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Power tariff hike in Tamil Nadu sparks criticism

N Sathiya Moorthy in Madras

There is all-round criticism to the steep, 11.45 per cent hike in the power tariff announced by the Tamil Nadu Electricity Board over the weekend. While political parties say it will add to the burden of the common man, industrialists claim it will badly affect production and prices.

While exempting the farm sector, hutment-dwellers and low-end consumers, the TNEB has increased the tariff for other consumers by 10 to 25 paise per unit, based on consumption-slabs. The rate is much higher for high-tension consumers, like trade and industry.

It has gone up by 45 paise per unit, to 3.35 paise for the former, and by 40 paise, to 3.20 paise for the latter. The Board has also retained the 10 per cent additional charge per unit levied to the trade and industry sectors in Madras metropolitan area, comprising the state capital.

All political parties, including the Tamil Maanila Congress, an ally of the ruling Dravida Munnetra Kazhagam, have criticised the government's move. The TMC was guarded in its criticism, but the Opposition All India Anna Dravida Munnetra Kazhagam went hammer and tongs at the state government, particularly Electricity Minister 'Arcot' N Veerasamy.

Others like the Bharatiya Janata Party, Marumalacchi Dravida Munnetra Kazhagam and the Congress too have joined the chorus.

For its part, industry in the state has criticised the government move, and industry leaders have dubbed the hike, 'anti-industry' and inflationary.

"It will aggravate the problems in the industrial sector, particularly the small-scale sector which is facing recessionary conditions," president of the Guindy Industrial Estate Manufacturers Association in Madras, K V Kankambaram, said in a statement. The South India Mill Owners Association in Coimbatore has cautioned about possible closures and retrenchments in the textile sector if the tariff hike was not withdrawn.

More than the economics of it, it is the 'politics of power tariff-hike' that has amused the common man, who is already reeling under the burden of similar hikes in bus fares and milk prices, announced by the government earlier this year, and as pointed out by AIADMK supremo J Jayalalitha.

Where, however, she seemed to have gone wrong was in doing her homework, and the ruling DMK was quick to capitalise on it.

Jayalalitha alleged that the government had imposed a 10-paise surcharge per unit on domestic consumers, had not exempted lower-income groups, as used to be the case when she was chief minister, and withdrawn the concessional tariffs for educational institutions and social service organisations.

She also challenged the government's claim that the tariff hike became necessary after the recent pay-rise for the TNEB staff. The pay-rise totalled only Rs 3.95 billion, but the tariff hike totalled Rs 6.25 billion in a year, she pointed out.

The government was quick to retort. "Jayalalitha has not cared to read the newspaper reports on the tariff hike properly," Veerasamy said in a statement. "The concessions have not been withdrawn," he asserted. The government also issued full-page advertisements in the newspapers, to clear the doubts of the ''confusing and the confused'' lot, clarifying that the tariff would remain the same at 65 paise and 75 paise respectively, for domestic users consuming 50 and 100 units, bi-monthly.

Veerasamy claimed this was only the second tariff hike in the power sector in the DMK's two-and-a-half year rule, against the annual hikes imposed by the erstwhile AIADMK regime. The government-sponsored advertisement said, the tariff-hike was only 15.6 per cent for educational institutions against the 30.67 per cent levied when the AIADMK was in power.

The government, while pointing out that Tamil Nadu was the only state to have free power-supply to hutment-dwellers, and was only one of the two, Punjab being the other, to give free power supply for the farm sector, said it was also only one of the six states that has granted central pay-scales to its employees. By comparison, Tamil Nadu's power tariff hike also compared well with similar hikes imposed in Punjab (33 per cent), Haryana (15 per cent) and Karnataka (12 per cent).

The current increases also compared well with those imposed by the AIADMK government, Veerasamy said in a separate statement. The figures were 25.66 per cent for high-tension industries against 15 per cent now, 23.35 per cent (15.4 per cent) for high-tension commercial, 14.04 per cent (11.97 per cent) for low-tension industries, 15.80 per cent (4.24 per cent) for LT commercial, the statement said. Veerasamy, however, did not react to Jayalalitha's charge relating to the TNEB pay-rise.

For his part, S Pancharatnam, general secretary of the TNEB Employees' Federation, led by the Centre for Indian Trade Unions, has questioned the government's claim that the tariff hike was necessitated by the recent increases in pay-scales.

"The minister himself had conceded earlier this month that the pay-rise will entail an additional expenditure of only Rs 1.80 billion a year," he said in a statement, adding that the government had cancelled 52,000 vacancies that arose following the 1992 wage settlement, thus resulting in a saving of Rs 1.5 billion, instead.

The last word, however, seemed to have been said by Chief Minister M Karunanidhi, though he had said it early. The average tariff-hike amounted to only 11.45 per cent, against the additional expenditure of 12.59 per cent incurred by the board under various heads, he said, adding, "I am prepared to quit in favour of anyone who can run the administration efficiently without increasing bus-fares, revising power-tariff, or imposing new levies."

UNI