The Times of India     09.09.2010

Rs 86 cr cost escalation in EWS housing scheme

PUNE: There has been a cost escalation of Rs 86 crore in the housing scheme for economically weaker sections (EWS) floated by the Pimpri-Chinchwad Municipal Corporation (PCMC).

The initial cost of the project was Rs 500 crore, said Subhash Dumbre, additional commissioner, PCMC while speaking to reporters, during a visit by journalists to the EWS housing scheme at Chikhli on Wednesday, organised by Pimpri-Chinchwad union of working journalists.

The PCMC is constructing 13,250 tenements as part of the EWS housing scheme and had promised to give three-room flats at a cost if Rs 1.5 lakh each to the beneficiaries. The total construction cost of each tenement was to be Rs 5.89 lakh which has now escalated to Rs 7.17 lakh.

"The PCMC has still not taken any decision about increasing the price of flats for the beneficiary," Dumbre said. The final list of beneficiaries was prepared in August 2008 and sent for approval to the union government.

In the first phase, PCMC is constructing 6,720 tenements on a 55-acre plot at Sector 17 and 19 in Chikhli, along Spine road. The construction of 588 tenements has already been completed, and the construction work of 3,444 tenements is in progress in various stages.

Giving information about the project, Dumbre said, "The union government gave primary approval in 2007 to the PCMC's proposal to implement the EWS housing scheme under the Jawaharlal Nehru National Urban Renewal Mission(JNNURM) scheme costing Rs 449.70 crore. The cost of each flat with an area of 400 sq ft was Rs 3.39 lakh. Later, a decision was taken to provide flats with an area of 500 sq ft, costing Rs 5.89 lakh. But, due to the cost escalation, external electrical work and contingencies, the cost of the flats has increased to Rs 7.17 lakh."

"The construction cost of each flat is Rs 1,435 per sq ft, due to which the cost of each flat is Rs 7.17 lakh. The market rates of similar flats in surrounding areas is Rs 2,200 to 2,300 per sq ft," said Rajan Patil, joint city engineer, who was also present during the visit.

The JNNURM projects have to be completed by March 2012. Dumbre said, "The work is in progress to acquire land reserved for EWS housing scheme in various parts of the municipal limits. We hope to complete this process soon and start construction of the remaining houses."

Patil said, "PCMC has spent Rs 103 crore on the project till date. It has received Rs 56.2 crore from the union government as its share. PCMC plans to give possession of 588 flats at Chikhli by March 2011. The construction of the remaining 6,132 flats will be completed by March 2012."