Millennium Post

Why AAP’s subsidies mean increased cost of living

Why AAP’s subsidies mean increased cost of living
Rich house owners, the urban minority, will benefit from AAP’s power and water subsidies and they will certainly not pass on this benefit to the tenants, the urban majority. Who will tackle the corruption of aam aadmi?

Delhi has voted for a drastic overhaul in cost of living in the form of Aam Aadmi Party (AAP). I decided to do some budgetary calculation to see if my savings will zoom in the new subsidised environment and whether I will be able to pay off my education loan faster. The result I arrived at has wiped the smile off my face and will soon erase the savings from my account.

I live in a barsati (an independent room on the terrace of a bungalow) at Chittaranjan Park in south Delhi. I share the place with one of my colleague so as to absorb the insane base rent that my landlady justifies as ‘going rate’ in the locality. Utilities – electricity and water – are billed extra based on our consumption. This is the typical rent agreement which most tenants are made to sign in Delhi, especially students and young professionals, with provision of increase of base rent by 10 per cent at the end of the year. Straight forward isn’t it? Not really, complications are with the utility bills. Let me explain.

Electricity: no relief for tenants

Normally, a typical bungalow has two or more tenants, along with the owner’s family. Tenants can be any combination of a family or an individual or two or three individuals sharing an accommodation. In my case, I and my colleague share the barsati, with a family on first floor and owner on the ground floor. There is a main electricity meter with each of us having a sub-meter to keep track of our electricity consumption. Technically, it is a single connection and monthly bill needs to get split accordingly. But this is not the trend; the rent agreement expects each tenant to pay for their consumed units, based on the highest tariff, with 10 per cent surcharge and service tax. (In the old regime tariff was Rs 3.90 for 0-200 units, Rs 5.80 for 201-400 units and Rs 6.40 for 401 units onwards). Electricity tariff for me works out to be Rs 7 per unit, even though my monthly consumption has never crossed 100 units (AAP has announced a 50 per cent slash in electricity charges for those who consume less than 400 units).

Ideally, I should be charged Rs 1.95 per unit now but it is 259 per cent higher. In fact, there were a few months in between when the whole bungalow’s bill was for consumption of under 400 units which is subsidised, but there was no subsidy for me or my fellow tenants. The owner charged us almost twice the official billed amount and we couldn’t protest or complain. But I am still better off as I know there are localities in Delhi where the charge is as high as Rs 12 per unit for tenants, 515 per cent higher. The logic given is that it is the ‘going rate’, accept it or shift out.

Water bill goes up

Bungalows usually have a single water connection with no sub-meters. Therefore, the bill is equally split among everyone, irrespective of individual consumption. I’ve noticed that a typical monthly water bill for the bungalow I am part renting has been around 30 kilolitre (KL) which roughly used to work out to Rs 575 a month. I have been paying roughly Rs192 monthly. But now under the new scheme, the bill for the same amount of consumption will be Rs1,205 (including sewage maintenance charge and service charge) because if the consumption crosses 20KL even by a litre the consumer will be charged for the complete 20KL at the new rate of Rs 22 per KL, an increase of 110 per cent instead of usual 10 per cent annual increase. The bungalow technically houses three households and each household’s consumption on average is around 10 KL per month, which is half the amount of free water allowed per household, but how does one explain that to the Delhi Jal Board meter reader. And I’m pretty sure as soon as the first water bill under new scheme lands in the landlord’s hand, the ‘going’ trend will become that owner consumes less than 20 KL which is free, thus the water bill should solely be tenants’ responsibility. I’m sure to be billed Rs 602.50, as it is tenants’ fault that bill crossed the 20 KL mark.

Savings mirage

2014 brought in AAP’s subsidies but for me it starts with 10 per cent increase in base rent, no change in inflated electricity bills – in fact, now I’ll be paying a tariff 259 per cent higher than what my consumption of less than 100 units a month warrants – and 214 per cent increase in my share of water bill. My dreams of increased savings have evaporated. There are some lucky people who rent out complete flats in apartment complexes and get independent utility connections, free from all the complications I enumerated above and might very well benefit from AAP’s subsidies. But most students and young professionals like me don’t get that privilege. I’m personally planning to shift to a smaller place in a cheaper locality, so as to cut down at least on the base rent in order to accommodate the rise in utility bills.

If we set aside the market-controlled base rent and metering complication, even then most tenants are unfairly over charged for utilities, be it electricity or water. What will the AAP do about this corrupt practice of exploitation of the tenant aam adami of Delhi by the house-owning aam adami and aurat? Will AAP fight this corruption, too? Will it revisit the Rent Control Act and may be its enforcement?

Challenge

This clog in the trickle down of government subsidies defeats the ultimate goal of reducing wastage of resources. End users have no incentives to save electricity or water. The challenge is how this clog can be removed.

Maybe a good start will be to meter the households and not just the house, so that each individual has the incentive to be more resource efficient – as a city belongs to every citizen not only to house-owners.

By arrangement with Down to Earth magazine
Avikal Somvanshi

Avikal Somvanshi

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