Cut in State support, stagnant revenue sources and escalating expenses have pushed the Kochi Corporation into a deep financial crisis, according to a document on the fiscal health of the local body.
A statement prepared by the Accounts Officer of the Kochi Corporation also criticised that many expenses “incurred by the local body lacked sense of reality.” The corporation was not properly inspecting and recording the distribution of drinking water using tanker lorries in the city. It was also the case with the use of vehicles for transporting refuse to the solid waste treatment plant, the report criticised.
The local body had installed a few unnecessary street lights and public taps. A technical committee should look into the issue and remove the unnecessary ones. The distribution of drinking water is the responsibility of the Kerala Water Authority and the money shelled out by the local body on this account should be realised from the agency, it was suggested.
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Incidentally, the local body was spending Rs.30 lakh a month for the distribution of water and another Rs.50 lakh for the transportation and processing of refuse, the report noted.
The major outstanding debts of the corporation included Rs.20 crore incurred for land acquisitions for various projects, Rs.13 crore library cess, Rs. 10 crore water charges and Rs. 6.5 crore due regarding the implementation of the Department for International Development project in West Kochi. It also has a debt of Rs.2.5 crore towards the revised wages and other payments of contingent workers in 2009. The local body has to pay Rs.30 lakh towards the Employees Provident Fund.
At the same time, the government owed the local body nearly Rs. 36 crore towards pension allotments and another Rs.42 lakh paid to the salary of the engineering wing of the local body. The corporation has to realise Rs.16 crore in property tax and Rs.1.75 crore in profession tax. The repayment of loans would come to Rs.1 crore a month, said the report which would be discussed at the meeting of the corporation council on Tuesday.
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Nearly 60 per cent of the revenue of the local body is spend for meeting the salary of the 545 permanent staff, 640 contingent workers and around 1,200 pensioners. The salary for the daily workers is also met by the corporation. The recent reduction in entertainment tax and the delay in revising property tax have also thinned the revenue inflow.
The corporation should take steps for getting licence fee, profession tax and property tax revised on time and explore new revenue sources, it was suggested.