Govt to ‘trust’ philanthropists to keep amma canteens alive

In a desperate move aimed at saving the low-cost Amma Canteens, a flagship scheme of former chief minister J Jayalalithaa, and sparing the Greater Chennai Corporation, which is increasingly finding it difficult to meet the rising expenditure of running this welfare scheme for the urban poor, the State government has decided to look at other avenues of revenue generation.

According to a senior official with the Chennai Corporation, the State government has given its approval to constitute a trust to run the canteens, thereby relieving the Chennai Corporation from spending on the canteens. “Once the trust is put in place, philanthropists and corporate companies can donate their money to the trust. Most of the companies are not fully using the amounts earmarked for Corporate Social Responsibility (CSR) activities. The trust will try to pool in such money for meeting the financial requirements of the canteens,” the official said.

The official added that if the money collected through the trust becomes inadequate to maintain the canteens, the State government would sanction funds under the capital grant. “We don’t have to allocate funds from our Budget, which will be a great relief. The trust will be constituted under the clauses of the Companies Act,” the official said.

The much-needed relief has come at a time when the Greater Chennai Corporation is struggling to meet its regular expenses like releasing funds to contractors and providing the salary for its employees. After the State government withheld property tax hike in the city, the civic body was struggling to earn revenue and the collection is expected to further decline during the forthcoming financial year.

As per the records, the Chennai Corporation has incurred a loss of around Rs 483.75 crore since the scheme was launched in 2013-2014 financial year. Surprisingly, the income from the canteens has been coming down over the years even as the number of canteens registered a rise.

In 2014-2015, as many as 207 canteens collected Rs 40.52 crore on the heavily-subsidised food items it served. In 2018-19, it further came down to Rs 24.87 crore, even as the number of canteens that the civic body was funding went up to 407. During 2016-2017, the civic body had accrued a loss of Rs 127.06 crore on Amma Canteens, which was the highest loss over the years.

Despite the new decision — which was taken after a meeting of Chennai Corporation officials with Chief Minister Edappadi K Palaniswami — sources in the civic body said the new arrangement would take a few more months to be in the implementation stage. “We have only received the minutes of the meeting. Based on the minutes, a Government Order will be issued. Only after that, we would be able to commence the process to start the trust,” the sources added.

In another move to cut the losses and earn revenue, the civic body has also decided to sell tea, coffee and other drinks in the canteens without affecting the basic operation and purpose of Amma Canteens.

“Wherever we have space for having tea stall, we will sell tea and coffee. Apart from this, we will also let commercial organisations advertise on Amma Canteen walls. These moves are aimed at bringing in more revenue and cutting the losses incurred by the civic body on the Amma Canteens,” an official said.

Officials are expecting that the funding from the government would also save them from local auditing as they are obliged to respond to the audit report if the civic body accrues losses.

Apart from the formation of trust, the civic body would create an integrated kitchen from where the cooked food items would be supplied to the Amma Canteens. The civic body would also let individuals adopt the canteens and bear the expenses. “Once the Government Order is issued, we will implement all the proposals,” the official said.

To assess the impact of the Amma Canteens in the city, the civic body had recently conducted a mass survey among the customers. The results of the survey, which covered as many as 5.38 lakh customers, suggested that 85 per cent of the beneficiaries are from economically backward class.

According to the survey result, around eight per cent of the customers were students and seven per cent elderly people. Around 24 per cent of the Amma Canteen customers are construction workers.

According to the original proposal submitted by the civic body to former Chief Minister Jayalalithaa in 2012, the welfare scheme was designed to run in a no-loss, no-profit model, as inputs such as rice and sugar are subsidised.