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Thursday March 28, 2024

KMC approves Rs26.44bn budget in first-ever open-air session as power supply cut off

By Oonib Azam
June 29, 2019

In an unusual move for the first time in its history, the Karachi Metropolitan Corporation (KMC) approved its budget in open air just outside the old KMC building on MA Jinnah Road on Friday, after K-Electric (KE) suspended the power supply to the corporation due to the non-payment of outstanding bills.

The council approved with a majority of votes a budget of Rs26.449 billion for fiscal year 2019-20. One such session had earlier been conducted, but it wasn’t a budget session, when the Jamaat-e-Islami’s Naimatullah Khan was mayor, according to retired city council director Muhammad Ghufran. Due to the unusual nature of Friday’s budget session, opposition and treasury members sat together.

The JI’s Junaid Mukati and the Pakistan Peoples Party’s (PPP) Karam Ullah Waqasi, who is also the council’s opposition leader, along with members of the Pakistan Tehreek-e-Insaf (PTI) and the Pakistan Muslim League-Nawaz (PML-N), happened to sit with members of the Muttahida Qaumi Movement (MQM). Later, water bottles and handheld fans were also distributed among the council members.

The budget

Speaking on the budget, opposition leader Waqasi asked the mayor how he could approve a surplus budget despite the severe financial crunch facing the corporation.

“Why didn’t you show deficit?” he asked and added that the mayor could have included schemes of opposition members in the budget and increased the amount of development work.

The mayor, according to Waqasi, failed to accept the 33 percent members belonging to the opposition by failing to include any scheme in opposition’s union committees (UCs) in the last three budgets.

“We all agree that the budget is insufficient for Karachi,” he said but added that there should be a priority for schemes.

The health sector, he pointed out, has been allocated Rs4 billion, and the Abbasi Shaheed Hospital’s budget is Rs1.08 billion. “The hospital has 2,100 employees and hardly 400 attend the hospital,” he said and asked the mayor to investigate.

“There are 1,500 city wardens and the mayor himself has accepted that hardly 700 are on duty,” he said.

The MQM’s Khalil ur Rehman shared that an allocation of Rs1,700 million for the engineering department was quite less. He pointed out that health was actually the Sindh government department, for which the council had allocated a handsome amount. The money allocated for the sports and recreational department could also be transferred to the engineering department’s pool.

If the amount allocated for the Information Technology sector was for surveillance, he said, then it would be fine, else that allocation could also be transferred to the engineering department.

The PML-N’s Rana Muhammad Waris of Union Committee No. 1 said that for three years, the UCs of opposition members had been neglected in the KMC budgets.

A young PTI council member, Meraj Shah, said that the share of Karachi should be Rs500 billion. Prime Minister Imran Khan’s Rs162billion package for the port city, according to him, was very insufficient.

He pointed out that in last year’s budget the chairmen received Rs2.5 million for development out of which hardly Rs0.6 million were used. “Where did the rest of the amount go?” he asked. Meanwhile, the PML-N’s Tanveer Jadoon from Lyari Town presented a charge sheet against Akhtar, asking why the council had been continuously ignoring his town.

In response, Akhtar formed a committee to look into the matters of Lyari and made Jadoon its head. The JI’s Mukati in his aggressive tone said that for 72 years the residents of Karachi had been paying hefty taxes. “Now it’s time Karachi spends its tax on itself,” he said and added that the city gave Rs2,000 billion in tax. “Isn’t Rs500 billion our right from the government?” The people of Karachi pay huge taxes on their small plots of 500 or 600 yards, but what about those who live on a land of 500 canals. “Do they pay taxes?” he asked and suggested a Karachi Board of Revenue should be formed.

Mukati later tore a copy of the budget, saying it did not include a single scheme from his UC. “I have written several applications, but got no response,” he said.

KE’s outstanding bills

Mayor Wasim Akhtar at the start of the session informed the council that early in the morning the power supply of the engineering department and their head office was discontinued. The standby generators, he said, weren’t working.

“They were unable to bear council hall’s load,” he said and shared that one of their big generators was with the Karachi Development Authority’s (KDA) finance department and despite repeated requests they had not handed that over to the KMC.

As for the KE, he accepted that they were their defaulters, but those outstanding bills were from 2010. This is the liability of Rs4.5 billion, according to the mayor, which the elected council has inherited over which they are in reconciliation talks with the KE.

In the reconciliation process, he said, they been had been able to convince the KE to bring down their outstanding bills to Rs2 billion. The case then went to the court where it was decided that the KMC would pay Rs580 million for its 71 electric connections and the rest of the amount would be settled through reconciliation. However, due to the corporation’s severe financial crunch, the court ordered the Sindh government to increase its monthly grants so that it could pay off its debts.

The KMC, he said, had to pay Rs50 million monthly to the KE, but it did not have the money. “For the first time in the KMC’s history the shortfall of our employees’ salaries that is Rs220 million is being carried forward to another budget,” he said.

The court, according to the mayor, verbally forbade the KE from discontinuing the KMC’s power supply until the reconciliation was over. The power utility, he pointed out in the council, had to pay the KMC Rs8 billion for using the corporation’s land for their electric installations.

KE’s response

The KE in a press statement said that multiple power connections of the KMC had been disconnected on account of the non-payment of monthly electricity bills as the municipal body still owed Rs4.11 billion to the power utility. The court had directed the KMC to pay monthly electricity bills from April 2019 onwards to the KE, out of which no payment had been made since the court order was issued in April 2019.

KE had served several notices to the municipality for the payment of monthly electricity bills before cutting off the connections. It urged the authorities concerned to pay outstanding dues as per the court order at the earliest. It also condemned damage to its property at one of its offices by the KMC later in the day.

The outstanding receivables of K-Electric have ballooned to Rs54.39 billion on account of outstanding payments from various federal and provincial public sector entities, including the KWSB, which owes Rs32.07 billion to KE.