Money to be released in the next five months
The Supreme Court has ordered the Sindh government to help the Karachi Metropolitan Corporation pay its electricity bill of Rs580 million.
The case has been running for several years. It started after K-Electric disconnected power supply to the city government’s head office for not paying its bills. Power was eventually restored but the bills weren’t paid. KMC owes the power utility over Rs2 billion. It was decided that the bills of 71 connections worth Rs580 million should be cleared first.
On February 14, the Sindh High Court ordered the city government to pay up. But the corporation challenged the verdict in the Supreme Court.
Judge Maqbool Baqar and Justice Sajjad Ali Shah heard the case at the Karachi Registry on Friday. The court said that bills should be cleared in the next five months.
Sindh Advocate-General Salman Talibuddin said the government is willing to pay Rs100 million in the next 15 days. However, the government can’t pay the entire amount in one go because of cash constraints, he said. The Sindh and federal governments have been engaged in a tussle over funds too, he claimed.
The Sindh government isn’t bailing the KMC out but they have been asked to decide how the city government will repay the Sindh government. They have been asked to decide if it’s a loan or whether it will be adjusted from the funds given to the KMC.
The city government is responsible for looking after important issues such as trash collection, sewage and others. “It is a part of Karachi and can’t be excluded,” remarked Justice Shah.
KMC to pay future bills
The court ordered the KMC to start paying its bill every month from April onward. Its bill reaches Rs50 million every month.
Mayor Wasim Akhtar, however, said that the KMC won’t be able to do so because it doesn’t have the money. “The Sindh government used to release funds of Rs500 million to the KMC. It then started giving funds of Rs200 million from that total to the [Karachi Development Authority].”
The corporation requested the government to return its original funds. The finance department agreed to give it Rs130 million from the amount that was going to KDA.
“If we get our remaining Rs70 million then we will be able to pay our bills,” the mayor argued.
Justice Shah asked the government representatives to explain the functions of the KDA. “We know what it does but if we open our mouths then many people will get offended.”
Local Government Secretary Khalid Hyder Shah said they need to pay the KDA employees. “I am asking you about its functions. I am not asking what you do with the funds,” replied Justice Shah.
The secretary said that the government had decided that 60% of the funds will go to the KMC while 40% will go to the KDA. This was changed and now the city government gets Rs430 million, he added.
“The Sindh government has taken many of our functions through its notifications,” contended Akhtar. They took local taxes, licensing fees, the water board, transport, master plan and BTS towers [for mobile phones] from us,” he remarked.
Sindh should pay as much as it can to help the KMC, said Justice Baqar.
The KMC is responsible for developing the city’s infrastructure, said Justice Shah. “If you [the Sindh government] agree to give the remaining Rs70 million to the KMC, then cut Rs20 million from it every month,” he said. “If you are taking the revenue, then you must share the burden too.”
‘We just want our money’
Syed Moonis Abdullah Alvi, the chief executive of K-Electric, said that the company has been borrowing money to make up for their unpaid bills. “It has become difficult for us to sustain.”
He said that bills worth Rs1.3 billion have yet to be cleared. The lawyer for K-E, Abid Zuberi, said that the power utility has taken loans of Rs130 billion from banks.
Zuberi said that they just want their money. We don’t want to be dragged into the tussle between KMC and Sindh government, he said.
“The process of reconciliation should continue. [But] efforts should be made to pay us for our remaining 271 connections too.”