On March 29, Ajoy Mehta, commissioner of the country’s richest municipal corporation, presented a trimmed down version of BMC’s annual budget, cutting close to ₹12,000 crore from last year’s outlay of ₹37,000 crore. “It is to make the spending more realistic,” he had said at the time. Specifically, Mr. Mehta wants to directly relate the budgetary allocations to the glaring gaps identified by ‘Development Plan 2034’, the holistic project the city planners have come up with for Mumbai’s development in the next two decades.
In an exclusive interview to the The Hindu , Mr. Mehta said quality roads are “an achievable target” following the blacklisting of 13 contractors by the BMC. He also said he will not hesitate to institute criminal as well as civil action against underperforming contractors.
The 2016-17 budget is being touted as a realistic budget for the large cuts in outlay in comparison to the previous year. What necessitated this?
Earlier budgets had figures that were much higher than what was actually spent. The capacity to spend was disproportionate to the allocated funds, even to the extent of our revenues generated. It was not a sudden development, but a culmination of issues over time that has resulted in the current budgetary proposal for BMC.
The alignment of DP 2034 is the unique feature of this budget.
The Development Plan sets out the land use pattern of the city for the next 20 years. While setting these patterns, it has apportioned land for meeting essential milestones or segments – including creating jobs, commercial property, and housing. The outlay weighs in the importance of quality of life, including hospitals, schools, gardens, parks, and even ensures we take care of those people who are unable to maintain the regular pace of life. The DP’s efficacy is dependent on how the corporation backs its implementation financially. Likewise, the city’s financial planning cannot be devoid of its DP. To be honest, the DP was a long-drawn process. Through it, we reached several important conclusions that could affect the quality of life going forward. This is why the DP is an important part of the budget. We have allocated resources based on what is envisaged in the DP; schools, gardens, dispensaries, and other public utilities and services.
You have been a power sector specialist at the Maharashtra State Electricity Board, and understand the power sector. How do you reconcile with the BEST electricity operations? And its sister agency, the public bus transport service?
BEST has historically enjoyed the luxury of a TDLR (Transport Division Loss Revenue) surcharge. This way, the transport sector loss was recouped by imposing a surcharge on electricity consumers. There is no TDLR anymore. This is a wakeup call. The question we have to ask ourselves, therefore, is of efficiency.
Secondly, not every public transport utility in the world makes losses. There have been studies to show that though a public transport utility does not make money, it can certainly break even. Next, I have told BEST clearly that BMC will finance the BEST, because we cannot afford to shut it down. However, the luxury of financing inefficiencies shall no longer be available. We will only finance whatever deficit arises because of a provided service or if a subsidy is being handed out to consumers. But we will not finance costs emanating out of inefficiency. BEST has been told to sort out inefficiencies. We are not blaming BEST, but it has to tell us where the inefficiencies lie.
In terms of allocations, how targeted is the budget to gear up in terms of deliveries?
When we found that expenditure was not commensurate to the allocation, we followed up with each department for figures of the last five years in order to arrive at an average value. We realised that the spending capacity was at a particular average value and no more. This time we asked the departments what their spending capacity was? The moment they placed a figure as their annual ask, we told them that they ought to limit their demands for funds as per their spending capacity and only ask for as much. Therefore, if you see the budget plan, the provision is higher than the figures that are listed out against expenditure last year on most of the heads. It won’t be correct to say that the incremental funding is only marginal. Compared to last year,there is substantially higher allocation for expenditure. However, if you look at it from a provision to provision perspective, you may definitely feel the allocations have reduced. To put it simply, think of a business owner paying his employee a household expenses component of ₹ 1,000 in his salary. If the employee spends only ₹800 every month, the owner gets back to him and tells him he will pay ₹850 henceforth. This means that the home expenditure (₹800) remains the same, but that particular salary component has come down. Even then, it is higher than your average expense.
What are the consequences of this rationalistation?
Targeted monitoring is now a reality. Large budgets meant a large agenda, and no one took responsibility for detail. This budget narrows down the agenda. We have said that these are the five items you can spend on, and for these five items, we will back you with money so you can spend in a more focused manner.
What are your top focus areas in the current budget?
Well, everything is important: healthcare, education, water supply, roads. We can’t say that health is more important than roads, or that roads are less important than education. Now, the demand is to prioritise as per the development plan. Why do I repeatedly talk of the DP 2034? You see, it is a public document. It has identified ward-wise shortages or deficits in civic amenities. There is a holistic map of civic deficiencies, and we have targeted them specifically.
Summer is already upon us. The BMC house has already been informed of water disruptions in Mumbai. Is there a water tanker mafia at work or is it a technical issue of disruptions in the distribution network?
We supply almost 37 million litres of water every day. There are 7000 km of pipelines, four reservoirs, and five lakes. It is a huge network. When you are operating on these scales, there are bound to be technical issues. It is like when you run an electricity network, there are bound to be downturns, breakdowns and outages at certain places. This is not being justified in any way. But there are problems that come up. We are also putting a lot of money for upgrading water networks, including strengthening walls and the use of technology.
The Middle Vaitarna dam was touted as the project that would turn Mumbai into a water surplus city. Why has this not happened?
Mumbai is blessed when it comes to water. We need to realise this, and be aware and thankful for this. Having said that, there is a need to improve. This 24x7 water supply is a target we need to reach. We are working on it, but there are issues to be dealt with. In a 24x7 supply network, the needs to be top-class. You need efficient and robust metering as you cannot afford wastage. You need pipelines that can withstand high pressure. We are working on these systems, and we should hopefully be able to execute such a water supply system in the near future.
What are BMC’s infrastructure imperatives? Mumbai has seen a major road repairs controversy as well as action from BMC also in terms of prosecution of errant contractors for deficient projects. What is your roadmap to quality roads becoming the norm in the city?
We want quality, cost-effectiveness, and timeliness. On the quality front, we have changed the tender conditions. The bidding process has been strengthened to ensure that it does not become a monopoly of a few contractors, but has a wider bouquet of options. The message is now loud and clear. We will be able to give good roads to Mumbai soon.
What are the changes in the existing bouquet of contractors?
Thirteen contractors currently face blacklisting. They will invite not just civil action, but also get converted into a criminal case. We will not take bad quality lightly. Do it again, and we will take criminal action again. In terms of costs, earlier we used to dig up every road. No longer. Why should we touch utilities, unless there is no other option. You end up wasting a lot of time and money on that. Our efforts have resulted in a reduction in the construction costs of roads radically. Earlier, we spent ₹5,000 per sq metre; it is now down to ₹1,200-1,800 per sq metre. Thirdly, in terms of speed, we have fixed deadlines. We have also moved to use technological innovations such as using quick-setting concrete. For concrete roads there is no alternative to cement. This affords us the option of quick-setting cement or what is called early-setting cement. We are looking at better technology to support our road imperatives.
This budget has seen women officers and staff play a big role.
Budget preparation is a gender-neutral exercise. Since I joined, though, I have found there are outstanding women officers. None of them has expressed an inability to balance personal responsibilities with their professional work or ever cited it as a limitation.
