CITCO Explores Public-Private Partnership for Hotel Operations
The Chandigarh Industrial and Tourism Development Corporation Limited (CITCO) is actively considering a significant shift to the public-private partnership (PPP) model for managing its hotel properties. In a strategic move to enhance operational efficiency, the corporation has established a seven-member committee tasked with studying best practices in this domain.
The newly formed committee, led by the general manager (finance and accounts), has been mandated to visit and analyze successful PPP implementations in other states, union territories, and corporations where hotels and restaurants are operating under this model. The committee's primary objective is to benchmark practices that could improve efficiency, service quality, and financial sustainability across CITCO's hospitality units.
Employee Union Voices Strong Opposition
Meanwhile, CITCO's employees' union has expressed serious reservations about the proposed PPP model. In a formal communication addressed to the chairman and managing director, the union highlighted their concerns regarding the potential adoption of this approach.
The union representatives stated, "It has come to our notice that CITCO has adopted the public-private partnership model for CITCO hotels. It appears that CITCO has already started leasing out some of its properties under this model, which is causing financial losses."
The union cited several concerning examples from past experiences with private partnerships:
Drop-In Cafe, Sector 34: The private party allocated this cafe in 2020 has not deposited the license fee since allocation. The matter remains under dispute, with no payments made to date, resulting in blocked revenue and additional court fee expenses for CITCO.
Baithak Restaurant and Banquet, Kalagram: The private operator surrendered the premises without prior notice and failed to clear outstanding dues. Currently, this facility remains non-functional, causing significant revenue losses.
Magic Wok Restaurant, Hotel Mountview: The plan to lease this Chinese restaurant at CITCO's five-star property to a private party did not materialize successfully. Presently, neither the Chinese nor the Indian restaurant at Magic Wok has commenced operations at the Sector 10 location.
Health Club, Hotel Mountview: This case presents a particularly complex situation. CITCO decided to re-tender the contract due to unsatisfactory services and low rates offered by the existing licensee. However, the licensee refused to vacate, filed a court case, and obtained a favorable order from the District Court. The matter is now pending in the High Court, while the licensee continues operations uninterrupted, causing ongoing financial losses to CITCO.
Union Proposes Alternative Solutions
The employees' union has suggested that instead of adopting the PPP model, CITCO should focus on improving existing operations. They argue that CITCO hotels are already performing well and revenue could increase further with enhanced operational efficiency and better guest attraction strategies.
The union emphasized that recruiting skilled staff and undertaking property renovations would significantly improve service standards, strengthen brand identity, and ultimately lead to better revenue generation. They have humbly requested the CITCO management to reconsider the PPP model implementation.
The seven-member committee is expected to submit its comprehensive report at the earliest possible opportunity, which will likely influence CITCO's final decision regarding the PPP model adoption for its hospitality units.
