KP CM approves home financing scheme for government employees

PESHAWAR: Chief Minister Khyber Pakhtunkhwa Pervez Khattak formally approved home financing scheme for government employees under Khpal Kor Low Cost Housing Scheme (KKLCHS) in a meeting held at Chief Minister House Peshawar.

On this occasion, MoU signing ceremony with the Bank of Khyber (BoK) and Habib Metro Bank (HMB) regarding the scheme was also held.

It was attended by Advisor to Chief Minister for Housing Dr. Amjad Khan, Advisor to Chief Minister for Planning & Development Mian Khaleeq ur Rahman, Chief Secretary Muhammad Azam Khan, Secretary Housing Waqar ul Hassan, DG Provincial Housing Authority (PHA) Saifur Rahman Usmani, regional heads of the commercial banks and other concerned authorities.

Speaking on the occasion, the Chief Minister said that the facility of Bank Home Finance is initially intended for about 120,000 government employees to own their housing units. He said that financing of an estimated amount of Rs216 billion was required at the rate of Rs1.8 million per unit.

The finance will be provided for single storey 5 Marla houses, which will comprise 2 beds, drawing room, kitchen, 2 baths, car porch, backyard and boundary wall with specific design to be provided by the PHA. The unit will cost Rs1.8 million, including cost of plot, cost of infrastructure development and cost of construction.

He said the provincial government also wanted to provide the facility to 200,000 units for general public in the first phase, which requires about Rs360 billion for the purpose. Both these interventions will collectively plug the demand-supply gap and deficiency by 15%.

Pervez Khattak directed housing department to chalk out comprehensive short and long term plans in housing sector with active involvement of the private sector whereas the department should work as policy planner and facilitator only. He expressed the confidence that Khpal Kor Housing Scheme would attract Rs20 billion investment in Khyber Pakhtunkhwa.

He further asked the department to provide all facilities to the investors as well as the buyers in housing sector under one window operation. He agreed with the proposal of one IT based book for the plot and house owners that contained all details including purchase, transfer deeds and registries etc.

He also directed to develop all facilities in every housing scheme including schools, hospitals, playgrounds, markets and mosques in the first phase to create maximum attraction in the schemes and then the plots and houses would be sold like hot cakes. He said that housing schemes in the past failed due to lack of basic civic facilities even water, power and gas etc.

The financed amount will be recovered from the salaries of the government servants over a period of 20 years. The banks will charge KIBOR+1/2% spread. The plot will be accepted as collateral and as 20% equity. The home finance will be governed under a tripartite agreement between the bank-employee and endorsed by the Provincial Housing Authority. There are about one million government servants and pensioners in the province, which includes employees of the provincial government, autonomous bodies, federal government employees and employees of armed forces working in the province/hailing from KP and pensioners.

He said that there is a deficiency of about 2 million housing units in Khyber Pakhtunkhwa and estimated minimum investment required at the flat rate of Rs1.8 million per unit totals to Rs3752 billion, which cannot be met by the government in its limited resources. He said mobilization of private sector can plug the gap and control the souring real estate prices.