Contractors get rich on housing for poor

Thane: The Thane civic administration could risk charges of "criminal omission" and "flawed planning" in the JNNURM-funded Basic Services for Urban Poor (BSUP) scheme , as developers and contractors reaped profits despite incomplete and shoddy construction work, say officials. 

    Six years after the launch of the welfare programme that provides near-free housing for slum-dwellers, less than 50% (2,412 tenements), of the 5,443 dwelling units, are ready for occupation 
    Against the project price of Rs228.33 crore, estimated for construction of 5,443 homes, the developers and contractors have been paid Rs 174.83 crore (an excess of Rs 73 crore), with the TMC paying Rs117 crore. The TMC's share was initially penciled in at Rs18 crore—9% of the total project cost. 
    "It is a criminal conspiracy and fraud aimed to split profits by civicofficials, contractors and political leaders. Ideally, fund disbursal ought to be in sync with the on-site physical progress achieved by the developer. In this case, the developers should have been paid 50% of the cost or Rs 101.18 crore for the 2,412 tenements built so far. Instead, the Thane corporation paid Rs174.83 crore, which simply cannot be a justified expenditure," a top bureaucrat told TOI. 
    Officials said the central and the state governments are not bound to fund the escalations arising due to implementation flaws. 
    "To ensure that the financiallyweak sections of the society are not pushed out of the city where land is premium and urbanization rapid, the Centre planned a housing scheme for the urban poor. Instead, the TMC officials and contractors have made it a profitable venture or a once-in-a-lifetime opportunity to pocket public money,'' another official said. 
    The TMC had initially secured sanction for two projects. The first project report prepared in 2007, estimated costs at Rs201.83 crore for construction of 9,423 homes, which was subsequently revised twice. The tenement units were reduced to 5,123 in January 2010 and cost reworked to Rs193.91 crore. The second DPR was for construction of 822 homes at an estimated cost of Rs 34.42 crore 
    "Of this 5,123 dwellings in DPR-1 only 1,590 homes have been built so far and work on 3,533 units is still underway," an official said. 
    "All of the 822 homes in DPR-2 have been completed but costs have soared to Rs 56 crore with TMC's share ballooning to Rs 27 crore as against its original estimated share of Rs 3 crore for these 822 homes,'' he explained.