Unfinished Promises: Beedi Workers’ Housing Scheme Stumbles Amid Fund Mismanagement
Story By G Mahantesh | August 5, 2025 | Translation by a volunteer for ‘The File’
Housing Scheme Lags Behind Expectations
Bengaluru — Eighteen years after the launch of the Revised Integrated Housing Scheme (RIHS) in 2007 aimed at providing homes for beedi workers, progress in Karnataka remains alarmingly subpar. Despite ambitious goals, many districts have failed to meet their targets under the scheme, leaving hundreds of workers still without permanent shelter.
Adding to the setback, the state has been unable to fully utilize the central grants allocated for construction. Consequently, the unutilized funds, now accruing interest, must be returned to the Centre — a financial burden that the government is struggling to manage.
Centre Pulls Up State Over Delay
In a letter dated July 21, 2025, the Union Ministry of Labour and Employment expressed serious concerns over the delay and inefficiencies in the implementation of the scheme in Karnataka. It directed the state government to return ₹15.8 lakh in unspent funds with interest, due to incomplete housing projects in Tumakuru district’s Sira taluk.
This prompted the State Housing Department to write to the Rajiv Gandhi Rural Housing Corporation (RGRHC) on July 28, seeking detailed updates. However, as of this report, the corporation has failed to respond.
Incomplete Homes, Overgrown Lots
Under the RIHS, 279 houses were sanctioned for beedi workers in Sira taluk. Of these, 79 remain incomplete, with some lying abandoned and overgrown. Tumakuru’s Sira taluk is represented by senior Congress leader T. B. Jayachandra — raising political eyebrows as the area continues to reflect failed execution despite being under high-profile leadership.
“Return Unspent Funds with Interest”: Centre Warns
According to government correspondence reviewed by The File, the Centre has made it clear that any delay in returning the unused funds will result in further escalation of the interest amount — for which the state government and RGRHC will be held directly accountable.
“The ₹15.8 lakh that remains unutilized must be returned immediately with interest. Any further delay will increase the liability,” stated a directive addressed to the Managing Director of the RGRHC.
Beedi Workers Left Waiting
Originally rolled out in 2007 to address the acute housing shortage among beedi workers, the RIHS aimed to support eligible workers through financial assistance, group housing via cooperatives, and individual construction on land owned or allocated by the government.
Each rental home under the scheme was budgeted at ₹45,000 — including a ₹40,000 central subsidy and ₹5,000 from the beneficiary. Any additional costs were to be borne through loans or state support.
However, 18 years later, the implementation paints a disappointing picture.
Statewide Housing Progress Grim
Across Karnataka, out of 6,72,499 houses sanctioned under various rural and urban housing schemes, only 4,01,072 have seen any real progress. Of these, just 2,71,427 houses have received the first installment — indicating a mere 42% overall progress.
In Mysuru, Chief Minister Siddaramaiah’s home district, 35,451 homes were approved. Only 19,673 are under construction, with 15,778 receiving the first installment. In Housing Minister B.Z. Zameer Ahmed Khan’s constituency of Bengaluru Urban, 3,095 houses were sanctioned, but work has yet to begin on 391 of them.
Key District-wise Breakdown (Rural and Urban)
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Vijayapura: 42,966 homes sanctioned; 18,170 under progress; 24,796 (58%) received first installment.
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Belagavi: 42,237 sanctioned; 24,887 under progress; 20,350 disbursed.
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Bidar: 31,960 sanctioned; 13,658 progressing; 13,302 funded.
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Raichur: 40,096 sanctioned; 22,131 progressing.
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Kalaburagi: 40,007 sanctioned; 20,869 in progress; 19,138 funded.
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Tumakuru: 32,479 sanctioned; 20,895 progressing; 11,584 funded.
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Chamarajanagar: 23,479 sanctioned; 12,415 progressing; 11,064 funded.
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Bagalkot: 23,297 sanctioned; 12,234 progressing; 11,063 funded.
Similar delays were observed in Yadgir, Koppal, Dharwad, Mandya, Udupi, Chikkamagaluru, and other districts.
Urban Housing Also Stalled
Under the Pradhan Mantri Awas Yojana (PMAY), only 26% progress was recorded across 31 urban districts in Karnataka. In Bengaluru and Udupi, even the basic target of identifying eligible beneficiaries hasn’t been met.
Out of 42,538 houses sanctioned under various urban housing initiatives, only 37,303 are progressing, while 5,235 projects remain at a standstill.
Unutilized Funds and Allegations of Corruption
During the previous BJP government’s tenure, over ₹751 crore allocated to the Housing Department remained unused. Allegations of widespread corruption in tenders under the slum development board and Rajiv Gandhi Housing Corporation were raised by the then Opposition Leader and now Chief Minister Siddaramaiah.
The Housing Department had also engaged in communication with private firms like Boston Company for housing development on government land, a move that triggered transparency concerns.
The present Congress government has now sought a fact-based report on the irregularities that plagued the BJP-era housing initiatives.
Rajiv Gandhi Housing Scheme in Disarray; Minister Zameer Ahmad Khan Silent Amid Scandal
The Karnataka Government’s Ministry of Housing, under the leadership of Minister B.Z. Zameer Ahmad Khan, stands at the center of a glaring administrative failure that has severely impacted thousands of beedi workers across the state. Despite the availability of central funds and a well-defined housing scheme launched in 2007, the ministry has failed to ensure timely implementation, effective fund utilization, and completion of sanctioned housing units. The shocking revelation that ₹15.8 lakh of central grant remains unutilized — and must now be returned with interest — exposes the ministry’s inability to coordinate with executing agencies like the Rajiv Gandhi Rural Housing Corporation. Moreover, the ministry has not provided adequate public accountability or responded to official queries, even as unfinished homes lie abandoned and overgrown in districts like Tumakuru. This situation reflects a broader pattern of bureaucratic inefficiency and lack of political will that continues to undermine welfare programs intended for the most marginalized.
Unanswered Questions
The File has sent detailed queries to the RGRHC regarding:
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Total funds allocated under RIHS
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Disbursal and utilization details
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Number of incomplete houses
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Reasons behind delays in districts like Sira
As of publishing, the corporation has not provided any response. This report will be updated if and when the requested information is made available.
📌 Short Summary:
Despite central funding and a long-standing housing scheme for beedi workers launched in 2007, Karnataka has failed to deliver on its promises. Many districts, including Tumakuru’s Sira taluk, have incomplete houses while ₹15.8 lakh in unused funds must now be returned with interest. The project under the Revised Integrated Housing Scheme (RIHS) reflects only 42% progress across the state, exposing administrative inefficiencies and sparking fresh political and public scrutiny.
📚 Context & Background:
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Scheme Name: Revised Integrated Housing Scheme (RIHS), launched in 2007
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Target Group: Economically weaker beedi workers and their families
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Central Assistance: ₹40,000 subsidy per house + ₹5,000 from beneficiary
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Objectives: Provide individual/group housing through government/allotted land or cooperatives
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State Implementing Body: Rajiv Gandhi Rural Housing Corporation (RGRHC)
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Current Status (as of Aug 2025):
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Only 42% of approved houses in Karnataka have seen progress
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15.8 lakh rupees in central grant unused in Sira taluk
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Numerous houses left incomplete, abandoned, or overgrown
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🗣️ Key Quotes:
“The ₹15.8 lakh that remains unutilized must be returned immediately with interest. Any further delay will only increase the financial burden.”
– Union Ministry of Labour & Employment directive to Karnataka Housing Department
“Many houses meant for beedi workers remain incomplete. This delay not only wastes public money but also keeps vulnerable families homeless.”
– Official in the State Housing Department (name withheld)
“Sira taluk, despite political representation and funding, showcases abandoned construction sites. We demand transparency and accountability.”
– Local social activist, Sira
“The corporation has yet to respond with any data on fund usage. We’ve raised formal queries and are awaiting answers.”
– G Mahantesh – The File
🎤 Q&A:
Q1: What is the Revised Integrated Housing Scheme (RIHS)?
A: A central government scheme launched in 2007 to provide affordable housing to eligible beedi workers through direct subsidies and cooperative construction.
Q2: Why is there a delay in construction?
A: Inefficiencies in fund utilization, administrative apathy, lack of monitoring, and bureaucratic delays at state and corporation levels.
Q3: What are the financial consequences of the delay?
A: Karnataka must return ₹15.8 lakh in unused central funds with accrued interest, increasing the state’s financial liability.
Q4: Are these delays limited to one area?
A: No. Across Karnataka, only 42% of houses under various schemes have seen progress. Many districts face similar issues.
Q5: What is the government’s response?
A: While meetings and letters have been exchanged, as of now, no public accountability or detailed clarification has emerged from the implementing agencies.
Q6: Why were the funds not utilized in time?
A: Delays in land allocation, slow beneficiary identification, tendering issues, and lack of coordination between state and central agencies contributed to the failure to utilize the sanctioned funds.
Q7: What happens to the incomplete houses?
A: Many unfinished houses have been abandoned. In areas like Sira taluk, some structures have become overgrown or dilapidated, posing both financial and social concerns. These may require revaluation or reallocation of funds for completion.
Q8: Who is responsible for monitoring the scheme’s implementation?
A: The Rajiv Gandhi Rural Housing Corporation (RGRHC) is the nodal agency at the state level, while the Ministry of Labour & Employment monitors the scheme at the Centre. Local bodies are also involved in execution and oversight.
Q9: What are the eligibility criteria for beedi workers under this scheme?
A: Workers must be registered beedi employees, classified under the Economically Weaker Section (EWS), and should possess land or be eligible for group housing. Caste and income considerations may also apply.
Q10: Can the funds be reallocated or rolled over into the next financial year?
A: Generally, central schemes require time-bound utilization of funds. Unused grants must be returned with interest. Reallocation is only possible with fresh approvals, and often requires revised project proposals.
Q11: How many total houses remain incomplete across Karnataka under various housing schemes?
A: Out of 6,72,499 sanctioned houses statewide, 4,01,072 are under progress — meaning over 2.7 lakh houses are either incomplete, delayed, or yet to be started.
Q12: Have similar issues been reported in other welfare housing schemes?
A: Yes. The PM Awas Yojana (Urban & Rural), Slum Board schemes, and past Rajiv Gandhi Housing initiatives have also faced delays, fund lapses, and corruption allegations, especially in previous administrations.
Q13: What action is the current government taking on previous irregularities?
A: The present Congress-led state government has written to central agencies seeking factual reports on irregularities during the previous BJP regime and has committed to investigating alleged misappropriations in housing tenders.
📱 #BeediWorkers #HousingCrisis #RIHS #KarnatakaHousing #Accountability
Note:
The authentic documents and official correspondence related to this news story can be accessed at www.the-file.in.
