LEARNING BY SIMULATION

An Urban Laboratory Exercise in Developing Policy for Low Income Housing

in Metropolitan Regions of Developing Countries

11-15 April 2008

WORK BOOK

Prepared by Terry Mc Gee Professor Emeritus

University of British Columbia Vancouver, Canada

Module 2

This Urban Laboratory is Module 2 of the Specialization Course:

Organization, Management and Finance for Regional Metropolitan Governance

presented by:

Universidade Federal do ABC (UFABC)

14 March - 20 June 2008, Santo André, Brazil

Partners:

UNIVERSIDADE FEDERAL DO ABC (São Paulo, Brazil) UNIVERSIDADE SAO JUDAS TADEU (São Paulo, Brazil)

UNIVERSITY OF BRITISH COLUMBIA (Vancouver, Canada)

TABLE OF CONTENTS PREFACE.................................................................................................................................................... 1 PART ONE - INTRODUCTION ............................................................................................................... 2

1.1 THE INEVITABILITY OF GLOBAL METROPOLITAN GROWTH ................................................................ 2 1.2. THE POLICY CONTEXT: PLANNING FOR URBANIZING SOCIETIES........................................................ 2 1.3 THE PLANNING CONTEXT: SOFT AND HARD PLANNING FOR METROPOLITAN REGIONS...................... 2 1.4 POVERTY IN THE URBAN CONTEXT: CHANGING CONCEPTUAL APPROACHES...................................... 3 1.5 WHAT SHOULD A METROPOLITAN REGION BE?................................................................................... 3 1.6 WHAT ARE THE TYPES OF GOVERNANCE THAT EXIST IN METROPOLITAN REGIONS .............................. 3 1.7 WHO ARE THE METROPOLITAN STAKEHOLDERS AND WHY SHOULD THEY COLLABORATE? ................ 4 1.8 THE CHALLENGES OF METROPOLITAN GOVERNANCE......................................................................... 4

PART TWO - HOUSING METROPOLITAN POPULATIONS ........................................................... 6 2.0 THE HOUSING SITUATION IN METROPOLITAN REGIONS OF DEVELOPING COUNTRIES......................... 6 2.1 DEFINING ‘ADEQUATE’ HOUSING?....................................................................................................... 6 2.2 LAND AND HOUSING MARKETS........................................................................................................... 6 2.3 POLICIES TO PROVIDE ADEQUATE HOUSING FOR LOW-INCOME POPULATION ....................................... 7

PART THREE - LEARNING BY SIMULATION: A CASE STUDY IN DEVELOPING LOW INCOME HOUSING SOLUTIONS IN A METROPOLITAN REGION ............................................. 8

3.0 AIMS ................................................................................................................................................... 8 3.1 THE SIMULATION EXERCISE................................................................................................................ 8 3.2 ASSUMPTIONS ..................................................................................................................................... 9 3.3 THE PROJECT REQUEST ..................................................................................................................... 10 3.4 ISSUES IN MUNICIPAL COLLABORATION............................................................................................ 10 3.5 A MULTI-DIMENSIONAL PROJECT IN HOUSING PROVISION: AN OPPORTUNITY TO CREATE AN INNOVATIVE EXPERIMENT IN ‘ADEQUATE’ HOUSING PROVISION. ............................................................ 11 3.6 THE MUNICIPALITIES BUY-IN: WINNERS AND LOSERS...................................................................... 11 3.7 THE REALITIES OF THE URBAN LABORATORY SIMULATION. ARE THERE ALTERNATIVES?................ 12

PART FOUR - ORGANIZATION OF URBAN LABORATORY SIMULATION EXERCISE AND TIMETABLE ............................................................................................................................................ 13

4.1 ORGANIZATION ................................................................................................................................. 13 4.2 SCHEDULE ......................................................................................................................................... 13 4.3 OUTCOMES OF THE ROUNDTABLE ..................................................................................................... 14 4.2 EXPECTED CLASS REQUIREMENTS .................................................................................................... 14

PART FIVE - ASSESSMENT OF URBAN LABORATORY EXERCISE ......................................... 15

APPENDIX ONE - BASIC PROFILE OF METROVILLE.................................................................. 16 METROVILLE PROFILE...................................................................................................................... 16

APPENDIX TWO - PROFILE OF THREE SQUATTER SETTLEMENTS...................................... 19 SQUATTER SETTLEMENT A (CORE) ............................................................................................... 19 SQUATTER SETTLEMENT B (PERI-URBAN) .................................................................................. 20 SQUATTER SETTLEMENT C (PERIPHERY ZONE)......................................................................... 21 DIAGRAM OF METROVILLE: LOCATION OF SQUATTER SETTLEMENTS............................... 23

Urban Laboratory 1

PREFACE

The UBC contribution to this course is offered as part of a four year project jointly funded by CIDA and Brazil. The project is designed to enhance the capacity of public consortia to reduce poverty in informal urban settlements and other precarious settlements within Brazilian metropolitan areas and reduce social exclusion and the need for these settlements. It has based on the assumption that metropolitan governance in Brazil and many other countries of the world has not evolved as larger metropolitan regions have become a major feature of the urbanization trend. One feature of this lack of evolution has been the inadequacy of mechanisms for coordinating action at an inter-municipality level and between municipalities and senior levels of government. Thus, the project is centrally concerned with sharing the experience of Canada and other parts of the world in developing collaborative institutional mechanisms for urban governance. These would include public, private and civil society components of Brazilian metropolitan areas. The project involves the Ministry of Cities, various Federal Departments and five Brazilian Metropolitan Areas including Belo Horizonte, Fortaleza, Recife, Santarém and São Paulo (through Santo André), Brazilian universities and UBC and other Canadian partners. This course, “Leaning by Simulating”, introduces students to the main aspects of low income housing provision in metropolitan areas in developing countries, first, by presenting the main policy options, and second, by then asking students to take part in a role-playing exercise in developing a policy response for a project designed to provide low income housing being proposed for three municipalities within a hypothetical metropolitan region. See: NPC Project website: http://www.chs.ca/consortia/indexE.html presented in Portuguese and English

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PART ONE - INTRODUCTION

1.1 The Inevitability of Global Metropolitan Growth

The only global data base that provides ongoing comparable data is compiled every two years by the United Nations Population Fund. See: Most recent data available is in the ‘State of World Population Report’. United Nations Population Fund (UNPF). 2007. http://www.unfpa.org/swp/swpmain.htm

1.2. The Policy Context: Planning for Urbanizing Societies

The Challenges of Mega-Urban regions See: T.G. Mc Gee. (2007). “Planning for Mega-Urban Regions: Policies for the Twenty First Century”. Unpublished paper presented to an International Symposium on Regional Planning in the Yangtse River Delta. Sponsored by the Shanghai Municipal Government. http://www.chs.ubc.ca/consortia/referencesE.html

1.3 The Planning Context: Soft and Hard Planning for Metropolitan Regions

Comparative Experience Table 1: Hard and Soft Planning Approaches

Hard Soft Challenge Straightforward Messy (Problematic) Purpose Problem Solving Problem Structuring Organization Hierarchical To be negotiated Methodology Logical (Math) Conceptual Models Result Product Learning Process

See: Oliver M. Brandes & David R. Brookes (2006) ‘The Soft Path for Water in a Nutshell’. Friends of the Earth. Ottawa & Victoria http://www.polisproject.org/PDFs/nutshell_revised_lowres.pdf

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Jorge Wilheim (2004) ‘Urban Planning: Innovations in Brazil’. University of California Berkeley, Center for Latin American Studies. CLAS Working Papers. No 11. http://www.clas.berkeley.edu:7001/Publications/workingpapers/pdffiles/Wilheimwithtitleandcoverweb.pdf

1.4 Poverty in the Urban Context: Changing Conceptual Approaches

• From understanding poverty as “culture” (Lewis) to “deprivation of capabilities” (Sen).

• Breaking down the “space of dualisms”. The Brazilian contribution (Santos). • Poverty as one dimension of a multi-dimensional approach to targeting low-

income populations for the purposes of “adequate housing provision”. See: Oscar Lewis (1966) ‘La Vida’. Random House. New York Milton Santos (1976) ‘L`Espace Partage’. Paris Libraire Technique Alexandre Apsan Fredani ‘Sen, The World Bank and Poverty Alleviation: The Case Study of Brazilian urban poor’. http://www.unipv.it/deontica/ca2004/papers/apsan.pdf

1.5 What should a Metropolitan Region be?

• Environmentally sustainable • Livable • Inclusive socially and politically • Economically productive and competitive providing employment • Cultural identity

See: J. Friedmann (ed.) (1999) ‘Urban and Regional Governance in the Asia Pacific Region. Vancouver, Institute of Asian Research. Copies will be available for class participants.

1.6 What are the types of governance that exist in metropolitan regions

Relationships between different levels of government: national, state and municipal.

• Centralised / Hierarchical e.g. Singapore e.g. city state. China • Politically decentralized at sub-metropolitan level but formation of sectorial

collaboration for example in transportation or service provision, e.g. water

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• Metropolitan Regional Authority based on collaborative buy–in of sub-regional political units (e.g. cities) to some form of coordinating charged with Metropolitan Regional Planning. Preparation of Master Plan; Strategic Planning etc. e.g. Vancouver Regional Authority (Metro)

See: Students of the School for Community and Regional Planning. ‘New Public Consortia for Metropolitan Governance in Brazil: Global Review’. University of British Columbia, December 2006. http://www.chs.ubc.ca/consortia/pubsE.html

1.7 Who are the Metropolitan Stakeholders and why should they collaborate?

1) Public a) International. Lending agencies e.g. World Bank, aid organizations, UNO e.g.

Habitat b) National, state and municipal governments c) Sub-municipal governments d) Public utility companies/ Quasi Governmental service companies.

2) Civil Society. Workers Unions, Housing Associations, Community Associations,

Religious organizations etc.

3) Private Sector. Multinationals, national companies, local companies, lending agencies, e.g. banks, quasi-governmental organizations, developers associations, Housing Material Suppliers Associations, builders associations.

See: Claudio Acioly Jr et al (2002) ‘Participatory Budgeting in the Municipality of Santo André, Brazil: the challenges in linking short term action and long term strategic planning”. IHS - Institute of Housing and Urban Development Studies, Netherlands SINPA – Support to the Implementation of the National Plan of Action/Bolivia and Municipality of Santo André, Brazil. http://www.ihs.nl/downloads/IHS%20publications/staff/C_Acioly/Acioly%202004_Participatory%20Budgeting%20Sto%20Andre.pdf

1.8 The Challenges of Metropolitan Governance

1. Jurisdictional - Intergovernmental Cooperation 2. Sector. 3. Fiscal 4. Including stakeholders 5. Implementation mechanisms e.g. consortia

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See: OECD (2000) ‘The reform of metropolitan governance’. Policy Brief. http://www.oecd.org/dataoecd/3/17/1918016.pdf Sol Garson (2005) ‘Metropolitan Regions in Brazil- Institutional and Fiscal Obstacles to Cooperation” Many references in Portuguese. http://www.observatoriodasmetropoles.ufrj.br/download/Garson_Sol_Ponencia_tab.pdf

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PART TWO - HOUSING METROPOLITAN POPULATIONS

2.0 The Housing Situation in Metropolitan Regions of Developing Countries

Global Rhetoric: Davis. UN Habitat - the ‘right’ to housing Shortfalls in ‘adequate’ housing stock. World = 1 billion units (2006)

See: Mike Davis (2006) ‘A Planet of Slums’. London, Verso UN Habitat (2007) ‘State of the World’s Cities 2006-2007’. United Nations, New York

2.1 Defining ‘adequate’ housing?

a) Physical: (i) homeless (ii) sub-standard housing (iii) lack basic infrastructure

b) The issue of illegality and property rights c) Household income and housing: poverty and low-income. d) The issue of eligibility and targeting.

See: UN Habitat (2007) ‘State of the World’s Cities 2006-2007’. United Nations, New York

2.2 Land and Housing Markets

a) The Housing Industry: Suppliers, Developers, Sellers and Buyers b) Two Housing Markets: Formal and Informal? c) Ecology of Metropolitan Housing

• Core city: slums, upper class housing, old established squatter areas • Peri-urban: slums, squatters, worker housing, illegal housing • Middle income housing: enclave upper income housing • Periphery: squatters, illegal housing developments, gated high income

housing See: MV Serra, David H Dowall, Diana Mota, Michael Donovan (2004) ‘Urban Land Markets and Urban Land Development: An Examination of Three Brazilian Cities:

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Brazilia, Curitiba and Recife’. Working Paper 2004-03. Institute of Urban and Regional Development.University of California, Berkeley http://www-iurd.ced.berkeley.edu/pub/WP-2004-03.pdf David H.Dowall (2006) ‘Brazil’s Urban Land and Housing Markets’. Working Paper 2006-08. Institute of Urban and Regional Development. University of California, Berkeley. http://www-iurd.ced.berkeley.edu/pub/WP-2006-08.pdf Haroldo Torres, Humberto Alves & Maria Aparecida De Olivera (2007) ‘Sao Paulo peri-urban dynamics: some social causes and environmental consequences’. Environment and Urbanization, Apr 2007; vol. 19: pp.207 - 223. http://eau.sagepub.com/cgi/reprint/19/1/207

2.3 Policies to provide adequate housing for low-income population

1) The context of urban reform 2) Policies

a) Forced relocation of illegal housing occupiers to public low-income housing. b) The provision of subsidized rental housing for low income housing on the

basis of needs. Poor, disabled, etc c) Housing upgrading in existing illegal housing based on acquisition of security

of tenure, property rights and provision of basic services. d) Fiscal policies designed to aid upgrading and/or access to adequate housing

Voluntary relocation. These vary and can range from public intervention in land and housing markets by public subsidies for materials, land-price, loan markets and rent to enabling private activities in the market .World Bank ‘enabling strategies’.

See: Edésio Fernades (2007) ‘Implementing the Urban Reform Agenda in Brazil’. Environment and Urbanization, Apr 2007; vol. 19: pp.177 - 189. http://eau.sagepub.com/cgi/reprint/19/1/177 Abhas K Jha (2007) ‘Low Income Housing in Latin America and the Carribean” World Bank. En Breve. Jan 2007; No 101. http://siteresources.worldbank.org/INTENBREVE/Newsletters/21182026/Jan07_101_LowIncomeHousing_EN.pdf

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PART THREE - LEARNING BY SIMULATION: A CASE STUDY IN DEVELOPING LOW INCOME HOUSING SOLUTIONS IN A METROPOLITAN REGION

3.0 Aims

1. To develop a process for developing collaborative decision-making processes that facilitates the alleviation of poverty through housing provision in metropolitan areas. This will be accomplished by focusing on the issue of the provision of adequate housing for the poor and low-income populations in metropolitan areas, which most national governments in developing countries have included in their national planning priorities.

2. To provide class participants with the opportunity to actively engage in this process of collaborative decision-making through their involvement in a simulated classroom exercise utilizing a case – study of designed to provide adequate housing for the poor and lower-income populations in a hypothetical metropolitan region called ‘Metroville’.

3. To develop the capacity among class participants to implement collaborative decision-making processes in the metropolitan context. It is well established that the successful implementation of pilot studies can be used as a basis for building mutual understanding between and a common identity among stakeholders that can be utilized for larger projects.

3.1 The Simulation Exercise

The use of simulation models for strategic decision-making is now a common practice primarily using information databases and computer programmes. See: Reif & Quezada 2003: www.worldbank.org/urban/symposium2003/docs/papers/reif.pdf However this simulation exercise is designed to create an interpersonal environment for decision-making. Because of limited class room time for the simulated case study several assumptions have to be made that certainly may not be the case in real urban practice.

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3.2 Assumptions

1) Assumption One: That there is a broad commitment among all stakeholders in the metropolitan region of Metroville, backed by National and State government stakeholders, that priority should be given to the development of a strategic policy designed to increase the provision of adequate low-income housing for as part of any poverty reduction strategy.

2) Assumption Two: In concrete terms institutional, legal and fiscal programmes

that are designed to facilitate and permit the implementation of these programmes that reinforce this political commitment. This means that in the class exercise the assumption can be made that the fiscal requirements for programmes will be in place. In real urban practice this would be a major issue and would take a major portion of the time in developing a strategic housing plan and its implementation.

See: Alex Abiko et. al (2007) ‘Basic Costs of Slum Upgrading in Brazil’. Global Urban Development Magazine.Vol.3, Issue 1: pp1-16 http://www.globalurban.org/GUDMag07Vol3Iss1/Abiko.htm

3) Assumption Three: That for the purposes of this exercise it is assumed that the simulation should involve collaboration between municipalities. This is certainly intended to be facilitated in the case of Metroville by the law on public consortiums passed by the national government April 6,2005.

See: Vicente y Pia Trevas (n.d.) “The public consortia law as the Brazilian Federation’s new instrument of strength in relationship with local development”. English/Portuguese. http://www.chs.ubc.ca/consortia/referencesE.html

The assumption has been made that the funding requirements of any metropolitan housing policy would depend upon municipal collaboration and use of the consortium framework. It is envisaged that this law will enable cost savings, encourage inter-governmental co-operation and permit innovative responses to policy challenges. As indicated in Part One, research has shown that housing and labour markets operate at a metropolitan level often accentuating the problem of accessing adequate housing by the poor. There is thus a need to develop regional responses. While any real strategic agenda designed to increase the provision of housing for poor would have to assume that local plans (at the level of a single municipality) would make-up an important part of any strategic plan for the purposes of this exercise the focus in this simulated exercise will be on developing a strategic agenda that involves the co-operation between three municipalities.

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4) Assumption Four: Because this ‘simulated’ exercise has to be completed in a short period of time, the focus should be on producing an outline strategic agenda agreement at the inter-municipal level. This means that it will only focus on the production of an outline strategic agenda; this means the ‘stakeholders’ would be only be represented at the municipal level. International, national and state ‘stakeholders’ would almost certainly be involved in various combinations in real situations but for the purpose of this exercise they are not included.

5) Assumption Five: For the purpose of this part of the strategic agenda the

simulated exercise will focus on a case study of three ‘squatter’ housing sites located in three municipalities. Participants will represent the stakeholders of teams from the three municipalities. This will involve role playing with an overall objective to reach an agreement to form a consortium to provide ‘adequate’ housing to the poor of ‘squatter communities’ in the three municipalities.

3.3 The Project Request

For the purposes of this exercise the three municipalities have been asked by the Federal and State Governments to engage in a pilot study in the developing a metropolitan region wide housing response to the provision of housing for the poor and low-income populations. This project will assume that some form of public consortia will be put in place to facilitate this project’s implementation. The pilot study will produce a strategic agenda for a regional response to housing that can be specifically be applied in the pilot study but also can be used as a basis for a metropolitan-wide housing policy. It has been decided to focus on case study of three squatter areas in three municipalities the populations of which are variously integrated into the metropolitan urban system. See:

• Appendix One: Basic Profile of Metroville • Appendix Two: Profile of Three Squatter Settlements

3.4 Issues in Municipal Collaboration

It is generally agreed by the municipal government stakeholders that policies of forced relocation of illegal squatters to public housing located at considerable distance from the relocated sites have not been successful and in many cases have increased social and economic problems among the resettled populations. In the past, private housing developers have focused on the provision of housing for the upper income market primarily focused in the core city. However, as the market for ‘lower middle income housing’ has begun to increase, this stakeholder group has begun to see that there may increased opportunities for profit by supporting an agenda that is designed to deliver a wider range of housing. This is further supported by increased economic growth in the metropolitan region that is facilitating the emergence of a larger lower middle income

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population. In addition, the banking sector is becoming more willing to extend credit and loans to enable this development to occur. Finally, the national government has created housing funds to assist poor and low-income populations to access adequate housing through renting and loans, etc. Such loans also recognize that there is an increasingly diverse population in terms of household income levels in illegal settlement that encourages a belief in a multi-dimensional policy of housing provision.

3.5 A Multi-Dimensional Project in Housing Provision: an opportunity to create an innovative experiment in ‘Adequate’ housing provision.

An Outline of the Pilot Study Developing a Proposal:

a) It is therefore suggested that the timing may be right to attempt to an innovative experiment in the implementation of a multi-dimensional housing project.

The availability of a large bloc of former industrial land in Municipality B offers the opportunity to attempt to implement this experiment in multi-layered housing provision which would create an urban settlement of mixed housing for poor, low- income inhabitants from the three squatter settlements which would be funded in part by revenue earned from the development of upper middle income housing.

b) It is estimated on the basis of household surveys in the three squatter areas that of the 10,000 households to be offered relocation 4300 households have household incomes that are below the poverty line and 5700 households in the lower and low middle-income categories.

c) On the basis of this information it has been decided to proceed with the planning of a multi-dimensional housing development to be located in Municipality B that would include low and lower middle–income housing (high rise) and adequate housing for the poor consisting of ‘low rise’ housing (four stories walk-up). This housing would be part of a development that included physical services (water, sewerage, etc) and social services accessible to all inhabitants including schools, health facilities, a community centres, recreational facilities, etc. There would also be shopping facilities and a plan to create employment opportunities through state-supported training programmes and incentives for economic development.

3.6 The Municipalities Buy-In: Winners and Losers

On the face of it, this proposal appears to offer Municipality B the most too loose since it will be expected to make a valuable piece of developed urban land (at present earning no income) to help Municipalities A and C create initiatives in their own municipalities that will help improve the housing situation in their municipalities. But if the proposal should be successfully implemented it needs to offer some source of ongoing revenue

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for Municipality B. This is where the public consortium law can provide a legal and contractual framework that could help create a result that Municipality B can see as beneficial. The increase in lower middle income housing would presumably be revenue generating for Municipality B. There is also the issue of how the provision of social housing (subsidized) for the poor would be funded after an initial period of public funding by national and state funding agencies. Could this be part of some form of Metroville Social Housing Authority? (e.g. Toronto Community Housing Corporation. See www. torontohousing.ca)

3.7 The Realities of the Urban Laboratory Simulation. Are there alternatives?

In the actual simulation in which class participants are involved they may not consider the above proposal as a realistic one and the various Municipal teams may want to develop alternative proposals. This would be an acceptable and understandable way of proceeding in the simulation.

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PART FOUR - ORGANIZATION OF URBAN LABORATORY SIMULATION EXERCISE AND TIMETABLE

4.1 Organization

The class participants will be organised into three municipal teams: • Team 1: Core Municipality • Team 2: Peri-Urban Municipality • Team 3: Periphery Municipality

This will be a role-playing exercise in which class participants will assume the roles of major stakeholders. Each of these teams will have representatives from the three major stakeholder groups: Public, Civil Society, Private sector. It is assumed that the ‘mayor’ (or his/her appointee) of each Municipality would act a chairperson of each team.

4.2 Schedule

a) Urban Laboratory 1: Friday 11 April Introduction; Laying out the Background and Tasks; Description of Urban Laboratory Simulation; Selection of Municipality Teams.

b) Urban Laboratory 2: Saturday 12 April Simulation Exercise: Each team will be produce a ‘position paper’ outlining the municipality’s commitment to participation in a tri-municipal consortium’s project on the provision of low-cost housing. It would be expected that because of the different resources and low-income housing context of each municipality. these ‘position papers’ would place each municipality’s needs as a priority. These ‘position papers’ should be no longer that two pages and prioritized.

a) Urban Laboratory 3: Monday 14 April

This session will be organized in ‘roundtable’ at which all team members would be present. There would be a rotating chair from each of the municipalities. The person role-playing the Mayor would be most suitable. Position papers would be presented. The goal would be to agree on an outline statement of a memorandum of agreement for the low income housing designed to accomplish the goals of the each municipality and contribute to the alleviation of poverty though housing improvement. Ideally, this statement might include a statement of the strategic agenda for implementing the memorandum.

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4.3 Outcomes of the Roundtable

This ‘roundtable’ held at Urban Laboratory might result in several outcomes ranging from ‘agreement’ to rejection, but an assumption should be made that the participants are committed to an agreement.

4.2 Expected Class Requirements

a) Readings for the module. b) Three municipal position papers at the end of laboratory two. c) Draft of decisions on collaborative agreement on the housing proposal including

strategic agenda for implementation.

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PART FIVE - ASSESSMENT OF URBAN LABORATORY EXERCISE

1) Is it an effective tool for developing capacity and understanding of collaborative processes designed to improve the conditions of the poor and low income populations in the metropolitan regions of developing countries?

2) What changes should be made to the urban laboratory exercise in order to make it more effective as a learning tool?

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APPENDIX ONE - BASIC PROFILE OF METROVILLE

A Preliminary Note: The following description of the basic features of Metroville represents an attempt to incorporate information from some of the largest municipalities in Brazil to create a hypothetical model. Even a preliminary assessment of the basic information on several examples of metropolitan areas indicates that there are wide differences between regions of Brazil. Thus the following metropolitan profile is more typical of the Southeast region of Brazil. Nevertheless there is basic similarity in size, population growth, distribution of population, metropolitan economy, labor and housing markets, urban poverty, and the problems of transportation and the environment of similar metropolitan areas in Southeast Asia particularly Manila, Bangkok and Jakarta.

METROVILLE PROFILE

• Date of Establishment of Metroville: 1711

• Definition of Metropolitan Area: comprises 39 municipalities with an area of 8051 square kilometers

• Population of Metropolitan Region: 19 million (2000 Census)

• Definition of Urbanised Area: comprises 21 municipalities that form a continuous urban area that accounts for a population of 16.5 million (86.0 per cent of the population of the municipal area)

• Population Increase/Decrease 1991-2000 - Urbanized Area:

1991 2000 Population Growth Rate %

14,433,045 16,468,555 1.48

• Population Increase/Decrease 1991- 2000 - Urbanized Area by Zone:

1991 (Million) 2000 Million Population Inc/Dec % (yr)

Core Zone 7.0 6.0 - 1.4

P-U Zone 5.5 7.0 + 2.7

Per. Zone 1.5 3.0 +5.0

Total 14.0 16.0 +1.1

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• Socio-economic and Service Indicators (2000) Urbanized Area by Zone:

Household Income % Core Peri-urban Periphery < poverty line 20 40 60

Average years of Schooling HH Heads

8.5 6.4 5.5

Unemployment rate % 14.0 20.0 22.0

Afro-descendants % 17.0 33.0 42.0

Children 0-4 yrs % 6.0 20.0 24.0

Water % 99.0 96.0 93.0

Sewerage% 95.0 85.0 65.0

Illegal Housing 20.0 40.0 60.0

General Observations

1. Metroville has experienced uneven growth in the distribution of population from 1991-2000. The inner core has declined in population while the peri-urban and periphery zones have continued to increase absorbing 3 million population most of this in the peripheral zone. Unlike cities in North America, Metroville’s urban expansion is dominated by the growth of poorer populations. Thus the outer zones equal almost two-thirds of the population of the urban area.

2. These kinds of variations in zonal population growth have important consequences

for public policy particularly in terms of transportation, housing provision, environmental policy and employment generation.

3. This urban sprawl is also the consequence of high priced core zone land prices and

a housing industry that services upper-middle and higher income markets. In the outer zones there is little evidence of either private housing development or public housing and the housing demand has to be satisfied by poor populations living in ‘self-built’ housing.

4. At the same time these developments in Metroville are a reflection of structural

changes that are occurring involving a shift to service activities in the core zone, the restructuring of industry in the peri-urban zone and the growth of poor populations on the periphery. Even though this leads to a continuing pattern of spatial segregation by income and housing it does not mean that they prevent the emergence of metro-region labor markets and other flow patterns of the daily movements of population, commodities and information commodities that are occur at a metropolitan regional level

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5. These observations reinforce the view that metropolitan housing policy should be part of a metro-regional policy that integrates these various sectors. This observation underlies the decision to engage in a municipal consortium in housing development.

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APPENDIX TWO - PROFILE OF THREE SQUATTER SETTLEMENTS

1. On the basis of the previously collected Metropolitan site data (see Appendix One) it has been established that” inadequate housing” and the proportion of households living below the poverty line vary according to the three main ecological zones of the city (1) Core (2) Peri-urban (3) Periphery. On one hand this makes the “targeting” of households who are eligible for improved housing easier for it would seem logical to adopt a spatial focus on the areas where the need is most obvious. However policies that have tried this strategy of “total” removal of squatter populations to new locations have generally failed at least in part because of this inadequate “targeting” that fails to understand the diverse socio-economic characteristics of squatter settlements. This suggests that multi-option and multi-layered strategies should be adopted.

The policy response in the simulated case study is to identify policy responses that can utilise the collaborative mechanisms of public consortia to facilitate the goals of the rehousing of the population from these three squatter settlements.

SQUATTER SETTLEMENT A (CORE)

• Date of Establishment: 1976

• Size (2008): 10,000 Households (Population.circa 40,000)

• Location: One kilometre from the international airport; 8 kilometres from the city core. Densely populated and located adjacent to river and subject to flooding.

• Tenure Status: Illegal land occupation but many of the houses have been substantially upgraded and services such as water energy and sewerage have been accessed. There has been de facto recognition of property rights recently.

• Land Ownership: The land on which the squatter settlement is located is 50 per cent owned by the Municipality and a number of private owners.

• Social Services: These are limited. Schools, health clinics etc are located outside

the settlement and involve fees.

• Socio-Economic Features of Squatter Population: o Household Income: 20 per cent <poverty line. (2000 HHs) o 80 per cent – low to lower middle income o Employment: Formal: Some 60 per cent of households have at

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least one member of the household working in some form of wage employment Almost 100 per cent of these jobs are located either in the core or the peri-urban parts of the metropolis.. Informal: 40 percent of the households earn income from informal or government sources.

Core Municipality Aims of Squatter Housing Project:

1. The Core Municipality wishes to upgrade the existing squatter settlement by providing the opportunity for the upgrading of the settlement by the provision of new services: schools, health clinics; community centres, recreational facilities etc.

2. The Core Municipality also wants to improve the provision of physical services including waste, water removal and realignment of lots to allow roads, etc.

3. This will involve the clearing of some 20 per cent of the land occupied by some 3000 households. There is no land adjacent to the settlement to allow on site expansion. This would be part of process whereby remaining households would be given title to the land and various fiscal forms of assistance to enable them to purchase the land and engage in upgrading or rebuilding of existing houses.

SQUATTER SETTLEMENT B (PERI-URBAN)

• Date of Establishment: 1986. This settlement grew out of an invasion to provide

housing for migrants who had come to work in the new industrial estates established during the 1980s as part of the new industrial policy encouraged by the government. In the 1990s as a result of industrial restructuring much of this industry has closed down or relocated leaving high rates of unemployment. Some of the unemployed workers have found other jobs in the core or periphery or have relocated with industry but still remit income to their families.

• Size: 4000 households (16,000 population)

• Location: 12 kilometres from the centre of city core and close to main arterial

route to city core.

• Tenure Status: land illegally occupied. Property rights not recognized by municipal government. Limited provision of physical and social services.

• Land Ownership: the land on which the squatter settlement is located is owned by

the Municipality.

• Social services. None in the settlement, but can be accessed on a fee basis outside the settlement.

• Socio-Economic Features of the Squatter Population Settlement B.

Urban Laboratory 21

o Household Income: 50 per cent of the households < poverty line o 50 per cent low to lower middle income o Employment: 40 per cent of the households have one earner in the wage

sector - 60 per cent of the households. From informal or government sources.

Peri-Urban Municipality Housing Goals:

1. The Peri-Urban Municipality wishes to use the existing site of Squatter Settlement B for a middle income housing development. In recent years as land and housing prices have increased in the CORE, and per capita incomes have increased there is a growing demand for middle income housing which can be developed in the lower–priced peri-urban zone. There is thus considerable pressure on the Municipality to create contiguous blocks of land that would enable large scale housing development

2. In this case this will involve the resettlement of the population of 5000 households from Squatter Settlement B to former industrial land located 1 kilometre from the existing site that is already provided with basic services and access to public transportation. This is large enough to accommodate 10,000 households ranging from below poverty to lower middle income.

3. The Municipality is thus faced with need to attract some 5000 households to the new development. Encouraged by national governmental financial and institutional arrangements (e.g. Public Consortia) the Municipality proposes to join with the two other municipalities in this development in a effort to create a form urban development which can be seen as a model for solving the housing problems of the poor and lower middle income communities in urban settings.

SQUATTER SETTLEMENT C (PERIPHERY ZONE)

• Date of Establishment: 2003

• Location: Squatter settlement C is located 30 kilometres from the metropolitan region centre in an area that forms part of an environmentally sensitive water catchment area for the metropolitan region.

• Size: 3000 households (approx 12,000 population)

• Tenure Status: Illegal occupation no land or property rights. Limited provision of

physical services.

• Land Ownership: Public ownership

• Socio-Economic Features: o Income: 60 per cent <poverty line from informal or government sources o 40 per cent low income o Employment: Formal: 40 per cent of the households have one person

22 Urban Laboratory

earning income from the formal sector. Most of the formal sector workers are employed in the core or peri-urban zones. Informal: 40 percent

Periphery Municipality Goals

1. The Municipality wishes to relocate this settlement as part of a national policy designed to relocate squatters in areas zoned for environmental preservation

2. The Municipality is proposing to resettle the squatter population within the Municipality but cannot find a suitable location.

3. Therefore the Municipality is proposing the relocation of 3000 households in the new proposed housing development in the peri-urban Municipality

Features Squatter Settlements A Core B Peri-Urban C Periphery Date of establishment 1976 1986 2003 Households 10,000 4,000 3,000 Population 40,000 16,000 12,000 Location: distance from centre of Core City (kms)

8 12 30

Tenure Status land illegal land illegal land illegal Property (house) de facto Illegal illegal Landownership 50% municipal 100% municipal 100% public Physical services e.g. water, sewerage, etc

90% 85% 60%

Social services e.g. schools, medical etc

limited limited limited

Socio-economic characteristics

a) Household income 20% < poverty line 80% low/lower middle income

50% < poverty line 50% low/lower middle income

60% < poverty line 40% low/lower middle income

Employment 60% formal

40% informal 40% formal

60% informal 20% formal

800% informal Project goals upgrade settlement Multidimensional

relocation for development of new

housing

Relocation because of environmental

and health reasons

Number of HH’s to be offered relocation in the project.

3000 4000 3000

Urban Laboratory 23

DIAGRAM OF METROVILLE: LOCATION OF SQUATTER SETTLEMENTS