The BLC was a success, but housing for the poor is woefully inadequate

Among the four verticals of PMAY, Beneficiary-Led Individual House Construction (BLC) has emerged as the front runner with about 60% of the total PMAY houses sanctioned under this vertical. Along with its ease of implementation resulting from the availability of land rights, this vertical also attained significant traction from the innovative approaches adopted by various state governments to expedite the disbursal of the BLC subsidy. These innovations have enabled the states to facilitate house construction among the urban poor through the provision of land rights, increased subsidies, and financial assistance.

To understand the process of BLC implementation and the innovative interventions by states to streamline this process, household surveys were conducted across three states: Odisha, Kerala and Tamil Nadu.

Studies from the three states have revealed high incidence of informal borrowing among the beneficiaries to finance construction. Despite the subsidisation of house construction, the financial contribution required from the beneficiaries is significantly high, forcing them to resort to borrowing from informal sources. The cost burden on the beneficiaries was exacerbated as the final cost of construction for many beneficiaries amounted to more than the estimated costs, owing to significant supply chain fragmentation.

While the overall satisfaction levels for various administrative processes were high, except in Odisha where beneficiaries faced delays in receiving the subsidy thereby incurring increased costs, the studies observed considerable gaps in the administrative processes. There were instances of beneficiaries undertaking construction without obtaining building approvals because it is not mandated by the states. Further, there was limited attention to the relocation of beneficiaries during the construction phase, and the costs for the same remained unaccounted for. As the construction period lasted an average of 40-50 weeks, the costs of relocation came to a hefty amount for some beneficiaries.

Despite the mandate to ensure the provision of basic amenities in the houses constructed under PMAY, there continues to be a sizeable lack of basic infrastructure in many BLC houses built. Approximately 96% of the beneficiaries in Odisha lacked access to an individual household latrine (IHHL) in both their old and new houses, and the bulk of them lacked a primary water source within the premises. Most houses in Kerala had metered electricity and a high proportion had water supply within premises. In Tamil Nadu, merely 7% of the BLC houses had access to all three basic amenities: piped water within premises, metered electricity, and pucca roads.

As per its mandate, PMAY has gained traction in its goal to empower women as most of the BLC beneficiaries in the three states were women. However, there continues to be a lack of a mechanism for proper information dissemination, along with limited participation from awareness-raising institutions/agents such as community mobilisers, slum committees and women self-help groups.

The study can be accessed here

(The study is authored by Shubhagato Dasgupta, Aparna Das, Anindita Mukherjee and Baisakhi Sarkar.)