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Revenue Generation and Procurement Agenda
How do you unleash innovation in your city? How can you benefit from innovation in other cities? Cities that can enable vibrant business ecosystems and find the best ways of serving their citizens will succeed in digital transformation. There is a digital divide between cities that make the right choices today versus cities that are unaware of the opportunities or oblivious to the risks.
Date: 1 July 2016
Venue: DLB Conference Hall, Jaipur, Rajasthan
Interestingly, every existing city, which will retrofit under the Central government´s ambitious programme of Smart Cities, has been engulfed with challenges.
But as they say, ´every challenge brings an opportunity´; the advent of Smart Cities in the country seems to be a major boon for citizens. This is mainly because, when an entire city is retrofitted, the citizens may be tasting a new wine in an old bottle, but the end results are likely to be better than the bitter pills they were swallowing earlier.
In a recently concluded Smart Cities workshop -´Revenue Generation and Procurement Agenda´ by the Smart Cities Council India, decision makers and solution providers closely examined what cities should do today in order to enable a vibrant city operating platform. This workshop also examined what needs to be put in place in order to capitalise from innovation in other cities. The workshop was a great learning experience and threw up many opportunities for the Council´s partners.
The inaugural session was an amalgamation of profound ideas from Pratap Padode, Founder & Director, Smart Cities Council India (SCCI), and a realistic picture of India´s Smart City plan was presented by Purshottam Biyani, Director-Local Bodies, Government of Rajasthan. The workshop witnessed a full house, packed to capacity. In his opening remarks, the Founder & Director of SCCI emphasised on the need for smart and quick solutions for implementing Smart City projects. Padode also highlighted the need for sustainable projects and a mechanism in urban local bodies for revenue generation. In his address, Padode pointed out the need for error-free and transparent procurement strategies by the newly formed Special Purpose Vehicles, created by winning Smart Cities.
A session which witnessed a free flow of views was hosted by Dr Manjit Singh, Principal Secretary, Government of Rajasthan, who cleared the air on what exactly does the Smart City concept mean for a state like Rajasthan. He suggested that a Smart City must take care of basic infrastructure, where a city can minimise the losses on public utilities, and at the same time gain maximum from it. Also, his remark on the need for sustainable projects depicted the impeding challenges that stand before various other cities in India.
Dr Singh said, ´In the case of Jaipur city alone, the financial requirement for implementing 100 per cent water supply, sewerage and drainage system, green areas and improvisation of public transport, would be not lesser than Rs 15,000 crore.´ How to generate revenue
This seems to be a big question for every urban local body. However, the Council´s lead partners were ready to solve this impeding issue. In a session, ´Revenue Generation Strategies for smarter development of the city´, the private players gave solutions for revenue generation projects in property tax, water management, waste to power, renewable energy, smart parking, e- governance, smart lighting and water metering, etc. Here the experts from the Council helped city authorities understand innovative ideas for maximising revenues in the cities through projects and strategies, inclusion of PPP in revenue generation, etc.
In his session, Manik Sethi, Manager-Strategic Marketing, Thomson Reuters, presented an integrated land administration solution. In his brief presentation, he explained how AUMENTUM, an enterprise platform, helps provide governments foundational level automation of internal office functions. Also, with this solution, a city corporation can manage land & property ownership rights, automate mass appraisal valuation processes and property fee/duty collection.
Interestingly, Sethi showcased a comparative analysis of the AUMENTUM solution which was implemented in the city of Cape Town, South Africa, three years back. According to him, the city witnessed a 2/3rd fall in taxpayer objections from nearly 1 lakh to a mere 36,000. Importantly, since the year 2000, the city has added 2.36 lakh properties to its tax roll, with an increase in assessment of 330 per cent. This can only happen, as explained by Sethi, through a citizen engagement programme.
Dr Niraj Prakash, Director-Applications Sales Consulting, Oracle India, explained the digital intervention process in the form of an example that the company has delivered in San Francisco. He also advocated single point technology intervention rather than cities developing separate solutions for their Smart City plans. According to him, a state must create a single digital hub and its services should be made available to all present and future cities. Meanwhile, this hub should not be limited to a particular public utility service.
In his session, Rushab Shah, Partner, Responscity, examined a core weakness of ULBs -revenue generation. A government authority in the audience raised concerns over irregular property tax collection, inadequate surveys, lack of competent tax collecting staff and conflict between public representatives versus officers. Here, Shah suggested creating a digital infrastructure to overcome these impediments, on the lines of Vapi, Gujarat where every house has been equipped with near frequency communication (NFC) sensors and a digital address.
Procurement strategies and process
This session discussed procurement strategies with focus on integrated development and aggregation, e-auctioning, e-procurement, specification, standardisation, technology, life-cycle costing, transparency, governance and specifications. As far as efficient project procurement is concerned, the Central government has advised winning corporations to induct Project Management Consultants. The workshop also highlighted the Central government´s strategy to form a joint venture between Indian and foreign consultants who have the experience in implementing Smart City projects.
An Indian PMC will mandatorily have to form a JV with a foreign PMC so as to bring in Smart City know-how to the country. And by doing so, the capacity building of the Indian companies can also increase.
Over the next few years, more advanced technologies will flow into Indian Smart Cities through PMCs. However, Saravana Kumar, the CEO of Jaipur Smart Mission, a newly formed SPV, suggested that municipal corporations should not blindly follow the suggestions of their PMCs.
A PMC must not blindly recommend company-based technologies. Instead, a PMC must back its suggestions with various case studies on technical solutions that have been applied in other cities.
Devesh Shukla, Business Development & Solution Sales, Public Sector, Microsoft emphasised on the monetisation of procurement which is likely to take place in the entire Smart City plan. Shukla explained the importance of using ICT for procuring materials for road infrastructure, O&M, end-to-end solutions for citywide project implementations and to improve transparency in the overall process.
In his detailed presentation, Rajeev Dholakia, AVP-Smart Cities, Essel Infra Projects, suggested three procurement models to the august gathering. In his remarks, Dholakia suggested to elevate the role of an SPV to a contract management and financial organisation. In addition, he emphasised that the SPV should have strong monitoring and performance evaluation. Meanwhile, he advocated the bundling of a fewer number of contracts to help minimise managerial tasks at the SPV level and to improve contract management.
Meanwhile, Gokul Venkatraman, Business Development Leader, Owens Corning, was of the opinion that the procurement risk can be minimised by proper material selection.
The road ahead
At the end, cities in India are currently under quick transition towards a low carbon environment, high quality of living, and resource efficient economies. Urban performance depends not only on the city´s endowment of hard infrastructure, but also on the availability and quality of knowledge communication and social infrastructure. There is a growing importance of Information and Communication Technologies (ICTs), and social and environmental capital, in profiling the competitiveness of cities.
Information and communication systems play a critical role in building Smart Cities and supporting comprehensive urban informatics. Extensive research is taking place on a wide range of enabling information and communication technologies, including cloud and network infrastructure, wireless and sensing technologies, mobile crowdsourcing, social networking, and big data analytics for Smart Cities. ICT brings together citizens and integrates technologies and services such as transportation, broadband communications, buildings, healthcare, and other utilities. Advanced communication and computing techniques can facilitate a participatory approach for achieving integrated solutions and creating novel applications to improve urban life and build a sustainable society.
The main purpose of this workshop was to bring together decision makers and solution providers in the field of systems, networking and communications, to discuss major challenges, research problems, and potential applications to support Smart Cities and urban informatics.