Each time Sheila Dikshit fattens Delhi's two discoms with tariff hikes, we hear wearisomely familiar harangue, but what political parties and civil society end up ignoring are the structural inconsistencies of the privatisation model which gives them a free run
Power to the people acquires a completely different context in Delhi, where citizens have felt the heat of electricity bills ever since power distribution passed into private hands. The much vaunted power
privatisation project, following the power reforms agenda undertaken during the NDA and its consequent Electricity Act 2003 has in a macabre twist achieved its exact opposite — a mockery of the original intention.
The issue has continued to roil at every tariff revision. It has also fuelled the electoral fantasies of a new group of political entrepreneurs who made an abortive attempt at stealing the issue from under the Opposition's nose. Curiously, each of their attempt to cull mass support from the issue only resulted in opprobrium: a call to not pay bills went unheeded; a hunger strike was stricken with no supporters and an earlier attempt at reconnecting a non-payer’s electricity brought more trouble for the consumer as he got slapped with a case of theft, far worse calumny than a non-payment case.
Those who are not new to this matter will recall that the electricity hike became a referendum in 2005 against the arbitrary and unjustified hike without concomitant improvement in services. It was then that a resident welfare association (RWA) movement coalesced around the issue and with massive public opinion mobilisation succeeded with the Delhi Government having to roll back the hike.
Interestingly, there has not been any such success thereafter in spite of the Opposition party poradically raking up the issue or the new entrants in the political arena and their exertions. Tariff hikes have continued without much by way of obvious justification or transparency.
Core issue
The real issue is, as usual, obscured in the shenanigans of attention seekers. To explain, attend to just three key facts.
One: The distribution companies (DISCOMS) are a joint venture between private parties and the Delhi Government, which owns 49 per cent of these entities. In effect, infrastructure to the tune of hundreds of crores was effectively handed over to help them start operations without time lag.
Two: These companies file an annual revenue requirement petition with the DERC, the regulatory authority, provisioning for expenditure and incomes and projects a tariff structure to balance their books. The DERC accepts or modifies this petition and adjudicates on the final tariff. Three: A public consultation exercise with consumers and stakeholders is carried out by the DERC to seek objections etc. to these petitions whose operative parts are publicized in newspapers.
Cyclical protests every year around the time of tariff revision have become de rigueur, but there no serious attention has been paid to the structural reasons these companies enjoy which lies at the basis of their luck with tariff revisions. And the reasons are simple. One is that there is no third party audit of the accounts they file and the DERC meekly accepts everything they submit as gospel. And the other that these companies have sought to keep themselves outside the reach of the RTI on basis that they are private entities. In the first instance, they are alleged to be free to cook their books, and in the other they are protected by a veil of secrecy which allows no disclosure of their real costs and receivables leading to no conclusive evidence against them.
AuditIJ
In November 2011, in an exercise to build legislative pressure on the government to force these companies to submit to an audit and the RTI, the writer of this article along with a few intrepid members from URJA, the apex RWA body of Delhi undertook a 23-day continuous walk across 70 constituencies of Delhi meeting all 70 MlAs of the Delhi Assembly to press for these two caveats.
The walk which began with a petition to the leader of Opposition in the Delhi Assembly and ended with one to the Chief Minister of Delhi resulted in a Delhi Cabinet recommendation to have the private distribution companies accounts audited from the first year of privatisation.
With a win like that, we would have thought that we had cracked the case and all that was left to be done was to press the point even as the private parties went to court to stall the process. Chief Minister Sheila Dixit, already accused of a soft corner for the private firms, got a lifeline when the anti-corruption protests led by Anna Hazare and his acolytes took over the narrative and the next year and a half were lost in the various twists and turns of their own making.
No strategy
It turns out that now, finally when civil society had the time to regroup and rewrite the script, a faction of that protesting group has launched itself into politics with typical noise that drowns out strategy and sensibility. There lies the rub. In the attempt to make the issue an election issue, no party is looking for a solution. Instead it suits them to keep it festering.
In the middle of all this, the discoms have provided more cosmetic retouching by trying to make the people understand the issue in the terms of public perception of unfair trade practices and fast running meters. Their propaganda does more damage to the issue by reducing it to a few specifics when in fact the underlying basis of this privatisation model is a foundational fraud on consumers.
The truth is that if a CAG audit were conducted and that these companies were to submit to RTI, we would unearth humungous amount of incriminating data starting from, for example, whether there were in fact any standards set for the electronic meters before being procured for installation — or were the standards created post factoIJ Are they making profits or lossesIJ Why hasn’t AT&C loss reduction of 40 percent converted to revenue leading to tariff reductionsIJ How do we know procurement is not being manipulated, over invoiced or routed through shell companies and sister companiesIJ Are they trading in surplus power to the detriment of their prime consumers who have to suffer outagesIJ
Clearly, a seasonal outcry on these issues every year around the time of tariff revision is getting tiring for all and patently disingenuous for political aspirants. The need of the hour is to not allow distractions get the better of us and focus on what will bring lasting relief and create a model for an effective reformist agenda for the sector. That will require the political establishment to synergize its demands with the RWA movement and single mindedly enforce the cabinet recommendation for a CAG audit of these ‘government-owned’ power distribution companies. Everything else, is gas.
(Sanjay Kaul is a spokesperson for the BJP)