How to compare society contractor quotations fairly
04 Nov 2026
Quick answer
Annual society budget: A housing society annual budget works best as two lists side by side: recurring costs the society pays every month, and planned repairs it expects to carry out in the year. The first is estimated from last year's actuals and current contracts; the second from evidence of need and quotations. Members then see what the monthly charge pays for and what the repair fund is for.
What the law says about the budget
Under the West Bengal Co-operative Societies Act 2006, the AGM's business includes approving the annual budget and considering the latest audit report (s.29(5)). The co-operative year begins on 1 April (s.4(23)). The original text required primary societies to hold the AGM in April to June; a 2013 amendment Bill provided for the AGM within six months of the close of the co-operative year. Check the current wording and your by-laws for timing.
The Act does not prescribe budget heads or require a particular fund. Those come from your by-laws and general body decisions.
Step 1: recurring costs from actuals and contracts
- Take each head's actual spend for the last full year from the ledger, not from memory.
- Replace the estimate with the contract figure wherever a contract exists (security, housekeeping, lift maintenance).
- For metered costs such as common electricity, use last year's units and the current tariff, and write down your assumption.
- Add small heads (bank charges, stationery, audit fee) so they do not become "miscellaneous".
Example only. All figures in this article are invented to show the method. They are not real data or recommended amounts.
| Head (example) | Last year actual | Next year budget | Basis of estimate |
|---|---|---|---|
| Security services | Rs 5,52,000 | Rs 5,76,000 | New contract rate from April |
| Housekeeping | Rs 2,76,000 | Rs 2,88,000 | Contract renewal quote |
| Common-area electricity | Rs 2,04,000 | Rs 2,16,000 | Last year's units, current tariff |
| Lift maintenance contract | Rs 72,000 | Rs 72,000 | Fixed-price contract |
| Pump and plumbing upkeep | Rs 51,000 | Rs 57,600 | Average of two years plus one motor service |
| Office, bank charges, stationery | Rs 40,800 | Rs 43,200 | Last year plus known increases |
| Total | Rs 11,95,800 | Rs 12,52,800 | Rs 1,04,400 a month |
Rs 1,04,400 a month over 24,000 sq ft gives Rs 4.35 per sq ft, the rate used in the maintenance bill example.
Step 2: planned repairs with evidence
A repair line should say what is wrong, how you know, what it will cost and when it should be done. Waterproofing before the monsoon is the classic Kolkata example; see monsoon repair planning. Prices should come from comparable quotations, as set out in comparing contractor quotations fairly.
| Planned repair (example) | Evidence | Estimate | Timing |
|---|---|---|---|
| Terrace waterproofing, Block A | Leak complaints from top-floor flats; contractor inspection | Rs 3,60,000 | Before June |
| Replace one water pump | Motor rewound twice; service report | Rs 45,000 | Q2 |
| Lift rope replacement | Maintenance contractor's report | Rs 1,20,000 | Q3 |
| Total | Rs 5,25,000 |
Step 3: test the repair fund
Continuing the example: the repair fund opens at Rs 4,10,000 and receives Rs 500 per flat per month, Rs 1,44,000 for the year. Available: Rs 5,54,000. After the planned repairs it would close at Rs 29,000, which leaves almost nothing for an unexpected failure.
The committee should put the options to the AGM rather than choose quietly: raise the monthly contribution, approve a one-time levy, or move the lift work to next year if the maintenance contractor confirms in writing that it is safe to wait. Lift safety is a matter for qualified people, not the budget alone.
Step 4: present it so members can decide
- One page with the two tables and the fund test.
- A short note on each assumption (tariff, contract renewals, contingency).
- The effect per flat: monthly charge and any levy, using the society's billing basis.
- The options where a choice is needed, with the committee's recommendation.
- The latest audited accounts alongside, since the AGM also considers the audit report.
During the year
Compare actuals with budget each quarter and minute the variance. A head that is running over by a large margin needs an explanation before the year end, not at the next AGM.
Doing this on COOPMAN
COOPMAN supports meetings with minutes and resolutions, so the budget resolution and later variances can sit with the meeting record. The maintenance ledger provides the actuals for each unit. See the society management guide.
This article is general information, not legal advice.
Annual society budget: frequently asked questions
Who approves a co-operative housing society's budget?
Approving the annual budget is part of the AGM's business under s.29(5) of the West Bengal Co-operative Societies Act 2006, along with considering the latest audit report. The committee prepares it; the general body approves it.
Must a society keep a sinking fund or repair fund?
No such requirement was confirmed in the West Bengal Act or Rules for this article. Many societies have one under their by-laws or a general body decision. Check your by-laws, and if you have a fund, show its opening balance, contributions and planned use in the budget.
How large should the contingency be?
There is no fixed figure. Base it on what went wrong last year, the age of the building and whether a separate repair fund exists, then state the figure and the reason in the budget note so members can judge it.
Can the committee spend more than the budget during the year?
Check your by-laws for the committee's powers. Good practice is to record any overspend, explain it at the next Board meeting, and seek general body approval or ratification where the by-laws require it.
Should a big repair be billed as a one-time levy or paid from the repair fund?
Either can work. Compare the fund balance after the repair with the next likely repair, and if a levy is needed, put the amount per flat, its basis and the payment schedule before the general body for approval.
Sources and review
- West Bengal Co-operative Societies Act 2006, Gazette copy (FAOLEX) faolex.fao.org
- West Bengal Co-operative Societies (Second Amendment) Bill 2013 – PRS prsindia.org
Facts checked against the sources listed on 3 October 2026.
Next step: read the society management guide.
