From zero to 5.69 lakh? Why Maharashtra govt's repeated MoU-signing with MCHI is a joke

Apparently, history repeats itself in politics too.

The 'affordable housing for all plan' is the brainchild of former Maharashtra chief minister Ashok Chavan's government. They first signed a Memorandum of Understanding (MoU) with the Maharashtra Chamber of Housing Industry (MCHI) on 28 April, 2010 for the construction of five lakh homes in five years. But the signatures and MOU remained on paper alone, because not a single affordable home was built since then. But the BJP-led government of Chief Minister Devendra Fadnavis went one step ahead of its predecessor and signed a Rs 1.10 lakh crore MoU for the construction of 5.69 lakh homes in five years. The interesting thing is that while the signing authority changed for government and MCHI, everything still remains only on paper.

Firstpost has acquired copies of both the MoUs.

After signing the MoU in April 2010, the state government passed a government resolution (GR) on 1 June, 2010 and made a joint committee which was headed by the then chief secretary along with the five senior-most IAS officers from the departments of urban development, housing, MMRDA and Mhada, along with the city's municipal commissioner, to monitor the MoU. From the MCHI, the signatories were then chairman Puran Doshi, president Sunil Mantri, Dharmesh Jain, Mayur Shah and Nainesh Shah. The 10-member joint committee has not even met five times in five years, alleged a senior official from the housing department.

While the 2010 MoU looks like an actual MoU, the 2016 one signed during 'Make in India' week last month looks like a scribble on plain paper.

See for yourself. This is the 2010 MoU:

Homes for All

It doesn't completely stand on legal ground, said an official. However, despite the fact that not a single home was built in the past five years, the review committee is not taking any serious action against MCHI, he added. "I am not aware of what was signed in the year 2010, but if at all it (the MoU) was signed, it shows that the erstwhile (Congress-NCP) government had the habit of signing fake MoUs and doing nothing (about it). Our government has a policy of following every single MoU signed," Fadnavis said, while speaking to media persons.

Meanwhile, here's the MoU signed by the Fadnavis government:


Preempting an Opposition attack during the Budget session of the legislature this week, the Maharashtra government on Saturday said it has formed a high-powered committee headed by Chief Secretary Swadheen Kshatriya to ensure that the MoUs signed during the 'Make In India' Week fructify. On 3 March, in an exclusive story, Firstpost revealed how the Fadnavis government's showpiece MoU for housing for poor is a rehashed dud. The formation of the committee was announced days after the Opposition raised serious questions on the lack of transparency of the MoUs. NCP spokesperson Nawab Malik had alleged that one MoU with the Maharashtra Chamber of Housing Industry (MCHI) on affordable housing was inked by the government only to inflate the investment numbers.

Kshatriya said that apart from the high-powered committee, there will also be some sub-committees that will report to it on the progress of the MoUs. "We will decide the modalities about MoUs, as there were over 2,500 MoUs and it is not possible for the high-powered committee to take a review and monitor all of them. So we have decided to bifurcate MoUs on the basis of expected investment and the jobs generated," he said and added,"The large MoUs in terms of investments and jobs will be handled by the high-powered committee, while the rest will be taken care of by the sub-committees and also by the principal secretaries of the concerned departments, under the high-powered committee."

Malik said the Congress-NCP government headed by Ashok Chavan had inked a similar MoU with MCHI in 2010 for constructing 5.69 lakh affordable houses in five years in Mumbai Metropolitan Region, but the MoU lapsed in February 2015, without a single house being built. “The value of this MoU is Rs 1.10 lakh crore, which in turn means that around 15 percent of the Rs 8 lakh crore investment announced by the chief minister is fake,” he had alleged.

File image of the Mantralaya in South Mumbai. Wikimedia Commons

File image of the Mantralaya in South Mumbai. Wikimedia Commons

Confirming that there was a similar, if not identical MoU between the two sides, SS Husain, CEO of MCHI, told Firstpost that the earlier one signed with the state government in 2010 did not  work out from both ends and hardly any work was done on it in the past five years. "It could not be executed from both sides," he admitted. Asked why, he simply said: "Ask the previous MCHI president, not me."

But this time, Hussain claimed the intent was genuine and that the MCHI, which has more than 1,500 builder-members, will execute the project in all earnestness. "In 2016, we will build 3 lakh affordable homes," he said with inexplicable confidence, based as this claim is on the ruins of a defunct MoU.

The project, however, never took off, because Chavan had to resign in November 2010 — the same year after his name came up in connection with the Adarsh scam. A senior officer from the housing department confirmed that the 2010 MoU expired in February 2015, and Fadnavis has decided to give the builders one more chance. “The MoU was to come to an end in February 2015. This year, the housing department once again sent a letter to MCHI reminding them about this and to find out whether the builders are interested in carrying out the five-lakh homes project in the future,” he said.

In an interaction with senior officers before the 'Make in India' week, Fadnavis reportedly said that roping in private developers was important to construct affordable homes. He emphasised, however, that care needs to be taken to ensure that no untoward benefits accrue to builders. Three months earlier, Fadnavis also asked the Slum Rehabilitation Authority to give Rs 500 crore to the Konkan board of Mhada to buy land in the MMR and construct affordable homes. The chief minister also assured Rs 500 crore to the Shivshahi Punarvasan Prakalp Limited (SPPL) for building affordable houses in the MMR region.

When Firstpost asked why these same MoUs are being inked with the MCHI, a senior official from the housing department said that this time the Maharashtra government will facilitate the members of MCHI-CREDAI, to obtain necessary permissions, registrations, approvals, clearance and fiscal incentives. "We are doing only 'Ease of Doing Business' in all sectors just like it has been implemented in the Brihanmumbai Municipal Corporation," he added.

Former chief minister Prithviraj Chavan alleged that during 'Make in India', most of the MoUs signed were fake. "I have asked the chief minister to put all 2,500 MoUs on the internet so that everyone knows which company signed and what is their background. We did not act upon it because the builders wanted to extract unreasonable concessions. If I had agreed to those conditions I would have committed illegalities," he said.

Speaking with Firstpost, the chief minister who presided over the signing of the first MoU Ashok Chavan acknowledged that the MCHI did not build a single home. "We accommodate all clearances and facilitate approvals, but they (MCHI) are busy building big houses for rich. The lapses were from their end, so ask them why they did not build five lakh affordable homes in five years," he said.

Meanwhile, then chief secretary and chairman of the joint committee JP Dange said that he could not recall the MoU and had nothing to say about the matter.

Updated Date: Mar 10, 2016 12:47 PM

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