One of the oldest government agencies of the city, the Brihanmumbai Electricity Supply and Transport (BEST), seems to be in financial turmoil. With loan interests piling up on one hand, the undertaking was recently unable to pay salaries to their 47,000-odd employees, until yesterday.
Officials from BEST claim that because of summer vacations, there has been a drop in daily revenue in the transport and electricity division. File pic
Sources from BEST claim that it is more of a one-off case in which the undertaking had to delay the payment of salaries, to the tune of around Rs 140 crore. “There was a delay of 12-13 days, but we have paid the salaries on May 20,” said Arvind Dudhvadkar, chairman of BEST committee.
While Dudhvadkar accepted that the financial condition of the body has not been in the best of shape recently, mid-day decided to dig deeper into the issue to realise the financial instability of the undertaking that has taken several loans from various banks and financial institutions (see box).
Not only that during the end of last year, it also took a loan of Rs 1,600 crore from the parent organisation, the Brihanmumbai Municipal Corporation (BMC), that was used to pay off loans and the interest accrued from it.
Sources said that the highest priority remaining now is the repayment of the BMC loan, for which they might take smaller loans.
The civic body is not charging any interest for the first year, only 9 per cent interest from the second. From the third year, BEST will have to start paying the instalments. According to BEST’s union leader Sharad Rao from the NCP, the Sena-led unions have deteriorated the condition of its employees.
“We will protest in front of BEST depots for this delay in salaries,” said Rao. Speaking to mid-day, BEST member Sunil Ganacharya from Shiv Sena said, “Till date, the government hasn’t allowed us to take long term loans, which is why the current situation persists.
When our government comes to power, we will ensure that policies change and there is a drastic improvement in BEST’s condition.” Another reason for the delay in salaries was the drop in revenue for both the transport and electricity supply divisions. Officials claim that the daily revenue from electricity division has seen a drop from Rs 14 crore to Rs 9 crore in the last 10 days.
Similar shortfall of Rs 20 lakh was also witnessed in the transport division. Authorities attribute the shortfall to the summer vacations, assuming that most Mumbaikars have left the city for holidays and haven’t paid the bills, or travelled in buses.
Loans taken by BEST
Short term loan
Rs 1,034 cr
Rs 173 crore
Rs 295 crore
Loan from BMC
Rs 1,600 cr