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Cash crunch hits BEST, staff not paid salary for February

Published On : 15 Mar 2017   |  Reported By : Courtesy: The Hindu   |  Pic On: photo credit: The Hindu


Mumbai (The Hindu): It is mid-March and over 44,000 employees of the Brihanmumbai Electric Supply and Transport Undertaking are yet to receive their salary for the month of February. While the BEST has been running at a loss for quite some time, things have come to such a stage that the administration is unable to disburse salaries to its employees. The salaries are normally paid between 8th and 12th of every month.

While the salaries have been delayed on and off, the BEST would borrow to pay up the dues. But, this time the financial crunch has impacted the cash flow hitting the average employee, even as BEST has been unable to commit as to when it would be able to pay the staff.

Colossal losses

The BEST, which has an annual turnover of nearly ?6,000 crore runs on an annual deficit of around ?1,000 crore per annum and hence the problem just gets bigger with time. The transport division was running at a loss for a while, but they were borne by the profit-making electricity division.

“Every public transport across the world is running at a loss. But, things turned difficult for us since the time the SC barred us from recovering transport deficit from our electricity consumers in October 2016. So, that source of revenue of about ?70 crore per month dried up,” says Dr. Jagdish Patil, general manager of the BEST.

Major expenses

Outlining the major expenses, Dr. Patil explains that debt servicing every month alone runs to about ?200-?250 crore per month. “Only last month we borrowed loans of about ?200 crore in the first week of March. Now, we have approached other banks for further loans of ?100 crore, but such things take time,” he said.

Dr. Patil said, “The net salary alone comes to about ?185 crore per month. This includes emoluments like retirement benefits, and payments towards provident funds.”

The BEST has put in cost cutting measures like reducing 3,500 posts in the last three years, not clearing promotions except to essential posts, withdrawing incentives and even cutting down on fuel allowance.

The new committee that takes charge on March 16 is faced with the huge task of bringing BEST back on track.

Suhas Samant, president of BEST Nagar Sena and a nominated member of the BEST committee, met Dr. Patil on Tuesday and threatened to strike if workers were not paid soon. “We were told that salary will be paid as soon as loans will get sanctioned. We will also seek intervention of Uddhav Thackeray,” he added.

Advocate Sandesh Kondvilkar, ex-BEST committee member, said: “The GM has sought ?1,000 crore aid to tide over the problem but neither the State nor BMC is extending support.”

 







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