Pushing it deeper into trouble, the loans of the Brihanmumbai Electric Supply and Transport (BEST) undertaking now stand at Rs 2,500 crore, with fresh loans worth Rs 500 crore taken in just the past three months. The BEST administration had to resort to the loans to pay its staff.
The BEST has taken close to Rs 150 crore in loans each month for paying its 42,000 employees since March this year. Senior officials from the undertaking said returns in the form of arrears received from different sources have not sufficed for the payment of salaries or the operation of the undertaking.
“Loans worth Rs 150 crore have been taken from different banks every month to be able to pay our employees. We are liable to pay their salaries by the 20th of every month, as per the labour court’s orders,” said Sanjay Bhagwat, additional general manager, BEST.
In March, the BEST delayed salaries by 10 days, after which the labour court directed it to pay its employees by the 20th of each month. Every month, the undertaking starts afresh by approaching new banks for loans to clear pending payments and encash salaries, officials said.
“The utility is bound to pay monthly installments of loans till a certain deadline, failure of which could draw legal action against us. After that is cleared, fund collection for encashment of salaries begin. While Rs 80 crore is required to disburse salaries, an additional Rs100 crore has to be encashed well before the 15th of each month to clear other financial benefits of the employees,” a senior official added.
Till January, a surplus received through the Transport Division Loss Ratio (TDLR) helped the undertaking manage pending payments and pay salaries, but this was scrapped. Earlier this month, the BEST committee also rejected a cost-cutting proposal of the undertaking.
“We are awaiting an aid from the municipal corporation to improve our financial position. Many of our initiatives to buy new buses or utilise the old ones through maintenance are suffering due to the financial crunch,” Bhagwat added.
“We plan to meet Sena Chief Uddhav Thackeray and Brihanmumbai Municipal Corporation (BMC) commissioner this week to help the utility deal with the increasing amount of losses. We hope the corporation will aid us with at least Rs 2,000 crore to deal with the crisis,” the Sena’s BEST chairperson Anil Kokil said.
BEST has stopped hiring fresh staff for the past two years. While a proposal to hire 1,000 conductors for the undertaking was mooted, it was scrapped later.