With budget deficit of ₹278 crore, Chandigarh MC set for another tough fiscal

Jan 31, 2022 01:32 AM IST

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The budget proposal for 2022-23 will come up for approval in the Chandigarh MC General House on February 1

The Chandigarh municipal corporation (MC) is set for another tough financial year as it has proposed a deficit budget for the coming fiscal (2022-23).

The Chandigarh MC is hoping for a grant-in-aid of <span class='webrupee'>₹</span>957 crore from the administration, which itself has sought <span class='webrupee'>₹</span>550 crore from the Centre to provide to the civic body which is running on a deficit budget. (HT File) — The Chandigarh MC is hoping for a grant-in-aid of ₹957 crore from the administration, which itself has sought ₹550 crore from the Centre to provide to the civic body which is running on a deficit budget. (HT File)

With an estimated expenditure of ₹1,725.19 crore, and a revenue estimate of ₹1,448 crore, Chandigarh MC is set to face a budget deficit of ₹278 crore, and that too, if the grant-in-aide demanded from the UT administration comes through.

The budget proposal will come up for approval in the MC General House on February 1.

The MC is hoping for a grant-in-aid of ₹957 crore from the administration, which itself has sought ₹550 crore from the Centre to provide to the civic body.

Even if the MC gets ₹550 crore as grant-in-aid, it would start the new fiscal with a deficit of at least ₹705 crore. It estimates to end the current fiscal with a deficit of ₹148 crore.

In the current fiscal year, only ₹500 crore grant-in-aid was sanctioned.

While the MC has shown an overall buoyancy in its own receipts, from ₹444.61 crore in current fiscal to ₹616 crore estimate for 2022-2023, it will be largely on the back of collections from its petrol pumps and commercial property tax.

Its other receipts from sources such as water tariff, residential property tax and estate receipts are largely stagnant.

With a deficit budget, Chandigarh MC is likely to constrict its spending on development works in the coming fiscal as in the budget proposal, the estimates for capital expenditure has been reduced in comparison to current fiscal. (HT Photo)

Poor spending on capital works

The MC is likely to constrict its spending on development works in the coming fiscal as in the budget proposal, the estimates for capital expenditure has been reduced in comparison to current fiscal.

The budget estimates 2021-2022 had pegged the capital expenditure at ₹448 crore. But this year, the MC is proposing to spend only ₹401 crore on development works.

But staggeringly, the revised estimates for 2021-2022 under capital head are ₹170 crore only, that means, even though the MC had proposed to spend ₹448 crore on development works, it could spend only ₹170 crore in the current fiscal. ₹1323.77 crore are the budget estimates are under the revenue head for the coming fiscal.

Last year, the MC had prepared ₹1,646 crore budget. The MC had demanded ₹1,202 crore as grant-in-aid, assuring to earn ₹469 crore from its own but as per revised estimates for current fiscal, it would earn ₹444 crore only.