Important recommendations of Standing Committee of Housing and Urban Affairs

New Delhi News (12/03/2026): The Parliamentary Standing Committee on Housing and Urban Affairs has urged the government to adopt more realistic budget planning, strengthen coordination among urban development schemes and prepare a long-term strategy for infrastructure investment in India’s rapidly expanding cities.

Presenting the Ninth Report of the Standing Committee on Housing and Urban Affairs (2025–26) in the Lok Sabha, Committee Chairperson Magunta Sreenivasulu Reddy outlined a series of key observations and recommendations related to the Demands for Grants (2026–27) of the Ministry of Housing and Urban Affairs.

The report highlights several structural challenges in urban governance and financing while recommending reforms to improve planning, implementation and monitoring of urban sector initiatives.

The Committee expressed concern over the declining share of the Ministry of Housing and Urban Affairs in the Union Budget. Despite rapid urbanisation and the growing need for improved urban services, the Ministry’s allocation has dropped to 1.60 per cent of the Central Budget for 2026–27, the lowest level in the past five years.

It also pointed to a persistent mismatch between projected financial requirements and actual allocations. The gap between projected outlays and approved allocations stood at 22.82 per cent in 2022–23, 11.52 per cent in 2023–24 and 17.25 per cent in 2024–25, indicating systemic issues in budget estimation.

The Committee recommended that the Ministry adopt evidence-based and realistic budget forecasting methods, aligned with the implementation capacity of states and local bodies. It also suggested preparing a time-bound roadmap to gradually increase the Ministry’s share in the Central Budget, in line with the government’s vision of Viksit Bharat 2047.

The report also raised concerns about the widening gap between Budgetary Estimates (BE), Revised Estimates (RE), and Actual Expenditure (AE) across various urban schemes. It noted uneven fund utilisation, substantial unspent balances and increasing surrender of allocated funds.

For instance, the Budget Estimate for 2025–26 was ₹96,777 crore, which was later revised down to ₹57,203.78 crore, while actual expenditure as of February 20, 2026 stood at ₹40,967.62 crore.

To address this issue, the Committee recommended a comprehensive review of the budgeting process, better alignment between BE, RE and AE, and removal of procedural bottlenecks in fund flow mechanisms such as SNA-SPARSH. It also suggested setting quarterly expenditure targets for each scheme, strengthening the administrative capacity of states and urban local bodies (ULBs), and avoiding the concentration of spending towards the end of the financial year.

Faster Action on Legacy Waste under Swachh Bharat Mission (Urban) 2.0

Reviewing the progress of Swachh Bharat Mission (Urban) 2.0, the Committee acknowledged significant achievements in urban sanitation and waste management.

According to the report:

* 96.54% of wards are now covered by door-to-door waste collection

* 88.08% of waste is segregated at source

* 81.65% of waste is processed

* 1,193 cities have been declared Garbage Free

However, the Committee observed that only ₹1,321.15 crore had been spent out of the ₹2,000 crore Revised Estimate for 2025–26 as of February 17, 2026. Out of 2,510.78 lakh metric tonnes of legacy waste, about 1,568.01 LMT has been treated, leaving 942.77 LMT yet to be processed. This backlog could affect the government’s target of making all cities garbage-free.

The Committee recommended that the Ministry ensure adequate financial allocation at the Budget Estimate stage and encourage urban local bodies to adopt sustainable waste management technologies such as waste-to-energy, biomining, composting and material recovery, instead of merely shifting legacy waste to new dumping sites.

The Committee also reviewed the progress of the PM SVANidhi scheme, which was introduced during the COVID-19 pandemic to support street vendors through collateral-free loans.

The scheme has now been extended until 2030, with a Budget Estimate of ₹900 crore for 2026–27. According to the report, 73.33 lakh loans have been disbursed under the first tranche, of which 28.03 lakh loans (38.23%) remain outstanding. The restructured scheme now aims to benefit 1.15 crore vendors, including 50 lakh new beneficiaries.

To ensure effective implementation, the Committee recommended that states and union territories, through urban local bodies, conduct carrying capacity assessments of vending zones. This would help determine the number of street vendors that can be accommodated in specific areas.

It also advised that Letters of Recommendation (LoR) or Certificates of Vending (CoV) should be issued only after such assessments, and that vending zones should be located in high-footfall and commercially viable areas, in accordance with the Street Vendors Act and PM SVANidhi guidelines.

The Committee noted that several proposed initiatives still await Cabinet approval despite having budget allocations. These include:

* National Urban Digital Mission (NUDM)

* Industrial Housing Scheme

* SAFE Accommodation under Pradhan Mantri–National Industrial Workers Accommodation Scheme (PM-NIWAS)

* Deendayal Jan Aajeevika (Shehari) Scheme (DJAYS)

* Municipal Bonds initiative

The panel observed that allocating funds without finalised guidelines often leads to implementation delays, administrative uncertainty and under-utilisation of resources.

It therefore recommended that the Ministry undertake proper due diligence before announcing budget allocations, and ensure that proposals are placed before the Cabinet or Expenditure Finance Committee (EFC) with a clear timeline for operational rollout.

The Committee also highlighted the risk of overlapping functions among multiple urban schemes, which can lead to duplication and inefficient use of resources.

Several government programmes operate in related areas such as affordable housing, sanitation, waste management and urban livelihoods, including:

* Pradhan Mantri Awas Yojana (Urban)

* AMRUT

* Swachh Bharat Mission

* PM SVANidhi

Given the overlapping operational areas, the Committee recommended that the Ministry develop a comprehensive convergence framework clearly outlining the objectives, beneficiaries, components and funding structures of each scheme. Such a framework would help prevent duplication and improve coordination among different programmes.

Finally, the Committee emphasised the need for a long-term investment strategy for urban infrastructure development.

It noted that the last comprehensive national-level assessment of urban infrastructure needs was carried out by the High Powered Expert Committee (HPEC) in 2011, which projected requirements only up to 2031. No updated assessment has been conducted for infrastructure demand beyond 2030.

Considering the rapid pace of urbanisation and the importance of major schemes such as AMRUT 2.0, SBM-U 2.0, PMAY-U 2.0, Metro Rail Projects and PM e-Bus Sewa, the Committee recommended the formation of a new High-Level Expert Committee.

This body would assess infrastructure needs, financing mechanisms, governance reforms and capacity requirements up to 2047, enabling coordinated planning and balanced development across metropolitan areas as well as Tier-II and Tier-III cities, in line with the national vision of Viksit Bharat 2047.

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