GOVERNMENTS AND THE HOUSING PROBLEM:
THE CASE OF BIHAR STATE HOUSING BOARD IN INDIA
by
B.Arch.
RAJESH KUMAR PRADHAN
School of Planning and Architecture, India
(1979)
SUBMITTED TO THE DEPARTMENT OF
URBAN STUDIES AND PLANNING
IN PARTIAL FULFILLMENT OF THE REQUIREMENTS
FOR THE DEGREES OF
MASTER OF SCIENCE IN ARCHITECTURE STUDIES
and
MASTER OF CITY PLANNING
at the
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
June, 1986
0
The author
distribute
Rajesh Kumar Pradhan, 1986
hereby grants to M. I. T. permission to reproduce and to
copies of thisA thesis
document in whqje or in part.
Signature of Authoy .. . .
.... ...
entfoof Urban Studies and Planning
May, 1986
Certified by....4
A'
Professor Bish Sanyal
Tpjesis Supervisor
Accepted by.....................
Professor Phl Clay
Departmen al Graduate Cdmmittee
Chairman, Department of UrbaA Studies and Planning
Accepted by............................
\_Pofessor ;llian Beinart
Chairman, Departmental Graduate Committee
Department of Architecture
Rot&
MASSACHUSETTS INSTITUTE
OF TECHNOLOGY
JUL 1 0 1986
LIBRARIES
GOVERNMENTS AND THE HOUSING PROBLEM:
THE CASE OF BIHAR STATE HOUSING BOARD IN INDIA
by
Rajesh Kumar Pradhan
Submitted to the Department of Urban Studies and Planning
on May 19, 1986 in partial fulfillment of the
requirements for the Degrees of Master of Science in
Architecture Studies and Master of City Planning
Abstract
Field research was carried out on the performance of
the
State
Housing Board during the periods between 1972 and 1985.
Through
extensive
interviews
and
review of government documents,
the
research tried to determine why the organization failed to
meet
its stated goals of increasing the housing stock.
The
study
established
a
chain
of
causality
linking
the
organization's changing image, political meddling, profitability
of investment in land and the organization's performance.
Thesis Supervisor:
Bish Sanyal
Title:
Assistant Professor of Planning
C O
N T E N T S
Pages
1 - 6
INTRODUCTION
CHAPTER
1
The Formation of the Housing Board
7 -
16
17 -
28
CHAPTER 3
Evaluation
29 -
48
CONCLUSIONS
49 -
53
CHAPTER 2
Housing Board:
END NOTES
BIBLIOGRAPHY
1972 -
1985
INTRODUCTION
Motivations and Objectives
Public
sector
institutions
in
developing
countries,
particularly the Parastatals, Boards, Corporations and the like,
have increasingly come to be criticized for gross inefficiencies
(Raj 1977,
Chopra 1982).
In part, this criticism is based on a
trend of attacking public institutions in general.
is
based
on
a
In part,
concern for fiscal efficiency amidst a time of
deepening fiscal crisis of most governments or,
a
low
made
outputs
institutions.
given
the
agencies,
establish
it
relative
to
the
Whatever be the
huge
investments
reasons
investments
that
for
have
concern
these
been
in
how
these
institutions
these
criticisms,
made
in
it is not surprising that studies are being
precisely
for
have
these
made
to
performed
relative to their stated goals.
This thesis focuses on the State Housing Board in Bihar,
India.
It is an evaluation of this organization, established in
1972 to deliver housing and land in a cost-effective manner.
We
explain why the organization was not able to meet its goals.
Conceptual
Framework
The
stated
goals
performance
has
of
organizations
relative
to
their
been the focus of evaluation in the field of
organization analysis (Perrow, 1961;
Pierce, 1968;
The relevant literature has suggested three ways of
1
Scott, 1981).
looking
at
--
organizations
and
perspectives;
its
of
attainment
organizations
views
perspective
goals,
stated
as
The rational
and criteria for evaluation
1950;
achieving
of
capable
collectivities
Simon, 1957,
views
perspective
systems
natural
economies
the criteria
in the rational systems view,
natural
ensure
Etzioni,
views
its
but
goals
specified
maintain
the
in
emphasized
morale
of
and incentives for people in the organization
to
survival
1961;
include
perspective
systems
participants,
as
organizations
In addition to the criteria used
a social unit.
as
The
1964).
simultaneously engaged in other activities required to
themselves
for
instruments
stressed are the numbers and qualities of outputs and
in the use of inputs (Mannheim,
for
criteria
and
that correspond to those perspectives.
evaluation
systems
goals
identified
has
natural and open systems
rational,
the
ie.
(Barnard,
as
highly
environments and as engaged in
system-maintaining
systems
interdependent
system-elaborating
1961;
perspective
with
as
organization's
The
activities.
of
Clark and Wilson,
The open
1970).
Perrow,
organizations
1938;
measures
their
well
as
adaptive
capacity to respond to problems, or its bargaining position, are
considered to be important criteria --
reflected in the
ability
of the organization to exploit its environment to acquire scarce
resources needed
(March and Simon,
1958;
Pfeffer and Salanick,
1978).
The
organization
that
we will examine appears to have
not met any of the goals that these three perspectives
2
suggest:
the
land
resources,
reflected in the 1985 petitions by the
morale -government
and
housing and serviced
of
output
high
of
goals
We consider these and other goals
therefore, to meet
its goals.
espoused by people
within the organization and
we
therefore,
value
do not attempt
rational
systems view),
natural
systems view)
acquire
resources
attempting
to
how
on
it
appreciation
constrained
in
--
one
the
open
simply,
organization and,
in the
view).
to
By
explaining why
why goals were not met,
ie.
"evaluation" as used in
understanding and
Forrester, 1975).
organization's
factors
that
performance.
will focus on lack of direction or conflicting
morale/individual
the
in
(process,
systems
which refers to
we will examine
the
(outcome,
was achieved
meaning of the word
(Hudson, 1975;
First,
to
normative or a measurable
establish causality or,
research
attempt
or on the capacity of the organization
(structure,
we emphasize another
of
the evaluation,
In
achieved
things happened the way they did --
evaluation
met.
to put a
organization
the
what
on
not
were
goals
those
why
explain
terms
In
we will
the organization's performance,
that
we conclude
met.
reasonably
even
not
were
goals
evaluating
the
to
staff
of the organization to maintain its survival and,
inability
these
low
a
;
plots
itself, suggests reluctance
scrap the organization
to
stated
its
meet
inability to
explains its
,
key
the
of
one
acquire
to
inability
Board's
Housing
appear
to
have
For example,
we
lack
of
goals,
in
the
constraints due to lack of coordination
with
incentives
participants
for
3
interdependent
the capacity
organizations
to
maintain
and
lack of bargaining power or,
support
from
the
environment
for
acquiring key resources.
In
addition
perspectives on
factor
that
to
these
organizations,
appears
to
changing
actual performance.
of
the
organization
we
offer
-
Housing Board's performance:
organization's
factors
image
a
generated by the three
will
consider
unique
namely,
we
will
explanation for the
determined
the
organization's
We will observe that image and
were positively linked:
discuss
specific
the extent to which the
associated with better performance and vice
terms,
a
performance
better image was
versa.
In
general
the proposition that the image or the
expectation of how an organization will perform in future,
(from
the perspective of people controlling inputs and benefiting from
outputs),
determine whether an organization is able to meet its
stated goals or not.
Based
on
our
general
concern
for
examining
the
performance of public sector organizations, the central theme of
our study is to explore the question, "why did the Housing Board
perform the way it did between 1972 and 1985 and
the
extremely
poor
image of the Board in 1985"?
story in Chapter I by setting
factors
the
context,
and
what
explains
We begin the
describe
the
that led to the formation of the Housing Board in 1972.
Subsequently in Chapter II,
did between
1972 and 1975.
we give an account of what the Board
We tell this story to illustrate the
4
five factors that seem to explain the Board's performance -lack
of
direction,
support
from
the
the
inter-agency
'environment'/
Board's own image.
considering
incentives,
to
coordination,
Board's bargaining power and
In Chapter III,
extent
ie.
we re-examine the story
which
each
by
of these five factors
really explain why the Housing Board could not meet
its
stated
goals.
The key questions, then, are the following:
(1)
How did the Housing Board come into being, and
how did it define housing as a problem?
(Ch.I)
(2)
What did it do?
(3)
What really happened?
(4)
What are the implications of the story for
(Ch. II)
(Ch.III)
future research and policy?
(Conclusions)
Research Methodology
This research is based on personal interviews
actors
in
assumed
the
that
rise and the fall of the Housing Board.
the
Housing
Board's
direction
was
influenced by its members in the leadership role.
the
top
1972 and
important
key
It was
primarily
Consequently,
management
staff who have been with the Board between
1985
interviewed
by
Field officers
establish
with
work
were
them
and
to
identify,
goals
deemeed
or their approaches to the housing problem.
middle
incentives
level
staff
avilable
several employees who have been
with
to
the
5
were
them.
interviewed
to
By speaking to
Housing
Board
ever
its
since
formation,
I tried to get indications of changes in
Board's
Interviews with the staff of interdependent
existence.
organizations were conducted to
Key
personnel
problems.
coordination
assess
from the financing institutions were interviewed
which
to determine why they continued to fund the Housing Board
clearly
the
of
staff morale and Board's image during different periods
appeared
to
be
performing
poorly.
ruling political party and members of the state
Ministers of the
judiciary
told
me about the extent to which Housing Board received support from
the
Housing Board's reports
'environment' in which it operated.
were
reviewed
to to document the organization's performance in
terms of outputs produced,
visited
and three main
project
to determine the validity of those claims.
sites
Finally,
spoke with some of the residents and private landowners
around
these
project
areas,
to
were
in
I
and
understand how they had been
affected by Housing Board's projects and how they had
to them.
6
responded
CHAPTER 1
India's
has
been
one
capital
city
with
Bihar
the
Patna,
states.
poorest
1947,
in
Since independence
population of about a million and the focus of
a
Board's
Housing
For example,
in contradictory ways.
described
is
activities,
of
its strategic importance in
one hears of Patna's ancient glory,
the colonial past and its current status as a fairly flourishing
city.
constraints,
the
reinforced
image.
poor
city's
and
high
geographical
certain
by
exacerbated
density,
population
shelter
growing
growth
physical
concentrated
Patna's
problem.
a
and
with predominantly poor people
place,
dirty
also scorned as a somewhat rural,
is
Patna
But,
The capital
city's semi-urban/semi-rural look became one of the concerns
of
the state government.
In the
Various attempts were made to change this image.
field
example,
the
secretariat
projects
several
housing,
of
and
Cooperative
the
during
distribute
Department
government
projects
and
exclusively
body
provided
loans
housing
was
state
set
individuals.
to
The
established to extend loans to the
Patna Improvement Trust
up
in
extensive
for the city of Patna.
Local Self Government
the
in
late 1940s to implement public housing
private housing cooperatives.
local
up
set
was
Department
Housing
For
established.
were
agencies
1952,
a
implemented housing
infrastructure
Finally,
(LSG) was established at
7
(PIT),
services
the department of
the
secretariat
coordinate
to
level
activities
the
the Local government
of
bodies with that of the Housing department.
Despite good intentions, these organizations contributed
city.
little to either the housing stock or to the image of the
For example, while the Housing Department had started innovative
similar
schemes
&
site
today's
to
projects,
services
implementation problems, wrong interest payment calculations and
distributions
discrimination in loan
(20000
tenements
in
to
terms of output.
housing cooperatives formed
officials benefited -the
machinery
influential
by
Patna
had
Only those private
senior
government
of the State government to make land acquisition
Improvement
Trust
1973).
(Housing Board Report,
(PIT) met with a fate similar to
slum-
it was commended for its
that of the Housing Department:
upgrading
output
by securing government loans and by using
somewhat easy and at minimum cost
The
low
The Cooperative department also
in
contribute
in
incomplete projects and a bad
20 years),
name for the organization.
little
resulted
and site & services type approaches,
time it was charged with extensive diversion
construction irregularities and the like
of
and at the same
funds,
public
(PIT Commission report,
1969).
Disenchantment
performance
the
with
these
of
organizations, concern for a growing image problem and a housing
problem,
set the grounds
organization to emerge.
for
a
performance-oriented
It is not surprising,
Life
when Housing Department approached the
8
housing
therefore,
Insurance
that
Company
the LIC Chairman stressed
(LIC) for loans for housing projects,
that loans would only be provided to a statutory/semi-autonomous
in
At the state level,
financing semi-autonomous housing agencies.
occurred:
an important event
dissolved
was
(HUDCO),
Corporation
the
at the Central level with the explicit objective of
established
too,
institution,
finance
housing
Development
Urban
and
Housing
primary
India's
1970,
time,
At the same
agency which is led by a competent engineer.
Bihar
importantly,
came
Bihar
and
under
ministry
popular
President's
rule
leadership
the
under
came
the
More
(1).
of
was
Governor
D.K.Barooah who was later to play a key role in formation of the
Housing Board.
Board
The Formation of the Housing
consider
to
known
was
Governor
The
housing
as
an
important area of government intervention and chose it as one of
felt.
the sectors where he wanted his impact
the temporary head of the state
with
the
senior
fairly
position
as
(1) brought him in close contact
officers of the housing and urban development
Among these officers,
related organizations.
been
His
impressed
by the qualifications and reputation of
the
the Special Officer at
he seemed to have
Public
Works
Department,
Mr.P.J.
Prasad, particularly by his versatile experience in the field of
engineering
and
housing.
The
Governor's
with those of the LIC Chairman and the HUDCO,
issued
an
ordinace
in
1972
interests coincided
and the
Governor
to set up the Housing Board with
9
had
involved in
came
into
President's
the
rule
ended;
special powers
to the newly
Governor
the
and
elected
Board
the
relinquished
his
from
the
Minister
Chief
and
;
announced
was
election
state
being,
to
after the Housing
Soon
heads.
institutional
appointing
him
institutions
government
of
up
setting
the
the
decision-making
legislative-style
protracted
the
override
Act of
allowed
powers
special
Governor's
The
legislature.
an
was not
be renewed every six months as it
to
ordinace
The
its first Chairman and chief executive.
Prasad as
Congress party.
passed
Six months
(2).
because
congress party allowed
ruling
The
as
appointee
technical/administrative head in
actually
quite
a common phenomenon,
offering
of
them
parastatals
income of
members
the
boards.
the MLAs but
official residences,
strongly
of
These
exist
which must
Barooah,
Mr.
however,
This
is
retain
the
undertakings/
sector
public
positions
peons
and
not only supplement
amenities.
other
protested the ruling party's move,
and
the
as
Prasad
also include benefits such as staff-cars,
Thus,
Ordinance was allowed to lapse.
to
political
of the legislative assembly (MLAs) by
chairmanships
and
lapse
particularly strong during
the formative stages of a new ministry,
support
a
with
position.
no.2
the
lapsed
the ordinance to
Mr.
with
Chairman
the
Board Ordinance
Board
to reconstitute the
wanted
it
and the Housing
Prasad
went
considered
Mr.
Prasad
but the Governor's
the Housing Board ceased
to
back
the
this development
10
PWD.
to be a
Governor
personal
party
the
as
he
because
also
humiliation,
state
to the same political
belonged
Prime
being
Besides,
Minister.
Chief
Minister's direct nominee, the Governor's allegiance lay more to
the
Centre
than
to
Bihar's
to
Barooah expressed his extreme displeasure
Minister in categorical terms.
So,
elected ministry.
Chief
state
the
within a month the
As a result,
Housing Board was re-created and Mr.
Governor
Prasad was
reinstated
as
the Chairman of the organization.
Having
structured
survived
itself in
the
the
through
the
its
the Housing Board
Being
environment.
institutional
institution,
semi-autonomous
crisis,
first
link
formal
with the state
Housing
secretariat's
state
a
government
was
Department
which could only give broad policy directions to the
Housing
Housing
Board.
Board's
semi-autonomous
status
was
further enhanced by the fact that the state's ruling party could
control
Housing
Board's
pressurizing Housing Department
The
following
chart
and
describes
the
only
activities
in
the
--
indirectly
legislative
by
assembly.
illustrates the institutional environment
linkages
and
responsibilities
interdependent organizations.
11
of
the
Description of
-
-
-;4-
N -I
-
L.(Fe
etis
jf-UCO~
Nt.2
Nrey
se
NMZf6
LA
I
-
LEGEND_
FOR
THE
PRECEDING
CHART
oUs4
OMI
.
sANS
I~
(Bcvor- 3og p
-"- - - -- --
,-
*
I
-
-
_.-.
-..
*I
-e
1- ATO
. A
Prr.
e1'AC
-eT-
Rf?:P
eommT&
..-
.-
-.
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-SuCHEAtrM
tussRtr': osr.
'rD'rr.
-LOE'
AL
*
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j
*6
6
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*6
* *
*:.
~
~eNEPC~AI~ /
T
GD4VF~
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~
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~
M~DIA~.
--
7
LINE OF CONTROL
DIRECT ACCESS
INFORMAL ACCESS
FEEDBACK
REPRESENTATION
(Authority)
(Broad policy direction)
(Consultation)
(Reporting)
(On Board Committee)
state
the
of
leverage
some
G-
State Government
the state government
from
guideline
any
principle,
In
be
must
Board,
Housing
the
to
legislature
the
agencies and
coordination
For
Department.
Housing
the
through
addressed
most of the following agencies are represented on the
purposes,
Housing Board Committee:
ocec..-
-R ve
I;
*************
>
>
>
>
general
very
Planning Commission and Ministry of Housing -- sets
policy guidelines/housing strategies.
Sets limits on market borrowing for all
Reserve Bank of India -institutions.
for the national
bonds
public
-issues
Finance
of
Ministry
Housing
the
to
funds(loans)
supplying
institutions
financial
Board.
Housing and Urban Development Corporation (HUDCO); Life Insurance
Nationalized
Company (GIC);
Insurance
General
Company (LIC);
Banks -- supplying project-specific loans to the Housing Board.
STATE ~ov~
t
----------------------<-.-. -. -.-.............
Resposibilities
Central Government
Housing is the responibility
Technically,
exercise
but central government can
governments,
through:
-
.
Linkages and
oerrT.
T
compliance of adminstrative
the
ensures
-Department
Housing
Provides some funds as
rules and state's broad policy guidelines.
Represents Housing Board in the state's
administrative grants.
legislative assembly (the cabinet).
Planning Department -- advises the state government (the executive
and the legislative branches) on funds to be allocated on the
housing sector in general.
loans)
(and
funds
Plan
Year
Finance Department -- issues Five
allocated by the state government to the Housing Board.
advises Housing Board on Master Plans.
Town Planning Department -Public Works Department (PWD)/Public Health Engineering Department
(PHED) -- advises Housing Board on infrastructure/construction
technicalities.
local
Department of Local Self Government (LSG) -- represents the
Municipal Corporation which are
the
as
such
bodies
government
propertyresponsible for Housing Board projects' maintenance and
land-use and
local
on
advises
also
LSG
The
collection.
tax
infrastructure plans.
Department of Civil Supplies -- supplies subsidized cement and
steel to Housing Board (not represented on Board Committee).
Revenue Department -- acquires land for the Housing Board.
-12-
and
With its responsibilities
clearly
established,
the
Housing
its
institutional
role
Board set out to tackle the
problem of housing.
Housing Board's goals, or
its approach to the Housing Problem
"Operative goals designate the ends sought
through
the
actual operating policies of the organization; they tell us what
people in the organization actually are trying to do,
of what the official goals say are the aims"
(Perrow, 1961).
evaluating the performance of the Housing Board,
In
are concerned with the operative goals espoused
the
regardless
Housing
Board
with
members
Committee between 1972 and 1985.
the
Five goal
and
top management at the Housing Board.
The
emerged
from
first of these was accompanied by extensive statistical data
Bihar's
low
coupled with,
urbanization
rate,
high unemployment
density
populatuion
of
documents
statements or problem-definitions
interviews
by
we
and
statistics was used to
very
state
urban unemployment rates
low
rates
low
that
on
in
rural
rural
areas,
high
productivity.
The
informal-bondage
or
semi-
feudal relations in the villages had prevented rural labour from
migrating
in
the past.
considered to be an ideal
migrants and,
productivity.
Large scale finished urban housing was
incentive
for
potential
rural
in-
therefore, a solution to the problem of low rural
Construction
in
general,
together
with
the
untapped traditional and informal sectors of employment in urban
13
that
seen to be highly
were
areas,
state-
potential
supported
not
were
goal statements
The other
any
by
intuitively argued
and we found them to be mostly
or data
of a
large scale.
in-migrants on a
study
argued
for the
therefore, provide housing
and,
level problem
It was
take a comprehensive view
Board should
Housing
labour absorbing.
cases.
intervention
for large scale
nor
se
policy.
According to this argument,
would solve the housing
all,
This approach was probably the most undefined of
problem.
but
was defined as
the problem
if provided,
which,
housing
target group for
identified any particular
per
the
analyzed
and neither
problem
lack of resources,
merely stated the need
arguments
example, one of the
For
something
they
because
people
intervention
assumed
sense
a
advocates
its
provided
it
that
incapable
were
purpose in
of
the
without
of
doing
government
care of their
taking
housing needs.
Some
dealing
housing,
shortages
Housing Board
leaders saw the
as
problem
one
of
with people's insatiable desires and changing tastes in
and with the "unreasonable"
were impossible to satisfy.
which
causing
demands
The
housing
proponents of
this view blamed the speculative private sector which catered to
and
these desires
provide
role
was
"dream
modern
to
expectations
put
by
houses".
necessary
providing
by
expectations
fuelled
which
Accordingly,
check
on
traditional,
14
trying
to
Housing Board's
people's
desires
and
indigenous and modest
shelters with the
possibility
of
upgrading
them
in
distant
future.
the Housing Board leaders also empathized with
of
Some
the problems of
dwellers
were
own
class
low/middle
understood
sector' jobs,
their
the
to
have
having no time to
been
dwellers.
caught up in
organize
resources
of
providing
These
'formal
to
build
Housing
Because of the resulting shortage,
houses.
Board's role was seen to be that
houses
urban
fully
finished
so that people could devote the time and energy saved to
things considered more important and productive than housing.
Some members of the Board Commiitte considered rural inHousing was
migrants as contributing to the problem of housing.
such a basic need for
the
migrants,
haphazard building activities,
that
their
illegal
and
in and around public land,
found to obstruct implementation of efficient Master
were
Plans.
It
was argued that provision of infrastructure to these unregulated
developments
was
As a result,
become slums.
little
priority
primarily
subdivision
problematic and these areas were predicted to
this
gave
view
to the shelter part of the housing problem and
increased
advocated
and
the proponents of
provision
the
supply,
land
of
land
planned
efficiently
laid
out
infrastructure.
The similarities,
these
approaches/goals are self-evident.
goals did not advocate
group,
differences and contradictions
the
policies
towards
While two of the five
any
specific
remaining differed in their prescriptions.
15
among
target
For one
housing
approach,
concern;
the
for
the other,
for
activities
was
the
this
therefore,
group's
sector'
For example,
either
shelter-
was to be regulated in a stringent manner.
Another view focused on an entirely different group,
'formal
primary
housing of the rural-migrants created
environmental problems and,
building
rural-migrants
employees.
the
There were also strong agreements.
all the five approaches required a high output
serviced
land or housing units --
stock.
These
views
also
reflected
a
of
the primary
that is,
goal of the HousinQ Board was to siQnificantly add to the
housinQ
urban
faith
urban
in the
capacity of the Housing Board to achieve those goals.
In the following section,
we describe what the
Board did as a result of believing in these goals.
16
Housing
CHAPTER 2
The performance of the Housing Board
1985
can
be
grouped
into
four
reconstitutions of the leadership
times
during
that
period.
leadership, in brief,
Housing
Board
Chairman.
The
parts,
The
story
events
under
the
the
surrounding
response
to
this
nominee.
change,
background was appointed
person in the organization.
replaced
an
by
Administrative
to
four
changing
of
Mr.
Prasad
officer
and
party
was
Prasad who
resigned
with
Director
Managing
the first
a member of the
replacing Mr.
Since
in
a technical
as
no.2
the
the Managing Director was
In 1978,
(IAS).
the
congress
Surprisingly
Chairman from the ruling political party was
Indian
the
from
adminstrator/bureaucrat
Service
as
appointment
In 1975,
another
the
about
this
the Chairman of the Board,
Governor's
much
leadership
legislative assembly (MLA) from the ruling
was
as
and
between 1972 and 1975 the
reappointment were described earlier.
appointed
1972
corresponding
structure
is as follows:
continued
between
in
removed
1982,
from
the
the
Board, the top two positions were merged and the IAS bureaucrats
started
to
hold
Managing Director.
Housing
Board
jointly
Then,
reverted
the
posts
of
the Chairman and the
in terms of leadership structure,
to
its
original
format
with
the
the
bureaucrats displacing the technocrats in the organization.
What follows is a brief description of
the
performance
of the organization during these periods of changing leadership.
17
The description also examines the role of several factors -lack of direction;
power and image --
incentives;
coordination;
ie.
support/bargaining
that seem to explain why the Board was unable
to meet the various goals mentioned earlier.
(a)
1972 -
1975
With
dissolution
Housing
the
in
six
Board's
months
and
creation
turned
to
Board's chief.
the
battle
the
the
its bureaucracy and the
over the appointment of Housing
Governor Barooah's direct involvement in an area
outside his official domain,
on
its
re-creation,
subsequent
attention of Bihar's political leaders,
media,
1972,
in
attracted further public attention
When the controversy was resolved,
Housing Board.
organization and its Chairman, Mr.
Prasad, were perceived to be
enjoying the blessings of a strong political leadership.
Prasad recalls,
the
"...with the desired
level of
As Mr.
political support
and autonomy in the maze of interdependent institutions, we were
able to begin in a professional way".
The
was
Chairman
fairly
clear
about
direction of housing policy for he had been a
of housing for the rural migrants.
the
strong
As a professional,
he felt the need to have a better estimate of
the
general
proponent
however,
distribution
of housing demand in the state and, consequently, he initiated a
state-wide
Demand
Registration
Process.
The process required
people who wanted housing to declare their incomes
Rs.50
(about
$5.00)
in
nationalized banks.
18
and
deposit
The turnover was
quick and encouraging for the Board: about 85% of the 58000 that
responded wanted houses as opposed to
applicants
state.
preferred
Patna
plots,
any
to
and
Insurance Company
(LIC),
(HUDCO) and the Life
for financing housing projects.
temporarily
The Board decided to
the
corporations
looking
rural
migrants
shelve
projects.
The
and
goal
media
publicizing
attention
organization received was a strong incentive for
prepare
its
of
in order to impress the financial
(for funds) by presenting
housing
to
the Board
the state government and the financial institutions,
the Housing & Urban Development Corporation
helping
the
of
of the other towns in the
With these indicators of housing preferences,
approached
staff
50%
smart-
that
the
the
technical
and good-looking housing designs.
efficient
The financial institutions were impressed and the Board obtained
the necessary finance to carry out the
projects.
demonstration
With the Housing Board showing so much activity,
the government
and the Reserve Bank allowed the Board to issue two public bonds
at good rates -public
an
allowance
agencies in Bihar.
With
projects.
finances
for
new
Commercial banks were also tapped by
the Board for a cheap credit line,
that were paid by people to
unprecedented
fairly
in exchange for cash advances
in
participate
in
place,
the
the
demonstration
Board
its
turned
attention to obtain the land necessary for those projects.
In this area too,
getting
the
necessary
the Housing Board's image
worked
support of the Revenue Department,
organization responsible for acquiring and
19
disposing
of
in
the
land.
About
600
Housing Board's
housing
of land was delivered within one year for the
acres
demonstration
first
scheme
in
Patna).
compensated for their land,
on
the
past
price
Board
private
(the
Lohianagar
land-owners
the compensation price being
were
based
of similar land that had been sold in the recent
in an adjacent area.
Housing
Most
project
and
The swift
the
Revenue
coordination
between
the
Department was primarily made
possible by the personal relationship between the heads
the
of
two organizations.
The Board did not encounter any problems in justifying
demonstration projects in the National Five Year Plan
these
1974 -1979).
According to the Chairman,
the
national
(of
housing
policy
guidelines which the Board's project had to satisfy were
written
in such general
policies
was
terms,
and
monitoring
the
housing,
divided
the Housing Board
ie.
was
into
In addition to the
phases for implementation purposes.
infrastructure --
those
that guidelines could always be met.
so minimal,
The 2000-unit Lohianagar housing project had been
several
of
responsible
for
the
developing land/land-filling,
primary
laying the
entire sewage network and providing water, electricity and roads
in the project areas.
Each phase
range of housing options,
and
detached
subdivisions,
housing,
mostly
(earning upto $100
housing
of
the
project
included
a
but it was essentially a mix of group
quite
conventional,
unaffordable
per month).
Since
with
few
plot
the lower-income groups
to
the
national
and
state
policies included a large variety of housing strategies
20
the Housing Board got an implicit approval to proceed with
(3),
their Lohianagar project.
intention
of
the Housing Board to implement this demonstration
project in order to gain
which
was
According to the Chairman, it was the
considered
support
less
for
rural
housing
migrants
atrractive and less visible by the
political and the financial institutions.
The success of the Housing Board in procuring
the
land
and
the general expectation that it was capable of successfully
implementing projects,
staff
morale
However,
and
appeared to have a
implementation
the time arrived for the
because
Ordinance
the
Governor Barooah
political
gone,
appointee
(an
positive
Board
to
about to lapse
the
state
as
reconstituted
moved
to
With
put
a
the Chairman and change the
Managing
The conflict thus triggered,
the first Chairman's resignation and,
senior
be
(Aug/Sep'75).
ministry
previous Chairman's designation to that of a
in the no.2 position.
on
proceded in a timely manner.
was
MLA)
effect
Director
resulted in
in the appointment
of
a
PWD engineer as Managing Director who was to serve under
the politically appointed Chairman of the Housing Board.
(b)
1975 -
1978
With this division of power at the
were
soon
structure.
of the
made
in
the
top,
other
changes
composition of the Board's leadership
Three additional members of the legislative assembly
ruling
congress
party
were
appointed
in
committee in positions reserved for housing experts.
21
the
Board
Unlike the
previous
these
chairman,
the
new
managing director did not protest
instead,
appointments;
he
focused
on
designated
his
to implement and plan projects identified during
responsibility
the earlier period.
The
superseded
attention
scheme.
he
For
new
by
more
on
the
larger
director's
managing
immediate tasks at hand and he focused his
the
of
implementation
ongoing
Lohianagar
Whe n he started to plan for the project's second phase,
began to
notice unexpected developments in the project area.
example ,
cooperatives
the Housing
operating
organized
construction
private
had started to mushroom,
It was
Board's plans.
had
cooperatives
as
that
most
these
of
'overnight' by individuals
These
developers.
or
builders
in complete violation of
found
been formed almost
housing
by
cooperatives,
the y acted as a group or through political connections,
because
resisted repeated warnings by Housing Board officials to
the
were
goals
officially
vacate
When these warnings turned into
acquired land.
threats of forcible eviction, the cooperative members managed to
obtain
a
stay
price
compensation
(4).
order
from
paid
the
by
court
to
grounds
that
the
the Housing Board had been unfair
The Housing Board leadership
committee
on
look into the matter.
by
reacted
establishing
a
With a court stay order in
place, no work could be comprehensively undertaken in the second
phase of the project.
completion
The Board turned
its
attention
to
the
of the first phase and the managing director started
the process of
acquiring
land
for
the
22
Hanumannagar
housing
Patna --
in
scheme
another middle-income group
(demonstration)
project conceived of during the earlier period.
even
resistance
stiffer
encountered
the managing director
In this project,
private land owners.
the
from
simply refused to give up their
land.
private
The
an
They
landowners
petitioned to the Chairman of the Housing Board or other elected
representatives on the Board committee
or
(the MLA-housing experts)
that
even to the state housing minister on several grounds:
not
the procedures of the Land Acquisition Act had
or
portions
needed for serving the
In this case as
fell
the
which
severe
appointed
the
area
enabled
the
Hanumannagar
the
litigations,
unaffected,
to
project
Though coordination
in taking off.
delays
committees
As a result of these
made by people.
charges
and
Chairman
the
with institutions supplying finance and
remained
outside
"public interest" --
well,
investigations
encountered
plots
to acquire land under the law of eminent domain.
Board
investigate
of
that
or that certain areas were not at all
notified for acquisition,
Housing
fully
that plot measurements were wrongly taken;
complied with;
certain plots
been
construction
materials
managing director and his staff felt
the
the
helpless in the legal battles and
of
image
an
efficient
organization began to crumble.
The
state's
senior
bureaucrats
director of the Housing Board
stressed
The
the
need
legislators
for
blamed
inefficient
the
managing
management
and
for streamlining organizational procedures.
shared
these
views
and
23
they
appointed
a
bureaucrat
from
the
elite
Indian
Administrative
managing director in the no.2 position.
director
went
back
to
the
The
position
position
in
Chairman
was
of
the
the
technical
hierarchy.
also
replaced
previous
managing
Public Works Department to a more
coveted position in the technical core.
the
Service as
Housing
Board,
head slipped down to the no.3
Amidst
by
At the
this
another
reshuffling,
the
member of the ruling
congress party.
(c)
1978 -
1982
The
concerned
new
with
leadership
procedural
of
the
Housing
Board
was
more
guidelines than with fulfilling the
The
earlier objectives of the organization.
managing
director
wanted to make sure that all procedural rules were complied with
even at the expense of rapid project implementation.
his
energies
on
He focused
allotment procedures as some of the flats and
plots in the Board's first project were ready for occupation.
According to the guidelines,
pay
or
plots.
When
final
payments
were
sought,
the
encountered problems that it had been expecting.
management
most
to
final installment before they took possession of their
the
houses
allotees were required
cases,
periodic
installments
had
not
been
made.
In
As
defaults had piled up,
the individual's capacity to pay old and
new dues had worsened.
The
difficult
to
managing
director
also
found
it
deal with many defaulters who had started to live
in houses or had started to build on plots
24
even
before
formal
The management was also aware of many
allotments had been made.
who
occupants
who
had
either never registered in the first place,
had
jumped
the
allotment
queue,
or
who
ineligible for the particular flats they occupied
by
income
levels).
made by the
(as determined
appointees
on
the
Board
itself,
This dilemma created serious
But he ended up doing just that
cases differently.
political
pressures
from other Board members.
had been established,
in
indulge
lengthy
the
management
had
problems
management
the managing director could not treat these
because
the
did not know how to manage the situation most
staff
effectively.
simply
Because many unauthorized allottments were
political
management
were
no
'irregular'
because
of
Once precedents
option
but
to
negotiations and justifications with every
faulty allotment case.
With these problematic cases
piling
up,
the
managing
director's role was being reduced to a paper-pushing one because
decisions
be
would
postponed in favor of investigations
would never be conducted).
be
known
as
an
The reputation of the Board came
organization
inefficent
would
dimming
the
positions
in
be damaged,
prospects
of
being
transferred
the state or at the centre.
within the short period of four years.
bureaucracy
or
their
career-
affecting their career mobility and
then that as many as five bureaucrats served
state
to
and few bureaucrats
They felt that
wanted to be associated with it.
resumes
(that
the
state
to
important
It is not surprising
in
this
position
They would maneouvre the
ministry
25
to
have
them
The reluctance of the organizational heads to stay
transferred.
also led to a low morale
with the Board for a long time,
among
the staff in the organization.
However, the financial institutions seemed unruffled and
HUDCO
the
forward to finance another large housing project
came
housing
2500-unit
project
in
Bahadurpur,
--
This
Patna.
too, had been conceived of during the initial years of
project,
the Board as a demonstration project, and contained the same mix
of
types.
housing
While
funds
HUDCO
from
and
the
other
financial institutions kept coming, there was little progress on
project-implementation
because
political
meddling
in
land
acquisition and resistance of the private land-owners continued.
at
Surprisingly,
its
withdraw
this
appointed
time
Chairman
control of the organization.
Managing
Director
were
the
ministry
state
decided
and let the bureaucrats take
The posts of the Chairman and
merged
to
and
the
the Board reverted to its
original format with the bureaucrats displacing the
technocrats
in the organization.
(d)
1982 -
1985
When the bureaucrats took control of the organization in
1982,
political meddling in matters related to land acquisition
and allotments almost stopped because most
were
out
of
and
Board.
as
However,
a
the
politicians
result
of
Housing Board's image in the public eye was at
performance,
worst
the
of
as
past
its
a result of legal precedents established in land
26
litigations,
stronger.
the resistance of
The
media
interference and huge
Board
officials
output by early
initial
years.
projects
(the
Bahadurpur
the
suggested
private
that
most
of
charges
'80s had been
very
grew
there had been political
misappropriation
denied
land-owners
public
funds.
The
but could not deny that
low,
except
for
the
few
More embarrassing was the fact that most of the
Lohianagar,
housing
Hanumannagar
project)
that
the
and
Board
part
of
the
claimed to have
completed, were in a poor state of maintenance.
The
Corporation
Housing
blamed
management
for inefficient maintenance.
out to be otherwise:
to
Board
the
Municipal
The real story turned
The Municipal Corporation was not
willing
take the blame for maintaining projects with incomplete land
filling,
incomplete
incomplete sewage network and
roads.
The
of both organizations suffered as scenes of choked sewage
image
littered garbage and
networks,
boats
plying
in
water-logged
end of monsoons.
The
Housing Board pressurized the Municipal Corporation through
the
streets
of
project
areas,
marked
the
department of the Local Self Government at the secretariat which
was
the
liason
agency
government agencies.
hoc work --
between
state
partly because they could not refuse since they
been superseded because
as
and
local
This led to Municipal Corporation doing ad
become part of the state bureaucracy
partly,
government
of
its
--
ie.
ineffecient
had
the Corporation had
performance,
and
the Corporation received very little tax money from
the landowners and homeowners in the Board's project areas.
27
The result of incomplete projects coupled with a lack of
and perhaps more
maintenance was visible,
could
paper.
damaging
These projects stood as testimonies to thirteen years of
organizational
inefficiency.
The
middle-level staff reached such
morale
a
sense
of the upper and the
level
low
to leave the Board as soon as possible and to
state
government
(to the Board).
petitioned
the
Chief
complete
of
that
government inquiry into the operation of the Board,
deputed
what
be inferred from analyzing Housing Board's performance on
Housing Board's performance and portrayed a
various
than
go
fearing
a
they wanted
back
to
the
departments from where most had been
As a result,
Minister
in
the Housing
late
organization itself.
28
1985
Board
staff
to abolish the
CHAPTER 3
Evaluation
On the basis of
Housing
Board's
why
reasons
and
we had
goals,
these goals
will
were
Housing
have
Board.
also
individual
case
image
as a
or,
In other
to
that
suggested
by
(a)
These are:
lack
and
(d)
will then
factor that appears
the
The
evident
appear to be
factors.
in the
factors
four
various
which
the purpose of
inefficiency
that
perspectives
(b)
lack
on
of
with
coordination
of
lack of adaptive capacity
examine
offer a unique
to
be
extent to
lack of direction;
(c)
We
power.
the
met.
those
words,
we will discuss the
incentives;
bargaining
not
that
try to establish the
and
the source of
interdependent organizations,
and
study
those factors
to trace
First,
been
organizations.
factors earlier
insurmountable.
the re-examination is
were
appear
met also
evident
is
Our story revolved around
and dominance of
constraints
it
earlier,
were not
the
re-examine
relevance
stated
identified several
possible constraints.
We
the field research,
Board's changing
explanation for
the Housing Board's performance.
(a)
Was
there a
It
has
direction because of
lack of
been
in
suggested
the
multiple-goals?
literature
that
in
organizations having different and mutually contradictory goals,
one
would
expect
organization's
a
lack
inability
to
of
direction and,
meet
those
29
goals
therefore,
(Bales,
the
1963;
Litterer, 1969).
We know from Chapter I,
that the Housing Board also had
different and contradictory goals
strategies
and
addressing
requiring
different
different
housing
groups.
For the
target
proposition stated above to be true, we would expect the Housing
Board to
be
therefore,
Board
implementing
lacking
adopted
conventional
in
strategy
identified
framed
by
focus.
1972,
public
thirteen years.
that
in
different
housing
However,
despite
the
continued for the next
the Board did
--
the
(3).
For
example,
building
some
case
study
official
document
Board
could
choose
of the options that the Act had
by
materials/housing components or by focusing
on land readjustment and land subdivision.
the
change
Housing Board increasing housing stock
identified included,
producing
not
leadership in 1972 which identified policies or
listed various housing strategies that the
from
building
fact that several options had been
in the Housing Board Act
the
involving
projects,
More significantly,
and,
the strategy that the
essentially
housing
strategies
that
the
Housing
Board
We
also
know
from
was under no policy
constraint, either from the state government or from the central
government,
regarding which strategy to adopt.
semi-autonomous
various options.
status
Housing Board's
enhanced its freedom to choose from the
However,
neither anyone
questioned
why
the
other options were not even considered, nor was there an attempt
on
the
part of the Board to plan for these other strategies in
30
the thirteen years;
instead,
what
appears to have started
demonstration/experimental
strategy,
this
conclude that the
evidence,
undefined,
was
we
clear for all
We found
groups'
all
that
the leaders
a similar consistency
were
to benefit from
the projects examined, the
indicated a
Board's
definite bias.
an
assume
about $50
monthly
the
allotment
on
this
(earning about
required
written
illiterate
Housing
(EWS) category,
if
even
about
the
bank
26%
$100
per
on
of
a
this
10-year
family
month) was 60%
bias was evident.
legal
the rural
statements,
jargon,
would
and relatively unresourceful
31
migrants or
to
complete
and
references,
assume
and
an
suggest
used
necessary
can
in
10-year schedule.
the
Board
We
we
(earning
52%
the richest
level also,
incomes.
in
to
the thirteen years the application
that
In
of housing units
high
or
on a
The lengthy paper work
certifying
projects.
income-category
schedule
or 30%
'target
free payment schedule:
towards the needs of either
procedures
formalities,
in
5-year
throughout
the urban poor.
largely
a
procedures
affidavits
unreasonably
Board.
the
belonging
easy interest
a more qualitative
insensitivity
these
was
5-year schedule
example,
terms of
Given
however
Housing
these housing
corresponding figures for
The
month on a
On
in
was required to pay
Income category
Low
For
a unit
per month),
schedule.
at the
a family
the richest family
income
direction,
official pricing
For
unrealistically
for example,
abandoned.
economically weaker section
designated
the cost of owning
per
must
was never
as a
that
these
discourage the
individuals.
that
We believe
Board's
Housing
intended to benefit the higher-income groups
per
month)
despite
affordable to this
higher-income
the
than
had
any
people
in
the
(earning above $200
other
income
group.
The
responded to the Demand Registration
Process conducted by the Board in
of
not
fact that the housing units were more
group
groups
was
direction
entire
1972 to assess
housing
needs
The distribution of housing
state.
'needs' in this process indicates that the 85% of the applicants
from the higher income groups had preferred plots/land to houses
of any kind.
the
However,
the Housing Board
consistently
strategy building housing units and as a result,
of the applicants from
alloted
land
by
the
1984.
high
We
income
can also
group
about 75%
had
conclude that
lobby of the high-income group failed to influence
pursued
not
been
the powerful
the
Board's
leadership to change the organization's direction.
Field
research
supported
this
view for we could not
find any powerful coalition within the organization that
to
favour
a
goal among the different organization
particular
goals stated earlier in Chapter I.
planners,
or
engineers
different goals on the
For
example,
organization to favour
land-use
It was also
politicians
basis
their
would
one
expect
housing
the
planning/zoning
seemed
in
not
true
that
on the Board conformed to
professional
the
townplanners
approach
conformity
affiliation.
which
in
advocated
with a master plan as
opposed to the engineers in the organization who would favour
more
'engineering'
approach of constructing houses.
32
the
a
One would
also expect the politicians to favour the
'engineering' approach
because of a high visibility of this
approach.
research
there
clearly
indicated
that
However,
were
field
townplanners,
engineers and politicians who considered each others' approaches
as acceptable solutions to the housing
accurately
determine
why
an
problem.
We
could
not
organization with multiple goals
pursued a consistent direction of building
housing
flats
that
were not even wanted by people who could afford them the most.
We
can
conclude,
relationship between Housing
then,
that
Board's
there
was
multiple
no
goals
clear
and
its
inability to meet them because of a lack of direction.
(b)
Was there a lack of individual incentives?
The
literature
on
organizations
organizations having few inducements,
staff
morale
and,
therefore,
a
one would
high
organization's goals would not be met
has stressed that in
expect
probability
(March
and
a
low
that
the
Simon,
1959;
Price, 1968).
Lack
of special incentives at the Housing Board for its
staff to work efficiently,
other
was not unique to Housing
as
government organization in the state worked under similar
conditions.
At the Housing Board, therefore, there were neither
special monetary inducements nor special promotional
for
Board
the
upper
if they worked
or the middle management staff,
hard to increase Housing's Board
contribution
33
incentives
to
the
housing
stock
or
if
they fought
being addressed
for
in Housing
if
unchanged
throughout the period between
were
there
attainment
major
successful
the
Lohianagar
the
morale
chairman
were not met.
changes
in
high
between
procuring
project
and
of
the
the
1972
high
a
speedy
output
were
well-meaning
several
between
1975 and 1985.
a
period
and
1985.
degree of goal
1975 when the
manner.
and
To a
to
decline
the
in
morale
Board was
implementing
large
extent,
of
'charisma'
Subsequently,
almost
individuals
1972 -
staff
steadily,
the
the
even
led
the organization
of
incentives
that
we find as many as seven
1975,
(managing directors) serving in the organization
exexutive heads
in
However,
Given the same set
between
available
1972
Board during that period.
though
were there any
remained
and
due
not
These controls
large amount of land
in
that were
We were told that
morale and output continued to
were
Nor
staff morale and
in
during that period.
unusually
people
Board's projects.
sanctions
was
these goals
the cause of
of
years.
seven
inducements/sanctions,
observe,
between
relationship
significant
We
changes in staff morale
therefore,
no
changes
in
and
of
degree
goal attainment.
We cannot make an a priori judgement,
incentives and sanctions were increased,
espoused
invariant,
would
have
been
met.
the
in short, that if
goals
that
were
Since incentives had remained
this factor does not explain the
performance of the Board in the later periods.
34
particularly
poor
(c) Was there a lack of coordination with other orqanizations?
suggested
--
that
for
organizations
on organizations,
literature
the
In
for
an
it has also been
on
dependent
organization
approval of programs and supply of necessary
lead
to
therfore,
in
a good coordination would
inputs for goal attainment,
timely approvals and timely supply of inputs and,
(Mooney,
an ability of the organization to meet its stated goals
Price,
1947;
other
1968)
The mechanism through which coordination was achieved at
the
Housing
Board
organizations
that
was
Heads
institutionalized.
required
were
of
most
to formally approve Housing
Board's plans or that supplied key inputs, were Board members of
the Housing Board and met in the Board meeting regularly
month).
every
used for this
suggests
study
Informal
purpose.
a
lack
(twice
mechanisms and consultations were also
Despite
of
mechaninsms,
these
inter-agency
the
case
coordination to some
extent.
As far as approvals were concerned, we know from the case
study and from the previous discussion on
that
"lack
of
direction"
either from the central
there were no policy constraints,
government or from the state and the local governments regarding
what the Board ought to do.
Thus, lack of coordination with the
State's Housing and Planning Departments was neither
an
actual
nor a perceived constraint for the Housing Board.
On
the
other
hand,
lack
35
of
coordination
with
organizations supplying inputs
organization's
the
why
explains
partially
land),
and
(finance
We know
goals were not met.
from the case study and Housing Board's Accounts that, as far as
Plan
year
timely
always in a
supplied almost
Five
manner.
were
allocations and state government loans came in
rose more than estimated for,
every
received
Only when project costs
the financial institutions.
from
the
example,
For
every year and project specific loans were also
year
negotiated
state government or the financial institutions,
the
with
had
the funds that the Board
finance is concerned,
the supply of additional
finance
was disrupted because of cost revisions (Housing Board Accounts,
1972 -
Board could not complete its demonstration projects.
Housing
can
Delays in getting these funds may explain why the
1985).
that
conclude
a
as
result,
the Housing Board could not
expand its operations and, therefore,
However,
is
this
could not meet its goals.
a only a partial explanation because we have
not yet determined why project costs rose in
instead,
project
have
we
discussed
only
place;
the effects of increases in
costs.
the
supply
the
housing
of
land.
with
Procuring
the Housing Board,
because
the
respect
to
Land was one of the inputs common to all
in
strategies
organization.
Since
first
the
We find a similar partial explanation
or
We
land
the
multiple-goals
of
the
was one of the main problems for
either due to lengthy acquisition procedures
landowners
procedures
simply refused to part with their land.
were
lengthy
and
36
if
coordinational
collecting
state
Department
and
the reliance on
the supply
time
(about 600 acres
would
IAS,
the
cadre,
took almost
it
However,
As
in
for
members
result,
also
only
determined
is
could
a
why
not
partial
-
refused
service
excessive
own
network.
land.
1200 acres of
between
delays in
we can conclude that as a
not expand
explanation
executive
same
organizations and
meet its stated
lanowners'
1975
relationship
the
evident and
Housing Board could
the
therfore,
land
of
to maintain a very
their
of
10 years to acquire
the case with finance,
of
supply
amount
circumvent
to
known
lack of coordination between the two
the
the
to
belonged
and
procedures
bureucratic
the least
whose members are trained
network,
working
close
-
initial years,
coordination since the
expect better
two organizations
of the
heads
mechanisms
In the period between
1 year).
in
Revenue
major variations in
In the
1985.
land
expedite
coordination
land was acquired in
amount of
largest
we
never represented
to
there were
and
between 1972
of land
the
1985,
as
non-representation of
informal
unchanged till 1985, but
remained
( such
memos)
and
However,
procedures.
acquisition
had
Board relied entirely on informal
telephones
(such as
mechanisms
Revenue Department
the Revenue Department was
committee and the
on the Board
for the
updating a complex cadastral
taxes and manually
Yet,
base).
data
the
responsibilities besides acquiring land
other
several
extremely difficult
was
it
anything considering that
to do
Board
work,
not
did
mechanisms
its operations
goals.
because
to
37
sell
However,
we
have
land
and,
this is
not
yet
during some
periods as opposed to others;
instead,
discussed
we have only
the effects of the phenomenon of refusal to sell land.
(d)
Was there a lack of adaptive capacity and bargaininq power?
It
has
organization
needed
the
been
suggested
exploits
its
for its programs,
to
capacity
resources,
goals.
the
the
in
environment
literature
to
acquire
that
an
resources
and if the organization does not have
respond
to
problems
organization
acquiring
of
those
will be unable to meet its stated
(March and Simon, 1958;
Hage, 1965;
Pfeffer and Salnick,
1978).
It
appears
discussion that,
the
the
from
case
study
and
except for the initial years,
organization
problems
of
feedback
process),
were
acquiring
or
either
unaware
resources
that
needed,
they
were
of
the
previous
the leaders
the
of
nitty-gritty
mostly
land
(poor
unable to exploit the
political and the legal environment in acquiring those resources
(poor bargaining power).
With the Board commitee making all major
decisions
for
the Board, one would expect an inefficient feedback process from
the
field level to the top.
But field research shows that even
within that centralized system,
institutionalized
and
appeared
the feedback process
to
work.
For
example,
regular Board meetings were forums where the recurrent
of acquiring land were widely discussed
was
well
the
problems
(at least twice a month)
38
top management
the
between
and
committee
itself.
acquired
had
problems
program
housing
the
study,
the
1985.
the Board to
processes
the
and
the
were
systems
the case
saw in
the way
manipulated between
the capacity of
it was
instead,
feedback
limited by
land
on
stay-orders
court
and
the problematic
little to do with
(which were working well);
appointments
problem
because of
We can conclude, therefore, that
respond to problems had
political
As we
able to do neither
legal
decisions to
delays in
changing
in
in the long-run.
leadership was
political
1975 and
itself
the number of
we can expect
were large,
the short-run, and delays
in
solving
few
by a
be handled
since
However,
faced.
organization
that the
innumerable problems
the
these
leaders,
The
gossip.
of
status
fully aware of
were
therefore,
the
discussion on
level,
informal
an
At
Board
the
within
the financial institutions and
management
the top
between
field staff,
and the
litigations during certain periods.
saw
We
were made by
were
elected
appealed
to listen
obliged
to prevent
in
in
appointments
exchange for the
support of
MLAs,
The
(MLAs).
to appeals of the people
Therefore,
in
the private
when
land acquisition,
land acquisition
political
form
or
who had
landowners
we would expect
some
in
the
the MLAs
other.
seems to suggest that certain goals of the political party
and goals of
came
case study that
the legislative assembly
them to power.
to interfere
This
the
the political party,
the members of
turn,
in
the organization
together.
conflicted when
This conclusion
does offer an
39
the
two
systems
explanation of
why
was
Board
Housing
not
political
removed
determined
appointments
Chairman,
4
and
were
suddenly
made
in
why
most
whereas we would expect
as a
the
appointments
political
1972
and
as in
because we have
partial
between
to use the organization
to continue
But
why,
as housing experts)
1982 --
in
is
effects of fluctuating
examined the
and have
its goals.
meet
the explanation
previous discussion,
only
to
unable
1985,
1975
five
(1
them
of
as
were
the political party
means
of
distributing
favour.
If we combine
discussed
find
a
lack
was
is,
(power of
respond
of
the
landowners
politicians
legal
it
that
had
is
landowners
did;
we
been
right
the legal
1982
to
--
partly
know
know
why
what
land
had
to acquire
so
after
resistance
though
because
earlier.
the
they refused
with their land in certain periods as opposed to others.
40
we
Board
of
do
However,
established
we only
also need to
land,
Housing
continued to grow stronger even
partial because
explanation
of
problems
was unable
in
where we
Board's goals/programs
appointments.
left the organization
precedents
the
to
though Housing
1975 because of the political
(c),
of why the
explanation
eminent domain),
with
ensuring supply
and the Board had
sanction
legal
to
unable
That
acquisition.
land
coordination in
partial
similar
leadership
a
of
the preceding argument
most
of
The
private
to part
(e)
inputs
We will
discuss the proposition
needed
by
an
benefiting from
We know
--
high
performing
image:
from
to
a
ability
public
Board's initial
to perform
positive
believe that
major events, the
was told and
its
assume
of its first
Chairman
state's
highest
the
Board's output
during the
by the
land acquired) was
relatively
Board
was also perceived
unprecedented
acquire
Board
(LIC) and the
These
image and,
to
achievements
therefore,
be
this
events reinforced
the largest
single funding
being
allowed
the
reinforced
it
was expected
this initial expectation determined the
political appointments,
around which the story
which seem to be responsible for the
inability to meet
Since
can
bonds.
of
well.
We
and
reputation
aura
to
The
to
institution
financial
it
time.
the
Two other
well.
Board's
issue
that
therefore,
and,
the
had the blessings of
(as indicated
initial years
very
at
office
political
perspective of
and gave the organization an
enhanced by
it
the
how
of
formation brought
that the Housing Board's
notion that
and a
is
attainment,
goal
from the
future,
key
of
its outputs.
the attention of the media
exclusivity
in
supply
expectation
the
ie.
perform
will
organization
--
its performance?
that the
for
organization
image
its
by
determined
groups
determine
Board's changing image
Did the
it
image
the stated goals.
the organization
that
Board's
was expected to perform well,
was expected to deliver
41
significant
we
amounts
We can expect a
of valuable outputs, serviced land and housing.
political party to distribute favours to its members in exchange
Board,
The
support.
their
for
attractive to the
was
thus,
organization
politcal party because of the expectation that the
produce
would
among friends,
goods
that the MLAs could capture or distribute
among people who
relatives or most importantly,
Since these
helped them get elected to a position in the party.
benefits
valuable
were
in
political party to fight any opposition and appoint MLAs
ruling
on
the
expect
we would
normally came with a Chairman's position,
that
amenities
the
to
addition
Making
Board.
the
an
when
time
a
at
appointments
organization is successful, would not be motivated by collecting
the organization's performance --
for
kudos
contribution of politicians
the
functioning
of
the
in
appointments,
motivated
by
desire
distribute
to
more
likely
favours.
We
are
therefore,
conclude that the better the image or stronger
political
the
to
the
tendency
appointments
or
greater
made.
would
be
We can explain,
the
to
a
The
be
can also
expectation
that the organization would deliver the valuable goods,
would be
of
unfortunately carries the image
efficient functioning of an organization.
political
a
Bihar)
(particularly the MLAs of
organizations is well known to the public.
Even a well-meaning MLA,
meddler
partly because the
greater
number
therefore,
of
the
appointment of the Chairman and those of four others in 1975, in
In the case
positions reserved for housing experts.
also
saw
Housing
study,
we
Board's output to continuously decline after
42
showing
it
its
whose performance can be a
Housing
Board in
1982.
wait to
see what
happens
nor
was
appointees
few
party
to
from an organization
were removed from the
if we
in
well
Board performs
if the Housing
we
Therefore,
be fully validated
can
This theory
relatively
political
liability.
political
the political
why
explain
can
the
detach itself
and
appointees
the
With
future.
expect
we would
outputs forthcoming,
remove
in
produce enough
to
expected
other words,
any valuable outputs
neither producing
organization was
In
1982.
virtually no activity around
organization
the
with
image),
(associated with a declining
1975
future.
relationship
This
appointments is
political
establish
to
appears
consistent
manner,
and
1985.
1972
discussion
this
to
central
causality that
chain of
(c)
and
(d)
offered
it
for
explains in
a
Board between
the
completes
it
addition,
In
image and
changing
the performance of the Housing
that factors
explanations
answers
a
Board's
between
earlier
--
partial
ie.
it
the questions,
Why did
landowners refuse to
as opposed to others?
sell
land during certain
periods
and,
Why did project costs rise?
Since
we
discussed and
through
certain
these two questions,
which the phenomenon of
phenomenon
between the theory
suggesting a relationship
are
of people's
periods
to
we need
the mechanism
political appointments
refusal to sell
bring about
to know
land,
increases in
43
just
and
the
interacted during
project
cost.
The
mechanism
that
we
believe
profitabilty of owning
the
project
influenced
land or
areas;
and
prevent
their
land
not elected
obliged
to
the
being
politicians
which
the political
Board
could
not
acquisition appeals
The
landlords
were
not
to these
to look
ineffective
also expected
politicians on
by
the
politicians outside
to look
Board,
into
land-
to semi-
outside
were
the
of the state's legislative assembly.
landowners either
obtain
a
price than
or,
successful
the
these
unlike the MLAs,
because matters relating
the
sell
to
response
committees
the
private
to the technical
totally
Board:
Through these appeals,
if
Prior
In
granted a hearing
as easily,
was
representatives to
therefore,
being
pressures.
organizations such as
jurisdiction
the
instituted committees
up
institute
around
and
the organization,
staff,
complaints.
ended
in
themselves,
and,
than by politicians outside the
autonomous
in
could not appeal
typically
is the
profitability
acquired.
positions
such
chance of being
better
Board
to their
factors
image.
because the technical
matter,
because of
from
entertain
appeals, the
into the
of
were appointed
the land owners
staff as easily,
a
degree
land
started to appeal to these elected
appointments,
were
the
them from the land-owning class
landowners
these
investing in
Board's changing
by the
When the politicians
some of
integrates
higher compensation
land
landowners the
at
what
a
much
higher
latter potential
price
benefit,
44
the Board offered
they expected
preventing acquisition,
in
expected to
in
future.
however,
to
For the
would be
more
with
first provided
by
or
the
in
rate of
over
and above
and
the
building
there would be an
definition
return
what would
was
Board
housing.
of
investing
occur if
expected
increase in
and,
income, this additional increase
means of storing
would
increase the attractiveness of owning
area.
This expectation
that
property
ineffective
rates
of
would also be
taxation by
(5:
return
and
model
increases
in
land
reinforced
the Municipal
for a general
on
land
45
project.
land prices
in
land,
provided
was
for
land efficiently
asset
therefore,
in
a
land prices
in the
by
a
landowners
or speculating
acquire
an
owning
or
be
that
land in
housing
infrastructure
to
'Since land was
a
in
allotees or tenants
not to the many
The
infrastructure
to the few
property would accrue
commercially-viable
much
required
building housing could
speculating
of
benefits
the
because
That is,
implementation
would increase the attractiveness to own
thwarted,
and
that
primary
of
acquire land for
to
activity in
supposed to follow.
which was
the provision
after
attempts
Board's
area
the housing
that
expectation
Board's
with primary infrastructure
than
land
water and
expectations because the projects were
these
assured
strategy
be provided
would
extension of
viable.
area
project
the
and around
developed,
thereby making commercial
lines,
trunk
electricity
expectation
because of the
primarily roads and
infrastructure,
less
area to be
agricultural
the
the
with
firstly,
increase,
would
announcement to acquire land
Board's
that
prices
Land
attractive.
project
the
fact
Corporation was highly
the
determination
prices due to
of
Board's
would
the
poor
organization's
land
in
meddling
result
of
is
Board's
projects,
the
project
areas
posh
areas of
the city,
compound
(Annual
27%
versus
1972 and
explained
be
behaviour
now.
The
be
by the
between
1972
that
a
clear
land and the
Board.
This
despite Housing
prices in
land
the downtown and
in
land prices
general
in
the
inflation.
project
inflation of
fail.
also, by
area
was
8.98% between
if
forthcoming
this
loan repayments
the returns from the
Board by
we found
the financial institutions
projects were poor
We
would
46
were
Accounts
Not only were funds
made regularly,
were
interest and
on time.
investments
Board
the state government
making the
investments
repayments
Housing
be
the financial
The
loan
view.
also
or the increased
expect
would
such projects.
1985 support
Board's perspective,
Housing
we
can
encourage
definition,
borrowing organization.
and
When
instituions
attractiveness
investing in
supplied regularly,
the
fact
the financial
increased
particularly
assured
any
of
therefore,
and,
made
institutions to be
would
the
of increase in
compound general
of return would
rate
on
political
was
to sell
accounting for
of
of
result
there
over that
after
inflation
the
rate
well
a
by
1985).
The
to
are
annual
an
by
reinforced
was
refusal
appointments
supported
incomplete
as
Thus,
landowner's
political
relationship
performance
acquisition.
between
relationship
land for housing
to acquire
be unable
the Board
that
The expectation
acquiring land).
in
inefficiency
without
from the
bailing
loan repayments
therefore
out
to
expect
the financial
Board's
supply of
Since
Housing Board,
1982
We
was relevant
factors that
would expect
that
cooperatives would
Board had managed to
the
developers themselves had
as
soon
Surveys
farmers
the
project
case.
on
land
construction
or
purchase
owned
who
the
formalities
of
agricultural
on land that
farmers
from
public.
wish
land acquisition and
court
prices
than
land to
what
the
to
then,
that
these
developers
cooperatives
'overnight',
built
minimal
and that
them
offered
formed
shelters
It
is
not
housing
rapidly
and appealed to the politicians on
47
the
through
Board offered.
surprising,
'legitimize' their claim,
who
Board's
to
procedures,
the developers
Housing
go
Most
trends.
prior
land
not
they preferred to sell
these
supported
areas
intervention said that they did
higher
landowners'
acquire,
managed to
the
exactly
the housing projects were announced to the
as
in
be motivated by
the private
between
who had formed
developers
these developers to start
the
either
in
the
precdents had
delays
similar
expect
would
we are only
1985 and though
so many legal
in 1982,
case
litigation
landowners;
1975 and
The behaviour of the
1985.
private housing
same
that we
established
and
trend between
land
the dilemmas of
every
that
the
of
favour
the Board
left
politicians
been
general
a
explaining
not suggesting
the
in
settled
need to consider
for
real constraint
a
finance was never
we only
We are
litigations.
was
only
interests.
serve their
the
by the
upset
rates of return would
increases in
any
image since
to be particularly
not
institutions,
to
the
Board to
prevent
supports
this trend.
We
eyes
of
result
of
can
the
therefore,
land acquisition.
conclude
landowners
that
projects
inability
espoused
explains
the
badly
get
out
of
Board's
Housing
Housing
for
If we
17%
of
land subdivisions
were
environment',
Housing
the
Board's
proponents
to prevent
also
recent
not
description.
of
project
slums,
costs as a
chain
demonstration
money.
The
explains why the goals
were not met.
the
report
first year
11%
of
itself
(1972),
met.
achieved
Bahadurpur
10%
goals of providing
development
entirely
the
housing
providing
The
the
economically
the
low-income category and
referred to the
the
the
which,
this
energy and
Bahadurpur project in
of this goal had
'environment'
in
The goals of
rural migrants were never
the
image in
consider output relative to
Board managed to only satisfy
category,
totally
resistance
administrative
the middle-income category.
planned
cycle
this
applicants of even
housing
weaker section
of
the time,
1984
substantiates this claim.
number of
their
in the organization
by people
Board's poor
maintained incomplete
consumed most of
to
research
The cummulative effects of
of those delays.
were
Housing
field
delays and increases
explains
events
that
The
of
if
Patna.
image
'slum-like
we observe
Since
and the
project
the
unsafe
fits
the
It is said that even the police is afraid to go in
the project area
after darki
48
CONCLUSIONS
Several
in
public
criticisms
sector
organizations in
beyond the
scope of
over
usefulness
the
of public
has
traced
public sector
explain
sector
a
cycle
political
We
in
form
of a
when
attempts
after enhancing
its
value,
key
or
value of that
the
used
its
in
a
land or
a housing
to distribute
this situation as
members, distancing
well, to
itself.
which stand
the
people
party
performance.
And
led
of
were
the
When
very few).
process
the private
in
got
the
(After
landowners.
This
49
case
benefited most
enhance its image
For
redistribute
the political
favours.
the organization's
In
unit were
well,
a scarce
asset determine
the private
benefits that
the organization was performing
in
to
public
goods
to
performance.
its
party and
long time,
piece of
deterioration
in a
groups
the groups/institutions that
the organization
of
This
tried
an organization uses
and
political
for a
kinds
the
particular
have
likely to happen
certain
debate
terms.
in one
we
input
a
output
Board,
ruling
waiting
that
from the increased
organization's
Housing
out
land as
the market
to benefit
the
In other words,
was
to determine
in quantitative
that are
It
environment.
pointed
such as
asset
of events
ineffeciencies
ideological
of inefficiency
organization delivering
certain
it
organization.
the
institutions or
inefficiency
the source
about
developing countries.
our study to enter
degree of efficiency/
study
have been made
used
to the
the party
by pulling out
landlords,
the
for
potential
land area
where there
demand
(for land)
asset
to
and
as the
situation
interests
vested
probably there
wasn't
small
group
who
kind of a
a
difficult
two
towards
the
benefited
the
For
the
created
where
ought
to be
any,
and more towards
organization
from
if
thereby
land,
was
problem
The criticisms,
one.
and away from
difficult.
more
of
kind
certain
the price of
an
new
was stuck with
underutilized
hiked
intervention
a
less
had
and
organization,
directed
A
speculative purposes.
kept prime land
had
subsequent
making
simply
was
interplay between the organization and the
uses,
alternative
increased
an
was
land
because
physical
organization's
the
to
prior
the organization
problem was created:
in a
introduced
definition,
by
a shortage
for
held
be
wasn't one
result,
The
intervention.
profits were
substantial
public
and
organization
the
funds.
this
While
Board
which
performed
can
particular
it
did,
the way
the
question
that
public
sector
services other
similar
example,
has
constitute
inefficient
events
study
has
organization's
organization's
subsequently.
of the Housing
explained
performance,
declining image
Future research
experienced a chain of
This
Board.
chain
the
could
study,
events
of
its inabilty to perform
focus
50
on
for
linking
meddling,
political
and
goods and
providing
organizations
One
whether
is
unanswered
remains
than land and housing have
to that
research.
further
of
remain
other questions
several
focus
why Housing
to answer
enabled us
the
well
semi-autonomous
public
sector
establish
why
organizations delivering
other kinds of goods,
they performed
In
image undergo a similar
organization's
political
meddling
Consequently,
phenomenon
is
create
the story
which
against
inflation
are
public sector
success.
face
similar
and
which
research
For
also
in
and
example,
political
of
the
such
owner
this escalation
of
image.
the
land.
Madras
the
generalized
or
as
it a
is
--
land
to
capture
case.
it
stories of
It would be useful
forces
responsible
State Housing
Did
How
this
would also be
Board
in
organization
were they
useful
overcome?
to
study
organizations which have
been
like private sector organizations.
land prices
Escalating land prices,
Board
Housing
Board's
analysis
a
which provide a hedge
identify the
public sector
to operate more
prevented
of
constraints?
focus on success
constraints?
research agenda,
this study.
attributed
Did
Board
the
delivering
We also observed increasing
issue
organization?
organizations,
allow
can
organizations
performance
structured
Housing
unique,
been cited as one such
Within this
the
this
insurmountable
sector
locationally
to study such organizations
India has
How did
evolution?
unearned income).
Future
for
the
to organizations providing assets
(assets
significant
of the
public
regarding
unique
similar
did
particular,
of the
image affect the performance
changing
story
poorly.
to
to
operate
to be a
among other things
cost-effectively.
to speculation which was
Future research can carry out
determinants
of
land
51
central
prices.
We
a
function
an
in-depth
How
are they
historically determined?
be
more
profitable
economy?
More
intervention,
has
added
than
to
How
ie.
how
real
much
value
of
of
much
in
what
proj ects
through
investment
investment
importantly,
price increases?
desirable --
Why does
in
appear
to
other sectors of
the
extent
land
does
government
this nature influence land
this
price
rise
is
land prices rise because government
do
how
and
much
do
they
rise
speculators are exploiting a
situation
inefficiency?
who loses on account of
And
socially
finally,
created
by
because
government
this price
rise?
In addition to these
this
story
also
In general,
make
Board,
ought
game.
planning
circumvent
be
future
in
perspective of the
be a
of
like,
the
and
in this
Housing
the
in the
and not
Housing
housing
misplaced
Housing
projects
plan
to lose
like
policy.
be explictly directed toward
case
the
must
stand
tenants and the
it appears to
building demonstration
who
organizations
and policy ought to
as
research,
lessons for planning and
those
In the case of
manner
Consequently,
the
to
the low-income
the losers,
from
provides some
for
the groups for which organizations
policy,
political
implications
in
a
a
Board.
strategy,
to be doing image-
Board,
first
As
place.
noted
earlier, this strategy will most likely create a housing problem
where one
doesn't exist.
circle in
the case
to
which
policy standpoint,
study suggests that
focus its energies and
land,
From a
the Housing
resources to the
is clearly one of the
key
Board
ought
problematic issue
inputs
52
the vicious
in
any
of
housing
supply
directed almost solely towards
with
the minimum
allowance
demand
point of
In
always
a few
would
work
organization which
suggesting
motivated
these,
or
possibly
a
-- ie.
projects.
individuals
assuming that
are
within
goals
sanctions.
53
an
mix of
From an
it.
there are
organizations
even if
land
to be done
ultimately redistributes
we
It
involve
not
land acquisition ought
to meet organization's
incentives
would
that
policy).
redistributing
that group
of building housing
view,
land
together with
for
scheme
strategies
problems
organizational
by the same
credit
supply
and
acquiring and
infrastructure,
of
a
or
implementation
many
form of simply
take the
could
a
(ie.
land
ought to be
therefore,
policy,
housing
The
strategy.
who
there were not
END NOTES
1
According to the Indian Constitution's Articles 352-356, the
President of India can declare President's Rule
in
the
entire
country
or
in
any of its states.
This declaration is made in
situations such as:
the ruling political party losing majority;
ruling
party's
term
expiring and delays in election;
extreme
internal security problems.
In
such
cases,
the
President's
nominee
in
the state,
the Governor,
takes over the executive
powers (of a Chief Minister) and heads
state's
administration,
in
addition
to
carrying
out a Governor's customary role as a
the
Central
government
head
of
state,
advising
symbolic
occasionally on the state's political situation.
2
the President of the country or
Under the President's Rule,
the Governor of a state can issue
decrees
(Ordinances).
These
must
be renewed every six months since they are not
ordinances
formed by the legislators of an elected ministry.
Bills
passed
by the legislators are called Acts and do not have to be renewed
like ordinances.
3
of
the central and state
The
housing
policies/strategies
governments listed in the Housing Board
Act
are
in
as
broad
terms and as many as:
economically weaker section housing; lowrental
group
housing;
housing;
middle-income
income
group
for industrial workers;
land acquisition and
housing;
housing
improvement
town
slum improvement scheme;
development scheme;
readjustment;
and
land
land
redistribution
scheme;
of
building
scheme;
production
provision
infrastructure
materials/housing components etc...
4
With Housing Board announcing its intentions to acquire land
for a project,
land prices in the project area were supposed to
The
prohibited.
between
landowners
and
land
sales
freeze
the
Revenue
Board
(through
that
the
compensation
price
Department) paid for land acquired from landowners, was based on
actual sales price of similar land in the vicinity in the recent
the
lower
than
be
past.
The compensation price would always
price
because people reported a lower-than-actual sales
market
most
transfer taxes and,
price in order to save on stamp duty,
importantly, on the regular property taxes.
continued...
54
-4'
5
Determination of the rate of return of investment
VLNPWMEA?.
PTU
1
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,
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F
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