Housing ministry explores funding options
Ajith Athrady & Aditya Raj Das, New Delhi, Dec31, DHNS:
The UPA government’s ambitious scheme of making the country free of slums in the next five years by providing proper houses to slum dwellers faces hurdles with the Planning Commission and Ministry of Finance differing over the pattern of funding the project.
The Planning Commission is for a Public Private Partnership for implementing the project, while the Ministry of Finance is insisting that the Centre and the states should share the cost.
The scheme which is also dubbed as Rajiv Awas Yojana was announced by President Prathiba Patil in her address to the joint session of Parliament earlier this year.
Scheme
Finance Minister Pranab Mukherjee has allotted Rs 1,500 crore for the scheme in the Budget for 2009-10.
The scheme is scheduled to start before the close of the current fiscal ending on March 31, 2010.
As per an estimate a staggering amount of Rs 8 lakh crore to Rs 9 lakh crore is required to make the country free of slums by building around 80 lakh houses.
In the first year the Centre plans to construct one lakh such houses.
Initial draft
As per the initial draft of the scheme prepared by Ministry of Housing and Urban Poverty Alleviation, the financing pattern should be on the lines of the existing Jawaharlal Nehru National Urban Renewal Mission, under which the Central government provides 50 per cent funds (up to 90 per cent in case of special category states) and the remaining is matched by the states concerned.
However, officials in the Planning Commission say that if the scheme is implemented based on Central and state sharing basis, the Centre has to struggle to raise the fund as some of the states have already pitched for larger share considering large number of slum dwellers.
As the Centre has been funding several schemes including Jawaharlal Nehru National Urban Renewal Mission, this scheme should be developed based on Public Private Partnership mode, the Planning Commission has suggested.
Implementation of the project through Public Private Partnership mode will expedite flow of funds for the scheme, the Plan Panel sources said.
But the Finance ministry fears that civil society and slum dwellers may oppose roping private builders in this type of project as the private builders may hijack the project by denying due share to genuine slum dwellers, sources in the ministry told Deccan Herald.
Panel proposed
Against this back drop, the Housing Ministry is planning to constitute a committee to explore the avenues to fund the scheme, a senior official in the Ministry told this paper.
As the Centre is planning to provide property rights to allottee, it wants the scheme to be implemented without any legal hurdle.
The Housing Ministry has worked out the average price of housing at Rs 2.5 lakh.
The latest statistics says, the number of urban poor has increased between 1993-94 and 2004-05 from 76.34 million to 80.80 million due to migration from rural areas.
