MHADA cancels 11% Housing Reservation for MLAs & MPs

The 11% reservation for elected officials, state and federal employees, and Mhada personnel who fall under the Economically Weaker Section (EWS) and Low-Income Group (LIG) categories is being considered for cancellation by the Maharashtra Housing and Area Development Authority (Mhada). This action is a result of worries that their pay surpasses the Mhada income threshold.

Since the taxable income limits for EWS and LIG applicants—Rs. 6 lakh and Rs. 6-9 lakh annually, respectively—are much lower than the salaries of public servants and lawmakers, the 1981 Mhada rules that established this reservation have drawn criticism. A committee was formed to look into the matter and has given the state government recommendations for improvements.

A Member of Parliament (MP) receives a base pay of Rs. 1 lakh per month, with additional benefits such a Rs. 70,000 constituency stipend. Similarly, Maharashtra's MLAs are much above Mhada's wage brackets, earning Rs. 2.5 lakh a month plus bonuses.

A housing lottery for 2,030 apartments was conducted earlier this year by the Mumbai Board of MHADA, with 33 properties set aside for Members of the Legislative Council (MLCs), MPs, and MLAs. Interestingly, 15 of these residences were designated for the LIG and EWS categories, but not enough applications were received.

According to Mhada sources, a proposal has been made to do away with the EWS and LIG reservations for government personnel and elected officials. The reservation for the Middle-Income Group (MIG) and High-Income Group (HIG) categories, which are defined as earning between Rs. 9 and 12 lakh and more than Rs. 12 lakh annually, respectively, will not change, though.

The dearth of applications from elected officials in lower income levels is the driving force for this decision. On the other hand, there has been a lot of demand in properties designated for higher income groups. For example, former Union Minister Bhagwat Karad applied for a house in Powai in 2023, and farm leader Raju Shetti of the Swabhimani Shetkari Sanghatana applied this year.

Both the state government and Mhada's internal authority must approve the proposed adjustments. However, it is unlikely that these changes will be finalized until after Maharashtra's new government is formed. Following approval, the residences that were previously set aside for government workers and elected officials under EWS and LIG will be made available to the general public and other reservation categories. There may be more chances for candidates in these categories in subsequent drawings since unsold units from the previous housing lottery will also be carried over.