In the backdrop of unprecedented water crisis and a desperate need to tap additional sources of revenue, the Brihanmumbai Municipal Corporation (BMC) is batting for an increase in water charges in an attempt to lift itself out of its current financial doldrums.
The civic body's hydraulics department has moved a proposal to increase water rates by 25-35% in the residential and slum category and by 20-38% for the industrial and commercial sectors. The last time water charges were hiked was six years ago.
If the BMC gets its way, housing societies and other residential complexes will have to pay Rs 4.50 per thousand litres of water as opposed to the current charge of Rs 3.50. Industrial establishments will see an increase of Rs 7 per 1,000 litres (see box).
One of the main reasons for this proposal is the rising cost of water production, say civic officials. "With a staggering rise in our production cost, it is essential to revise the existing rates so as to enable us to maintain the extensive distribution system that supplies water to citizens," reads the draft letter. According to BMC estimates, cost of water production has increased by 50.58% since 2002 when the rates were last hiked.
The existing increase in the basic requirements for purification and transmission, and other factors such as labour cost, electricity power, liquid chlorine, liquid alum and other components, the cost of water production for the corporation works out to Rs 10.23 per 1,000 litres.
The revision has come after the BMC's finance department found the corporation was running short of funds. Six months ago, it issued a circular directing heads of departments to study the feasibility of raising the charges for services that have seen no increase in rates for the past few years.
This year, the BMC in its annual budget, has set aside a large chunk of money for water works project—an increase to Rs 2,721 crore from last year's 2,352 crore. "We believe that an increase in water rates will have a positive effect on the funding, planning and implementation of major projects of water supply," said an official.
The civic body's reasoning may not go down well with the general public, which has no option but to make do with limited water supply. The BMC currently supplies 2,950 million litres daily (mld), which falls short of the present demand by over 1,000 mld.
"If the rates are increased, we expect it will have a positive effect whereby people will impose restrictions on their consumption pattern," said the official.
The hydraulics department has moved a draft letter (DL) to the municipal secretary along with the revised rate chart. The DL will now be forwarded to the standing committee, and subsequently the civic house for final approval from political parties. "Political parties should keep in mind that it is no longer feasible to supply water at the existing rates, which are much lower than those of other cities," said a senior civic official.
The civic body's hydraulics department has moved a proposal to increase water rates by 25-35% in the residential and slum category and by 20-38% for the industrial and commercial sectors. The last time water charges were hiked was six years ago.
If the BMC gets its way, housing societies and other residential complexes will have to pay Rs 4.50 per thousand litres of water as opposed to the current charge of Rs 3.50. Industrial establishments will see an increase of Rs 7 per 1,000 litres (see box).
One of the main reasons for this proposal is the rising cost of water production, say civic officials. "With a staggering rise in our production cost, it is essential to revise the existing rates so as to enable us to maintain the extensive distribution system that supplies water to citizens," reads the draft letter. According to BMC estimates, cost of water production has increased by 50.58% since 2002 when the rates were last hiked.
The existing increase in the basic requirements for purification and transmission, and other factors such as labour cost, electricity power, liquid chlorine, liquid alum and other components, the cost of water production for the corporation works out to Rs 10.23 per 1,000 litres.
The revision has come after the BMC's finance department found the corporation was running short of funds. Six months ago, it issued a circular directing heads of departments to study the feasibility of raising the charges for services that have seen no increase in rates for the past few years.
This year, the BMC in its annual budget, has set aside a large chunk of money for water works project—an increase to Rs 2,721 crore from last year's 2,352 crore. "We believe that an increase in water rates will have a positive effect on the funding, planning and implementation of major projects of water supply," said an official.
The civic body's reasoning may not go down well with the general public, which has no option but to make do with limited water supply. The BMC currently supplies 2,950 million litres daily (mld), which falls short of the present demand by over 1,000 mld.
"If the rates are increased, we expect it will have a positive effect whereby people will impose restrictions on their consumption pattern," said the official.
The hydraulics department has moved a draft letter (DL) to the municipal secretary along with the revised rate chart. The DL will now be forwarded to the standing committee, and subsequently the civic house for final approval from political parties. "Political parties should keep in mind that it is no longer feasible to supply water at the existing rates, which are much lower than those of other cities," said a senior civic official.
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