Sindh govt, WB launch Rs33.6b liveable city project

Keen on strengthening local bodies so they may be self-sufficient organisations, says CM

KARACHI: The Sindh government, with the assistance of World Bank (WB), is going to start a Rs33.6 billion project, Competitive and Liveable City of Karachi (CLICK), next year. It is set to be completed within a period of five years.

The announcement came during the meeting of Sindh Chief Minister Syed Murad Ali Shah and a two-member delegation of World Bank, led by Acting Country Director Melinda Goods and Senior Operation Officer Amina Raja, at the CM House.

The meeting was attended by Local Government Minister Saeed Ghani, Chief Secretary Mumtaz Shah, Planning and Development Department Chairperson Naheed Shah, Principal Secretary to CM Sajid Jamal Abro, Local Government Secretary Khalid Hyder Shah and others.

The project is aimed at supporting Karachi Metropolitan Corporation (KMC), all six district municipal corporations (DMC), Karachi district council and excise and taxation department in carrying out a detailed property survey of the city.



The CM directed the chief secretary to hold a joint meeting of KMC, DMCs, district council and excise and taxation department to prepare a plan to formally devolve the collection of property tax. "I am keen to financially strengthen the local bodies in the city so that they emerge as self-sufficient organisations," he said, adding that under the project, capacity building of the related local bodies would also be ensured to facilitate them for the task of collecting property tax.

The CM said that the Karachi Water and Sewerage System Improvement Project (KWSSIP) would also be launched with the financial assistance of $1.6 billion from the World Bank. The payment will be made over the course of 12 years. Under the project, the Karachi Water and Sewerage Board (KWSB) would be overhauled. "I am committed to making KWSB a self-sustainable and efficient service providing organisation," said Murad.

The World Bank delegation and the chief minister also discussed the modalities and implementation methodology in their meeting.

Planning and development department chairperson informed the meeting that the first phase of the scheme of overhauling KWSB has been approved for Rs14.7 billion, over a period of five years.

The KWSSIP is divided into three phases. The first phase, estimated to cost $400 million, focuses on improving water and wastewater services and a defined set of institutional reforms to transform KWSB into a financially viable utility.

Under the project, the World Bank would finance $400 million three investment plans of KWSSIP that include reform in KWSB of $30 million, securing sustainable water supply and sewerage of $350 million and project management and studies of $20.00 Million.

Breakup of CLICK

Karachi Urban Management Project (KUMP) has been renamed the Competitive and Liveable City of Karachi (CLICK). It is a $250 million project which will be completed within five years. The project has three components such as performance-based block grants to Karachi urban local councils of $120 million, strategic infrastructure investment and capacity building in integrated stormwater drainage and solid waste management of $50 million and support for urban immovable property tax reform and institutional capacity building of $30 million. The tax reform component includes support for improvement and devolution of Urban Immovable Property Tax (UIPT).



The performance-based block grants to Karachi urban local will finance formula-based block grant to KMC and the six DMCs upon achievement of results. It will provide an incentive to urban local councils to improve their institutional performance and capacity in areas of investment planning and execution, financial management, procurement, business environment, and citizen engagement.

The grants would be used to fund local level infrastructure and municipal services within respective mandates of KMC and the DMCs for the improvement of Karachi's liveability and competitiveness. Indicative eligible investments may include small secondary or tertiary drainage works, municipal roads, street lighting, parks and other public spaces, public buildings and markets.

Strategic infrastructure investment and capacity building in integrated stormwater drainage and solid waste management will finance the strategic city-wide, inter-jurisdictional infrastructure needed to enhance Karachi's liveability and competitiveness. The component will focus on two interlinked sectoral interventions of integrated stormwater drainage and solid waste management (SWM) and include the development of drainage and SWM master plans, financing models, public awareness campaigns, feasibility studies for private financing models, etc.

Support for urban immovable property tax reform and institutional capacity building will be a support for improvement and devolution of UIPT. This sub-component will support the devolution of administrative functions of the UIPT to local bodies of Karachi. A phased roadmap to implement the administrative improvements and devolution of urban property tax and its respective institutional model has been developed, to substantially increase public revenues, through UIPT reform.

Reform activities to be supported during Phase-I include comprehensive all-Karachi property survey to update property tax database and fiscal cadaster and digitisation of the property tax base for all six districts in Karachi.

Phase-II may focus on deeper reforms of the property tax system. The collection function may be devolved to DMCs in a phased and gradual manner, whereas several options are being considered for provincial-level management of an ICT platform that manages the property register.

The sub-component, institutional capacity building and implementation support, will finance supply-side capacity building interventions for Karachi local governments in areas of financial management, project implementation, social and environmental management and technical assistance to enhance metropolitan coordination between the local bodies.

Support for enhanced regulatory environment and infrastructure financing for competitive Karachi will support developing a strategy, roadmap and institutional architecture for infrastructure financing model and enhancing the regulatory environment for improved competitiveness in Karachi. The main activities to be financed include technical assistance and feasibility studies for developing and setting up a proposed Karachi Infrastructure Fund (KIF) and a technical assistance programme targeted at KMC and DMCs for piloting public-private partnerships for service and infrastructure provision. This component will finance improving regulatory and doing business environment, by simplifying, streamlining, modernising and automating regulatory governance, and improving commercial dispute resolutions, particularly related to property rights.

The project's main coordinating agency would be the local government department. A Project Management Unit (PMU) would be established to provide overall coordinating and necessary technical assistance to Karachi's local councils. The project's executing agencies for specific interventions under this arrangement will be KMC, DMCs, KWSB and excise and taxation department.

Published in The Express Tribune, July 18^th, 2019.