Municipal corporations such as Mumbai will get a hefty sum in compensation against loss of local taxes, but they will have to perform well and spend public money on development works if they want the cash flow to continue
Municipal corporations such as Mumbai will get a hefty sum in compensation against loss of local taxes, but they will have to perform well and spend public money on development works if they want the cash flow to continue.
Finance minister Sudhir Mungantiwar made this announcement while the state legislature ratified one of the GST bills here on Saturday on the first day of a three-day special session.
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According to provisions made by the state government, local bodies will get a 100 per cent compensation based on their tax collection in the previous financial year. And, every year, they will get eight per cent extra on the previous year's amount.
However, former finance minister Jayant Patil who presented the Opposition's side asked for the setting up of performance indicators for the civic bodies so that the money given to them was put to good use.
"There should be some mechanism based on which the money should be given. The spend should also be observed in terms of proper use. Why not have performance indicators for these municipal councils?" he said.
Patil said that the performance when assessed should decide the cuts for bad performance and incentive for good show. "Remember this is public money and we need to justify how it is spent," said Patil.
Mungantiwar accepted Patil's suggestion and said that the government would get working on it. "Not only the local bodies, but also government department, will be judged on performance indicators," he said.
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