The affordable housing programs under the Federal Government Employees Housing Authority (FGEHA) and the Pakistan Housing Authority Foundation (PHAF) has observed a decline in progress due to an escalation in the cost of raw materials for the construction of houses. Most of the contractors stopped working on the existing projects because of the increasing prices of raw materials. Since the hike in the price of steel and cement was not anticipated in the resource baseline of the project, the contractors are not being compensated for its costs. According to the audit report of the Housing and Works Ministry for 2019-2020, the construction work on the government housing project was underway as per schedule but in August last year, the skyrocketing prices of steel from Rs 140,000 to Rs 210,000, significantly increased the overall cost of construction.
The halt in construction due to escalating prices could force the government to shut down the project. The incumbent government had ambitious goals related to the provision of affordable housing, however, the rapid inflation of raw materials has made government plans vulnerable.
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