Keeping its key promise to voters, the Aam Admi Party government on Wednesday that it would slash power tariff by 50 per cent for those households which consume up to 400 units per month. The government also decided to provide 20,000 litres of free water to every household.
While the move is a redux of its most popular policy decisions taken during its last stint in power, the AAP sought to ally concerns that it was following a populist agenda by laying out an action plan of sorts. Both subsidies, the government said, would become effective from March 1 and the cost per month would set the exchequer back Rs. 70 crore for power and Rs. 21 crore for water.
The government said it has planned to set aside an amount of Rs. 1,477 crore annually for the power subsidy while the projection for water is Rs. 250 crore annually. AAP sources said the projected amount for power is likely to include a possible hike in electricity rates by the Delhi Electricity Regulatory Commission this year.
Power distribution companies have demanded a hike of 10-15 per cent as their operating costs have gone up. The estimate for water will also include the cost of setting up more meters to allow more people to get the benefit of piped water.
“We had successfully provided similar concessions in power and water during our 49-day government as per our promise and believe it played a major role in allowing Delhi's Aam Aadmi to repose their trust in us again,” Deputy Chief Minister Manish Sisodia said at a press conference prior to making the announcement.
“It is very unfortunate that first the Congress government and then the Bharatiya Janata Party-led (BJP) Government which ruled the Capital indirectly through the Lt/ Governor took no steps to keep the subsidy in force after March last year,” Mr. Sisodia added.
According to the government, 36.06 lakh families, that is 90% of domestic power consumers would be provided 50% reduction in electricity bills up to 400 units per month beyond which no subsidy would apply. Similarly, no subsidy would apply for metered consumers using over 20,000 litres of water per month.
The AAP government's budget for Delhi is expected to announced by the end of March, meaning that they now have over a month to work out how to split expenditure between various departments and allocate funds for these subsidies. The proposed amount for subsidy will be many times higher than in previous Delhi budgets. The government's announcement on Wednesday came in the wake of a Cabinet meeting after Chief Minister Arvind Kejriwal called on the Comptroller and Auditor General (CAG) to assess the status of the audit of power companies ordered by the first AAP government more than a year ago.
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