Opinion Rude realty

Discretionary quotas in housing need to be scrapped. Bombay High Court shows the way.

March 24, 2014 12:21 AM IST First published on: Mar 24, 2014 at 12:21 AM IST

Discretionary quotas in housing need to be scrapped. Bombay High Court shows the way.

In a significant judgment, the Bombay High Court has scrapped the chief minister’s discretionary quota in housing, which had been at the centre of much discontent in Mumbai. So far, the CM had the power to preferentially allot flats from two quotas, adding up to 2 per cent of flats built by MHADA, and 5 per cent of flats built on land allotted under the now repealed Urban Land (Ceiling and Regulation) Act of 1976. In many states, such a discretionary power is one of the ways well-connected insiders get themselves great deals on prime property — homes built by MHADA are available at less than a quarter of the price set by private residential developers.

Such government quotas in housing have sparked dissatisfaction and protest in Tamil Nadu and Karnataka, when M. Karunanidhi and B.S. Yeddyurappa were found to have lavished them on family and friends. Both states have abandoned the allotments. In Mumbai too, the logic was to avoid the concentration of land and housing in the hands of the wealthy, and to allow the state government to use a certain percentage of apartments on private land for the poor and needy.

Flats are also allotted to freedom-fighters, artists, sportspersons and government employees from this quota. Instead, the urban land ceiling quota has been captured almost entirely by cronies, politicians, bureaucrats, judges, even journalists. The Ashok Chavan government made particularly egregious use of this provision. Records show that more than half the 221 apartments given away between 2003 and 2010 were high-income group apartments, and only 12 apartments meant for the economically weaker sections were allotted through this quota.

These may not be standout cases of corruption, as Adarsh was initially made out to be. But they are more corrosive, in creating the perception that a power intended to expand housing for the public inevitably ends up serving government officials and their networks. This is how patronage is sustained, as apartments are given to officials, judges and others who aid politicians, and their relatives. Often, the same family got two apartments, even as eligible contenders were denied allotments.

While the Prithviraj Chavan government had, in the wake of the Adarsh controversy, whittled down the use of the discretionary quota (the last allotment was made in 2011), the court has now made a systemic change, calling the use of the quota “arbitrary and illegal”. It has left it to the state to frame a fresh policy that would be fair. State governments should realise that paring down their own discretionary powers, and moving to clear, rule-based allotments is the only way to salvage their credibility in these matters.