Access To Shelter

In the site and services concept, the state developed the physical infrastructure and people bought plots of land and built their houses themselves on it. The government introduced various schemes on this concept in all the major cities of Pakistan. A certain percentage (usually 25 to 30 per cent) of the plots was of a small size and ostensibly meant for poor families. Their costs were subsidised by the larger plots. However, these schemes also failed for a variety of reasons. First, the scale of development was far too small. For example, the Punjab government’s Physical Planning and Housing Department, which has had the largest housing development programmes in the country (apart from Karachi), was able to develop only 117,000 small plots between 1972 and 1990. This works out to 6,500 plots per year against a Punjab demand of 78,000 per year during that period¹. Second, the cost of the small plots was unaffordable to low income families. Third, the process of acquiring plots in these schemes was far too complex and long for poor families to fulfil. And fourth, after acquiring the plot they were required to build according to building rules and regulations that were far too complex for them to follow and far too expensive as well.

Another factor that has worked against the sites and services concept is speculation. Since the smaller plots were subsidised they were in many cases well below market rates. Low income families could not purchase them and as such they were purchased by the middle income groups and held for speculation. Many government schemes have suffered this fate including a number of high profile government initiatives such as the 7 and 3 marla Prime Minister’s scheme of 1987. It is estimated that 200,000 plots developed by the Karachi Development Authority in the late 70s and the 1980’s were still lying empty in 1992. Most of them were held for speculative purposes².

As a result of the failure of government policies to provide housing to low income communities, katchi abadis developed all over urban Pakistan. These katchi abadis were strictly speaking illegal and were established on government land by informal developers who were supported by government officials who became their partners in the process. These abadis were unserviced and people organised in them to lobby politicians and government institutions for services. Where government land was not available, low income communities acquired land in settlements that were created through the informal subdivision of agricultural land on the periphery of the urban settlements. These settlements too were unserviced but unlike the katchi abadis, the residents have security of tenure.

The Katchi Abadi Improvement and Regularisation Programme (KAIRP)

Initially, (especially in the sixties), the government bulldozed katchi abadis but it soon realised that bulldozing was not a solution. So in the seventies, the government decided to regularise and upgrade katchi abadis on government land. This meant that katchi abadis would be surveyed and that physical and social infrastructure would be provided to them; the people living there would be given propriety rights through a 99-year lease; and that the beneficiaries would pay for land and development charges. The pros and cons of the programme are discussed in Section 4 below.

The KAIRP process has been slow and in the absence of a programme that can provide shelter to poor families, the rate of formation of new katchi abadis and informal settlements through the subdivision of agriculture land, exceeds the rate of regularisation and improvement of old katchi abadis. The situation in Karachi and Faisalabad, both important cities, is summarised in Box – 1: The Housing Demand-Supply Gap in Karachi and Faisalabad. The demand-supply gap in secondary cities and smaller towns is far larger in percentage terms.

Box – 1: The Housing Demand-Supply Gap in Karachi and Faisalabad

Karachi is Pakistan’s largest city and has a population of just over 12 million. Its annual housing demand is 80,000 units. The Karachi Building Control Authority (KBCA), over the last five years has issued an average of 26,700 building permits per year. The demand-supply gap is met by the creation of new katchi abadis which provide about 28,000 lots of land per year and encroach on an average of 1,000 acres. The rest of the demand is met by densification in existing settlements or not met at all. Even where schemes are developed for the poor, they remain unoccupied for anything between 10 to 20 years and are subsequently occupied by the middle classes.

Faisalabad is Pakistan’s third largest city and a major industrial area. Between 1947 and 1998, its population has increased by about 1.9 million. A minimum of 200,000 housing units would be required for this population increase. However, between 1947 and 1998 the government has been able to provide only 38,785 plots and houses whereas Faisalabad requires 12,000 housing units per year. As a result of this demand-supply gap, katchi abadis have developed all over Faisalabad and now no more government land, unlike Karachi, is available for their expansion. Therefore, housing is being developed through Informal Subdivision of Agricultural Land (ISAL) on the city fringe. According to official estimates, two to three thousand plots are developed every year through this process. Informal developers, however, claim that the figure is closer to 6,000.

Source:  For Karachi: Urban Resource Centre’s estimates, 1999For Faisalabad: Alimuddin, Salim et al; The Work of the Anjuman Samaji Behbood and the Larger
Faisalabad Context; IIED, UK, 1999

New Directions

In 1994, the government of Pakistan prepared a national policy and in 1997, the 9th five year plan, both of which dealt with issues related to low income housing. Both the documents did not offer any new programmes that could overcome the problems faced by low income families in acquiring shelter. Nor did the two documents provide any new steps to increase the capacity and capability of the formal sector in providing housing to low and lower middle income families.

The 1990s have seen the emergence of a new global economic order. Structural adjustment is a part of it. Under structural adjustment we have agreed with the IMF and World Bank that we will cut our budget deficits, privatise state enterprises and utilities and increase taxation. In cutting our deficits we have cut spending on the social sectors and increasingly rely on the market to deliver these facilities. As such, we have cut down spending on housing for low income communities as well. There are no major programmes in offing for them and a highly exploitative private sector cannot meet their needs. In addition, the middle class has expanded in Pakistan and increasingly needs land for housing. As a result, most locations that would be suitable for low income housing and are in proximity to employment zones, are being taken over by the higher and middle income groups. In many locations, katchi abadis and informal settlements are being bulldozed to make place for upper income housing colonies and complexes³.

Although problems for lower and lower middle income groups have increased (since government subsidies are no longer available) conditions for the higher and middle income groups have improved. Due to a cut in interest rates and other macro level global and government policies, there is a lot of liquidity in the banks in Pakistan. As a result, banks are offering large loans for house building purposes. Again, the poor are neither loan-worthy nor do they have collateral to access these loans. However, these loans have made it possible for the more enterprising lower middle income and middle-middle income groups to acquire a shelter to live. Government is also encouraging the formation of new housing banks in the private sector and has also increased loan limits of the HBFC. As a result of these initiatives in the fiscal year 2003, credit to the housing sector jumped up by 400 per cent to Rs 3.5 billion⁴.