The Importance of a Facilitator in Private Developer Led Low-Income Housing Projects

November 1, 2020

- By Meghna Mohandas

Guest Writer

(Meghna Mohandas is an independent researcher working on issues of housing and urbanisation in India. She holds a bachelor’s degree in architecture from the School of Planning and Architecture, Bhopal and a postgraduate degree in urban sociology from the London School of Economics.)

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Indian Housing Federation (IHF).

A 2003 report by the Cities Alliance stated that residents of slums should be vested with the primary decision-making role during slum redevelopment projects as they have the best knowledge of the issues faced by their communities, will be the ones who have to live with the outputs of the project, and have a constitutional right to participate in decision making processes. While this approach seems perfectly logical, slum redevelopment projects in India have largely failed to acknowledge these rights or include the expertise of the communities that are being redeveloped. The question I raise here then is, how can the low-income housing (LIH) sector in India arrive at an appropriate slum redevelopment model that balances the dual requirements of economic viability and social inclusivity?

The Departure of State from Affordable Housing

In the initial years following India’s independence in 1947, the State played the primary role of housing provider for low-income groups. During this period, government agencies directly implemented a number of LIH projects, taking charge of activities including constructing houses, providing sites, services, etc. Post liberalisation of the economy in 1991, the LIH sector evolved from a two-stakeholder system - government and community - to one that involves the private sector as a key stakeholder.

Given the enormous resources required to build adequate housing for all, the objective of the government was to arrive at a plan that would make affordable housing projects economically viable through the involvement of private developers, with the government adopting a more regulatory role. Privatisation was viewed by authorities as the solution for all of urban India’s problems – it would allow the transformation of cities like Mumbai and Bengaluru into the Shanghais and Hong Kongs of the future. In order to achieve these utopian visions of “Global Cities”, slums needed to disappear, and private developers were hailed as the only people who could usher in this new era.

In this whole scheme of things, one aspect was easily forgotten – what about the requirements of the people who lived in these slums, and for whom the houses were being constructed? Who was listening to their voices? The privatisation approach essentially reduced the community to a voiceless stakeholder, rarely consulted for opinions on how projects should be implemented (Figure 1). Ultimately, such projects constructed without inputs from the community failed to deliver housing that suited the social, economic and cultural needs of its residents.

Figure 1: Power Sharing Balance between Stakeholders of Affordable Housing Projects – Envisioned (Left) vs Reality (Right)

This approach is most evident in the slum redevelopment programme of Mumbai. The Slum Rehabilitation Scheme (SRS) introduced by the Government of Maharashtra in 1995, when the country was moving into the phase of liberalisation, still continues to remain in existence. According to scholars, the SRS, for the first time in the history of housing policies in India, utilised high values of land to attract private developers and builders. Under this scheme, slum dwellers residing in an area before a certain date are eligible for houses constructed through in-situ development by private builders. The builders are required to contribute a certain amount of money to a common fund co-owned by an elected representatives’ body of the community, the interest from which is used for maintenance of common areas. Additional floor space index (FSI) is provided to the builders who can construct units to sell in the open market at a profit and use the unused FSI elsewhere or sell it through the transferable development rights (TDR) system.

However, it has been noted in the course of implementation of several projects under SRS that the involvement of slum dwellers in the project was restricted only to obtaining their consent, as the builders required 70 per cent of residents to agree to the project for receiving approval.

The actual involvement of the community did not seem to matter to developers, and critics have argued that interests of stakeholders (builders and the government) largely revolved around freeing up lands for development, rather than the satisfaction of beneficiary groups.

A New Facilitator

The involvement of the private sector in slum redevelopment projects and the consequent marginalisation of the poor in India has given rise to a large number of civil society organisations (CSOs) that aim to act as the voices of slum dwellers and to adopt the roles of negotiators between private developers and the communities. Essentially, the role of these community-based organisations is to provide a voice for the people who have been rendered voiceless in the process of the construction of their own homes. Additionally, many low-income communities fail to understand government policies and schemes, and how they would benefit from these, which often results in a distrust of private developers. This is a result of multiple situations wherein slum dwellers have been evicted based on promises of new houses, which were never fulfilled. This is a particularly concerning scenario in the case of in-situ redevelopment, for which slum dwellers have to temporarily provide possession of their lands to developers for the duration of construction.

It is to address this gap that regulations under the SRS provide for an incentive of an additional 5 per cent built up area to developers for roping in non-government organisations (NGOs) to participate in the scheme. However, actual participation of this key stakeholder group was very less. In order to create a transparent and legible system under which affordable housing projects, particularly in-situ redevelopment, can be undertaken, it is important to include CSOs or NGOs as a key stakeholder. This kind of mediation by CSOs/NGOs would help bridge gaps that exist between various stakeholders in the low-income housing sector (Figure 2).

Figure 2: Revised Power Sharing Diagram between Stakeholders of Affordable Housing Projects (particularly In-Situ Slum Redevelopment)

A Case of Successful Facilitation

One organisation that has played the role of facilitator in slum redevelopment projects for many years now is the Mahila Housing Trust (MHT), a non-profit organisation based in Ahmedabad, Gujarat. In 2010, the Urban Development and Urban Housing Department (UD & UHD) of Government of Gujarat (GoG) released ‘The Regulations for the Rehabilitation and Redevelopment of the Slums - 2010’, which allowed for in-situ redevelopment of slums through private sector participation and was based on the SRS regulations mentioned previously. Developers were provided with multiple incentives such as additional FSI, TDR etc., in order to encourage their involvement. While the regulations did not mention the compulsory involvement of NGOs or CSOs at any stage of slum redevelopment projects, MHT is an organisation that got involved on its own accord, due to its existing relationships with many of the slums that had been identified for redevelopment under these regulations.

Through an analysis of secondary literature on two of MHTs successful involvements in private developer-led slum redevelopment projects in Ahmedabad (Kailashnagar and Abhuji Na Chhapra), some of the roles that they played have been identified.

One of the key requirements for development was that a minimum of 75 per cent of slum inhabitants had to provide their approval for development. This required extensive community mobilisation, which the developers were under no compulsion to conduct under the regulations, nor did they have the expertise to do so. Communities had extreme distrust in private developers, as they believed that they would be evicted from their lands, with no actual housing being provided, and thus, MHT played a key role in building trust between the two stakeholders. They conducted surveys on beneficiary eligibility and assisted them in putting together documents that could prove the same. They also connected residents to lawyers who could elucidate legal matters before signing of agreements.

Secondly, since the scheme involved in-situ redevelopment, slum inhabitants had to temporarily shift to other locations for the duration of construction. While the costs of this temporary displacement were to be borne by the developer, MHT worked with the communities to understand what the best way to transfer these funds would be, i.e., whether they should be directly paid to the landlords or provided to the residents themselves. It was also important that the residents be provided enough time to scout for alternative locations, and these needs were communicated to the developer through MHT.

One of the key aspects due to which low-income housing projects have often failed in the past is that high-rise complexes, which are usually the prototype for redevelopment projects, usually come with high maintenance costs, and thus, many inhabitants, unable to afford this, tend to sell or sublet their houses.

In order to offset this cost, regulations required that developers deposit a certain amount of money per constructed unit into a bank account that would be jointly held by the developer and the Co-operative Housing Society Group (CHSG) and interest from this pool of money would then be utilised to pay common maintenance expenses of the housing community. The idea of a CHSG or Residents Welfare Association (RWA) was first introduced through the SRS and was consequently included in the Gujarat guidelines. However, in order to realise this aspect, it was important to train residents on how to form elected CHSGs, and how to effectively utilise the funds for maintenance. Additionally, residents also had to be trained on how to use certain common amenities, for example, on how to segregate their waste for disposal. MHT provided these services, which are some of the softer aspects, that ultimately led to the success of the projects in which they were involved.

Another place where MHT played a key role in the project was to relay aspirations of the community to the developer[1]. The community had multiple requirements for their housing, which were based on their lifestyles, livelihoods and social behaviour. This included specifics on the types of materials and products to be used in construction, and spatial requirements common to the community. Thus, the facilitator organisation became a focal point of communication, for both the developer and the slum residents.

[1] This understanding was developed through the author’s interactions with members of MHT in 2017

Conclusion

While private developer led construction may not be the most appropriate solution for every slum dweller in the country, unsanitary living conditions in slums can be improved by a huge extent through their involvement, particularly under the ‘In-Situ Slum Redevelopment’ (ISSR) vertical of the Pradhan Mantri Awas Yojana - Urban (PMAY-U) scheme, which has been derived from state-level policies such as the 2010 regulations in Gujarat and the SRS policy in Maharashtra.

What can thus be concluded here is that the role that MHT played in the two projects mentioned in this article were crucial in the successful completion of the in-situ rehabilitation projects.

Private developers are able to implement projects feasibly in the financial sense. However, it is important that social inclusivity also be incorporated in affordable housing projects. In order to do so, it is important that NGOs or CSOs be looped in as a key stakeholder serving the important role of facilitation.

Such organisations would enable the bridging of a huge gap that currently exists between most developers and slum inhabitants, by playing the role of a facilitator.

However, in order to effectively implement projects through this system, it is also important that housing policies incorporate provisions for the compulsory involvement of NGOs or CSOs in LIH projects, particularly for in-situ slum redevelopment. This would provide the necessary policy push that would encourage private developers to involve NGOs/CSOs, thereby leading to socially inclusive slum redevelopment projects.

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