Continuing from yesterday’s post about introducing crisis pricing of water in Bangalore, here’s the real picture of how water gets subsidised for all residents of the city who receive municipal supply.
It turns out that a family of five using the national norm for urban water supply – 135 litres per person per day (LPCD) receives a whopping subsidy of Rs. 9,500 a year! A household using 200 litres per person per day in the city – quite common – receives an even higher subsidy Rs. 13,790 a year! Compare this to the LPG subsidy that the same households will receive: it clocks in at a much lower Rs. 2,800 a year (at Rs. 320 subsidy per cylinder of LPG and 9 cylinders per year). While LPG subsidies need to be reduced and its prices rationalised, I’ll leave it to the readers to see how much air time each issue has received thus far.
As the chart shows, even the maximum price of water levied is lower than the operational costs, so the more profligate a consumer, the higher the subsidy they receive. And this is a rather conservative estimate – one that does not include how the city’s sewerage is also subsidised, nor the heavy capital costs that go into building the infrastructure for the city’s water supply.
And we wonder why we have a crisis around water almost everywhere in the country.