Remunerations given to the government employees
are not commensurate with the services they perform. Their counterparts
in the private sector get much better pay packages. Apart from the respect
attached to the government service in our society, the only consolation
used to be a handsome pension and G.P Fund with which they could buy a
house/plot on superannuation. The current inflationary trend in the property
prices has eroded that expectation and thus there is need to put in place
a compensatory social security network for the employees with this objective
in view. The Government of the Punjab has launched a scheme of providing
houses/plots to member Government Servants from BS-1 to BS-22 after their retirement. The scheme is on the analogy of the defense forces
housing schemes where the officers pay the development and construction
cost, and the land is provided free of cost by the Government.
Government of the Punjab has promulgated the Punjab Government Servants
Housing Foundation Act, 2004 for implementation of the concept. The Foundation
is managed by a Board of Directors headed by the Chief Secretary, Punjab.
The salient features of the implementation strategy are :-
All regular Government Servants are eligible to
become member of the Foundation by option. Membership application were invited from 26.07.2004 to 28.02.2005 and thereafter membership was closed. Approximately 144,000 applications were received for membership of the Foundation. Every member will be provided
a house or plot according to his entitlement seniority at the station of his preference, subject to eligibility under law/rules. The Board of Directors has approved to establish housing schemes in the following 13 stations/districts:-
(1) Bahawalpur (Established/Completed)
(2) Dera Ghazi Khan (Established/Completed)
(3) Faisalabad (Established/Completed)
(4) Gujranwala (Not established yet due to non-availability of
(5) Lahore (Established/Completed)
(6) Multan (Established/Completed)
(7) Rawalpindi (Established/Completed)
(8) Sahiwal (Complete)
(9) Sargodha (Not established yet due to non-availability of
(10) Sialkot (Under Development)
(11) Khanewal (Established/Completed)
(12) Jhang (Under Designing/Planning)
(13) Lodhran (Under Designing/Planning)
2. Recovery of cost of the Houses/Plots.
This is basically a self financing scheme where
employees will have to pay the entire cost of development infrastructure
and construction of house in case of option of House by the member. In
case of option of Plot, the member will have to pay only development infrastructure
cost. However the raw land will be a subsidy from the Government and no
price for the raw land will be charged.
3. Mode of payment.
Full cost of the house/plot will be recovered before
handing over the house/plot. To provide a comfort level to the members,
part of the total cost will be recovered as monthly installments paid
by them through at-source deductions from their monthly pay bills. The
deduction will be made by the Accountant General, Punjab / District Accounts
Offices and transferred to the Foundation every month. A separate Account
of deductions for each employee will be maintained by the Foundation.
An annual mark up will be paid on the accumulations. A computer programme
for the purpose has been prepared. The balance at the credit of each employee
will be available on line and can be perused by him.
4. Land Bank.
A land bank has been established for the purpose
to make available suitable lands for construction of housing colonies.
This land bank will consist of lands ;-
(a) Transferred by the Government, free of cost.
(b) Purchased from the operational surpluses of the PGSHF i.e. sale of
commercial lands developed in the housing colonies.
(c) Purchase of private lands by raising bank loans.
(d) Purchase of construct units from Government developed in the housing
Provision of funds for land is basically a responsibility of the Government
of Punjab. The state land provided to the Foundation will be monetized
and reflected in the Budget both as income and expenditure sides. The
housing colonies planned on such lands will generate some expensive commercial
lands, sale proceeds of which will form a resource base for the land bank
of the Foundation. The periodic gaps accruing in these resources will
be filled through bridge financing by the Government of Punjab to ensure
that maximum prices are obtained of the commercial properties. A financial
model on the basis of this concept is being worked out so that the Government’s
liability from time to time can be anticipated and provided for. By adopting
this mechanism, the Foundation will have a reliable financial base for
the purchase of the lands both private and public for future use and its
reliance on the Government for provision of land or for Funds for this
purpose will cease to exist.
5. PGSHF Fund.
The Punjab Government Servants Housing Foundation
Act, 2004 provides establishment of a Fund that consists of :
(i.) such grants as may, from time to time, be made by the Government;
(ii.) other contributions and donations by private or public organizations;
(iii.) Such loans and advances as may be obtained from financial institutions
with the help of the Government wherever necessary;
(iv.) Contributions made by members from time to time;
(v.) Income and profits from investments from various sources;
(vi.) Fees or other user charges;
(vii.) Amounts received from sale or disposal of assets of the Foundation;
(viii.) All other sums received by the Foundation and income from any
The development operations of the Foundation will
be carried out on market based practices such as through hiring of planning,
designing and construction consultants or through a public private partnership
with the management contractors / developers. FUNDING of the operations
will be done with the following :
(a.) income stream accruing to the Foundation on account of members monthly
(b.) from loans negotiated with the Financial Institutions.
6. Categorization of Houses/Plots.
The houses/plots to be built have been placed in
four categories. Category along with entitlement of the employee grade
wise is as under :-
BS 1 – 7
BS 8 – 15
BS 16 – 18
BS 19 – 20
3000 – 3200 Sft.
BS 21– 22
3000 – 3200 Sft.
7. Allotment / Allocation
of built up houses/Plots
The scheme provides for allotment / transfer of
built houses/plots to the members at the time of their retirement (or
in favor of their families in case of death during service) in a transparent
manner in order of their seniority. The seniority will be determined for
each category on the basis of the date of retirement irrespective of their
scale wise seniority or their seniority that existed prior to their retirement.
8. After sale maintenance
of the housing scheme.
The Foundation will ensure that the schemes built
by it are maintained properly after their transfer. For the purpose, a
Residents Society under the relevant law will be formed and some financial
recurring resources will be placed at its disposal. The Society will be
empowered to raise user’s charges. Every proprietary right holder
will be mandated, as an essential condition of transfer of such rights,
to become a member of such Society.
9. Government’s Role.
This scheme cannot effectively be implemented unless
it is actively backed by the Government in the following manner :-
(a) Top supervision of its management
(b) Provision of financial resources to it in the shape of:
(i.) Land free of cost transferred by the Govt.
(iv.) Guarantees to the Financial Institutions against loans obtained
by the Foundation.