The special township policy will be reviewed because the state government realised it had certain lacunae and may have favoured developers at the cost of the public, admitted chief minister Prithviraj Chavan in the state assembly on Monday.
"The special township policy was aimed at creating small townships across 100 acres of land with all amenities provided by builders. However, there are certain anomalies in the policy and we are reviewing it now,'' said Chavan.
Under the policy, various sops were offered to developers to set up townships, such as bypassing the urban land ceiling restrictions and non-agriculture tax, with the condition that they provide 10% affordable houses in these projects. One of the provisions of the policy was that state government would provide land, if required, for a contiguous project. This provision was often misused.
Out of the two projects cleared under this policy in Thane district, one was by Roma Builders of the Hiranandani Group, which was given 42% of the land by the government at nominal rates. In the other project, 5% of the land was given by the government to Keystone Developers at nominal rates.
Niranjan Hiranandani, managing director of the Hiranandani Group, said the policy was very clear. "There were no adverse comments from the chief minister and he was happy. It's a clean and clear project," added Hiranandani.
A spokesman for Keystone Developers declined comment.
But Chavan admitted: "The policy did not put a cap on how much government land can be given away for such projects. Even if the government gave 40% of land, in return only 10% affordable homes were created."
He added that the state government would also review both these projects for irregularities.
Chavan made this announcement this in response to a calling attention motion raised by legislators over the lack of affordable housing stock in Thane district and government largesse in giving private developers land at throwaway prices.
Sources in the urban development department said the state was now looking at putting a minimum cap of affordable housing in such projects at 20%. It will also align number of affordable homes to the share of government land in such projects.
"This means for 40% of government land, the developer would have to give 40% low-cost houses,'' said a senior official on condition of anonymity. He added that the 2006 policy had helped developers bypass the ULC norms. In 2007, the ULC was repealed and the policy is no longer in demand.