This is an excellent idea. However, in Pakistan, we need to provide them with education first. We need to teach our children about ethics, cleanliness, environment and hygiene from the early years. There should be dedicated subjects in schools on these topics.
If government provides these houses now, in just one year (and maybe I am giving too much allowance), we will see these houses ruined as well, with paan stains on the houses, no greenery, garbage everywhere, etc etc..
The houses they have built for themselves in kachchi abadis are not cheap as well. So we shouldn't think that they are really very poor. A small structure anywhere needs money in five figures.. and they had this money to begin with. Plus, I have seen some houses from inside, they have all the appliances in their homes.. such as chinese LCDs, deep freezers etc..
They can finance their own new houses, however, to teach them how to maintain the area is the most important first step.. What do you think?