Homing in

This is a brief review of the ground-reporting done by me in 2020 to gauge the progress of Pradhan Mantri Awaas Yojana (Urban) in Maharashtra’s cities and towns.

I found that though the scheme, being implemented through the urban local bodies (ULB), was extremely popular, it’s execution was plagued with several issues which were further compounded by the challenges thrown in by the pandemic, with beneficiaries having to deal with bureaucratic red tape, loss of income as they struggled to build a new home.


Pradhan Mantri Awas Yojana (Urban) aims to change the urban residential landscape of Indian cities and towns by providing homes to the urban poor and by aiding others to buy their first home by subsidizing housing units.

The scheme is being implemented by the union government through urban civic bodies, namely Municipal Corporations, Municipal Councils, and Nagar Panchayats.

One of the flagship schemes of Prime Minister Narendra Modi, PMAY(U) started in 2016 with a stated aim to provide ‘housing to all’ by 2022.

It is one of the biggest welfare schemes ever undertaken by the Government of India, in terms of the amount of the grant, number of intended beneficiaries, overall financial allocation (also the political goodwill it can potentially generate for a political regime that undertakes such a welfare project), and the interest it generated among the intended beneficiaries, especially among the urban poor.

Under its most popular vertical – the beneficiary-led construction or BLC – the beneficiary family receives a total of Rs 2.5 lakh in government subsidy – Rs 1.5 lakh from the union government and Rs 1 lakh from the state government – to build the house on an owned plot. In the metro cities, civic bodies undertake housing projects in partnership with private builders and make the homes available to the urban poor at discounted rates (Rs 8 -10 lakh/house). In the latter case, Rs 1.5 lakh/DU PMAYU subsidy is transferred to the builder.

I reviewed the scheme at both these levels) at the level of the municipal corporation (Pune) where PMAY’s Affordable Housing in Partnership (AHP) component was the most popular vertical, and b) at the municipal council level (in Pathri, Hingoli and Jintur towns of Marathwada) where beneficiary-led construction (BLC) vertical of PMAYU was the most prominent.

Travelling across several districts of Marathwada, I visited cities and towns to speak to the beneficiaries who were allotted homes under the scheme and civic officials who were supervising the scheme.

I found that most homes sanctioned under PMAYU’s biggest and most popular vertical (Beneficiary Led Construction) in which beneficiaries are responsible for constructing the house on their own using the subsidy amounts, remained incomplete due to delays in the release of promised subsidy funds – especially the central government component.

In fact, in many cities and towns of the state, unfinished homes had become a common sight. The delay in completion of the construction and the financial hardships caused by staying in rented accommodations imposed a big emotional cost on the beneficiaries which the state or the media has no way of calculating. The ongoing pandemic made things worse for the affected:

Pradhan Mantri Awas Yojana subsidy delayed, thousands of beneficiaries forced to live in shanties or half-finished houses

APART from the legwork that I did for ground reporting, I also filed several Right To Information petitions with the local civic bodies, the state government, and the Union Urban Development Ministry to obtain data as well as to bring to the fore how the bureaucratic apathy and red-tape was affecting the effective implementation of the scheme.

The documents obtained through RTI showed that the state government and central agencies were in communication with each other for months over the issue of release of funds and were engaged in a blame-match while the beneficiaries continued to suffer:

Maharashtra: As PMAY (U) beneficiaries wait for funds, state, central agencies in a war of words

SOON after the publication of these news stories, the Hingoli Municipal Council received a pending central subsidy of Rs 3.33 crore (thus bringing reprieve to about 250 beneficiaries), Pathri Municipal Council received Rs 5 crore ending the wait for over 400 beneficiaries.

After the reports, MHADA, the agency implementing PMAY(U) in the state, also changed its fund distribution norms so that subsidy funds are not diverted by the beneficiaries for other purposes:

Show construction progress to avail PMAY funds: Maharashtra civic bodies

The situation in big cities – for instance, Pune – was not any different. It was found that the beneficiaries of the Affordable Housing in Partnership (AHP) vertical were facing a different but equally pressing conundrum.

In Pune, houses built for the urban poor (lower-income and middle-income groups) by Pune Municipal Corporation were found to be too small (350 square feet carpet area) which led to many beneficiaries who were initially enthusiastic about the scheme forgoing the allotment. In this case, the civic authorities and the union urban development ministry failed to notice a mismatch between the aspiration of the urban poor and the facilities being offered to them under the scheme. In many cases, the loss of employment during the pandemic curtailed their ability to pay for the allotted homes or obtain bank loans.

Financial troubles, tiny houses: Why many PMAY allottees rejected the offer

Even after a second round of allotment as many as 63 per cent of flats on offer remained unclaimed.

Pune: 62% PMAY homes remain unbooked after second round of allotment

The civic body later decided to allot the about 850 unsold flats to the staffers of Pune Mahanagar Parivahan Mahamandal Limited (PMPML) which it partially controls.

Unable to sell flats to intended beneficiaries, PMC moves to allot PMAY(U) flats to PMPML staffers