crore, Rs. 2,290.04 crore from non-tax revenue sources. It has also taken into account the government grants amounting to Rs. 1,732.88 crore. The estimated expenditure is Rs. 8,519.66 crore, which includes capital expenditure of Rs. 5,762.18 crore and revenue expenditure of Rs. 2,757.48 crore. The overall surplus is expected to be Rs. 90 lakh.

Property tax

As expected, a large chunk of the tax revenue is from property tax. The BBMP expects to collect Rs. 3,200 crore from the 16 lakh properties in the city. It also expects to collect Rs. 550 crore from telecom companies and other agencies that have laid optic fibre cables. However, this can be collected only after the government approves the draft amendment to the Karnataka Municipal Corporations Act, 1976. The other tax revenues include Rs. 107.50 from advertisement tax and Rs. 25 crore from trade licences.

Ruling Party Leader N. Nagaraju, defending the proposals, said: “The budget has covered road development, improvement of parks, gives priority to improving the green cover and has many welfare schemes.”

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