HOUSING AND URBAN AND RURAL PLANNING
THE housing programme which had its beginning in the First Five Year Plan was directed mainly towards housing for industrial workers and low income groups. The programme was considerably expanded during the Second Five Year Plan with the introduction of schemes of slum clearance and slum improvement, plantation labour housing, village housing and land acquisition and development. The Table below shows the anticipated expenditure in the Second Plan:
Table 1: Anticipated expenditure in the
Second Plan
(Rs. crores)
scheme anticipated
expenditure
subsidised industrial housing 24.2
slum clearance 9.9
low income group housing 37.8
village housing 3.7
plantation labour housing 0.1
middle income-group housing in Union Territories 0.3
state housing schemes 1.2
land acquisition and development 2.0
town planning 1.1
total 80.3
2. Besides the housing schemes mentioned above, a few other specific schemes designed to benefit sections of the community like scheduled castes, scheduled tribes and backward classes in rural areas, handloom weavers, displaced persons etc., were undertaken. The housing programme for workers in the coal and mica industries was implemented with resources provided by the labour welfare funds for these industries. During the Second Plan the Life Insurance Corporation began to provide funds for house building to middle income groups and to State Governments for undertaking rental housing for their low paid employees. Housing on a considerable scale was also undertaken by the Central Government Departments and public enterprises for their employees. The total outlay on public housing during the Second Plan was of the order of Rs. 250 crores and about 500,000 houses were constructed.
3. Although efforts on an increasing scale have been made in housing during the First and Second Plans, the problem of catching up with the arrears of housing and with the growth of population will continue to present serious difficulty for many years to come. Between 1951 and 1961 there was an increase in population of nearly 40 per cent in towns with a population of 20,000 or more. It was reckoned in the Second Plan that the shortage of houses in urban areas might increase by 1961 to about 5 million as compared to 2.5 million houses in 1951.
4. The growth of population and, in paticular, of the urban population suggests at least three general. considerations in relation to the directions in which housing programmes should be developed during the Third and subsequent Five Year Mans. Firstly, housing policies need to be set in the larger context of economic development and industrialisation, both large-scale and the problems likely to emerge over the next decade or two. Proposals relating to location and dispersal of industries will; therefore, be of increasing importance in the solution of the housing problem. In the second place, it is necessary to coordinate more closely the efforts of all the agencies concerned, whether public, cooperative or private. The need to undertake the preparation of master plans for urban areas becomes all the greater, for without these plans there is no means of bringing together and maximising the contribution of different agencies towards well-defined common objectives pursued systematically over a long period. In the third place, conditions have to be created in which the entire programme of housing construction, both public and private, must be so oriented that it serves specially the requirements of the low income groups within the community. In working out the housing programmes for the Third Plan an attempt has been made to bear these considerations in mind.
5. The housing schemes, which have been operating in recent years, namely, those relating to subsidised industrial housing, low income group housing, slum clearance, plantation labour housing, land acquisition and development and village housing will be continued and expanded in the Third Plan. There will be special emphasis on land acquisition and development as this is basic to the success of all housing programmes. New programmes for housing economically weaker sections of the community, dock labour and pavement dwellers will, also be taken up. Concerted efforts will be made to prepare master plans and regional development plans of metropolitan and industrial cities and resource regions. Provision has also been made in the Third Plan for undertaking experimental housing and research in building techniques and for collecting housing statistics, the absence of which has been a great handicap in the past.
OUTLAY AND TARGETS 6. For housing and urban development programmes, the Third Five Year Plan provides
359
360 THIRD FIVE YEAR PLAN
Rs. 142 crores as against the revised outlay of Rs. 84 crores in the Second Plan. In addition, funds for housing are also expected to be provided by the Life Insurance Corporation, whose contribution is estimated at about Rs. 60 crores. The distribution of the outlay for various schemes in the Third Plan is shown below :
Table 2: Outlay in Third Plan-1961-66
(Rs. crores)
scheme outlay
(i) Ministry of Works, Housing and Supply
subsidised industrial housing 29.8
dock labour housing 2.0
slum clearance, slum improvement and cons-
truction of night shelters 28.6
low income group housing 35.2
middle income group housing in Union
Territories. 2.5
village housing 12.7
plantation labour housing 0.7
land acquisition and development 9.5
provision for experimental housing, reasearch
and statistics 1.2
total 122.0
(ii) other schemes-
States, housing schemes 2.3
town planning including preparation of master
plans 5.4
urban development schemes 12.3
total 50.0
programmes included in the plan (i & ii) 142.0
(iii) programmes to be financed from the
funds expected to be provided by the
Life Insurance Corporation 60.0
grand total 202.0
The following are the main targets proposed
for the Third Plan:
Table 3: Targets in Third Plan
number of houses/
tenaments
subsidised industrial housing 73000
low income group housing 75000
slum clearance 100000
Village housing 125000
7. Besides the provision. for housing mentioned above, there are certain additional housing programmes financed from other sources. The coal and mica mine welfare funds are expected to provide in the Third Plan about Rs. 14 crores for the construction of 60,000 houses. The programme for the welfare of backward classes includes allotments for housing. Tentative estimates of the Ministries of Railways, Commerce and Industry, Communications and others suggest that over the plan period they may build about 300,000 houses for their employees at an approximate cost of Rs. 200 crores. Broadly, in the course of the Third plan, under various housing schemes and the construction programmes of Ministries, 900,000 houses might be constructed as compared to about 500,000 in the Second Plan.
8. In the private sector there has been an increasing amount of construction, but it is difficult to estimate its precise magnitude. The net investment on housing and other private construction, which was reckoned at Rs. 900 crores in the First Plan, is estimated at about Rs. 1000 crores in the Second Plan. In the Third Plan private investment on housing and other construction is placed at about Rs. 1125 crores.
HOUSING BOARDS 9. In the present stage of development, finance provided directly by Government can meet only a fraction of the demand for housing. Institutional arrangements are, therefore, required which will enable large numbers of persons, many of them with small incomes, to build for themselves. In this connection, the possibility of setting up a Central Housing Board is at present under study. Such an organisation could help to channel additional funds into housing, en- Courage the flow of credit on easy terms amongst other things by means of insured mortgages, improve lending practices and provide the machi- nery needed for the creation of a sound mortgage market in housing. It could, for instance, raise finance, directly to some extent and provide loan assistance to State, Governments or State Housing Boards for purchase and development of land, construction of houses and aquisition and redevelopment of slum ares. Funds obtained from the Life Insurance Corporation and from the Central Government could be channelled through it.In States where Housing Boards already exist,they generally serve as construction agencies for implementing the State housing Programmes. The existence of a Central Housing Boards and of Housing Boards in the States could in due course,secure for the development of housing resources which might not be otherwise readily available. Together these institutions contact assist in evolving housing policies which would facilitate construction of houses by persons of limited means for their own use and also enable banks and other financial institutions to undertake various services. It is proposed to consider these aspects further with a view to implementing the housing programmes of the Third Plan and laying the foundations for larger development in the future.
LAND ACQUISITION AND DEVELOPMENT 10. Availability of building sites in sufficient numbers and at reasonable rates is essential for the successful implementation of the housing programme. During the Third Plan, therefore, a fair share of the resources available for housing is being devoted to land acquisition and development. A scheme was introduced in 1959 for giving financial assistance to State Governments in the shape of loans repayable over a period of 10 years for acquiring and
HOUSING AND URBAN AND RURAL PLANNING 361
developing lands in selected places. The land acquired is to be utilised for house building under different schemes and for the provision of related community facilities like parks, playgrounds, schools, hospitals, shops, post offices etc. In the Third Plan a programme entailing an outlay of Rs. 26 crores (inclusive of the contributions to be made by the Life Insurance Corporation) is envisaged for land acquisition and development. The resources made available under this programme could serve as nuclei for 'revolving funds' in the States and be utilised for bulk acquisition and development of land.
HOUSING OF INDUSTRIAL WORKERS 11. Under the subsidised industrial housing scheme which was formulated in 1952 for providing housing to industrial workers employed in factories and mines, mainly in the private sector, the Central Government provides to State Governments, State Housing Boards and municipal bodies 50 per cent of the cost as loan and 50 per cent as subsidy. Industrial employers and cooperative societies of industrial workers are given financial assistance to the extent of 75 per cent and 90 per cent respectively, the extent of subsidy in both cases being 25 per cent. To enable industrial workers to provide the remaining 10 per cent of the cost, they have been allowed to draw non- refundable loans from their provident fund accounts. By the end of the Second Plan, the construction of about 140,000 tenements costing Rs. 45 crores had been approved. About 100,000 tenements had been completed and the rest were under different stages of construction.
12. The scheme should have made greater progress if even the subsidised rate of rent had not proved a comparatively high charge for workers, with the result that in some areas the tenements which have been constructed have not been occupied by industrial workers. The question of bringing down the rent so that it should be within the paying capacity of workers needs further study. Along with it, arrangements should be made to provide cheap transport for taking workers to their places of work. Certain aspects of the scheme have been revised already. Workers have a larger measure of choice as between different types of accommodation. Open developed and demarcated plots of land along with some building and roofing materials can be taken up by workers, so that they may build huts of the prescribed pattern themselves. For those who do not wish to go in for 'self-built' huts on open developed plots, 'skeletal' housing with the necessary foundation, plinth and roof to form a stable structure is provided. The rent for open developed plots is about Rs. 2 to Rs. 3 per month, whereas for skeletal housing it is about Rs. 8 per month. For non-family workers hostel or dormitory accommodation is built. A few other modifications such as extension in the period of repayment of loan, increase in the ceilings of standard costs to fit in with the rise in prices of building materials and labour, liberalisation of allotment rules and provision of developed sites to employers and cooperatives have been introduced. Recently employers have been granted a concession in income-tax in the shape of an initial depreciation allowance of 20 per cent on the cost of construction of new houses for their low-paid employees, in addition to exemption for three years from payment of income tax on the rental value of small houses.
13. Despite the steps which have been taken to make the industrial housing scheme more attractive to employers, much progress cannot be achieved without the employers generally accepting the housing of a substantial portion of workers as an essential obligation. It is necessary to remember that housing conditions for industrial workers have continued to deteriorate and that without improvements in this direction efforts to increase industrial efficiency and productivity will also be affected. The problem is, therefore, one of working out arrangements for new industries as well as for the established industries which might be feasible from the financial and other aspects and would also result in an effective contribution towards the solution of the housing problem. For instance, new establishments with a prescribed limit of paid-up capital (say, Rs. 20 lakhs or more) could be placed tinder the obligation of constructing one-half of the housing required by their labour over a period of perhaps 10 years. In the case of the older establishments, in any specific scheme that is worked out the contribution already made by an employer to provide housing for their workers should be taken into account. In these industries also, over a period, the aim might be to ensure that about 50 per cent of the housing required is made available directly by the industries and the rest as part of the general scheme of housing development. To the extent the employers are unable to construct directly the Government or the Housing Boards may take up construction. In such cases, the employers could contribute towards the cost of construction. These and other suggestions should be considered Jointly in consultation with representatives of employers and workers with a view to evolving a satisfactory scheme.
HOUSING OF DOCK WORKERS 14. A provision of Rs. 2 crores has been made in the Third Plan for giving loan assistance to Dock Labour Boards at Bombay, Calcutta and Madras to enable them to build houses for workers registered with them. A suitable approach might be for Government to grant loans to the extent of 80 per cent of the cost of construction. With the provision made in the Plan, it should be possible to build about 5000 houses. In recent years port development has been undertaken on a large scale, and in cooperation with the port authorities a coordinated view of the housing problems in the ports should now be taken.
HOUSING FOR LOW INCOME GROUPS 15. The low income group housing scheme provides for grant of loan assistance upto 80 per cent of the cost of the dwelling, subject to a maximum of Rs. 8000, to persons whose income does not exceed Rs. 6000 per annum. Assistance on this scale is also given to local bodies, public institutions run on no-profit-no-loss basis, recognised health, charitable and educational institutions and cooperative societies.
16. Since the scheme began in 1954, loans for about 85,000 houses have been sanctioned, and by the end of the Second Plan about 53,000 houses were completed. There is considerable demand for loans under this scheme. Progress has been greater in towns where developed sites are available. It is felt that in the Third Plan special steps should be taken to enable those sections of the community which are economically weak to obtain due benefits from the scheme, such as those with an annual income of Rs. 1800 or less. Persons in this category are in a position to pay rent in the range of Rs. 10 to 12 or, at the most, Rs. 15 per mensem. The principal methods for providing housing for them would appear to be either through construction of rental housing mainly by Housing Boards and local bodies or through housing cooperatives. As a basis for further consideration, it might be possible to provide local bodies with loans at a concessional. rate of interest repayable over a long period. Apart from pucca. houses, the question of providing open developed plots or skeletal housing on the lines of the industrial housing and slum clearance schemes could be considered. Rousing cooperatives comprising economically weaker persons could also be given similar assistance. Roughly about a third of the provision under the low income group housing scheme could be earmarked for economically weak persons. Exemptions from State and local taxes would also need to be considered. As more institutional finance for the housing of low in- come groups generally becomes available, a larger proportion of the funds provided by Government could be utilised for housing schemes for the economically weaker sections.