PMAY: Officials piling loan burden on beneficiaries, say activists

Slum dwellers across the state are allegedly being forced to avail bank loans for houses under the Pradhan Mantri Awas Yojana (PMAY), despite an option to construct houses independently.

Though there is a Beneficiary-led Construction (BLC) model under PMAY - where houses under the scheme are constructed by beneficiaries themselves, Housing Department officials are allegedly pushing the Affordable Housing in Partnership (AHP) model, where contractors build the housing units and hand it over to beneficiaries.

This is being done only with the motive of helping the contractors to make profit, activists have alleged. The officials, however, maintain that AHP is more efficient in urban areas.

Speaking to DH, Amruthraj Isaac, convener, Slum Janara Sanghatane - Karnataka, said that sanctioning houses under BLC will be more beneficial as slum dwellers will not have to resort to loans. “But the government is not taking it up under BLC because it cannot float tender for thousands of houses,” he said. Moreover, the beneficiaries are being forced to sign up for loans for constructing houses under AHP.

Even under the AHP model, authorities do not ensure that a single contractor takes up the job. “There are at least two sub-contracts,” he said, adding that it would compromise the quality of the houses which are constructed in a budget of around Rs 6 to 7 lakh.

According to the proceedings of the 24th State Level Sanctioning and Monitoring Committee meeting held in September 2020, Finance Department was of the view that taking up houses under AHP would lead to “delay in collection of (beneficiary) contribution, bank linkages”, which could ultimately lead to delay in completion and cost escalation.

Under PMAY, the eligible beneficiaries receive a grant of Rs 1.5 lakh from the Centre and Rs 1.2 lakh from the state government (Rs 2 lakh for SC/STs). While the BLC model transfers the amount to slum dwellers benefitting from the scheme, AHP involves beneficiaries availing bank loans to fund almost half the total cost of the house.

Meanwhile, Manoj Kumar Meena, secretary to the government, Housing Department, said that all new houses are being built under AHP model. Works of 54,000 houses are on under the model, and 97,000 houses will be taken up shortly.

“There are limitations to taking up BLC in urban areas, such as title deeds and issue of planning in areas where such houses will come up,” he said.

All the houses under the AHP model are sanctioned with the condition that bank linkage is assured to beneficiaries. “We are in the process of giving title deeds to slum dwellers, which can be used as collateral by beneficiaries to avail loans,” he added.