Get what you pay for?

BijleeSakkath hot weather. Somewhere in small town North India, I was stuck in a queue inside a barber’s shop. And electricity kept playing hide-n-seek with us. Fan off, Fan on, and off again. An old gentleman started the bitching session with a classic “Ee Sarkar ekdum bekaar” (this govt is useless) line.

Few younger mid-aged folks joined the wise man, and I heard all their complaints. If you were supplied electricity only 12 hours a day, trust me, you’d complain as well. Once they were done with their stories and cribs, this tall Shehari Babu was expected to join in. What did I have to share with them?

I started with a quick poll on how many of them had legal electricity connections. 5 out of 8, the barber refused to answer. Not bad. I went on to ask them how much they paid for electricity. It came out that our old gentleman had a BPL (below poverty line) connection, for which he paid a flat rate of about Rs 30 a month. All you can eat for Rs 30, for a guy who wore a Titan and polished shoes. Hmm. Two folks said they pay Rs 96 a month under another rural flat-charge plan. The fourth guy hadn’t been getting his bills for last six months due to an address error on supplier’s part. And not surprisingly, he did not wish to drive that problem to a resolution!

Once my mini poll was over, I asked them, “Jaisa dete ho, waisa milta hai, kyon?” (Don’t you get what you pay for).

They were not going to tolerate this non nonsensical stuff from a city boy. The tales of government apathy grew darker, voices of dissent grew louder, and I had to abandon my plans of getting a neat hair cut.

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25 Responses

  1. Sadly, even educated people have the same problem. Everyone wants to get everything WITHOUT paying for it. One example is the IT industry’s constatn complaints about the crumbling infrastructure in Bangalore-do they pay property tax to BMP or income tax to Central Govt.? Of course not-both have been waived in order to attract investment. While this was necessary in the early stages, it is not required now as the industry is growing at a healthy rate.Considering the boom in salaries/office rent, which they have no problem in paying, I cannot seee why tax cannot be paid.Furthermore, they want to extend the tax holiday to the IT industry which is due to expire soon. Persons criticising this are labelled as “communists”.

    Infy wants subsidized land in Bangalore-surely with a mulit billion dollar balance sheet they can afford to buy it for themselves? I agree they will pay the market rate, but the “market” rate as decided by the govt is much less than the real rate(anyone who registers a house knows the difference between the real market rate and the index value fo the govt).

    PS-I am part of this industry which clearly has done a lot to benefit both India and Bangalore. I am only criticising some aspects of it. My views here are PERSONAL and do not represent my employer or any other organization.

  2. You are so right George.

    Billions of rupees of profits but still crying for sops is worse than the fellow sporting a Titan watch and wearing a pair of polished shoes, but still opting to be BPL candidate. No sops now atleast when they are earning so much at the cost of so many other stake holders who have been put to so many problems. Companies spend crores in getting those glossy annual reports printed and when it comes to paying taxes, they cry. Many more things could be written…but let me stop here.

    When you are a humble middle class family student somewhere in Mysore, you became an engineer because the subsidized education made it possible. Then few decades later, you become a billionaire, and then you advocate removing subsidy in the primary education sector. ????

    What can one say about the attitude of that Innova driver in the other post? ‘Chillarrey’! He has no consideration of what is going to happen to the auto, as he swerves at his will. There are many educated idiots who want things for free and take things for granted.

    The rat race to earn that extra dollar has made people mad.

  3. Good Post…
    The Irony is .. People laugh at us when we genuinely want to pay the money.
    Long time back, our BWSSB bill was coming constant how much ever more/less water we used. Then I realised that the meter was corrupted due to which the meter man billed on flat rate based on our earlier usuage(its termed Estimation)…
    When We were thinking to get this repaired, people suggested that .. hego kadime bill barthaa ide, sumne irodu alva (anyway you are getting lower bills, why don’t really bother?).. I wonder if the response would be same if they estimated more ?
    In US, the utility customer even sue the utility service providers for estimating their bills high! It happens only in India ??

    Nice pictures are those you have taken on the bangalore roads, I have captured some videos on hosur road, I plan to upload them on youtube sometime later. Its fun to watch though :-)

  4. India is land of ifs and buts and subsidies. The law teaches people to make best use of it. Indian taxation system is good example of that. Lack of clarity and Confusion in laws is a breeding ground for law enforcers to become corrupt, and people to make merry with them.

  5. George is right!! IT/BPO sector does not pay anything to BMP or state government directly (except Rs200 in the form of professional tax per person/month). BMP and GoK have to rely on secondary taxes such as sales tax, VAT, property tax, vehicle tax etc. IT/BPO sector wants to perpetuate the tax sops it is receiving despite having benefited for over a decade or so.

    The “old economy” sectors that work out of such locations as Peenya have no proper water supply, roads, drainage etc. They should be complaining louder than the IT/BPO sector about poor infrastructure. After all they pay all sorts of direct taxes to BMP and GoK.

    In one of the meeting IT sector had with Dharam Singh’s govt, the head honchos of various companies provided a list of roads to be improved. Almost all of roads in the list happened to be in the eastern part of Bengalooru!! Presumably the places where these bigwigs work, live, shop and catch a flight. Talk about of leeching!! They were diverting funds from legitimate projects in other parts of the city to REPAVE the roads that were relatively in good shape already.

    I remember reading in Outlook that some in IT sector threatened to move out of the state if GoK imposed even a 2% infrastructure cess!!

    BTW, why do auto drivers always get a bad rap in the print and electronic media? There are equally bad bike/car/bus drivers who have turned our roads into hell. I suppose it is always easy to go after the weakest section of the society and establish your pecking order.

  6. By George!!

    Auto rick drivers are not weakest section. There was an estimate sometime back in this blog itself!!

    An averge rick fellow takes home 300 Rs per working day WHICH IS 100% tax free. Just check that out against an educated person putting in 14 killing hours or a night shift BPO to earn that kind of money. Ricks are law on to themselves.

    Offcourse they are the main offenders simply because they drive more than anybody else …

  7. Google Smoogle.. will soon buy a auto.

    It is because of people like him that india is poor and backward. Potholes are ok, as long as no one complains. If someone complains immediately look at his bank balance and start shouting nonsense – oh you IT professional, oh you BPO, look at the auto wallas they never complain only fleece.

    Right google smoolge ? Lets all live in filth and enjoy.

  8. George, Arun, the key point is this. We never consider “ourselves” to be a part of the problems we face. It is always them. Be it the netas or babus, the rich folks, the poor folks or whatever. Our traffic is one perfect example of this situation (blame them, not my fault), and see what a mess it is. Anyways. I liked how you see the Infosys land-hunt and no-subsidy cries in similar light as this little anecdote.

    Mr Google Smoogle, what made you assume that I was blaming the auto there (I assume you are referring to that other post)? The blame is as much Innova’s as that auto’s for trying to make the extreme turns. What do I make of your rushed assumption? Careless defense? I may have to agree with what Mohan and Click say, though Click went a little overboard with that filth comment there :)

  9. @SB – You were not blaming the auto guy at all. Mixing up response to two separate posts was my fault. Your report on the innova/auto was objective :-) I was reading through the comments and found Arun’s comment about the other post. What I made was a general statement. Since we are talking about auto guys, the estimated take home is generally between Rs.4-5K/month. I have asked a number of auto drivers themselves.

    @Cluck – RTFC again and cluck away!!. I said IT/BPO sector has less of a tax burden compared to “old economy” sectors. I also said that the old economy sector should be complaining LOUDER than the IT sector. If that makes me responsible for keeping India backward or living in filth, so be it!!

    Sure I will get an auto :-) I find dignity in all jobs … as long the job is done honestly. How many of us describe what happens to us at “nice” restaurants, pubs, multiplexes, star hotels as fleecing? The point is, we as a society treat white collar and blue collar crimes differently.

    PS: Like George, I am a Techie too.

  10. Goog Smoog All clear sir. Your point about old economy firms having a lot more to complain than IT/BPO sector has serious legs. But why don’t they do it!? I like anyone who complains. Seriously.

    Actually, I think they do. They may not be as visible (visible is a media term) in Bangalore urban chaos, but look at country in general. NRN or Premji don’t influence country’s economic policies as much as Tata/Birla/Ambanis do. Though you can say that new age Indian businessmen expect better. Nothing wrong with that. Expect (read complain) more, and you shall get it.

  11. Again, a thoughtful post SB. And you nailed it when you said the problem is that “everyone thinks its not us, its them”. That mentality if the root of all issues. George’s comparison is not too far off the mark.

    Regarding the power situation, read this – India struggling with power theft. 33% of all electricity is stolen. That doesn’t even include people who get a flat rate for being Below the power(ty)line. It is good that private investment is being welcomed in areas such as water and power management.

  12. Thanks everyone for reading and responding to my comment. Thanks to everyone who noted that in many cases, we are part of the problem that we crib about.

    @Click,
    Please note I am not saying that modern infrastructure should not be built. It must be built if India is to progress. I am only saying that those who use modern infrastructure should pay for it-you cannot have anything for free. All industries must pay tax fairly,The only reason for a tax break is to attract investment. This was a valid rationale in the early or mid nineties, when the IT industry was not well developed. It is not valid now- the IT industry is growing at breakneck sped, more and more companies are setting up in Bangalore. To give you an idea of how much the willingness to invest is ,a start up in Silicon Valley cannot get funding easily unless it has plans for a Bangalore office. A certain networking company was acquired, not for its IP, but just because they had a working team in India. It is obvious that IT investment in Bangalore will not dry up just because a tax sop is withdrawn.

    We IT employees keep demanding higher salaries, right? Pay hikes in India are the highest in Asia, and much higher than north America, right? Real estate rents are increasing daily.Companies are willing to pay this as it makes business sense for them.Why should the situation be any different for taxes?? Investing in Bangalore means high profits even after the high cost of land and labour-so a small tax hike will not scare them away. If you really care about the costs to companies,will you give up salary hikes at 25-30% per annum and get only the 1-5% per annum prevalent in USA? No company will ever agree to this. A company will be glad to pay good money for good people just in order to retain them. The same goes true for the cost of maintaining the nation, state and city.

    Special purpose infrastructure must not be built out of public money. It must be paid for by the persons who use it. An example is the elevated expressway on Hosur Road. It is certainly essential- without it, lakhs worth of employee time is wasted travelling to Electronic City daily. However, it is very costly(over 400 crore), and serves only a small number of people, not the whole of the city, let alone the state or the nation. It is foolish to use public money for this. The correct solution, which I am happy to say is somewhat close to being implemented, is that part of the funding comes from private sources, who recover the investment through a toll. This enables the end user to pay for what he uses. A private co maintaining the tollway also has an incentive to maintain it well.

    @Veena.
    Your honesty is appreciated. India needs more like you.

    @Silkboard.
    Why do you like EVERYONE who complains? Some people have valid complaints, some do not.Some people do not just complain, but actually do productive work in order to alleviate the problems they are complaining about. The latter are to be appreciated, but those who make unreasoanble demands and then crib when nothing is met are just nuisances.

  13. Aren’t IT employees among the highest honest tax payer’s not just in Bangalore but in India too ?

    So, if they ask – how and where this money is spent – whats wrong with it? Every citizen should ask. When DRDO has wasted Rs 1000 crore of tax payers money on developing a nuclear powered submarine which no one has seen still date – you expect everyone to just keep quiet? Why – should one man fleece another. I don’t care what the reasons are – and not too fond of socialistic crap.

    If old economy companies are not complaining – why are they not? They should too. Many of the big old economy companies have simply gotten used to getting their own little agendas in place by bribing away folks. This bribe is not so forth coming from new economy companies.

    As whats this crap about – that we dont complain when restaurants charge high, multiplexes charge high. Thats misleading. If they charge high, their services are of better quality too. And if we dont like we have the option of not availing of their services.

    This is different from Infrastructure – if you don’t lilke a road, you cannot just start using another one. Got it sire?

  14. Well said Click.

    Oi – in some places power theft is as high as 50%.
    And you will be surprised (am not though anymore) that almost all of the power theft happens with collusion of the power electricity department itself. This is not surprising because it starts right at the top. Unless we have better people at the top, the bottom is going to stink.

  15. IT employees are the highest tax payers as our salaries are high. It is also true that being salaried, with properly disclosed salaries, tax evasion is difficult. This does not mean that they are innately more honest -just look at the number of them who produce fake medical bills/ travel receipts to claim tax deduction on medical allowance and LTA.

    Of course,one of the main benefits of all the “new ecomony” salaried jobs is that they put more and more white money into the economy. Most of the new salaried class spend not only with cash but also with credit/debit cards, making dodging of sales/service tax by merchants difficult. This is clearly one of the benefits of new economy companies.

    Every Indian has the right to question how the Central Govt spends money and the right to demand services from it. Simply because you are richer and consequently pay more tax, does not mean that you deserve special priviledges. ALL Indians are equal. The poor pay less or no tax as they cannot afford it. India and most democratic nations have a progressive tax system, where the tax rate increases according to income. This ensures that too high a burden is not placed on those who cannot afford to pay. Tax breaks are also given to encourage the growth of specific industries, and a tax break in the ninties to IT companies was completely justified. However, when an industry is prospering, there is no justification for tax breaks or any other subsidy – such as free land and so on.

    I agree that “old economy” companies in many cases have bribed their way out of paying their fair share of tax revenues, as well as using the license raj regime to their advantage. Many merchants do not pay sales/income tax. This must be stopped, but it does not mean that new economy companies should also use unfair means. We cannot have an attitude that “others are doing wrong, so why not me” or “why are you catching me for doing wrong when others are also doing wrong”. That keeps India underdeveloped.

    Please stop calling me a socialist here – in many of my postings on this blog, I have called for private investment. I do not blindly believe that “‘govt is bad, private sector is good” or vice versa. I belive that in some cases, govt suceeds, and it others private enteprise suceeds. Both govt. and private enteprise must be evaluated based on their performance- that is all that matters.

    —————————————————————————-
    DRDO
    A discussion about DRDO specifically is off topic based on the heading and contents of Silkboard’s post.However, as it was brought up, a response to it is justified

    It is surprising that you mention DRDO as a waste of public money. While there have been some failures on its part,there have also been sucesses. Look at the LCA, or the indegenously developed Arjun tank. Both are firsts in India, and, unlike many innovations in the private sector, had to be acheived without any help from foriegn nations. In fact, being defence related products, many basic inputs were subject to trade sanctions. It is commendable that something has been achieved. While in certain cases there have been failures, and I do not defend them, it is wrong to say that DRDO is by nature deficient or incompetent. Besides, what about cases of private cos defrauding the tax payer’s money? The Bofors case comes to mind, as well as the coffin scandal in the Kargil war.There have also been countless cases of contractor fraud in defence contracts as well in other countries such as USA where defence contractor is private.

    In fact Click, if you look at the salaries senior scientists get, as compared to what they could get in the private sector, we should all be grateful for them.

  16. OI,
    Power theft is a serious problem in India. In Karnataka, power theft has declined over the years. One important innovation that helped in reducing this was initiated by the High Court. It ordered BESCOM to install power meters on each distribution transformer thereby making it easier to trace where the theft is happening. This makes it easier to hold the individual engineer in charge of that area responsible. Accountablity helps.
    Electronic meters that are harder to tamper with have also helped.

  17. @SB – You are correct about “old economy” sector getting their way or even complaining at the national level. My comments make sense in the local Bengalooru context. Small and medium industries are making some noise lately. Peenya area is getting about 25-30 crores in funding to improve basic facilities. That industrial area has been around since the late ’70s providing livelihood for lakhs of people.

    Power and water theft happens at all levels – poor to rich. Many large industries do it by bribing/influencing to enter into long term contract with ESCOMS to receive power at discounted rates that will surely result in a net loss for the ESCOMS.

    I have an interesting anecdote about power theft in US. A coworker of mine back in US had an uncle who used to work for a power company. His job was to drive around the rural areas all day and identify power theft. Apparently, some US farmers were stealing power by connecting copper rods to the distribution lines to run their farm equipment!! This was apparently common a few decades back.

    @Cluck. You said “Aren’t IT employees among the highest honest tax payer’s not just in Bangalore but in India too ?”. By your own example, salaried govt employees are also “highest honest tax payers” right? After all, the govt knows their salary and deducts appropriate tax from the pay check. Now, concentrate a little. Fleecing by auto drivers is no different than fleecing by fancy restaurants or other exclusive places. The customer suffers anyway. When you pay Rs 25 or more for a lousy cup of tea that tastes worse than what you get on a railway platform, or when items that you didn’t order magically appear on your fat bill is “better quality” service to you. God forbid, if the auto driver says “meter mele hathu rupayee kodi” is fleecing to you!!

    @George – Too bad people have attached labels to you. It happens when someone can’t make intelligent arguments anymore or that they are just used to living in a black and white world.

  18. By george again!!

    Its absolutely bad to compare one bad thing with another balance it and say one of them was better!!! What a bad example!!!

    This has become the norm of the day. Why do we have to compare between a cheating autowallah and the railway tea or the five star hotel MRP hiked drink?

    The fact is all are cheates, robbers..condemn all of them and dont spare a single one of them.

  19. This is very interesting…

    I have a couple of points to make.

    1. DRDO – As i work very closely with this behemoth here, one can assert that they have overall failed. Forget the corruption (which is pretty mind boggling and ‘closed’ circuit — meaning entry to the privileged club of vendors is difficult), their output is close to pathetic considering the overruns in cost, time and quality of the final products. Check with the Army or the Airforce to whom they cater.

    2. I recently paid 2000 bucks to the BWSSB area sanitary inspector (sic) to clear a clogged sewage drain near my home. I was the only one affected by the ‘back flow’ and nobody could give a damn.

    3. All of us are responsible and none of us want to take responsibility or the first step towards a new future.

    4. Blame game is our ‘birthright’ and we will find ways to crib and complain and move the buck to somebodyelse’s door.

    SB, wonder if (self) activism will ever come in ?

    Is there a future for us all indians?

  20. George boy – you are ill informed.

    LCA is more than a decade behind schedule.

    And Arjun MBT (Tank) is something Army refused to order after doing field trials. So their customer has given them a thumbs down.

    Lets not even talk of money down the drain. Read Namma Naidu’s previous comment too..

    Smoogey boy – you forgot to mention salaried govt. employees don’t necessarily work.. did Namma Naidu mention something about drainage clearance charge?

    All of us are responsible? Why?

  21. A note first. Guys (Goog Smoog, Click), please, no personal attacks.

    George, good points. One question though. How do you define “special purpose” Infrastructure? Roads are for everyone. Usually, infrastructure drives development. But here, we have the reverse situation in our country. It might be IT companies alone pushing for these expressways and flyovers today, but future companies would use these same facilities to catapult ahead of them.

    Click A very valid point about “choice”. If a restaurant fleeces you, you got fooled and never go there again. You dont have that choice about roads, law and order etc. So we must complain.

    To qualify that a bit “complain” thing a bit better, I like people who expect and demand more. That is the first step, isn’t it? At the cost of encouraging some useless noise, we as citizens should encourage this expect/demand/complain culture. A negative thing like that would be the the first step towards positive changes.

    Namma Nadu, #3 is perfect. But I do see activism coming in as soon as your point #4 meets the right channels. You and me exchanging complains is meaningless, but you and me filing complaints (feedback?) on BWSSB and BESCOM website would not be a waste. You and me joining hands to file a PIL against BWSSB supplying unhealthy drinking water would be a positive thing. I think we are headed there.

    And George, no, saying that Rich have to be a little more responsible, that is not being socialist. I didn’t put that label on you. Quite a few of the Rich in our country are so because they have worked this huge range of living-standards and incomes to their advantage. Isn’t it?

  22. At least you didn’t get lynched, silkboard :-). I suppose that was a… what is the term used so often… “positive” from your discussion.

  23. here is a contrasting picture

    btw, pranav, i was trying to get back to a heated ;-) debate i had had a while back with – i believe it was either tarle or sri. basically, i have totally forgotten the topic and where we left off. help please! :-).

    – s.b.

  24. This one perhaps?

    Thanks for that link. Didn’t know power tariffs were that high in Mumbai!

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