The much-awaited Tamil Nadu Affordable Urban Housing and Habitat Policy, passed by the government in March, but made available in the public domain only recently, has got urban planners, developers and housing activists complaining about the lack of clarity and direction in the policy, and its poor public consultation. Many are worried about whether the policy will serve its purpose.
On March 18, the Tamil Nadu government approved of the Policy draft. The policy aims to ensure access for all, to adequate, safe and affordable housing and basic services, and to improve slums by2030. This will also strengthen the role of the government as a provider of housing to the poorest and as an enabler of housing markets to ensure the poor and middle classes have access to affordable housing.
However, the main problem seems to have two aspects -- one, that there was not adequate consultation and two, it lacks basic clarity and direction.
Karen Coelho, associate professor, Madras Institute of Development Studies (MIDS), said that the policy is flawed both in its process and its substance. “Numerous consultants have serially been commissioned to draft this policy -- this one is at least the third draft, I am not sure why earlier drafts were rejected. There has been a shocking absence of basic processes of public discussion and consultation that one would expect from a policy with a bearing on so many urban sectors,” she said.
She felt that the content of the policy was sketchy. Apart from the broad framing of affordability and the orientation toward bringing in the private sector in to take a larger role in providing affordable housing, it does not tackle the real issues in the sector, she added.
“Our (MIDS) study of affordable housing in Chennai, which we submitted to the State Planning Commission just in February this year, made it clear that the single biggest constraint to affordable housing supply, whether by State agencies or private agencies, is land. Yet this policy is silent on how land will be made available for affordable housing, how land speculation will be checked, how land prices will be regulated. How can you have an affordable housing policy that is not explicit about mechanisms for releasing land for such housing?” she asked.
Ms. Coelho added that there were numerous other issues that are left hanging, such as how the Shelter Fund will be managed and governed, how in-situ or proximate resettlement of slum dwellers will be achieved, and how the whole issue of basic amenities for slum-dwellers will be approached. “The government is clearly in a hurry to get this policy out despite its glaring shortcomings. We need to ask why,” she added.
Padam Dugar, president, Confederation of Real Estate Developers’ Associations of India (CREDAI), said, “Every city has different sizes and value in terms of affordability. What is affordable in Mumbai, is not in Chennai. There is no proper clarity on this.”
Activists point out that the entire policy was done in a hurry without proper public consultation. They pointed out that the policy has not taken into consideration the views of the communities, who are the beneficiaries. “A small selection of people were called for discussion and even to them, the draft was not shown or circulated for discussion. Many of them did not have any idea what the policy was about,” said an activist.
The activist felt that other than rental housing, the policy has not explored other types of housing like group housing/community housing programmes for specific vulnerable sections such as homeless persons and transpersons.
“The policy has not addressed several components like cultural adequacy (design and location), accessibility (especially for elders and persons with disabilities), and access to social infrastructure facilities. The policy has to provide guidelines for using the finance allocated under the Scheduled Caste Sub-Plan for housing and converge schemes such as the State Scheme for Housing for Fishermen, Tamil Nadu Adi Dravidar Housing and Development Corporation Limited, housing schemes for BC, MBC and minorities. The policy remains silent about such schemes, and clearly lack social inclusion,” the activist explained.
Industry reaction
Padam Dugar, representing the developers, said that affordable housing requires demand creation and that the incentive given to the developer alone does not really help.
“Our view is that the government should incentivise the buyer. For example, in Maharashtra the affordable housing stamp duty is only some ₹10,000 and approval charges are also low. Besides, the home loan for affordable housing should not be on par with a ₹ 1 crore home loan. Though there is a rebate from Central government schemes, there is a need for a lower rate of interest for affordable housing loans too. There should a single-window clearance for affordable housing,” he added.
There should be a cost benefit for the developer and buyer should be incentivised. “There should be project funding for affordable housing. The real estate funding for affordable housing must be given infrastructure status, so that funding can be given by the banks at low interest. This will give a financial boost to developers and will be a win-win situation for buyer and developer,” he added.
Mr. Dugar said that the government should support developers with special funding for affordable housing and highly incentivise the buyer. “Land is an important product in affordable housing. If I have to sell at ₹25 to ₹30 lakh, we have to go away from the city and there is no proper infrastructure for people to travel easily. So the State government should open up their lands in the city and give it to developers for construction of affordable houses. This is happening in other states such as Uttar Pradesh,” he added. Besides, real estate developers also want the government to provide land adjacent to industrial areas they are developing, for affordable housing. “The staff will not have to travel long distances every day then,” he explained.
Housing Department officials were unavailable for comment.