- Civic agency selling commercial plots to generate revenues, as new sectors nowhere in sight
ISLAMABAD: For over a decade now, the utter failure of Capital Development Authority (CDA) to develop a single new sector in Islamabad not only stands a testament to growing inefficiency and indifference of city managers but has also resulted in selling of valuable commercial plots around the city to generate revenues for ‘non-development’ expenditures, Pakistan Today has learnt.
After sector G-14, developed back in 2005-06 when Kamran Lashari was the chairman of CDA, the authority has failed to develop another sector and the list of stalled sectors runs in dozens. Sector E-12 and G-12 have remained in news due to issues related to affectees who demand compensation on build-up property and allottees who ask for possession since they’ve been given allotment years back.
Furthermore, sectors like D-13, E-13, F-13, E-13, C-14, I-17, D-14 have remained at a standstill with no hope of redemption in near future. Interestingly, in order to plug the gap in revenue and in search for ‘alternate’ solutions to produce revenue, the CDA has set its eyes on commercial plots around the capital.
In the month of March, smaller plots including class-III shopping malls and filling stations grabbed the attention of real estate investors during the three-day auction held by CDA during which the civic agency announced of achieving its revenue target by successfully auctioning 29 plots in various sectors of the capital worth over Rs7.10 billion.
The smooth functioning of the Capital Development Authority (CDA) depends on generating revenue to meet its expenditures, pay salaries to its employees and officers and undertake massive maintenance and construction work all over the city. It is pertinent to mention here that the government of Pakistan gives money to CDA under Public Sector Development Programme (PSDP) alone.
At present, the CDA generates its revenue from multiple sources including property tax, water tax, billboard tax, transfer fees from plot and fees for map approval among others. However, the revenue generated through these sources is paltry and fails to meet the enormous needs of an organisation the size of CDA. In order to plug the gap, the civic agency auctions valuable commercial plots around the capital.
The revenue generated by auctioning helps CDA keep its machinery afloat, pay salaries to its employees and spend money on maintenance projects and work. Sources told Pakistan Today that the commercial auction of plots is necessary, although not a permanent source of revenue for CDA. “The CDA needs a continuous revenue source that delivers at regular monthly, yearly intervals,” they said.
Whenever the CDA develops a new sector, it helps us create huge and multiple revenue streams. The selling and transfer of plots, development of commercial areas and collection of civic taxes all make for revenue generation that keeps on giving. “Unfortunately, CDA has been lax at developing new sectors of late,” the source added.