'Annual Rs 600 cr aid needed in next 5 yrs to bail out EDMC'

Highlighting its strained financial condition, the cash-strapped EDMC today said that it needs an annual financial assistance of Rs 600 crores for next five years to get back on its feet.
Commissioner of the East Delhi Municipal Corporation Amit Yadav in the annual budget presented today said the civic body posted a deficit of over Rs 1,811.83 crore which is likely to shoot up to Rs 2,196.19 crore in 2016-17.
"Presently, the actual revenue gap of EDMC is Rs 600 crore which it requires as financial assistance. Along with this assistance, a one-time grant for liquidating the liabilities is required by the civic body to survive," Yadav said.

"It requires annual financial assistance of Rs 600 crores for next five years by which time a planned and strict financial discipline will enable EDMC to stand on its own without any support except from regular grant-in-aids," he added.
Presenting the revised budget proposals for 2015-16 and budget proposals for 2016-17 in the Standing Committee of the civic body, the commissioner laid emphasis on cutting expenditure while tapping sources to boost revenue.
The revised budget proposals for 2015-16 showed receipts of Rs 1128.54 crore and expenditure of Rs 2940.37, resulting in deficit of Rs 1181.83 crore.

The budget proposals for 2016-17 presented by Yadav estimated receipts of Rs 1,256-37 crore and expenditure of Rs 3,452.56 crore leading to Rs 2196.19 as deficit.

Pointing to the looming crisis, Yadav said "today the EDMC is unable to pay even salaries and retirement benefits to its employees as all options for loans from different sources have been exhausted."
"EDMC at this stage seriously requires support from the government to continue to provide quality municipal services to the city" he said.
Due to non availability of funds, the civic body owes a huge liability of Rs 1,525 crore including employees arrears of Rs 800 crore.
Currently, it requires at least Rs 1,440 crore per year, under non plan, for payment of salaries and to meet expenditure for running the corporation, he said.

Presenting the recipe to bail out EDMC, Yadav also proposed three new taxes and raising the property tax in the range of 1-2 per cent for different categories of colonies.
He also proposed cutting down on expenditure through ban on creation of new posts for next five years, restricting use of non-plan funds for new projects, avoiding loans except in case of remunerative projects and similar other steps, for better utilisation of resources.