Most of the urban local bodies (ULBs) in India lack an automated billing mechanism to levy and collect user charges for water supply and sewerage services. Inefficient billing and collection practices not only lead to poor recovery of operations and maintenance costs, but also increase the dependence on government and multilateral funding.
Even in bigger cities such as Delhi, Mumbai, Kolkata, Bengaluru and Chennai, ULBs are facing the issue of inadequate cost recovery. Lower revenue collection puts the creditworthiness of municipal agencies at risk, thus affecting their bankability and ability to tap into financial markets. However, the situation is slowly changing with several ULBs adopting advanced automated mechanisms to levy and collect user charges. A case in point is the Delhi Jal Board (DJB), which deployed a revenue management system (RMS) in 2012 to improve its revenue collection. The aim was to replace the manual billing process with advanced digitalised metering, billing and collection processes.
Prior to this, the utility’s revenue collection was highly inefficient due to issues such as inconsistent billing cycles, limited collection centres, incomplete records of properties and customers, and an obsolete grievance redressal system. Other challenges faced by the civic agency included complex and time-consuming processes, and lack of an up-to-date data collection system.
Over the past five to six years, the RMS has improved DJB’s revenue collection, service delivery and decision-making; increased the number of billed connections; and reduced tax evasion.
RMS is a multilevel management system, which automates the different functions across the board. The system comprises an intranet portal, mobile applications (separate for meter readers and consumers) and an internet portal. A customer care and billing software has been developed by Oracle for performing functions like metering, billing, collection and grievance redressal. Other software used in the system includes Oracle weblogic server, Oracle database, Oracle business intelligence enterprise edition and mobile devices, which are based on Android and BusyBox. In addition, there are a number of external systems that support RMS. These are payment gateway providers, third-party collection agencies, payment kiosks, SMS gateway providers, automatic meter reading agencies, etc.
DJB has deployed mobile tablets to capture the digital images of meters through the geographic information system (GIS). In its first phase, RMS was implemented in 18 zonal offices, covering 46 per cent of active consumers. The remaining zones are expected to be covered by July 2018.
Experience so far
Post the adoption of RMS, water meters are read through digital machines as opposed to manual reading. There are about 900 meter readers who provide door-to-door billing facility with the help of hand-held machines. The consumers can now pay their water bills through an online portal, payment kiosks and mobile wallets. The number of billing cycles has also increased from two to six per year. All functions including new connections, disconnections and mutations have been facilitated online, thereby completely eliminating manual processes. Further, the board has set up an online grievance redressal system and dedicated call centres for improving customer experience.
RMS has helped DJB improve its billing accuracy. Earlier, only 40 per cent of the consumers were billed on the basis of actual consumption while the rest were billed on an ad hoc basis. Today, about 90 per cent of the consumers are billed on their actual consumption and the remaining 10 per cent are charged the average of their actual consumption. The civic agency’s consumer base has also expanded from 2.25 million to more than 2.6 million customers post the development of RMS. DJB has set up a dedicated data centre for collecting real-time data on consumption, billing, payment, etc. RMS has led to an increase in the number of billing cycles and active connections, and improved revenue generation. During the first billing cycle of 2016-17, the active connection numbers (KNOs) stood at 2,051,344. During the year, 1,786,059 bills were generated, registering a billing percentage of 87.1 per cent. In 2017-18, the active number of KNOs increased to 2,242,216 during the sixth round of the billing cycle and the number of bills generated rose to 2,079,878. Thus, the billing percentage increased to 92.8 per cent during the sixth cycle in 2017-18.
During the period 2012-13 to 2017-18, DJB’s revenue collection increased from Rs 10.24 billion to Rs 16.9 billion, registering a compound annual growth rate of 10.6 per cent. Some of the specific advantages of RMS for customers are billing services at the doorstep, on-the-spot and regular billing, grievance redressal, and online/omnipresent payment outlets. Specific benefits for DJB include improved decision-making, efficient revenue management, better service delivery, higher revenue collection, reduced tax evasions, and increased number of consumers.
The digitalisation of different municipal functions through the adoption of RMS has been one of the key revenue enhancement strategies adopted by DJB. It has helped not only the board but also consumers by offering them a seamless online experience.
However, DJB faced several issues and challenges in the implementation of RMS. These include data migration of a large legacy system, data cleansing, staff training, and unavailability of certain Oracle modules. The successful implementation of the system has helped DJB strengthen municipal finances and facilitated effective delivery of services. Going forward, DJB’s experience is expected to encourage other utilities to take similar initiatives for improving their financial performance.
With inputs from a presentation by R.S. Godboley, Joint Director, Revenue, Delhi Jal Board, at a recent India Infrastrucutre conference