City Pulse

Bruhat Bengaluru Mahanagara Palike (BBMP) continues to propose a Rs 9,322 crore budget this year, despite not being able to hit the Rs 9,000 crore mark in the previous two years, according to 2018-19 budget analysis by IChangeMyCity an initiative of the Janaagraha Centre for Citizenship and Democracy. 

In 2016-17, the proposed budget was Rs 9,331 crore and actual was Rs 6,572 crore. The variance was 30%. In 2017-18 the budget proposed was Rs 9,997 crore and the variance marginally declined to 25%.  

Property Tax Collection Efficiencies

The collection efficiency of property tax has declined to 68% in 2017- 18 as compared to 75% in 2016-17 and 74% in 2015-16. 

The BBMP missing the property tax collection target by a huge margin is concerning. It had targeted Rs 2,600 crore for 2017-18 (excluding cesses and betterment charges), but the revised estimate pegs it at Rs 1,777.4 crore, which is only 68.4% of the targeted property tax of the year.

Mobilizing own revenues

Between 2013-14 and 2017-18, BBMP’s own revenue generation as a percentage of total receipts averaged at 45%. However, BBMP has set itself an aggressive own revenue target of 56% of total receipts in 2018-19, which is a positive sign. BBMP’s dependency on grants had significantly increased since 2013-14. In 2017- 18, grants as percentage of total receipts was at 51%. However, in 2018-19, BBMP has proposed to reduce its dependency on grants to 39%, primarily by mobilizing own revenues.  

Cities like Pune and Mumbai have recorded over 60% own revenue as a percentage of total receipts as per Janaagraha’s ASICS 2016 report.

While the state government grants have provided much needed relief to the BBMP and citizens of Bengaluru, such dependence on state grants may not be sustainable. State Government would need to devolve revenue powers to BBMP and hold it accountable for delivery instead of providing grants towards specific infrastructure works. 

Salaries

An interesting trend is that salaries as percentage of total payments have fallen from 14% in 2013-14 to 6% in 2017-18. It is advisable that BBMP should perhaps invest in good quality human resources and may be under investing in the same presently. 

Budgets vs Job Codes vs Bill payments trend

9,821 job codes were created in 2017-18 (up to February 18) amounting to Rs 3,689 crores. However, revised budget estimate of expenditure for 2017-18 amounts to Rs 7,514 crores, indicating that job codes against only 49% of the estimated expenditure has been created in the current year. 

This is significantly lower than 2016-17, where job codes against 83.6% of the expenditure was created. Further, out of bills paid up to February 2018, 81% pertained to pending or spill over bills, while only 19% pertained to the current year’s works. 

IChangeMyCity thanks all citizens who have contributed to the budgetary inputs during its MyCityMyBudget campaign. We  will stay connected to update you on how the budget translates into specific allocations at the Ward level and the impact on the budget inputs you have submitted.  

To read the complete 2018-19 BBMP budget analysis by IChangeMyCity, click here.