Tough times are ahead for the cash-stripped city corporation. Though the dispute between the civic body and the Kerala Water Authority over non-payment of the Rs 90-cr water charge has been settled for Rs 29 crore, the deal could have an adverse impact on the corporation's functioning.

The government will cut short the Plan fund allocation and annual grant to the corporation, in order to pay off the outstanding dues.

According to sources at the corporation, this will affect the development works and even the payment of salaries to employees.

“Any cut in Plan fund allocation and annual grant will have a serious impact on the corporation’s financial stability.

It will upset development plans devised for the fund-starved local body. Even payment of salaries may get affected,”reiterated sources at the corporation.

However, the extent of cut in annual funds will be known later and the corporation has urged that the dues shall be realised only in instalments.

Out of the Rs 29 crore, the corporation will need to pay Rs 5 crore as charges for water taps, to the KWA immediately.

If not, the authority will disconnect water supply through taps. If this happens, those areas which depend on public taps for potable water, will be adversely affected.

Observed K.J Jacob, Opposition leader, “It is a welcome decision to settle the dues for Rs 29 crore, but paying off the arrears will be a big challenge for the corporation.”

“The local body gets nearly Rs 33 crore as Plan funds and around Rs 4 crore as an annual grant from the government. Any reduction in the funds will worsen the financial stability of the local body, which is passing through a tough period,” he added.

Though the KWA took over the water supply in the city from the corporation in 1991, due to disputes on the number of public taps and assets handed over to KWA, the corporation’s arrears went up to `90 crore.

A joint meeting of the corporation officials and the Water Authority representatives held at Thiruvananthapuram on Wednesday discussed the issue of dues and reached a consensus to settle the amount at Rs 29 crore.

Mounting water bills a drain on exchequer

The city corporation’s already-ailing exchequer has been further hit by the huge expenses incurred from water supply.

Though the local body has no responsibility for supplying water, it spends a huge amount every year, under this head.

To supply water to the parched areas in the city through tanker lorries, it spends Rs 2.5 crore every year.

This, while the cost of drawing water from Kerala Water Authority reservoirs is Rs 30 for 1,000 litres.

The corporation also had to pay the charges for water supply through public taps. KWA charges Rs 5,250 for a water-tap annually.

“According to an estimation of the KWA, the city has more than 5,000 public taps, while the real number is only 4,600. In the joint meeting held on Wednesday, it was decided to conduct a joint in-sp-ection regarding the number of public taps,” said K.J. Sohan, chairman of the town planning committee.

In addition to the water supply, the civic body also bears the expense for repairing damaged pipel-ines and roads trenched for relaying the pipelines.

“Water supply is a vital issue and disputes bet-we-en various agencies sho-uld not affect the public. That is why the corporation is keen on proper water supply to all parts of the city,” added Sohan.

KWA silent on corporation’s assets with it

The Kerala Water Authority officials, while keen on recovering their dues from the city corporation, are maintaining a significant silence on the assets and funds they received from the civic body, allege the corporation authorities.

“When KWA took over the water supply of the city in 1991, we handed over to it various assets, including land, reservoirs, pipelines and water-taps.

However, the value of the assets was not estimated and the corporation didn’t get any compensation from the authority.

It was a unilateral decision to take over the responsibility of water supply,” said K.J Sohan, chairman of the town planning committee.

Apart from this, the corporation also gave external funds from agencies like Kerala Sustainable Urban Development Project (KSUDP) and Jawaharlal Nehru National Urban Renewal Mission (JNNURM) to replace the old pipeline network in the city.

The KWA should consider the huge amount of money spent by the corporation to repair the damaged pipelines and roads trenched for relaying the pipes, he added.