1.1 Introduction
âAdequate housing is necessary for social welfare as it provides protection from weather, a place to bring up families, and a place to work.â Hingorani and Tiwari (2012). However, about a third of urban populations living in developing countries in 2010 were either living in poor housing conditions or were homeless (Tiwari and Parikh 2012). The condition of housing is precarious when we look at the regional distribution across the globe. Those living in poor housing conditions in Sub-Saharan Africa formed about 72 percent of the total population of the region in 2001, in Asia-Pacific about 43 percent, Latin America and Caribbean about 32 percent, and Middle East/North Africa about 30 percent. Though the share of slums in the total population has been decreasing, the absolute number of people living in slums is still growing. The consequences of a lack of adequate shelter are many. One indicator, health of resident children, indicates that children living in slums have a high mortality rate and a very high incidence of disease. For example, in Kenya while the mortality rate among children less than five years old is 112 per thousand births at the national level, the rate is 151 per thousand births in slums. In some slums the mortality rate is as high as 254 (ibid.).
McKinsey Global Instituteâs (MGI) report âA blueprint for addressing the global affordable housing challengeâ estimates that $16 trillion will be required for the world to meet the urban housing shortage by 2025 (MGI 2014). For a global economy of GDP $77 trillion in 2014, which has grown almost ten times over seventy years, this seems to be an achievable target. MGI also outlines the enormous business opportunities that construction of affordable housing would generate for both developers and financiers. Despite this the housing shortage has stubbornly persisted and been ignored, without much of a solution in sight.
Development Paradigms for Urban Housing in BRICS Countries, is an attempt to investigate the challenge of urban housing from an institutional economics perspective. Cities of the developing world, and most famously those of the BRICS (Brazil, Russia, India, China and South Africa), are gaining importance in the global economy as ânew engines of growth.â These are also the countries which are highly populated, have witnessed high levels of urbanization in short periods, and face substantial housing problems. These countries have adopted different housing development paradigmsâas discussed later in this chapter and throughout the bookâbut the problem with access to decent housing persists. This book is an attempt to promote an understanding of alternative perspectives of urban housing delivery, provisioning of affordable housing, and slum upgrading. The book also offers a critical analysis of affordable housing, slum upgrading processes, options, and institutional linkages in BRICS countries. The role of communities, NGOs and policy makers in the preparation and implementation of affordable housing and slum upgrading has also been examined. The book hopes to provide enhanced access for all participants to debate policy options in a comparative way through the application of a common framework, outlined later in this chapter.
This book, however, does not argue the case for specific causes and policy approaches but rather seeks to clarify the debates and explain the implications of each approach as it applies to specific processes when addressing inadequate housing. The task is multidisciplinary, including economics, political science, constitutional law, urban planning, and other expertise.
1.2 BRICS: The Context for the Book
The BRICS countries of Brazil, Russia, India, China, and South Africa, provide an excellent political, economic, and institutional diversity for understanding how these have played out in delivering housing. Political ideological developments and the trajectories of institutional evolution in the housing sectors have varied among these countries, in some cases it has been slow and others fast. The economic growth in all these countries, though, has been rapid over a short time. Moreover, the economic shift out of agriculture is leading to a transition in the economies of the BRICS countries and the cities are nurturing economic opportunities in non-agriculture sectors like services, industry, and manufacturing. However most BRICS countries have embraced urbanization reluctantly in their development ideologies and hence are unable to demonstrate inspiring examples of âhow to seize the opportunities of economic growth that urbanization can provide.â (IIED 2012) The consequence of the resultant unplanned urbanization is these cities are suffering from an infrastructure which is inadequate to support the physical, economic, and social needs of fast-growing urban centers. Most BRICS bear a heavy burden from past failures in accommodating urban population growth equitably and efficiently (ibid.).
Prolonged ignorance of the basic needs of an urban societyâsuch as housing, education, infrastructure and other necessitiesâin BRICSâ cities has started to impact negatively on their economic, political, and built environment. Hesitantly, these countries are acknowledging interdependencies between economic growth and social welfare, where one harnesses the other. In pursuit of maximizing social benefits when allocating limited public capital to various development initiatives, revenue-generating activities (or economic development activities) have taken priority over capital consuming social activities in many countries. Persistently overlooking the need for public housing, schools, health centers, transport, and other social goods, has intensified the shortage of these services.
Developing countries are urbanizing fast and this is leading to an unprecedented increase in their urban populations, despite the unpreparedness of their existing infrastructure to bear more loads. Cities are dominated by the problems arising from overcrowding, congestion, inadequacy of physical infrastructure, housing shortage, slum formations, income disparity, and unemployment, which are hindering the efficient functioning of these âengines of growth.â Among the most acute problems faced by BRICS countries is a failure to meet the housing requirements of different income segments and age groups, particularly the socially weaker sectionsâincluding the poor, young homemakers, and retirees. Adequate shelter is crucial for human survival. The inadequacy of publicly supported subsidized housing is compelling a dependency upon the private market for this basic good (house or shelter) with the outcome that the market is segmenting, or filtering out, those who lack in financial ability.
To gain an understanding of existing housing problems more precisely it is important to know the different economic, social, and political contexts that have influenced the housing environment. While each country will be dealt with in detail in the following chapters, the next sections highlight some of the characteristic features of the approaches BRICS countries have pursued toward socio-economic evolution and how these have influenced housing conditions in urban areas.
- Brazil
- Adamant urbanization forming segmented cities overfilled with unplanned informal settlements or favelas
Brazilian policies resisted urbanization in the 1950s, despite the urbanization rate1 of 2.5 percent per year, with the urban population growing immensely at an annual rate of 5.6 percent, while the national population was growing at rate of 3.1 percent per annum (IIED 2012). The government feared that poor rural migrants would overwhelm the cities if it facilitated urbanization. An urban population explosion could not be controlled with the governmentâs non-supportive attitude and lack of urban planning. A consistent ignorance of infrastructure requirements and physical planning did not control urbanization; on the contrary, it led to a haphazard expansion of the cities. Organically grown, unplanned cities reflect a physical segmentation, with the majority of the population inhabiting poorly located and ill-served informal settlements (ibid.). The problems of poor housing and a dilapidated infrastructure stemmed from previous urban policies and the resistance of Brazilian governments toward urbanization. Despite this history urbanization has gradually led to economic growth and this realization is slowly improving the policy environment, which has embraced urbanization, particularly in last three decades. Brazil has recently initiated inspiring social innovations to improve the living conditions of the poor, although the fruits of this development have yet to reach the poorest communities.
- China
- From anti-urban to pro-urban
The Chinese development paradigm also resisted urbanization through a controversial household registration system (hukou), albeit at a huge social and economic cost. During the anti-urban Cultural Revolution of 1966â1976 urbanization was actively and successfully resisted. However, after China embarked on market based economic policies in 1978, the link between economic benefits and urbanization was recognized, though the hukou system continued. China has sustained a high rate of urbanization through a controlled migration system. A controlled national population growth through the one child policy made it manageable for China to prepare for an increase in urban population. âChinaâs economic transformation, which began as a rural experiment, soon became urban, involving first a string of coastal cities, then larger urban regions, then inland cities.â (IIED 2012) Local urban governments were given increased authority and the responsibility for raising the economic production of cities, which were the power houses running on global investment and local labour forces. As and when an urban economy needed a cheap labour force, the government loosened its control on temporary rural migration. However, the household registration system continued to deny most rural migrants the rights of urban citizens. Chinaâs stunning economic success is based on âclosely aligning local authoritiesâ official and unofficial interests with market pressures, even when that causes environmental damage or amplifies inequalities.â (ibid.) The fear of the Chinese development model is that urban economies, dependent upon entrepreneurial bureaucrats and developers, would continue to ignore social and environmental agendas and serious intervention would be required to modify the development model to make it inclusive and responsive.
- Russia
- Huge cost of redeveloping misplaced Soviet cities
Russia demonstrates the heavy influence of a political system on the social, economic and built environment. Single party governance and the centralized system of the Soviet Union gave priority to political and military objectives over social and economic requirements. This led to a geographical misplacement of urban centers and economic activities, which were non-responsive to locational priorities of markets and individuals. The legacy of cities in poor condition comes from the unresponsive planning and governance systems that dominated Russia during the Soviet era, 1922â1991. Non-market decision making left many cities exposed at the end of the Soviet Union and, despite the traumas of that era, its collapse led to a demographic and economic downturnâper capita income temporarily fell by more than a third and urban populations declined for over a decade (IIED 2012). Industrial cities of the Soviet era that had produced goods for the military-industrial complex, or consumer goods that were protected from competition, suffered enormously and their populations shifted to newly developed cities. The spatial restructuring of economic activities and population dislocation is burdening Russian cities with issues of housing quality and congestion, and a basic infrastructure inadequacy.
- South Africa
- Apartheid fragmentation still dominates urban lives
South Africa learnt a hard lesson from exclusionary urban policies that constructed racially, economically, and spatially segmented cities. The apartheid system dominated the urban environment of South Africa until 1994 when the political system was taken from the white minority to favour the black population, which had been excluded from the political system and all acts of development. Racial discrimination disrupted and oppressed the lives of black residents and constrained them to urban peripheries, which fractured the citiesâ physical forms and created separate residential areas for different races, with blacks confined to dormitory townships on the edge of cities and towns, far from jobs and amenities (IIED 2012). The urbanization rate was almost zero when apartheid was at its peak. Post-1994 unprecedented urbanization took place but governments adopted a reactive approach and still overlooked the basic social and economic needs of the previously excluded and ignored population. In the past, political controls kept the fruits of industrialization and urbanization away from the majority population of South Africa and therefore a need for constitutional support was observed. Although legal rights are not yet fully exercisable, due to a lack of political will, and there are insufficient government resources to meet peopleâs basic needs for electricity, water, and sanitation. Inclusive governance, planning, and leadership are expected to gradually integrate the cities and societies of South Africa.
- India
- With a majority of agrarian voters governments hesitate on urbanization
India is less urbanized than the other BRICS countries, and it is unfortunate that the country has not fully harnessed the economic growth potential associated with urbanization. Non-performance in the agricultural sector, a lack of employment opportunities, and various other push factors of rural living are causing people to migrate to cities. The country is caught up in a vicious cycle of underdevelopment, where a lack of support for urbanization is suppressing economic growth. Lack of public funds has curtailed investment in social infrastructure in urban and rural areas, depriving most populations of access to basic amenities. In a haste toward economic growth, the public sector has channelled its limited resources to large cities, which aspire to become Global Cities so as to attract foreign investment. The middle and low income segments are unable to meet the rising living standards of large cities and seek refuge in smaller cities or on urban fringes of large cities (called peri-urban locations), which are affordable but only receive a small share of infrastructure investment and thus suffer from an inadequate infrastructure, both physical and economic. The current approach toward urbanization is leading to patchy development at neighborhood and regional levels, thereby segregating the society between the haves and the have nots. In the recent past, several important programs have been introduced to support equitable and efficient urban development. These include the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), Rajiv Awas Yojana (RAY) and Prime Minister Housing for All Scheme, although their success has suffered from a lack of synchronization among ruling political parties operating at different tiers of government. Lack of capacity in urban local bodies or municipalities t...