NMC hikes water tariff by 5% for 9th consecutive year

Nagpur: The Nagpur Municipal Corporation (NMC) has increased water tariff by 5%. The tariff has been hiked for the 9th consecutive year, in line with the agreement with private operator Orange City Water Private Limited (OCW).
Municipal commissioner Abhijit Bangar on Thursday approved the hike in water tariff by 5% for 2019-20 fiscal. The new tariff will come into retrospective effect from April 1.
The tariff has been increased for all seven categories of consumers. The base tariff for first 20 units for residential consumers has increased to Rs7.76 per unit (1,000 litres) from earlier Rs7.39 per unit. But consumers will end up paying over Rs9 per unit. Apart from base tariff, NMC levies over Rs1.25 per unit for raw water and electricity surcharge.
As per the new water tariff, residential consumers will be paying higher charges for usage above 20 units. Tariff for consumption between 21 and 30 units is Rs12.41 per unit, Rs17.07 per unit for 31 to 80 units, and Rs23.27 per unit for above 80 units.
NMC has been increasing water tariff since it roped in OCW in 2011-12. The base tariff for residential consumers was Rs5 per unit at the time of appointment of the private operator.
NMC is bound to hike water tariff as OCW’s payment rate is higher than water tariff. Though tariff was Rs5 per unit, OCW rate was finalized at Rs7.90 per unit in 2011-12. Also, NMC is increasing OCW’s rate every year as it is linked to consumer price index and wholesale price index, which the central government increases every year.
Still, there is huge difference between water tariff and OCW rate, causing huge financial loss to cash-strapped NMC. At present, OCW’s rate is over Rs12 per unit.
Also, NMC and OCW have no control over water losses, which is over 55%. The arrears of consumers are also very high. NMC’s loss from water supply is estimated to be over Rs80 crore per annum.
Since 2011-12, the total rise in water tariff is 55%. NMC administration does not require permission of general body and standing committee to increase water tariff by 5% every year. The general body had given powers to the civic chief to hike water tariff by 5% every year.
Justifying the hike, NMC official told TOI difference between revenue and expenditure is high so increase in tariff is needed every year. “Hike of 5% every year does not cause too high a burden on consumers. Tariff in city is very less as compared to other cities in the state,” he said.
Chairman of water works consultative committee Vijay Zhalke also justified increase in water tariff. “NMC is incurring huge loss due to high water losses and non-metered consumers. Water supply is satisfactory so consumers should not have any problems with rise in 5% every year,” he said.
Leader of opposition Tanaji Wanve alleged OCW needs to be ousted to stop all anti-public activities. “OCW is basically a curse for the city. Only OCW is benefiting from water supply. People are forced to pay high water tariff due to OCW. People are not getting adequate water supply ever since OCW came in. If we get water supply, there are problems of contamination. NMC is also facing huge losses. People are aware how BJP-ruled NMC is working only for a private company’s benefit and will teach it a lesson,” he said.
Recently, NMC had also approved one time settlement scheme for OCW in which the civic body incurred whopping loss of Rs374 crore, and benefited the private operator.