The announcement by Prime Minister Narendra Modi of a scheme to help the urban poor build houses in cities is a signal that the government is to undertake one more plan to address the problem of a shortage in urban housing. Even five months ago, its stand was that no new housing scheme had been envisaged following the extension of the Pradhan Mantri Awas Yojana-Urban (PMAY-U) till December 2024, with the focus on expeditious completion of sanctioned houses. But an appraisal of PMAY-U may have caused the shift in stance. It also indicates that ‘housing for all’ is still a long way away. In the last eight years since the launch of PMAY-U, only two–thirds of the sanctioned houses, or 76.25 lakh houses out of about 1.19 crore sanctioned, were either completed or handed over as on August 14. The central assistance released was ₹1.49 lakh crore; the Centre’s share has been limited to 24.4% while that of States and urban local bodies is 16%. The remainder, almost 60%, has to come from beneficiaries. Of the estimated total investment of ₹8.31 lakh crore for the 1.23 crore houses originally proposed, the beneficiaries (urban poor) have to shell out ₹4.95 lakh crore. Under the proposed scheme, the share of beneficiaries should be brought down to at least 40%, as a parliamentary committee report highlights, as beneficiaries are not in a position to fully pay their share because of their low income. Even though some State governments try to help such beneficiaries access bank loans, financial institutions have been lukewarm in their responses citing the lack of proof of sustained income.
The parliamentary committee also made well-considered suggestions on the implementation of PMAY-U, and the government would do well to examine them while drawing up the proposed scheme. The committee’s most significant recommendation is on the need to drop uniform and fixed assistance across the country, as followed in PMAY-U, and adopt a flexible arrangement instead, depending on the topography and other factors. Reasons behind the poor quality of the houses and the prevalence of unoccupancy too should be gone into. High land costs, floor space index restrictions, and multiple certification from different agencies are factors that determine the success of urban housing. This calls for central government-organised discussions with the relevant agencies such as State governments, local bodies, urban planning bodies, urban sector professionals, financial institutions and activists, as there is enough time for the Union government to formulate the new scheme. This time, the objective should be to draft a fool-proof scheme so that ‘housing for all’ no longer remains a slogan but becomes a reality in the tangible future.