Despite house tax hike, revenue dips at KMC

KANPUR: Forget development, the Kanpur Municipal Corporation (KMC) has reached a point where it struggles to pay salaries and pensions.

Other than introducing major cost cuts, municipal commissioner Avinash Singh has asked all departmental heads to ensure files related to works and payment should not be pushed through unless the issue was of high priority.

At the back of teething financial trouble is KMC’s failure in realising revenue and non-payment of funds from the government which pays Rs 100 crore annually to the corporation from establishment fund.

Sources said the Corporation did not receive funds and added that about Rs 70 crore had not been released by the government

this year.

They said Rs 40 crore from 14th Finance Commission grant was also stuck and it was not clear when it would be released.

Even as the two majors sources of funds are blocked, the third and the crucial one — realisation

of taxes — has hit the rock bottom.

The KMC has fixed a target of realising Rs 154 crore during the current fiscal but it has managed merely Rs 49 crore till date despite increasing house tax by 15%.

An official said the KMC had collected merely 30% of the target and it would have to realise Rs 105 crore in the next five months to avoid financial collapse. The task, however, seems to be daunting as KMC officials and employees are engaged in Swachh Bharat Abhiyan and election duties.

“People have not received bills for residential and commercial properties. Situation will only worsen in future,” he said.

KMC’s plan to improve revenue generation by increasing house tax has got entangled in a legal battle with most of the big payers moving the court. They said they would pay taxes only after the court’s decision.

The Corporation has long relied on taxes and government grants rather than trying to increase its income. It has not been able to collect taxes from makeshift markets, rickshaws, handcarts, and solid waste management.

Social activist Chhotey Bhai Narona said in response to an RTI query, the data revealed by KMC confirmed that despite a reserve of several crores of rupees, it has no funds for the maintenance of its own administrative machinery. “It solely depends on the government grant,” he added.

The real problem facing the KMC is payment of salaries and pension. The total monthly outlay of salaries and pension is Rs 30 crore of which it gets Rs 21.6 crore from the government.

“We managed this month but I don’t know whether the KMC will be able to pay its employees,” the official said.