Housing Shortage in West Bengal Present and Future Shortage
Statistics show that the housing shortage in the country is increasing at an alarming rate. As per the 1991 census, the housing shortage for West Bengal alone stood at 14,30,399. Assuring a modest shelter of 250 sft. and an average cost of pucca construction @ 350 per sft, total fund requirement to provide shelter to all, would come to Rs.12516.00 crores approximately. Out of which 70% or Rs. 8761.00 crores would be required to be financed by the Financial Institutions (FIs). As per a rough estimate, the total fund channelised through the FIs may not be more than Rs.200 crores a year. Considering this scenario, it appears that the housing activities in the State is not adequate enough to wipe out the shortage within a decade or two. In a comparative study of loan sanction and release from HUDCO by various States of India it may be seen that loan sanction and release by these States are much higher than that of West Bengal.

A detailed study of income category wise housing shortage may provide exact information on the quality of housing shortage. As perayn cursory exercise done by me the present housing shortage of about 14.3 lacs may be more than double in the next 15 years (2010) considering the present rate of housing supply. The vast majority of people of our country belong to the Economically Weaker Section and Low Income Groups who are engaged in informal economic activities and agriculture. These are the unorganised sectors, which do not have any steady income. They require improved housing and living conditions most to upgrade their quality of life and economic activities. But public sector housing efforts including finance, technology transfer etc. does not reach them easily.

Quantification of Responsibilities of the Lead Actor Department
A number of Government of India sponsored schemes bearing grants such as India Awas Yojna, Scheme for Housing and Shelter Upgradation (SHASU) under NRY, Workers’ Housing Schemes etc. and various other schemes bearing grants are already in operation in the State under Department of Rural Developments, Municipal affairs, Labour and others. These Departments and the agencies under their control operate housing schemes bearing substantial or 100% grants. As such some of these Departments may not have arrangements for loan handling. The share of these Departments in housing delivery with institutional loan is very low.

Generally Housing Department and agencies like WBSCARDBL; WBSCHFL etc. under co-operation Department deliver shelters availing loan assistance from Financial Institutions. In the absence of any State Housing Plan or document, it is difficult to quantify the task of wiping out the housing shortage by each Department. The rural housing is being deal by the Rural Development as also by the Housing and Co- operation Department. Similarly, Urban Housing is being dealt by housing as well as Co-operation, Municipal Affairs and UD Department. It may be assumed that the Housing Department may have to deal with about 50% of the total housing shortage in the State which may come to about 15 lacs dwelling units including repairs, additions etc. within the next 15 years.

Long and Short Term Objectives for Housing the Poor
As the schemes like IAY, SHASU, PMI-UPEP etc. schemes take care of the rural and urban poor, it is expected that the housing shortage for the poor may substantially fall within this period. Economic conditions of the people in general are also expected to improve with more people coming under MIG and HIG income brackets. Hence, out of the 15 lacs dwelling units to be dealt with by the Housing Department, about 40% may be assumed to fall under HIG and MIG income categories who may be able to afford shelters from the market and 60% under the EWS and LIG categories of people who may require State support to procure decent shelters. The Housing Department therefore, may have to address its efforts only for this 60% or about 9 lacs families including repair and additions during the next 15 years. Out of the 9 lacs poor families, to be housed in 15 years, 60% may constitute construction of new dwelling units and 40% repair or addition on existing units. During the first 5 years main thrust shall be in strengthening the institutional network when about 20% of the task could be accomplished. In the successive 5 years this figure may be enhanced to 30% and 50% respectively.

Conventional Public approach to Housing Official Efforts:
Construction Schemes:

High Overhead and Low Delivery Rate
Various State Departments such as PWD, Housing, and Urban Development etc. have been engaged in construction of houses and disposing them initially on rental and subsequently on ownership basis. In fact, HUDCO during early seventies had constructed a demonstration-housing scheme at Ultadanga, Calcutta to drive home the point that houses can be built and delivered on ownership basis as a self- generating venture without any support of the State budget. This was followed by establishment of the State Housing Board, which undertook such self-generating housing projects since then. A few housing areas were developed by the Board in Golf Green, Salt Lake, Kasba, Sarsuna, Barasat, Birati, Dankuni, Uttarpara, Patuli, etc. by the Housing Board and CMDA. Gradually it was noticed that the rate of delivery of built shelter remained very meagre - around only 1000 per year at an average, which had hardly any impact in ameliorating the severe housing shortage.

The Board could not make much headway outside the Greater Calcutta area. It was also noticed that the overhead remained high. It was not feasible to increase the size of the organisation drastically in order to augment construction of more shelters. Possibly culture of time-bound delivery through Annual Work Planning, an essential requirement to avail institutional finance could not develop due to availability of softer options to institutional finance. It was clear that construction of houses could not be increased substantially through such approach in order to arrest housing shortage.

Cash Loan Schemes:
Weak Delivery Mechanism

HUDCO has been soliciting to its agencies to transform or diversify its role from builder to that of a facilitator by channelising cash loans and technology to the families owning their own plots. This would facilitate a much bigger operation with the same organisation. The act of construction would have such broader base with wide dispersal of decision-making process and organisation of construction. This would also help in encouraging local artisans and craftsmen.

The State Housing Department readily realised the importance of the cash loan scheme when 20,000 shelters were constructed by the cyclone victims themselves during 1989 within a very short time and at a very low cost. Thereafter efforts were made to avail this loan for the Poor in the Districts, Government Employees and Primary School Teachers. However, none of these schemes could meet with complete success so far.

It was decided by the Department to channelise the funds for District Housing Scheme through the WBSCBL, which in turn could further channelise it through its District Banks and then to the local subsidiaries. As per the fund flow, the flow had been linear and long drawn. This was obviously a slow process giving no scope of effective communication on technology transfer by the HUDCO or the WBHB. In case of Primary School Teachers’ Scheme also, the pattern was similar.

This however, would require special efforts to transfer technology, construction or demonstration schemes, establishment of Building Centres to ensure supply of quality materials at low cost and the like. Reorientation training would also form an integral part of operating this scheme. A highly motivated and committed network of organisation could not be developed to deal with the cash loan housing schemes for various reasons. This may be the basic reason for not generating demand and quick identification of the beneficiaries. Finally, the cash loan housing schemes could make limping progress with large number of closures and withdrawals of schemes.

Shortcomings of the Public Approach
Major shortcomings of the construction schemes, are generally absence of a time bound programme, high cost besides certain other problems. The approach is rather straight jacketed, as no one has any stake in the shelter delivery. The communities for whom the shelter was built are not born till the same are finished. Hence users participation in decision- making including planning and design, supervision etc. are completely missing. The common victim in such a situation is the quality of planning, design, construction etc. and economy.

In case of cash loan schemes, in the absence of an effective communication gaps and lack of commitment appears inevitable disallowing momentum to the schemes. In fact, these schemes are still now a non-starter. This becomes evident when the year-wise intake of loans by the other States is compared with West Bengal. A year wise loan sanction and release reveals the problems of low key housing activities availing HUDCO finance even when the lowest rate of interest was only 5% and the highest at 13.5%. If this is an indicator, the overall picture of availing funds from LIC, GIC, NHB etc. may also be equally discouraging.

Popular Approach to Housing Popular Efforts:
It is observed that the low-income people who are mostly engaged in informal economic activities. They build their shelters and even settlements with their own resources and initiatives even if this means unhealthy slums, jhuggis, shanties and the like as they lack fund to build anything better. They are not creditworthy in the eyes of the retail financing institutions like Banks, Insurance Companies and Public Financial Institutions. Under these circumstances, the poor depends totally on the following sources of funds:-

OWN SAVINGS: This is generally very meagre; however, the poor mostly appropriate building materials from the nature, community assets, agricultural and industrial wastes etc, which compensates for cash savings.

PRIVATE BORROWINGS: The poor may approach the local moneylender or their employers for housing loan in lieu of high rate of interest or free labour. This fund is very expensive for them. Sometimes it may perpetuate indirect bonded labour in the remote rural areas. Such lending and borrowing are confined in isolated pockets.

INSTITUTIONAL BORROWINGS: Normally financial institutions do not find them creditworthy, as they do not have any steady income. Supply of such fund is vast but mechanism to avail this fund for the poor is inadequate. Hence it does not serve interest of the poor.

Shortcomings of the Popular Approach
As the millions of poor have hardly any accessibility to institutional finance or have any savings; they have to depend on appropriation of materials from the nature, community assets or agricultural and industrial wastes. This leads to either shelterlessness or poor quality of shelter. Since services involve higher level of resource mobilisation, operation and technology, the isolated popular shelters and settlements fail to acquire it. This results in poor environmental conditions forcing the inhabitants to struggle for basic day-to-day needs finally resulting in low quality of life. The shelters do not provide safety; security or comfort and healthy living condition both in qualitative and quantitative terms. In a nutshell in most cases, their habitats are not conducive to healthy growth of body and mind. Nevertheless, the potentials of poor in local decision-making, construction, maintenance etc. in the matter of their shelter and habitat in their own way is discernible.

A NEW PARADIGM FOR SHELTER DELIVERYINVOLVING NGOs AND LOCAL COMMUNITIES.

Need for a New Paradigm - A Public-Popular Approach
The preceding discussions show that there are severe shortcomings in both public and popular approaches when they play in isolation. This sets us to review the paradigm of shelter delivery system for the poor being followed at present with a total public sector approach. The supply of 1.80 lacs dwelling units within five years will be a gigantic task within the State machinery is neither realistic nor advisable due to its financial implications. Hence, a realistic alternative to organise this massive programme is to be developed. It is also clear that the housing and human settlement activities cannot be entirely left to the popular efforts as it may jeopardise environment and quality of life of the people themselves. Hence, the resources of the State and the vast potentials of the people should be combined so that paucity of technical and financial resources of the poor do not distort their efforts to achieve a healthy living environment.

Role of NGOs as an interface between State and People in Shelter Delivery
A mechanism is required to be developed to harness the best of the public and people’s efforts. The funds may be provided by a Public Sector Financial Institution like HUDCO to the local communities. However, there is a severe gap of scale between these two actors. This gap will not only make the transfer of technologies, channelisation of funds, recovery of loan etc. difficult, it may even fail the objectives. The Non-Government Organisations (NGOs) and Community Based Organisations (CBOs) who have direct link with the local communities and beneficiaries are considered a viable institutional arrangement to close the gap between these two ends. The NGOs are generally organised and run by eminent people with good prossociations, samities, libraries etc. are available even in the villages. These grass-root level intuitions are well participated by groups of local people to attain various local objectives like sports, recreation, drama, Id, Muharram, Durga Puja and other social works. These CBOs are generally cohesive but non-professional in nature. Once they are trained, they are in a position to organise, train and orient the local communities and beneficiaries in the State-initiated housing process and harness their potentials in planning, execution finance and even research. The local community may include the immediate cluster communities where the beneficiaries belong, physically and mentally and the CBOs. The NGOs may play the role of an interface to forge the Public-Popular Approach while Zilla Parishads, Gram Panchayats etc. as local level State actors will render supports as facilitators.

ADVANTAGES OF PUBLICPOPULAR APPROACH
Organisational Advantage
By nature of constitution, the NGOs are close to these people at the grass roots through welfare activities. Some NGOs may be totally external. But they avail the services of Community Based organisations (CBOS) and local leaderships to carry out their missions. The CBOs exist in all villages and neighbourhoods particularly in this State, which is an advantage available for ready use. Once the CBOs are trained in shelter activities and become self propelled, the NGOs may withdraw to spread their mission elsewhere. Presently, they may lack experience in housing activities. Proper reorientation and training may make them effective in the shelter sector. Housing operations through them would be economic as their overhead costs are low and commitments are high.

The FIs may find it difficult to provide funds to them due to their lack of experience in loan handling for shelter activities, deficient loan recovery mechanism, professional training and credit worthiness. But the State Government may lend supports to them by recognising them on the basis of their performance rating and many other ways. The State may use the readily available infrastructure of NGOs and CBOs to launch a massive housing programme.

Operational Advantages in Public Popular Approach
The proposed delivery mechanism of funds will disintegrate the massive housing problem into manageable sizes and decentralise the task of shelter delivery to the local and immediate community levels which can be handled by the NGOs/CBOs ensuring community participation. In this process the peoples organisational and financial resources can be mobilised and implementation time can be reduced. Quality of the decision-making in planning, design and work will be far better as the community and the beneficiaries will have a direct stake in the matter.

Bulk finances of HUDCO may directly flow to the NGOs/ CBOs recognised by the State. In course of time, NGOs may operate at a slightly higher level and CBOs may implement the schemes at the grass root level, which will create a rational vertical hierarchy of actors with assigned tasks. The NGOs may specialise in technology transfer and train up CBOs and local community group for specific schemes with the help of District and local Building Centre, promoted by HUDCO. 

The CBOs may specialise mainly in credit mechanism and ensure to and fro flow of fund. However, the NGOs should gradually withdraw from the schemes by training the CBOs and the local community in maintenance of the shelter and loan recovery mechanism. It will be an advantage if the NGO sets up a composite credit mechanism at the local communitylevel dovetails the housing loan with it. The WBHB may also share responsibility by obtaining loans from HUDCO and channelising it to the beneficiaries through the NGOs. At the village level, Gram Panchayats may also assume the role of CBO depending on the scale of the activity and its commitment to the specialised field of housing.

INSTITUTIONAL FINANCE
Differential Rate of Interest by HUDCO Favouring the Poor
There are several housing finance inst14 the interest rates of the market. The loan assistance is offered generally to the public agencies against Government Guarantee or any other acceptable security. However, agencies are required to prove their legal and financial eligibility before seeking such financial assistance. HUDCO offers differential rate of interest based on income of the beneficiary group. 55% of its funds are provided for housing for the EWS and LIG categories at 9% to 13% rates of interest.

Lack of Capacity to Absorb Bulk finance From HUDCO
As a bulk financing institution, HUDCO offers low interest Cash Loans to the borrowing agencies like Housing Boards, Co-operative Banks, Development Authorities, ULBs etc. for construction of houses by the individual beneficiaries on their own plots. The Agencies may channelise these funds to the beneficiaries directly or through local agencies and recover it from them over a stipulated period of time. This requires a network of agencies to channelise funds to and fro and assist the beneficiaries in transfer of cost effecive improved house building technology. Experience shows that this network could not be developed as yet. As a result, low interest bearing HUDCO finance could not be absorbed effectively. However, a Public-Popular approach is proposed may provide an answer to this problem. Since the fund is mobilised from the public for a short term and provided to the beneficiaries on a long-term basis, recovery of loans becomes extremely important.

A FIVE YEAR SHORT TERM ACTION PLAN FOR HOUSING FOR THE POOR
Resource Mobilisation
The plan provides for maximum loan assistance of Rs.25,000/- to the EWS and Rs.70,000/- to the LIG income categories of people for construction of new houses on their own plots and Rs. 12,000/- to the EWS and Rs. 35,000/- to the LIG categories of people for repair /Upgradation/ extension of the existing houses as per the financing pattern of HUDCO.

HUDCO provides us with 55% of the total allocation for the EWS and LIG categories. The allocations may increase by 20% every year. Hence in course of normal allocations between 1996-1997 to 2000-01, the State may get Rs. 220 crores. If the State makes a higher demand, it may be possible to get it on the basis of demand and actual performance in the preceding year. Still there may be a gap of financial resources to complete the Plan, which may be covered by availing assistance from other FIs, if necessary. It may be difficult to meet the gap in resource mobilisation and organisational capacity unless efforts are made to augment housing delivery activities by involving the local communities and NGOs throughout the State.

THE SHELTER DELIVERY SYSTEM
The local level Non-Government Organisations and immediate Community Based organisations shall act as hierarchical linkages between the grass-root level users/beneficiaries and the public institutions like HUDCO, WBHB etc. The Zilla Parishads/Panchayats may help in identifying such NGOs/CBOs and provide all supports as facilitators in guiding the local level actors, loan recovery etc. This approach will split the massive housing operation into decentralised and localised shelter actions. Such action shall have better chance of success as the local community shall have a stake in maximising benefits to the beneficiaries who would enjoy the results.

ROLE OF THE STATE

Recognition of NGOs/CBOs
As per norms, the HUDCO would assess the track record of NGOs/CBOs and may require some assurance about their credibility. The State may come forward in sorting out these problems by recognise the NGOs/CBOs with the help of the concerned Gram Panchayat Samities/Zilla Parishads on the basis of performance rating. Certificate of recognition may be issed to the NGOs/CBOs. The State may maintain a list of good and creditworthy NGOs/CBOs and forward it to HUDCO. Since the State has a stake in augmenting housing delivery these supports shall help to achieve its objectives.

Financial incentives for the Beneficiaries
The deposits made to HUDCO as security for obtaining loans will earn interests. These accruals may be used to subsidise, the initial higher amounts payable by the beneficiaries to HUDCO as interest on the higher principal amounts. Such incentives may be made available or the NGOs and Local Communities when they are regular in making their loan repayments. Incentives to the local communities may be in the form of convergence of various central and state schemes in their areas. The State Zilla Parishads may also provide special financial incentives separately for the poorest of the poor.

Financial Disincentives for the Beneficiaries
A set of disincentives may also be formulated for those NGOs, Local Communities and beneficiaries who are not regular in repayments. They may be considered debarred for other benefits available from the Gram Panchayats/Panchayat Samities/ Zilla Parishads till they clear their dues to NGOs/ CBOs. The Gram Panchayats/Zilla Parishads may be empowered to deduct the default amounts from any other money payable to the defaulting beneficiaries towards repayments of shelter loan. In order to create community pressure on the defaulting beneficiaries, it may be necessary to enter into an agreement with the Zilla Parishads to deduct full default amounts of beneficiaries from the grants payable to the Gram Panchayats where the defaulters live and pass it on to the NGO/CBO concerned. An agreement between the Zilla Parishad, NGO, Gram Panchayat and each beneficiary may be executed to this effect so that the NGOs are able to recover dues from the beneficiaries regularly and repay the loans.

Financial Liabilities of the State
The State is not required to provide any Government Guarantee for this scheme as HUDCO accepts cash deposits as security for its Housing Schemes through NGOs. Accordingly, the State may extend support to the NGOs by providing cash deposit to HUDCO as security to the extent of 10% to 25% of the loan amounts. In financial terms, the State may initially provide a budget of Rs. 5.00 crores which may be used as security deposit to obtain a loan of Rs. 20.00 crores to Rs. 50.00 crores from HUDCO depending on the credit rating of the NGOs. The State Government may bear this small burden of deposit in order to avoid Government Guarantee, fulfill its commitment to provide shelter to the poor and many other tangible gains. In order to multiply shelter activities every year, State may increase its budget by 2.00 crores over the previous year. This will widen the resource base to facilitate mobilisation of more funds from HUDCO.The State share to be kept as security with HUDCO may be inadequate considering 25% deposit against loan amounts. However, WBHB may avail the balance funds from HUDCO directly against Government Guarantee and operate the schemes through the NGOs/CBOs. In the subsequent years, the NGOs with good performance may draw loan amounts against only 10% deposits, which may reduce the financial burden on the State as it will fetch more loan.

ROLE OF NGOs AND LOCAL COMMUNITIES
The NGOs and CBOs shall be essentially rooted to the local region and community. They will not only be closely working with the local people on various other welfare schemes such as child care, community health, adult literacy and other programmes, they should also have a good track record in their activities drawing high respect from the local people. They should be adequately prepared to diversify their activities to shelter sector. They may also organise income generation activities, training etc. and operate Composite Credit Mechanism (CCM) in order to make the people self- reliant as far as possible and meet defaults in repayment from their own sources.

Presently, the NGO movement in the State is mostly restricted to Calcutta and a few urban and rural pockets in the State. The State should take initiative to publicise its Housing Action Plan and encourage NGOs and CBOs to come up and interact with the Zilla Parishads and Gram Panchayats for their performance rating and recognition. The NGOs may undergo training in loan handling and recovery and technology transfer and in turn train the CBOs and Local Communities in order to take up housing activities.

The NGOs after gaining higher level expertise through training may coordinate with a number of CBOs, train them up in loan servicing, CCM, building supervision and monitoring, organising labour, etc. and utilise their services in channelising cash loans for housing to the beneficiaries. When HUDCO directly finances them, they may interact with HUDCO. However, CBOs may find it extremely difficult an ill equipped to formally interact with HUDCO or WBHB. The NGOs at a higher level may play this role more efficiently.

ECONOMIC IMPACT
Implementation of the Housing Action Plan will provide shelter as well as work space to the Low Income People who are mostly self-employed and use shelter as workshop. This will improve their working conditions at home to produce better quality of materials, particularly fabrics and clothing materials, bidi etc. The house construction activity itself will utilise local labour extensively. This will generate income for those who could provide self-labour. Besides, the local artisans and craftsmen will find work within their locality, which will improve their skill further. Depending on degree of use of local materials and labour, the loan fund would circulate within the local community, which will strengthen the local economy. Thus, the scheme will not only improve the living conditions of the poor in general, it would also generate employment and improve local economy.

CONVERGENCE OF ACTIVITIES
The scheme should encompass activities like income generation by digging ponds for pisciculture, using marginal lands for social forestry, putting vacant land for floriculture, organising collective animal husbandry, poultry, mushroom culture etc. The scheme may be conceived as a comprehensive eco-system holding the community, economic activities and settlements in a balance. The existing land can be reassembled and consolidated through sound physical planning so that electricity, potable water supply, drainage etc. can be organised easily an economically. Solar Power, bioas, Lok Deep Yojna, Jawahar Rojgar Yojna and similar other schemes under Departments of Rural Development, Urban Development, Fisheries, Labour, Minority and SC/ST Matters, Social Welfare etc. may be converged in order to make such schemes more effective and exemplary. Such an attempt will help the communities to improve their quality of life, generate higher income, achieve self-sustainability and make repayments of their loans.

TRAINING
Training for the Trainers for shelter Action:Generally, the NGOs are engaged in various public welfare activities other than housing. Also, they do not have experience in loan recovery as they depend mainly on grants for their present activities. In many third world countries like Bangladesh, Sri Lanka, Indonesia etc. the NGOs play a very crucial role in mobilising community resources as well as loans from various institutions. They also take part in shelter delivery activities. In India, particularly in West Bengal, experience of NGOs in this regard is limited. Therefore, training arrangements in finance, accounting, loan disbursement and recovery, community organsation for shelter actions, project monitoring, construction, technology transfer etc. shall have to be arranged for them by the Housing Department of the State and HUDCO.

Strategy of Training
Two types of training may be formulated. The first would be of short-term and intensive in nature for those NGOs who would be taking up the first lot of schemes immediately. The other type would be for those NGOs who are going to take up such schemes in future. Regular refresher courses shall have to be designed for the already trained activists. Besides such training, it may be necessary to organise review and interaction meetings between the NGOs/ CBOs, HUDCO and the State Agencies/Departments periodically. The State Government may set up new Habitat Institute under the Housing Department which may impart such trainings to the NGOs, CBOs, Gram Panchayats, Municipalities, Local Community activists and other actors in the scheme. Separate budget provision may be provided to establish the new Habitat Institute by the State Government. The Financial Institutions and Housing Agencies may also contribute in setting up this Institute, which is a long-awaited need in the State.