Opposition condemns BMC’s private takeover plan for Seven Hills hospital
In 2018, the BMC issued a termination notice to the operator, after it failed to abide by the contractual obligations, with only 306 or 20 percent, of the total beds remaining operational.
The undivided Shiv Sena had opposed privatisation of the Seven Hills hospital. (File photo) Days after the Brihanmumbai Municipal Corporation (BMC) proposed revival of the now defunct Seven Hills hospital in Andheri (East), opposition parties – Shiv Sena (UBT) and Congress have opposed the proposal of handing over the hospital to a private player, defunct since 2018. The civic body has selected Capri Global Holdings as the operator with whom the civic body is set to enter into a 30-year long lease agreement.
Meanwhile, on Thursday, by calling a press conference, Pramod Sawant, Sena UBT corporator from Andheri (East) opposed the BMC’s plan of handing over the hospital to a private entity for operation and maintenance.
“Seven Hills is one of the biggest civic health infrastructure in Mumbai, and instead of ensuring that common citizens get treatment at subsidised rate, the BMC is handing it to a private player, a move that is only going to increase the treatment cost for citizens,” Sawant said on Thursday. Historically, the undivided Shiv Sena had opposed privatisation of the Seven Hills hospital, which became operational in 2004, when the civic body had awarded the project to another private player—Soma International—under a similar 30-year lease arrangement.
However, in 2018, the BMC issued a termination notice to the operator, after it failed to abide by the contractual obligations, with only 306 or 20 percent, of the total beds remaining operational. Furthermore, the proposal stated that with time, property tax dues on the hospital mounted to a whopping Rs 140.88 crore. The BMC’s move was later challenged by the contractor and the legal proceedings entered the National Company Law Tribunal (NCLT). However, before the NCLT delivered its judgement, the BMC accepted a Rs 223.48 crore settlement package, to be paid by the private player who will be taking over the property from BMC.
In addition to this, the contractor will also be paying an annual rent of Rs 10.4 crore to the civic body, with an additional increase of 10 per cent in rent after every ten years.
“The cost of the property stands at Rs 3,000 crore, however, the BMC is handing it to the private players at a mere cost of Rs 223 crore. This is absolutely not fair and proper wastage of civic infrastructure,” Sawant said.
Meanwhile, issuing a letter to Mumbai’s municipal commissioner — Ashwini Bhide, Congress’s group leader, Ashraf Azmi said that the aforementioned proposal has been tailor made to serve the private players.
“Another shocking aspect of the revised lease structure is that the annual lease rent proposed in the new lease deed for the first 10 years reportedly remains the exact same amount originally quoted during the 2005 tender process, of Rs 10.41 crore, per year,” Azmi’s letter stated.
“This revised lease is being drafted more than two decades after the original tendering process. During this period, the land valuation has increased, commercial potential has substantially escalated, and despite this the revised lease deed reportedly continues with the same base rent structure originally quoted in 2005,” the letter furthermore stated.
The BMC’s document states that once the hospital becomes operational, 20 percent of the total 1,500 beds available in the hospital will be reserved for the patients that will be referred from several civic hospitals. The civic body’s contract states that the patients admitted to these beds will be charged at civic body rates. Furthermore, the contract also states that the 20 per cent quota will be applicable for patients taking OPD services as well.
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