UN consortium wins bid to build 50,000 brick houses | Sunday Observer

UN consortium wins bid to build 50,000 brick houses

In war-affected North and East :
The government’s previous plan to build prefabricated steel houses as modeled above by a Luxembourg-based firm Arcelor Mittal headed by Indian billionaire, Lakshmi Niwas Mittal has been scrapped
The government’s previous plan to build prefabricated steel houses as modeled above by a Luxembourg-based firm Arcelor Mittal headed by Indian billionaire, Lakshmi Niwas Mittal has been scrapped

Government decision to finalize a deal with a consortium of UN agencies and Non-Governmental Organizations to build 50,000 traditional brick and mortar type permanent houses for war-affected families in the Northern and Eastern Provinces will see a drastic improvement of local livelihoods, analysts hailed last week.

The brick-and-mortar housing project is seen as a major victory for Tamil politicians and grassroots activists who engaged in a long drawn battle to stall a controversial Government proposal to construct 65,000 prefabricated steel houses through French steel manufacturer Acelor Mittal.

Instead, the UN agencies and their partner organisations will take a community driven approach that will involve beneficiary families and local people in the construction of the brick and mortar houses, activists told the Sunday Observer.

The Government is in the final stage of negotiations with United Nations Human Settlements Programme (UN-Habitat), the United Nations Office for Project Services (UNOPS), Habitat for Humanity Sri Lanka and the Sri Lanka Red Cross Society (SLRCS)-led non-profit oriented humanitarian organisations consortium, informed sources said.

The bid by the non-profit consortium had beaten other bids by construction contractors, the Government Information Department said.

The Cabinet of Ministers last week decided to take future action in accordance with the proposal made by the consortium to construct houses in the districts of Jaffna, Kilinochchi, Mannar, Mullaithivu, Trincomalee and Batticaloa to build 25,000 houses under Phase 1 of the three-year project.


The eight member consortium has now proposed to construct permanent brick and mortar houses under a community-driven approach. The new housing scheme is styled similar to the 50,000 Indian Housing Project program completed in 2015 where a majority of the houses like the one above were self-built  Pic courtesy: World Habitat

The estimated cost per house is expected to be between Rs. 1.1 million and Rs. 1.4 million but an exact figure will be known once the final agreement is signed, in the near future.

Under the proposal by the eight-member consortium, 8,000 houses are expected to be built in the first year, 12,000 in the second year and a further 5,000 in the third year. It has been estimated, that the overall community shelter need in the war affected Provinces of the North and East is 120,000 houses. “This project is a complete deviation from the previously proposed prefabricated houses from Arcelor Mittal which was under a donor-driven modality that would not have benefited anyone but the contractors.

In contrast, this project is totally a beneficiary-designed model, subject to adherence to the minimum criteria and therefore, will have many positive implications to the community,” an authoritative source with knowledge of the negotiations for the UN housing project told the Sunday Observer.

Commenting on the Government decision, M.A. Sumanthiran, MP said the move to scrap the steel prefabricated houses was a victory for those who had insisted that brick and mortar houses must be built instead.

“To that extent, we are happy that the government has heeded what we have been saying right along. We also hope this will be done without delay,” he pointed out. Sumanthiran noted that since UN agencies have experience in building houses previously under the 50,000 Indian Housing Scheme program implemented in the Northern Province, he was optimistic that this will uplift the livelihoods of the community as well. The Sunday Observer learns, the government was planning to finance the first phase of the project estimated around Rs. 35 billion locally, by floating a long-term bond in Sri Lanka’s stock market.

They will also be raising funds by obtaining Rupee dominated loans domestically. The financing plans also meet recommendations made by researchers and activists on the ground in war-affected regions.

Explaining the finer details of the project, a UN agency official who did not wish to be named told the Sunday Observer that the proposal involves the owner of the house to shoulder the burden of building the house using resources sourced regionally.

The construction will however be overseen for quality inspection purposes by implementation agencies through their Technical Officers.

In circumstances where the owner has difficulties in progressing with the work, especially, in instances where it is handled by women-headed households, the owner would also be able to obtain assistance from the community, like the cooperative or rural development society.

“The implementation agencies will source all the materials, like cement and sand required for construction. When it is the community organisation building about 30 houses in a village, it will be cheaper to buy construction materials because they could be purchased in bulk,” the source pointed out.

Meanwhile, regional researcher Niyanthini Kadirgamar said, if the houses are constructed locally as opposed to being imported or prefabricated, it will generate local employment to people in the construction sector.

“This would benefit both, directly the local labourers such as masons and carpenters, and indirectly the smaller businesses in the region.

It is not just a Government housing project but also an investment that the Government is making in the region itself. So, it is important that it is implemented in a way that it would stimulate the local economy,” Kadirgamar said.

On the other hand, she pointed out, looking from a post-war context it is also important that the community was involved in the construction process by intervening in aspects such as, consultations in the design.

“We also think, instead of just leaving it to the individual to build the house, community organisations that are strong in the area should be part of the construction.

They could help in terms of purchasing materials and also sourcing labour,” she highlighted.

In September 2015, Cabinet approval was granted to permit Luxembourg-based steelmaker Arcelor Mittal to construct the 65,000 houses in the North and East, at an initial unit cost of Rs. 2.1 million.

However, the project ran into a storm of controversy over alleged irregularities and the quality, while academics and researchers questioned the quality and durability of the pre-fabricated steel houses and how suitable they were for the scorching heat of the Northern and Eastern region.

Amid consistent protests and heated debates in Parliament over the controversial housing program, the Government slashed the proposal to build steel houses in April 2017.

The initial steel-housing project would have forced the Government to borrow up to US $ 1 billion to finance construction.

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