Beneficiary led construction (BLC), one of the four components of the Pradhan Mantri Awas Yojana (PMAY)– Prime Minister Narendra Modi’s flagship programme to construct 1.12 crore affordable houses in urban areas by 2022, when India will mark the 75th anniversary of its independence – has emerged as the most popular component of the scheme.
The high demand for BLC, especially in small cities and towns, is because of the comparative flexibility it offers to beneficiaries to construct stand-alone houses on their own plot. The other three components of the scheme are the Credit Linked Subsidy Scheme (CLSS), Affordable Housing in Partnership (AHP) and In-Situ Slum Rehabilitation (ISSR).
Under BLC, the central government provides an assistance of Rs 1.5 lakh per beneficiary for construction of a new house, with a carpet area not exceeding 30 square metres or enhancement of 9 square metres to an existing house. Several states have also offered their own financial assistance to the scheme, with the Maharashtra government offering an additional Rs 1 lakh per dwelling unit (DU).
The popularity of the scheme in the state can be gauged by the fact that 2.19 lakh DUs have been sanctioned under the scheme since 2016 under 350 urban local bodies (ULBs), including municipal corporations, municipal councils and nagar panchayats, till date.
But, of the 2.19 lakh houses sanctioned under BLC between 2016 and 2019 in Maharashtra, only 22,000 houses have been completed, nearly 80,000 remain incomplete while work on the rest of the units are yet to start. Thousands of beneficiaries, who have already started construction work on their houses, await the release of next instalment of the central subsidy, which has been delayed for months – in whole or in part.
The Covid-19 pandemic and the prolonged lockdown has only made matters worse in the state as a large number of beneficiaries have not even been able to raise their own share of funds towards construction of these houses. As a result, over 1 lakh beneficiaries in the state have not been able to build their housing units further despite receipt of the first few instalments of the subsidy.
The desperate wait for new houses
Mukhtar Begam, a resident of Pathri, a town of about 40,000 residents in Parbhani district, is one of the beneficiaries of PMAY.
It has been over eight months since her family moved into a tin shed erected on an empty plot under high-tension electricity wires. After her house was sanctioned under PMAY last year, the family dismantled the kuccha house to clear the plot and build a new two-room house, with a kitchen and a toilet, as promised by the scheme.
The construction progressed until the lintel-level, but then the money ran out. The family has spent over Rs 2 lakh on the house, including the Rs 1 lakh they received from the state government. Her husband is a woodcutter who earns Rs 300 on the days he manages to find work. His income has dried up since March, when the nationwide lockdown came into effect in India.
“He has to travel to cut trees and during the lockdown, all the travelling came to a halt. We were struggling to survive,” said Mukhtar Begum, who is mother to three daughters and a son.
Monsoon has been especially challenging for the family. While they are used to a leaking roof, life in a makeshift shanty during heavy rain has posed some new and frightening challenges. The overhead high-tension wires often snap in strong winds and fall on the tin roof of her house, turning the entire tenement into an electrically-charged unit.
About 100 metres away, in Vilas Gople Nagar, Babarao Tambe says he regrets choosing PMAY over Ramai Awas Yojana, the Maharashtra government’s housing scheme for poor families from Scheduled Castes and Scheduled Tribes, which also provides a Rs 2.5 lakh subsidy for a new dwelling unit.
“My cousin had got a house sanctioned under Ramai Yojana at the same time I got mine through PMAY. I have received Rs 1 lakh and spent Rs 3.6 lakh on the house. I had to borrow Rs 2 lakh for this. My cousin has received Rs 2.5 lakh in subsidy and his house is ready… he has to pay back a loan of about Rs 1 lakh. I would have been better off if I had applied through that scheme,” said Tambe.
Across Pathri, 1,153 DUs were sanctioned under the scheme since 2018 and work started on 1,050 tenements between January 2019 and January 2020. As of October 5, only 200 homes have been completed while 621 remain in various stages of incompletion. All these houses have received Rs 1 lakh in two instalments from the state government’s share — one of Rs 40,000 and then Rs 60,000 – and are awaiting further funds to complete the work. About 250 have shown no progress.
In the neighbouring district of Hingoli, construction of 1,098 houses was sanctioned and work orders were issued in 951 cases. Of these, 448 DUs have been completed while 503 DUs are stuck at the lintel level. Even most of the beneficiaries who have completed their houses say they have not received central assistance.
On the delay in release of central funds, Hingoli Municipal Council Chief Officer Ajay Kurwade said, “We received Rs 11.33 crore from the state government and should have received Rs 16 crore from the central government… but have received only Rs 35.4 lakh (what does this mean?). Utilisation certificates of all the funds have been submitted – not once but four times – but further funds have not been released. In fact, for some of the beneficiaries, we used unspent funds from the state government scheme.”
Local political leaders pointed out that the condition of those beneficiaries who had moved into rental accommodations after dismantling their existing homes — to construct new and better ones under PMAY – was the most desperate.
“In Pathri, many beneficiaries are staying in rented houses and have spent a considerable amount in rent. Due to the long delay in the release of third and fourth instalments of the central subsidy, many have now started to return to half-constructed houses by covering them with tin or plastic sheets, because they can’t afford to pay rent anymore,” said NCP leader from Pathri and MLC Abdullah Khan Durrani.
The high cost of sand has also made it difficult for poor families to finish the construction on their own, he added.
‘Utilisation certificates not submitted’
According to Dilip Muglikar, executive engineer of the Maharashtra Housing and Area Development Authority (MHADA), which is the implementing agency for PMAY in the state, the main factor that has led to withholding of central assistance from the beneficiaries, whose work has progressed satisfactorily, is the failure of some urban local bodies to submit utilisation certificates (UC) of the central funds received by them.
“Funds from the sanctioned central subsidy are held up because of the issue of submission of the UCs. As per the rule, the state will have to submit UCs for at least 70 per cent of the released funds to seek further release. Of the Rs 600 crore-odd central assistance released to ULBs in Maharashtra, we have submitted to the Union Ministry of Housing and Urban Affairs (MoHUA) UCs for only Rs 214 crore. Utilisation certificates for Rs 200 crore have been received from ULBs and will soon be sent to the Housing Ministry. Once the number crosses 70 per cent (about Rs 450 crore), our case to seek the release of next rounds of funds will be strengthened,” said Muglikar.
He also said that there was a possibility that the beneficiaries may have spent the money sanctioned by PMAY elsewhere. “The Covid-19 pandemic and the prolonged lockdown may have played a role,” said Muglikar.
When contacted, the Ministry of Housing and Urban Affairs did not provide an official response. On condition of anonymity, a highly-placed officer said that the Ministry was aware of the issues being faced in the implementation of BLC in Maharashtra and was taking urgent steps to resolve them.
“We are in regular touch with MHADA officials and have now written to the state government. The issue is not caused by a lack of funds. We are seeking submission of utilisation certificates and will soon resolve the problem,” said the MoHUA official.
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