BMC, India’s richest civic body, to give cash against house to poor

The Mumbai civic body's move is inspired by two reasons: shortage of housing tenements and the number of projects stuck due to its inability to move people out from a particular area that needs to undergo developmental works

BMC’s move received widespread flak from activists, who claim that the civic body is simply looking to repudiate its role in giving alternative and affordable housing to the urban poor. | Representational image

In what can be seen as an astute breakaway from a longstanding civic policy, the Brihanmumbai Municipal Corporation (BMC) has decided to give money — instead of houses — to people whose homes have been affected by developmental projects. The proposal, already cleared by the BMC’s standing committee, will allow India’s richest civic body to give cash compensation to people living on corporation land, which includes slum dwellers.

The municipal corporation’s unconventional move is mainly because of two factors: shortage of housing tenements that it can offer to project-affected persons (PAPs), and secondly, the number of projects stuck due to the BMC’s inability to move people out from a particular area that needs to undergo developmental works such as widening of roads, nullahs, etc.

The scheme itself is applicable only to projects categorised as “extremely essential.” Proponents of the scheme argue that “something is better than nothing,” while critics say it will lead to large-scale gentrification and further create a sharper divide between the rich and poor, forcing the latter to move to peripheries of the city where they can afford a house. Under the current cash compensation scheme, PAPs living in structures constructed before 1964 will be compensated considering market rates, which will either be 1.2 times the ready reckoner rates of the area or, in case of slums, 0.75 times the ready reckoner rates or ₹30- 50 lakh, whichever is higher.

The move has drawn flak from housing rights activists, who claim the civic body is simply looking to repudiate its role in giving alternative and affordable housing to the urban poor, by treating housing as a commodity and not as a right. They claim that giving cash-for-land will force PAPs to move to the city’s outskirts, thus increasing the amount of time and money it takes for them to travel to their workplaces.


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“The proposed policy is meant to displace without offering comprehensive resettlement,” said 28 activists in a letter to the civic body. “The token gesture of monetary compensation undermines all established international practices and is highly regressive.”

Furthermore, housing rights activists said the proposal runs contrary to the official policy of the Ministry of Housing and Urban Affairs of the Central Government titled, “In-situ Slum Redevelopment (ISSR) using Land as Resource,” which promotes in-situ rehabilitation (rehabilitation in the same neighbourhood) of slum dwellers under the “Pradhan Mantri Awas Yojana (Urban) – Housing for All” mission, and recommends that “Slums, whether on Central Government land/State Government land/ULB land, Private Land, should be taken up for “in-situ” redevelopment for providing houses to all eligible slum dwellers.”

Experts and activists also say the proposal may result in corruption with middle-men taking “cuts” and kickbacks from the compensation amount provided to hutment dwellers.

Surprisingly, civic officials agree with activists.

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Vishakha Raut, Leader of House (BMC), said that displaced tenants would be given cheques and not cash. When asked if this move was a positive one for the urban poor, she said: “No…according to me it is not. What happens when you give a cheque or money is that the people tend to spend it on other things rather than buying a house. Therefore, giving them a house is a much better option. But in certain cases, where, for example, there are four brothers living in the same house in a slum, giving them one house on relocation…they are not happy,” said Raut.

The most important question is whether the BMC has enough alternate housing blocks to provide to PAPs. “The ones that are available are located in Mahul and people are not ready to move there because of high pollution in the surrounding areas. For a person to reach the main road he will have to spend about Rs 50 on a daily basis, which is unaffordable for most labourers,” Raut said.

People are also suspicious of the corporation’s willingness to keep it word, she said, adding, “There are certain areas in Mumbai wherein people were removed from their homes long back but no alternative housing has been provided yet. Something is better than nothing though. However, I still feel that the house-for-house was a better option. My first preference would be to give a house—but there are no houses now.”

When asked how could the richest municipal body in the country not have enough alternate housing for its poor, Raut said: “We are working on that…but it will take another two or three years more.”

It’s not like the BMC hadn’t been working towards providing alternate housing for the project affected people (PAPs). The civic body had started building 5,000 houses for PAPs in each of the seven zones of the city in 2019, but the project has dragged on for various reasons. Furthermore, the municipal body has 3,800 housing units lying vacant in Mahul; these cannot be used for relocation and rehabilitation as per instructions from the Supreme Court, which stated that the area is unfit for people to live in due to high pollution levels.

Now, as per an estimate prepared by the Estate Department that takes into consideration all major infrastructure projects scheduled to take place in the future, the BMC requires approximately 36,000 PAP housing units in the near future.

Ravi Raja, who is the Opposition party leader in the BMC, said: “If the corporation doesn’t have PAPs…they may carry out rehabilitation as per other norms. Any hutment that has been built (legally) before 2000, had to be provided with an alternate house by means of in-situ rehabilitation. However, the BMC doesn’t have vacant plots, which is why they are not able to provide alternative accommodation to relocate, which in turn, has led to a lot of the infrastructure projects getting stuck.”

According to Raja, approximately one lakh people are expected to be affected by developmental projects in Mumbai over the next decade. He said the scheme offering cash in exchange for land is a good move. “If the hutments are costing ₹20-30 lakh, and if we are giving ₹50 lakh…people will be able to keep the rest of the money for themselves after buying a house in a different part of the city. They can go to other areas that have hutments.”

When asked if this would prevent people from living in the heart of the city, which is closer to their workplace, rather than living in far off peripheries, Raja said: “What to do? If road widening has to be carried out…do we wait for years? Progress needs to take place in terms of development. The main problem is that we don’t have a stock of housing.”

“The lens with which they (BMC) looks at itself is not from the lens where housing should be delivered to the poor — and that itself is where the problem starts,” said Bombay High Court advocate Lara Jesani, who is also a member of the People’s Union for Civil Liberties (PUCL). “I don’t think it’s about lack of tenements—there is no doubt that Bombay is congested and there is a high density of people along with the scarcity of homes. Housing is extremely expensive and not affordable—but this is all the more reason why the government needs to make sure that people have access to affordable housing and even free housing. Housing has to be considered as a right,” Jesani said.

“The new scheme means that anybody can be evicted (from their house) as long as they’re paid for. The civic body is only looking at monetary compensation which is not enough,” she added.

“It comes down to a person being given in-situ rehabilitation,” she said. “The whole concept of in-situ rehabilitation has been taken away. You demolish a slum in Bandra but will rehabilitate people in a far off place. This is the entire manner in which slum demolitions are taking place. If you demolish a person’s house, you have to provide them with an alternate house. That was the understanding, and also, there must be in situ rehabilitation as far as possible. This new scheme is a deviation from that and reducing housing from a right to a commodity. Secondly, it will not be possible for the poor to afford housing in the centre of the city, and so it will divide people further on the basis of their economic levels. Somebody who is poor will not be able to have a home in a grander location of the city…there will be demarcated rich and poor areas. It may also happen that people who have been compensated in terms of money will not be able to afford housing in that particular area—they will be forced to go to the outskirts and once again, live in slums. So how is it going to solve the problem?”

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Last week, an article in The Hindu cited how Tamil Nadu’s first-ever draft Resettlement and Rehabilitation Policy “clings to a tired model of peripheral resettlement that fails on social justice,” stating that the police itself was not “anchored in a comprehensive housing and habitat policy that defines a framework for adorable housing, slum clearance, and land use in which the relocation of slum dwellers to remote peripheries is specified as a last-ditch option.”

The article also outlined how mass ghettos have emerged on the peripheries of cities all over the country as the “default move for rehousing the evicted urban poor.”