Selja wants scheme for property rights to slums

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Posted: Thursday, Jul 02, 2009 at 0020 hrs IST
Updated: Thursday, Jul 02, 2009 at 0020 hrs IST

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New Delhi: As part of the 100-day agenda minister of housing and urban poverty alleviation Kumari Selja on Wednesday said she wanted to launch the Rajiv Awas Yojana, which apart from providing property rights to slum dwellers and urban poor, will provide basic amenities such as water supply, sewerage, drainage, internal and approach roads, street lighting and social infrastructure facilities in slums and low income settlements. The housing ministry has estimated a cost of Rs 4,500 crore to implement this scheme.

The housing ministry is also planning to explore the public-private partnership (PPP) model for affordable housing for the urban poor. Selja said that the stake holder for the scheme will include the urban poor, municipalities, parastatal authorities, state and central governments and private developers.

So far master plans of cities failed to consider dwelling space for the urban poor. As a result illegal slum development took place in most Indian cities. The ministry will demand for ‘inclusive’ master plans for cities which will deal with the concerns of the urban poor for affordable housing and informal sector activities.

The ministry will support an inclusive city campaign involving all stakeholders to alter the existing city planning model and prepare ‘inclusive’ master plans/city development plans that adequately address the concerns of the urban poor for affordable housing and informal sector activities which engage most of the urban poor.

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» Land Partnerships

Posted by Chris Cook on 2009-07-03 03:53:07.306933+05:30
Hopefully the minister will take advantage of the flexibility of the new Indian Limited Liability Partnership (LLP) as a framework for the creation of a new - and arguably optimal - form of PPP for affordable housing.First the land is held in perpetuity by a (Gandhian....) custodian - either the government or a suitable foundation.Then suppliers of materials, labour and services etc are given the choice of receiving either cash or proportional units in the pool of affordable rentals which result. Whether or not they are willing or able to invest their costs, they are obliged to invest their agreed profit margin.Risk capital is necessary for the cash element necessary top cover uninvested costs.The completed properties are then rented at genuinely affordable, but index-linked, rental. The resulting rental pool is divided into proportional units (n'ths) and sold to investors. A secure (affordability =certainty), index-linked property-backed rental stream is ideal for pension funds, and its Islamically sound nature opens up the pool of investment further.Anything the occupiers may in excess of rental, enables them to acquire Units, and hence equity, and they may also acquire Units by carrying out maintenance themselves or assisting in the building.This "Land Partnership" is simple, but radical. However, it is only countries which have had the good sense to introduce the "Open Corporate" LLP who are in a position to implement it.

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