Dhaka South's 2024-25 financial accounting ends in disarray

Demonstrations, mismanagement mar Dhaka South functions

• Operations at Nagar Bhaban remained suspended for 40 days amid protests 
• Several ministries also faced difficulties in implementing projects
• Bills for many projects remain unsettled 
• Many bills approved without thorough vetting
• Revenue target will not be met

Dhaka South City Corporation is being forced to close its 2024–25 fiscal year financial accounts amidst widespread mismanagement amid a deadlock centring the mayoral position.  

Bills for numerous completed development projects remain unsettled. At the same time, many bills are being approved without proper verification due to time constraints.

Amid protests by BNP leaders, activists, and some city corporation employees demanding that BNP leader Ishraque Hossain be appointed mayor of Dhaka South, all operations at the Nagar Bhaban (city headquarters) remained suspended for 40 days. 

Starting 14 May, they locked the main gate of the building in protest demanding the mayor's oath-taking ceremony. Dhaka South's head office finally reopened on 23 June, but the engineering department and the administrator's office remain non-functional.

This protest brought essential Dhaka South services, revenue collection, development project implementation, and bill payments to a standstill. 

Several ministries, including the local government ministry and the health ministry, are also facing difficulties, as they have projects implemented through the Dhaka South – many of which are funded by the World Bank and other international agencies. 

Following a fire last December in Building 7 of the Secretariat, the Local Government Division had temporarily moved its offices to several floors of Nagar Bhaban. Those officials were unable to work during the protest either.

This fiscal year, Dhaka South has implemented various projects related to waste management, electricity, public health, environment, climate and disaster management, and ICT development.

Bill settlement and cheque issuance end today

A Finance Division circular issued on 22 May stated that applications for fund disbursement under the 2024–25 development budget would be accepted till 17 June. New expenditure bills could be submitted until 22 June. 

The final date for bill settlements and cheque issuance under both operational and development budgets is 26 June.

One senior official, speaking on condition of anonymity, said that although regional offices submitted bills, approvals remain stalled as key officials – such as the administrator, CEO, and chief engineer – have not been attending office. It is uncertain whether many of the bills will be processed or cheques issued.

Dhaka South Administrator Shahjahan Mia told The Business Standard over the phone on Tuesday evening, "The city corporation is currently in a 'semi-functional' state. Our revenue collection has dropped. Some project work continues, but most bills remain unpaid. Notably, the Urban Primary Health Care Project is ending this month, and we haven't decided on its extension. If the project shuts down, children's immunisation activities will be disrupted."

He added, "Most development project work is halted. Only a few urgent projects are continuing in the field. Despite the deadlock, the revenue department is working on next year's budget."

Dhaka South had announced a budget of Tk6,761 crore for FY 2024–25, with Tk5,368 crore allocated for development work.

On 18 May, the government assigned Shahjahan Mia additional duties as managing director of Dhaka WASA. Since then, he has been working regularly from WASA's Karwan Bazar office, where he reportedly handles some Dhaka South files as well.

Sources indicate that in this final stretch, many bills have been approved without thorough vetting, as key project files are stuck at Nagar Bhaban, preventing proper scrutiny of work continuity.

Revenue target to remain unmet

Dhaka South generates revenue from 22 different sources. Its main income sources are holding taxes, rents from markets and community centres, lease earnings, and trade licence issuance and renewal. Revenue typically spikes at the end of the fiscal year due to trade licence renewals.

Dhaka South had set a target to collect Tk1,504 crore in revenue for FY 2024–25. However, officials believe this target will not be met. In FY 2023–24, total revenue was Tk1,061 crore.

Additionally, since Dhaka South has not submitted final bills, ministries like local government and health are also struggling to finalise their own project accounts.

A Finance Division official noted that this year's fiscal closing is more chaotic than in previous years. The national budget came early in June, followed by a 10-day holiday for Eid-ul-Azha. This left ministries, departments, and agencies unable to complete key tasks on time. 

Now, despite incomplete work, agencies are submitting bills to secure payments, expecting to complete the work later. The Finance Division is being forced to approve such bills as completed, knowing they are not.