Politics & economics behind MCDs unification plan

Delhi’s State Election Commission (SEC) last week deferred the announcement of elections to the three Municipal Corporations of Delhi (MCDs), due in April, close on the heels of the BJP-led central government communicating to the former that it was considering a proposal to unify the MCDs.

How will the BJP dispensation execute its plan to unify the three MCDs?

The Centre will have to make an amendment to the Delhi Municipal Corporation (DMC) Act to unify the three MCDs – East, North and South MCDs. The ruling BJP is planning to bring an amendment Bill in this regard during the ongoing budget session of Parliament. The first administrative step for the proposed unification of the MCDs would be to nullify their boundaries, which could be the “easiest task” in this process. “Unlike the MCD trifurcation in which fresh maps have to be drawn, now one has to just declare that it all comes under one corporation. The number of wards would remain the same,” said a senior BJP leader. The next step would be the employees of the three corporations being brought under one umbrella. Here, while the number of the lower rank staff would not change much, the tally of higher rank officials would decrease in the 3:1 proportion. For instance, there would be one director for each department such as horticulture, sanitation, education, health, hospital, etc. in the unified corporation instead of the existing three directors. This would also be the case for commissioners, committee heads and mayors.

What are other reforms being planned along with the MCDs merger?

Senior BJP leaders have said that among the reforms that are being considered by the party dispensation are direct election of mayor, his / her tenure being increased to at least two-and-half years instead of existing one year, and provisions for allocation of funds directly from the Centre.

What will be the effects of unification on the MCD’s finances?

All the three corporations are currently gripped by financial crises, even as the East and North MCDs are the worst-affected with their combined budget deficit exceeding Rs 2,000 crore. The South MCD was solvent till a couple of years ago, but it has also come under financial stress now with a budget deficit of Rs 500 crore, said a senior south corporation official. The total annual income of the three corporations from their own revenues is around Rs 6,700 crore, while the total annual salary and pension expenditure for their combined 160,000 employees amount to Rs 8,900 crore. “If the corporations are merged, the civic body would be able to save around Rs 200 crore by decreasing the number of officers and renting out some spaces that will be vacated,” said a senior official.

So, will the savings following unification be enough to improve the MCD’s financial health?

Former director of the North MCD’s press and information wing Yogendra Singh Mann said it is not just about money, and that unification would result in “a lot of other advantages”. “Firstly, there would be a balance of resources, income, and expenses. Currently, North regularly suffers from a delay of salaries. After this, there will be uniformity,” he said. Also, the planning would be better as there is going to be a centralised authority for things like parking rates, property tax and new initiatives for the city, he said. An East MCD official, however, said that unification alone would not lead to anything until other problems are fixed. “The financial arrangements need to be worked out. The corporations must be given their dues and planning on remunerative projects needs to be done,” he said, adding that “the planning, if done well, will help the MCDs recover, else it will harm all the three MCDs’ financial condition”.

Is the proposed MCDs unification just economics, or it is about politics too?

The unification of MCDs, if executed well, along with other reforms, would boost the corporation’s financial health. But like the MCD’s trifurcation, the corporations’ unification would also not be about economics alone. The carving of the erstwhile civic body into three MCDs in 2012 by the then chief minister Sheila Dikshit and the Congress dispensation, was carried out in order to “decentralise” the mammoth MCD. However, it was also a political move to fix the civic body boundaries in such a way that the then ruling Congress could make inroads into the MCD, which had become a BJP bastion. The saffron party continues to rule the MCDs. Ten years later, it seems to be deja vu for observers, as the BJP is seeking to redraw the corporation’s boundaries for political gains.

What does the BJP hope to gain from the MCDs merger?

With their employees striking work periodically, the MCDs have maintained that they are devoid of funds since the AAP-led Delhi government has allegedly been blocking it. “The unification move would also help the BJP send out a message to the public of how they plan to fix the MCDs’ fund crisis if voted to power again,” said a party leader. Also, the party wants to “run the corporation after the merger in a better pay with employees’ salaries to be given on time and new initiatives taken”, to claim that it was the trifurcation that had led to the crisis and that the unification would correct a “historical wrong”. This, the BJP hopes, will at least help it put up a fight against the resurgent AAP in the civic body polls.

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