The concept of housing for all is both acceptable and desirable

Builders, politicians, bureaucracy and the underworld have kept slum dwellers in Mumbai from receiving benefits from the slum law enacted in the '70s, which stated that if 70% of slum dwellers in any declared area applied for the right to tenure of the land on which they live, the government would acquire the properties and hand them over to cooperative housing societies of slum dwellers. A new slum rehabilitation authority was set up in 1997 to regulate redevelopment, but many schemes have resulted in huge profits for developers and have left original residents without homes or compensation.

With the Supreme Court recognising that the right to live encompasses the right to shelter, citizens residing in the informal sector have become protected automatically. Sections 13 and 14 of the slum law enacted in the ’70s ensured that if 70% of slum dwellers in any declared slum applied for right to tenure of the land on which they live, then the government shall acquire such properties and hand them over to cooperative housing societies of slum dwellers.

The concept of housing for all is both acceptable and desirable

Despite such a progressive law, the nexus between builders, politicians, bureaucracy and the underworld kept the slum dwellers away from what was legitimately theirs. In some cases, builders took advantage of the provision in the slum act and usurped prime land in the name of providing ownership to the cooperative housing societies of slum dwellers. It is in this background that the slum rehabilitation authority (SRA), constituted in 1997, that the new regulations for slum redevelopment have to be observed.

While the FSI permitted for SRA schemes was more than three times of what was otherwise authorised in normal schemes in those areas, the slum dwellers got very little and major beneficiaries were the builders.

Let us take a look at an eye-opening case study. Four thousand slum dwellers lived on government land belonging to the home department on prime property in Tardeo. Those with vested interests got together and obtained signatures of 70% of slum dwellers for the SRA scheme. By promising them 300 sq ft carpet areas, around 16 lakh sq ft built up area was to be provided for their rehabilitation with additional accommodation to be provided for police personnel and space for public amenities.

In return, the builder was officially permitted to sell around 2,000,000 sq ft. This converted into a super built up area with loading of about 45% area on the 2,000,000 sq ft. The builder, by his own admission, sold flats at ₹75,000 per sq ft. It is obvious that the revenue to the builder from the free sale area by his own stated calculations were somewhere in the range of ₹16,000 to ₹18,000 crore. Car parking areas and some other facilities were sold at huge premiums. The entire cost of construction for accommodating the slum dwellers at the rate of ₹3,000 per sq ft would not cross ₹500 crore. The cost of building multi-storey towers for free sale, even if it is taken ₹5000 per sq ft, which is the outer limit, would have not cost more than ₹1,000 crore. Taking the rentals given to the tenants and miscellaneous expenses, the actual cost invested by the builder would not exceed ₹2000 crore. It is therefore obvious that on the land belonging to the taxpayers the builder made a profit of around ₹12,000 to ₹ 14,000 crore. He also took advantage of tax benefits since providing accommodation to the slum dwellers was in those days exempted from the provisions of income tax.

So who lost in the process? The common man and taxpayer since the land is owned by the government. We can furnish at least 10 such studies where thousands of crores were made by the builders.

On one hand, the state government has debt worth ₹6.80 lakh crore, on the other hand government lands are being usurped by the developers in cahoots with the entire government machinery.

The SRA made certain startling decisions, such as if any person on a vacant land would offer to build houses for slum dwellers, such vacant land would get all the benefits available to the SRA scheme. As a result of this, all those vacant lands in the areas around Trombay, Mankhurd, etc, which are very polluted due to petroleum and fertilizers companies, and no one wants to live there, were cornered at dirt cheap prices. Poor construction material was used to build, and the buildings handed over to authorities in return for maximum TDR.

So the TDR generated from Mankhurd, which is the most polluted area with a dumping ground and polluting refineries, were given these buildings and TDR generated from these buildings was used for posh areas such as Bandra. So one sq ft constructed in Mankhurd costing ₹2,500 per sq ft was used as TDR in Bandra where the selling price was ₹55,000 per sq ft. There were many such fraudulent transactions.

Considering all these facts, one must realise that 5,800 redevelopment projects, SRA and otherwise, are stuck in Mumbai city alone. The original residents have been given paltry sums as rent and thrown out of the original residences; builders have since stopped giving the rent. In a latest communication, the government has admitted 1,25,980 families have been dishoused due to the non-performance of different rehabilitation schemes.

Now with the new rule — provide tenements to those slum-dwellers residing in hutments built before January 1, 2011, by charging ₹2.5 lakh — making more slum dwellers eligible, the idea is also to provide more incentives to the builders rather than only the beneficiaries. The formula is simple, for every sq ft you build for the slum dweller, you get 1 or 1.33 sq ft for sale. While the cost of construction is about ₹3,000, the selling price in the worst part of Mumbai is ₹10,000 to ₹15,000 per sq ft but in the better areas of the city it could be between ₹50,000 to ₹1.5 lakh per sq ft. Imagine the kind of money a builder is making as a result of this scheme.

Unfortunately, this is the reality in Mumbai hence this entire SRA scheme needs to be scrapped and a new scheme conceived so that people for whom these schemes are ostensibly made get the benefit and not the builders. They should give alternatives instead of one scheme, there could be multiple schemes and slum dwellers may be given the option to choose from the schemes. If the government is serious about their plight, it should come up with viable alternatives that sociologists and experts in the field have unanimously recommended over the years.

(The writer is a housing expert and an urban planner.)