Why Do Urban Housing Projects Fail?

In Agra, about 240 houses built to house the urban poor are in a state of disarray. These houses, constructed by the state government under 'Manyawar Kanshiram Shahri Garib Awas Yojna', have been lying vacant even after four years of their allotment. It is claimed that the delay has been caused due to poor coordination between the District Urban Development Agency (DUDA) and the Agra Development Agency (ADU). While ADU claims that no one has approached it with the allotment letter, DUDA says it has allotted the houses.

Such mismanagement is often seen in urban housing projects. Even though the Narendra Modi-led central government sees 'Housing For All by 2022' a national goal, state governments, urban local authorities and various government agencies will play an important role in making this a success. While various international bodies like the World Bank, International Monetary Fund (IMF) and the United Nations (UN) formulate policies based on the thought that making of housing policy is centralised in the hands of national governments, this is hardly how things work in the real world.

The situation varies from nation to nation. Though local bodies in countries like India have fewer powers, they are key to implementing the housing policy and regulating land use, as these agencies have a better understanding of the conditions in local districts. Besides, the local development bodies are in a better position to negotiate with other allied local authorities than the policy makers at the Centre. Also, local bodies can quickly address the challenges at hand.

But urban housing projects often fail to meet the needs of the poor. For instance, it has been observed that many low-income households do not move to the periphery even when they are given formal housing free of cost. In many cases, they sell their flats as soon as they can and move back to a slum. This is often a poverty trap, because many low-income families cannot afford to live in the periphery and afford the cost of living there.

There is also a lack of coordination among various agencies, even between urban local authorities and the central and state governments. This is especially true of countries like India, where the roles of various governing authorities are not clearly defined. This happens partly because the government agencies at different levels are expected to specialise in what they do best and, at the same time, they are compelled to coordinate with other agencies and make sure there is little duplication and corruption in their activities. Also, the central and state governments and urban local authorities may not share a common vision. When they do not share a common vision, negotiation may be difficult. Handling all of these objectives is inherently difficult.