Chandigarh, January 2:
The Chandigarh Municipal Corporation (MC) is facing a severe financial crisis, delaying December salaries for its regular staff. With an advance grant from the Union Territory (UT) administration yet to be received, the MC is struggling to manage its financial obligations.
Employing 9,748 individuals, including 6,965 outsourced workers, the MC’s monthly expenditure is dominated by outsourced staff wages of ₹26 crore, while ₹16 crore is allocated for regular staff salaries. Despite a routine schedule of disbursing salaries by the 30th or 31st of each month, the corporation could not release payments this time due to its crippling cash crunch.
In addition, other liabilities, such as pensions (₹3 crore), utility bills (₹12 crore), maintenance (₹11.5 crore), and fuel costs (₹6 crore), are also under strain. Payments to outsourced staff, which are usually made by the 7th of each month, are now at risk of being delayed as well.
To mitigate the crisis, the MC has requested an advance grant of ₹30 crore from the UT administration. However, with only ₹73 crore remaining from the UT’s grant for January to March, sustaining salary payments in the coming months seems challenging. An MC official expressed hope, stating, “We expect to receive the grant this week.”
Municipal Commissioner Amit Kumar acknowledged the ongoing difficulties, noting, “We are dependent on the UT’s grant at the moment and are hopeful of receiving it soon. Salary delays may persist in the coming months, but we are working to recover pending arrears to restart developmental projects.”
The MC has already utilized ₹487 crore of its ₹560 crore annual grant, leaving a mere ₹73 crore for the remaining fiscal period. Compounding the issue, the corporation is unlikely to achieve its annual income target of ₹435 crore. In the first half of the 2024-25 fiscal year, it generated only ₹176 crore through sources such as property tax and water charges. With a target of ₹173 crore for the remaining quarters, the MC is projected to fall ₹86 crore short of its revenue goal.
The financial strain forced the MC to halt all developmental works, including road carpeting projects, as early as May. Repeated requests for an additional ₹200 crore grant from the UT administration have gone unanswered, with Punjab Governor and UT Administrator Gulab Chand Kataria advising the MC to curtail expenses and focus on boosting revenue generation instead.
Mayor Kuldeep Kumar Dhalor expressed optimism, saying, “We have requested the UT to release the pending grant of ₹73 crore and expect to receive it within 3-4 days. Salaries will be paid as soon as the funds are available. We are also working to increase revenue to avoid such situations in the future.”
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