The 5% hike in water charges effective from April 1 is not likely to bring about a marked improvement in the shaky finances of the Kerala Water Authority (KWA), according to officials of the water utility.
The annual hike, necessitated by a Central government condition for additional borrowing by States, is expected to rake in around ₹30-₹40 crore annually.
On the other hand, the KWA has been running on heavy losses and operational expenses have been mounting.
Water Resources Minister Roshy Augustine informed the State Assembly in March that the water utility registered a loss of ₹594.10 crore in 2020-21. The final figures for the 2021-22 fiscal is not yet out, but a senior KWA official said it is likely to be around the ₹550 crore-mark. According to the Water Resources Department, KWA faces a loss of ₹11.93 on every 1,000 litres of water produced and supplied.
''What is required is a comprehensive tariff revision in the KWA, for which proposals are still pending before the State government. Water tariffs, based on KWA proposals, were last revised in 2014,'' a KWA official said. Salary and pension liabilities, electricity bills and maintenance expenses have risen sharply after the overall hike in 2014, adding to the burden.
Following the negative impact of COVID-19 on State finances, the Centre, in February 2021, allowed additional borrowing of 2% of GSDP to the States, subject to conditions which included reforms aimed at strengthening local bodies. Under it, States were required to notify floor rates of user charges for water supply, drainage and sewerage ''which reflect current costs/past inflation.''
Consequently, the State government issued orders notifying the existing water charges as floor rates with a 5% annual increase from the 2021-22 fiscal onwards. As per the revision for the 2022-23 fiscal, the charges for the domestic category have risen for all slabs. For instance, for consumption up to 5,000 litres, consumers will now have to pay ₹4.41 (revised from ₹ 4) per 1000 litres, and, for the 5,000-10,000 litres slab, ₹22.05 plus ₹4.41 per 1,000 litres in excess of 5,000 litres.
No water charges will be collected from BPL families who consume up to ₹15,000 litres per month.
