Comparison of Housing Policies and Programmes of Developed and Developing Countries

Abstract
The Government of India has identified urbanization as a key priority area to meet growth targets for the Country. It points out that over 300 million will be added to Indias urban population in the next 20-25 years and identifies the need to provide low-income housing, clearing of slum in urban sectors, providing proper housing in entire country. By being in the master level Architecture its a report analyzing the housing policies and Programmes of various developed and developing nations to derive a proper way to solve the housing Issues of an country

Assignment for AR 1601 URBAN AND RURAL HOUSING By

A.Sivaraman, M.Arch General (2013-15)

Urbanisation
Abstract
Urbanization is the physical growth of urban areas as a result of rural migration and even suburban concentration into cities, particularly the very large ones. Urbanization is closely linked to modernization, industrialization, and the sociological process of rationalization. Urbanization can describe a specific condition at a set time, i.e. the proportion of total population or area in cities or towns, or the term can describe the increase of this proportion over time. Urbanization occurs as individual, commercial, and governmental efforts reduce time and expense in commuting and transportation and improve opportunities for jobs, education, housing, and transportation. Living in cities permits the advantages of the opportunities of proximity, diversity, and marketplace competition. However, the advantages of urbanization are weighed against alienation issues, stress, increased daily life costs, and negative social aspects that result from mass marginalization.
Comparison of Housing Policies and Programmes of Developed and Developing Countries

All

countries

have

formal development

economic and an

informal. But, on average, in developing countries the relative size of the informal sector is

considerably larger than in developed countries. That most poor households

derive their income from informal employment and they saves in an effective way Also, holding fixed real economic activity in

Poverty
Poverty is the state of one who lacks a certain amount of material possessions or money. Absolute poverty or destitution refers to the deprivation of basic human needs, which commonly includes food, water, sanitation, clothing, shelter, health care and education. Relative poverty is defined contextually as economic inequality in the location or society in which people live.

an

informal

economic government

endure,

provision of a given level of goods and services, which restricts the

desirable scale and scope of government policy. For the same reasons, housing policies that have proven successful in developed countries may not be successful when

employed in developing countries.

Poverty leads the people to migrate into an urban sector for their basic needs.

Slum
Comparison of Housing Policies and Programmes of Developed and Developing Countries

A slum, as defined as a run-down area of a city characterized by substandard housing, squalor, and lacking in tenure security. Urban sectors possesses high profiled living cost it leads the people who migrated in that particular sector to settle in an unhygienic place without proper household and proper living standards and facilities.

Housing
Housing generally refers to insure to that members of society have a home to live in, whether this is a house, or some other kind of dwelling, lodging, or shelter. Many governments have a department that deals with housing, for example National housing sector, India and united states department of housing and urban development.

Housing need
The household requirement of an individual family (2 elderly person + 2 younger person) in need for their social settlement in its own environ with proper requirement and proper services which satisfies the basic need of that family is said to be Housing requirement.

Housing need in urban sectors

The housing requirements in urban sectors of various developed countries states that the demand is always in increased manner the migration is constant depending upon the economic condition and the political condition of that particular state. The economic condition is always static but the poverty level is medium in that state. The housing requirements in urban sectors of various developing countries states that the demand is always in fluctuation depends upon the same considerations and extraordinary migration of people from rural sector to urban sectors. The economic condition is at three different level really high at some extent medium at maximum state poor without proper housing and basic requirements cum amenities is at a large extent in urban sector and scare at rural sector.

Introduction
Most, if not all, developing countries experience rates of urban population growth far above their national population growth. The degree of urbanization is thus increasing. On average, more than 40 per cent of the population in the developing world are now living in towns and cities. By the year 2000, there will be 16 metropolitan areas in developing countries with more than 10 million inhabitants. Moreover, in most countries urban poverty is increasing more rapidly than rural poverty. It is estimated that by the end of the century, 90 per cent of the poor in Latin America will live in urban areas. The figures for Africa and Asia are expected to reach 40 and 45 per cent respectively (World Bank, 1993a). (Ref: National experience shelter delivery for the poorest groups Report of United nations). Rapid urbanization has outpaced the ability of local authorities and national governments to provide adequate shelter and basic amenities for the urban poor. Large slum and squatter communities live illegally on government and private lands, especially in the big cities. These communities lack or have inadequate provision of water, sanitation, roads, electricity and housing. Overcrowding and environmental degradation are common problems. The poor are often forced to put up their shack on steep erosion-prone slopes, close to overflowing rivers, mosquito-infected wetlands, along railway lines or close to sources of heavy air or water pollution. The health of the poor in these areas is evidently bad. Lack of work adds immeasurably to the misery of these people. They live in an abject state where the future is measured day by day in search for food for survival. Every day, they face the risks of diseases, injury and starvation in a harsh and merciless city environment. (Ref: Journal: National experience shelter delivery for the poorest groups Report of United nations). These various factors Leeds to formulate the housing policies and programmes on each and every nation by their own after analysing their own housing criterias and its various influential factors. To organise and maintain a standard of living individual around globally organised by the United Nations World health organisations.

Comparison of Housing Policies and Programmes of Developed and Developing Countries

Housing policies and programmes

Comparison of Housing Policies and Programmes of Developed and Developing Countries

Housing policies in INDIA

1. Introduction
Housing is an important economic good in the consumption basket of a household. As it relates to the living of human beings, it is tied to their security. Therefore, an improvement in housing status leads to the development of household in true sense both economic and social. Moreover, housing activity is tied with many other sectors of economy, as well as the life stages of individual and his/her social network. Improvement in housing, on both qualitative and quantitative parameters, leads to an increased welfare of individual and the society not only by providing the vital shelter but also by offering room for improved health, education and nutrition. These characteristics of housing have prompted several governments to undertake the responsibility of housing provision, which India has also undertaken for almost 40 years after its independence. However, it has been severely criticised and shown as one of the root causes of poor housing status in several low income countries (Mayo and Angel 1993). With changing political and economic structure of nations and changing priorities of development policy, the focus and interventions of governments in the provision of housing have also been changing primarily shifting away from greater public provision to greater market provision. This role shift was in fact suggested by the World Bank more than two decades ago but stronger emphasis on policy changes and enabling environment came forth only a decade ago. This framework provided by Mayo and Angel (1993) argued for adopting policies that enable housing markets to work and suggested the following broad instruments as a part of housing policy: Enabling Environment for Housing Development

Demand side Instruments

Developing house registration and regularisation of insecure tenure: creating healthy and competitive mortgage lending institutions, and fostering innovative arrangements for providing greater access to housing finance by the poor Rationalising subsidies: ensuring that subsidy programs are of an appropriate and affordable scale, well-targeted, measurable, transparent and avoid distorting housing markets Providing infrastructure for residential land development: coordinating the agencies responsible for residential infrastructure to focus on servicing existing and undeveloped urban land for efficient residential development Regulating land and housing development: balancing the costs and the benefits of regulations that influence urban land and housing markets, especially land use and building, and removing regulations which unnecessarily hinder housing supply Organising the building industry: creating greater competition in the building industry, removing constraints to the development and use of local building materials, and reducing trade barriers that apply to housing inputs

Supply-side instruments

Management instrument

Development institutional framework for managing the housing sector: strengthening institutions which can oversee and manage the performance of the sector as a whole, bringing together all the major public agencies, private sector, and representatives of nongovernmental organisations (NGOs) and community based organisations, and ensuring policies and programmes benefit the poor and elicit their participation

India has been witnessing several macro-economic changes that affect all sections of its economy after the adoption of liberalisation policies in the early 1990s. The macro policies paved way for increasing role of markets in housing provision and targeting of

Comparison of Housing Policies and Programmes of Developed and Developing Countries

Developing property rights: ensuring that rights to own and freely exchange housing are established by law and enforced, and administering programs of land house registration and regularisation of insecure tenure

Comparison of Housing Policies and Programmes of Developed and Developing Countries

public housing to the poor (those meeting with the official criteria of below poverty line).There have also been attempts to strengthen the existing financial institutions both apex and retail so that the finance flow takes place with little difficulty. Although changes on the demand side have been quickly undertaken, supply side changes have not taken place to the extent desired by the above template of enabling environment. Somehow, these changes did not receive much attention of literature in the Indian context. Except the work of Pugh (1990), much of the Indian literaturei concerned with housing programs and issues concerning with a specific region/area (e.g., Mehta and Mehta 1989, Prabhavathi 1992) or they were too generic (e.g., Mohanty 2003) and confined to few areas (e.g., MoEF 2002). This Paper attempts to fill the gap through an overall review of changes in housing policy Changes in India, and that of urban housing in particular, and attempts to identify the key impediments, issues and reform agenda. We will also attempt to see, wherever possible, how the changes correspond with the template above. Before that, we will discuss the challenges faced by housing at the dawn of urbanisation.

1.1 Urbanisation and Housing

It is important to note that housing needs are largely driven by population and Demographic changes. India underwent a rapid population rise after independence, which somewhat stabilised in the recent decades. The number of households has been largely growing due to increase in family size and nucleation of families and important phenomenon accompanying it is urbanisation (Rakeshmohan 1996a). The share of urban population in total population has been increasing from 20 per cent in 1950s to touch almost 30 per cent by now (MoEF 2002). Figure 1 presents a picture of urbanisation and urban population growth in India. Yet, in comparison with the urbanisation levels of 60-70 per cent in Africa and 70-80% in the Europe, India is yet to transform in to a predominantly urban society. Among all classes of cities, metropolitan cities, which already have a large population and a major share of total urban population, are experiencing faster growth. Mega cities i.e., cities with more than ten million population, share almost 40 per cent of urban population and another 30 per cent is shared by other Class I cities i.e., cities with more than one million population (Rakeshmohan 1992, Kundu 2006). The polarisation of growth towards metro cities and mega cities poses a greater challenge to provide housing in urban areas, which are rapidly becoming areas of crowded habitations without basic amenities. This gets reflected in an increasing proportion of slum population which constituted 28 per cent of the urban population. In fact, the proportion of slum population in Mumbai, Delhi and Kolkata is rapidly reaching the levels of 40%; in Mumbai, it has reached almost 60% of total population according to latest census (Dadich 2002). The slum population faces challenges ranging from insecure

tenure and poor shelter conditions to the lack of access to basic infrastructure facilities like water supply, sanitation and solid waste disposal. The report of National Commission on Urbanisation (1985) eloquently pointed out the reality of comparatively rapid growth of population as well as the scale and intensity of urbanisation, the critical deficiencies in the items of infrastructure, the concentration of vast number poor and deprived people, the acute disparities in shelter and basic services, deteriorating environment quality and the impact of poor governance on the income and productivity of enterprises. However, only recently, the economic importance of urban areas in terms of their contribution to the national income has been recognized and so do their potential in absorbing large surplus labour of the rural hinterlands. Cities began to contribute to more than 50% of the GDP from less than a quarter in the post-independence era. Given the rising importance of urban areas and increasing challenges of urban housing, the problems and issues of urban housing assume significance and so do the reform agenda towards improving it. The structure of the paper is as follows: First, the economic importance of housing to Indian economy is explained; second, the focus and changes of housing policy are explained; Third, the shifts in housing policy are analysed; Last, various interventions made by government in housing sector, particularly in urban housing, are explained. Towards the end of the paper, we shall discuss recent policy changes and the way forward to a reform driven growth of housing sector in general and urban housing in particular.

2. Economic Importance of Housing

Housing constitutes an important element of human life which many aspire to achieve in their lifetime. It has the potential to contribute to a rise in national income, because of the linkages with various other sectors providing goods and support services. It also has the potential to add value over a longer duration even after house construction and because of this advantage it also contributes to the employment to a good extent (Gupta 1985). Housing production is labour intensive process in India, since the cost of labour is low and the relative cost of capital is high. Different components of a house demand a variety of products supplied by other sectors and skilled persons, creating demand for a variety of goods and services, thereby generate greater employment (Tiwari and Parikh 1999). Given such economic importance, housing policy needs to be carefully designed to ensure that its growth is not hampered by macro economic policies and plans. The economic importance of housing In India is reflected in its contribution to income and employment generation, and to capital formation. The income accruing from housing sector is of the order of 3.5 per cent of national income (at constant prices) (NBO, 1987). The share of Gross Capital Formation in Residential dwellings (GCFR) is

Comparison of Housing Policies and Programmes of Developed and Developing Countries

Comparison of Housing Policies and Programmes of Developed and Developing Countries

around 12-13 per cent of capital formation and the GCFR/GDP ratio has been stable at around 2.5 per cent. The GCFR in Urban areas (GCFRU) at around 50 per cent reflects the importance of dwellings in urban areas (Gupta 1985). In terms of employment, construction sector accounted for 5.4 mn workers (1.9 per cent of total employment), up from 3.7mn (1.7 per cent of total employment) in 1981 (Mukhopadhyay 2002), an estimated 60-70 per cent of it would have come from house construction. The indirect employment generation that takes place from backward linkages to the economy will be very high. Housing and Urban Development sector has been a thrust area of economic planning in India. It received attention and priority in most of the five-year plans, in which investments were stepped up regularly but the share in plan outlay remained more or less constant at 2.5 per centiv. Yet, the relative priority to housing in comparison to urban development appears to be declining, as allocations made to housing alone as a proportion of total plan investments have been reportedly declined (NBO 1987). This is a manifest of a shift in central government policy to curtail public expenditure. It is also in consonant with the macroeconomic policy change of states role from a provider of private goods to enabler of their provision. Housing, given its characteristics of durable consumption good, is viewed outside the area of public provision. Such policy departure would have resulted in crowding out of public investment to expenditure on other welfare areas, but it would have led to the production of social housing option for the poor, especially in the urban areas. Given that the crowding in of private investment to the production of housing would take longer time, there is an acute pressure on housing of low income population in many cities, particularly large metropolitan cities. Though public spending on targeted programmes of housing and/or infrastructure provision to urban / rural poor either by central government or through state governments has stepped up at the same time (Rao 2003), it is less than adequate and the resource transfers are plagued by leakages in the system.

3. Housing Policy Focus and Changes in India

The current and past state of housing can be better understood when the various approaches taken towards it are understood, which is reflected in the policy stance. Until 1990s, no comprehensive assessment of housing sector was made and policy was largely driven by government programmes (or, budgets) and interventions (or, regulations). The National Commission in Urbanisation (1985) called for reorganising government policies and programmes to meet the challenges of urbanisation in the coming decade. In 1988, the Union government came out with draft National Housing policy, modified in 1992, explaining the approach towards the sector and the policy objectives. This document was revised later in 1998, and brought forth as National Habitat and Human Settlements Policy. The Key features of these policies are presented in Annexure I and II respectively. This section, however, attempts to review housing policy, in terms of (a) the strategic focus laid down in economic plans and (b) the policy focus laid down in various programmes.

3.1 Strategic focus of Economic Planning

In the era of mixed economic planning in India i.e., during 1950-1990, housing sector policy was largely driven by the approach to address housing needs in the governments role of provider (Pugh 1990). In this era, housing needs were estimated from population projections, and public as well as private sector targets were laid down along with the investment outlays for achieving it. Thus, housing needs assessment was more of a technical exercise, and then each plan identified as how much they can achieve through setting-up targets; but, each plan envisaged housing development in a different way while balancing the needs of housing with those of other sectors of the economy. Housing made through this channel primarily catered to middle and low income groups in urban areas and low income groups in rural areas respectively (Pugh 1990). However, in the process it has not enabled the development of a capable and efficient private housing supply. The planned housing provision has replaced housing demand with needs, without knowing that the targets would not be able to meet the needs in a rapidly growing country, like India, endowed with few public sector resources. Housing delivery process was designed primarily in the form of Housing Boards of the State Governments, which was later extended to housing boards of the cities. These boards were assigned the task of land mobilisation, clearance, layout preparation, design and development and they were provided funding through the State Governments. The State Governments, in turn, were provided funds for the purpose of housing by the Central Government through plan grants. The grants flow was linked to the implementation of targets under the programmes undertaken within the five-year economic plans. Apex financial institutions were created specifically for the purpose of housing finance and creation, which include Housing and Urban Development Corporation (HUDCO), National Housing Bank (NHB) and, lately, National Buildings Organisation (NBO). As India pursued the path of economic reforms and liberalised various sectors of the economy in 1991, the hitherto thrust given to public sector housing was withdrawn, and market forces were given greater opportunity to participate in countrys development. While there were very few incentives provided for supporting housing production in private sector (e.g., central banks direction to reduce risk weightage to loans to home builders), the policy measures attempted to break the in access to housing finance and, thereby, raise demand to a great extent. This was achieved through incentives in the form of tax advantages for home buyers that make it attractive to go for home ownership (see boxes for the recent policy incentives). This stance has resulted in the increase in ownership of housing in urban areas and reduced acute housing shortage (Census 2001).

Comparison of Housing Policies and Programmes of Developed and Developing Countries

Comparison of Housing Policies and Programmes of Developed and Developing Countries

Housing Finance activity has also been released to private sector banks and financial institutions to facilitate the process of lending and expand service sector of the economy. This stance had percolated all sectors, to which housing is not an exception. As a result, the role of government took a shift from provider of housing to enabler or facilitator of housing provision (Rao 2003). This shift is apparent from policy document (GoI 1992): The government has to create a facilitating environment for growth of housing activity rather than itself taking on the task of building. However, this shift in the role has not yet taken place with the result that the government is still called upon to act as a provider. The other partners, like private and co-operative sectors, have not stepped-in to fill the void (National Housing Policy 1992) Although the Government and the Central Bank (RBI) have been providing the necessary impetus to the sector and it is now for the housing sector to respond to these initiatives. In particular, the enabling policy of making housing mostly a private sector activity has thus far focused on facilitating housing consumption process by providing fiscal and monetary policy incentives, but the technical delivery of housing has to improve, which largely remains in the organization of the industry on one hand and the prevalent legal, regulatory and institutional environment on the other. While housing sector itself has to become more professional and efficient like manufacturing sector, with the removal of impediments to investment flowvii, housing supply has to become stable, predictable and responsive to the needs of hour. As most of the housing supply is local, it is highly dependent upon institutional, legal and regulatory environment at that level, which requires reforms at the level of local bodies, which we will discuss later. It is also important, as noted earlier, that there are lags in the supply of private sector housing and that the supply may not reach urban poor, which calls for making provisions for housing of low income people either directly by the public institutes (to the extent possible, well-targeted with some element of cost-recovery) or in partnership with private sector, non-governmental organization and community based organizations. This approach becomes essential when the investment needs are gigantic, such as to the tune of Rs 526,000 crores in the case of urban housing according to Ninth Five Year Plan (India Core 2006). Foreign Direct Investment (FDI) inflows could potentially offset the investment but only if the returns are attractive and no impediments are perceived; housing industry is yet to reach such heights (Rao 2002). While the demand side instruments have dominated the policy changes in the era marked by increasing private sector role, there were few supply side instruments that have been used so far (see the earlier template). Home building industry is still poo rly organised and home builders respond in tune with the economic needs of housing i.e., property, rather than to the physical needs, in the absence of information about the housing requirements and the abilities of supply of other players. The competitiveness of the industry is poor when compared to other industries, primarily because of the immobility and durability of housing good and complex production process.

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3.2 Policy focus of Housing Programmes

Whereas the shift in policy in terms of plan investments of public and private sector was a turning point, the programmatic focus was taking different directions providing scope for understanding how meso-level operations were changing over time with changes in macroenvironment. It may be noted that most of the public housing programmes targeted low and middle income groups. The programmatic focus on housing urban poor was consistent with the prevalent focus made elsewhere with intervention of multilateral agencies like the World Bank Here, it has to be mentioned that after more than two decades of advocacy of the programmatic shift and policy reforms, Buckley and Karaickal (2005) claim that there has been an improvement in housing condition in general but with the learning of increasing need for addressing integrating informal housing into formal housing; the understanding of regulatory environment has also been well understood now. In the early years after independence i.e., in 1950s and 1960s, the government focussed on house building for people, with a preference to disadvantaged socio-economic groups, using its own machinery. The central plan targets were divided between various states, which were supposed to oversee house construction by their department in the provinces. It placed emphasis on building medium rise apartments, social housing for poor and providing rent subsidies (Pugh 1990). In this era, model towns were built near large cities and town planning schemes were adopted for providing housing in urban areas (Rao 2003). The system was delivering, but at a pace not sufficient to meet the needs of both existing and growing population. Moreover, it was marked by failures like bureaucratic red tape and delays, caught in the frails of favouritism and corruption and the beneficiary selection based on socio-political position was ensuring that only limited amount of housing would reach the poor and needy people (Rao 2003).

4. Public Interventions in Housing

Housing is not only a durable economic good but it has several other characteristics.

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Comparison of Housing Policies and Programmes of Developed and Developing Countries

The regulations that were aimed to ensure better habitat conditions themselves become major hurdles to housing supply in the urban context, if they are rigid and without any oversight of the intent of macro policies and, thereby, affect its price, which we will discuss later. The policy shift from provider of housing has been somewhat legitimate, given private good characteristics of it, but the crowded out investment should be used to create better urban infrastructure roads, water supply, sewerage, energy and solid waste disposal - on existing and undeveloped land. The India Infrastructure Report has estimated that infrastructure investment requirements of core urban services itself is Rs 28,035 crores (Rakeshmohan 1996b). Infrastructural bottlenecks, however, plague several cities, in spite of the repeated emphasis of reports on addressing it. Infrastructure is also a public good and considered as an essential ingredient of economic growth of cities. Only, recently, the focus has come on this subject, which we will discuss in the final section.

Comparison of Housing Policies and Programmes of Developed and Developing Countries

For example, good housing conditions leads to increased welfare of household by providing the vital shelter thereby offering room for improved health, education and nutrition. Good housing conditions can also result in social benefits like low public health costs and law and order problems. Given these merit good characteristics of housing, governments often intervene its provision so as to maximise the inherent benefits and welfare improvement of housed population, and they attempt to either provide or facilitate the process of its delivery. However, such welfare arguments for provision of housing fail to meet with complete success due to inherent limitations of governments, particularly in developing countries like India, wherein the resource limitations are high and government failures are more. India has also followed the interventionist path for quite some time with limited success and therefore moved to the role of enabler of the provision in the wake of pursuit of public sector reforms under new economic policy. It began laying down emphasis on providing infrastructure amenities in cities and rural areas and uses fiscal and monetary policy to influence the credit flow to house construction on one hand and to provide tax incentives for house purchase on the other. However, it is caught with limitations of incomplete land and housing sector reforms and the lack of institutional mechanisms for achieving housing for low income sections in cities. The experience of such interventions, in the form of plan strategies and programmes as well as regulations, is explained below.

4.1 Direct intervention

India has undertaken, from time to time, various programmes aiming at the provision of housing, as a part of both the strategy laid down in the five-year plans as well as the designated independent programmes. Besides the programmes of Union government, the state governments have also announced, at times, their own housing programmes, which were funded through their own budgets. Furthermore, several central and state government enterprises had the policy of housing provision to their employees from their own outlay, which also contributed, to some extent, housing from public sector. Although numerous such programmes were launched, their success was limited and inadequate. However, a good evaluation of these programmes and their impact assessment is missing, except for few such programmes which reflect a major change in the approach. As a result, the precise effects of such direct intervention, in terms of how and which target groups received benefits, and to what extent, are unknown. Yet, some general conclusions can be drawn about the success of intervention and reasons for their failure. Some of the reasons for failure are laid down below: First, the difficulty in ensuring that the funds would reach target groups. Second, the poor percolation of benefits and poor translation of housing on ground resulting from it.

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Third, housing supply was not efficient and responsive to the needs . Fourth, the lack of participation of beneficiaries in the home building process.

4.2 Regulation
Indian government, like several other governments, intervened in the provision of housing through regulation, in the form of enactments of model acts of Central Government, which were followed by similar enactments of State Governments, and Planning and Development Control Regulations of various states and cities. The major enactments of Government are the Urban Land Ceiling (Regulation) Act (ULCA) and Rent Control Act (RCA), which were enacted by various states and cities, the experiences with which are explained below. Besides, Land Acquisition Act of 1894, authorising the government to acquire land for public purposes is still followed in land acquisition for housing; but some State governments have amended this act to constitute their own model land acquisition acts. Likewise, Transfer of Property Act, 1908 has had a legacy of regulating property transfers for a long time. We will examine the regulatory and institutional interventions of the government that became impediments to housing growthx. 4.2.1 Urban Land Ceiling (Regulation) Act 4.2.2 Rent Control Act 4.2.3 Planning and Development Control Regulations 4.2.4 Title Registration and Records Management 4.2.5 Stamp duty and registration/transaction charges

5. Summary and Way Forward

Housing is an important economic activity in India. It provides good amount of income and employment and has strong linkages with other sectors. Therefore, policy changes in this sector shall have implications for overall growth of economy and macro policies can influence housing activity to a good extent. As India has transformed from mixed economy to market economy, housing witnessed many changes - for example, plan investments in housing were declining and so also the public provision of it. The programmatic focus of housing, in general, and that of urban poor, in particular, has also shifted from time to time reflecting the needs of time and people; but they achieved limited but not lasting success. This led to a conclusion that government has its own limitations in providing housing for all. Given the limited success with planning and programmatic approach and the surging need of housing in the dawn of urbanisation, it required a paradigmatic shift in the approach. The policy focus shifted from delivery of housing unit to facilitating its provision in line with changes in macro-economic policy. Here, the government provides primarily focused on demand side interventions in the form of incentives to various actors e.g., liberalising home financing, providing tax incentives, which encourage housing becoming a private activity. To what extent the new policy stance has affected housing at large is more of a guess work, but it improved urban housing to some extent. It has, however, not been able to address housing for poor and low income groups, which needs to come through local government innovations and State government support. Also, the policy has not addressed some supply side issues e.g., regulatory impediments like land

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Comparison of Housing Policies and Programmes of Developed and Developing Countries

Comparison of Housing Policies and Programmes of Developed and Developing Countries

ceilings, rent controls, high transaction prices and secure property rights in the form of titles. Further, planning norms have not been effective in achieving their goals but have been hindering housing development in some cities with the rigid standards, procedures and practices. Institutional and regulatory reforms caught attention recently, and the Union government has created Urban Reforms Incentive Fund (URIF) in the Union Budget 2003 as a means for tapping resources by the States so that they can undertake reforms that address the key issues plaguing development including the housing sector. However, the response has not been very encouraging. The Draft National Housing Policy 2005 has widened the objectives laid down in the earlier draft emphasizing on strong far-reaching changesxiii. It laid down the role that could be played all tiers of government and public agencies and laid down the agenda for changes in land, finance, and institutions (legal and regulatory). These measures are comprehensive and their implementation in spirit can percolate benefits to the sector. Further, recognising the need to widen the scope of reform, the Union Government came out recently with the Jawaharlal Nehru Urban Renewal Mission, which seeks the cities to bid for financial support to infrastructure and overall development through city development strategies and plans. It also provided for mandatory reforms (including repeal / modification of land ceilings, rent controls etc.). It is hoped that this will usher in a new era wherein the cities will strive towards well organised development of their infrastructure while enhancing housing options and habitability conditions of their citizens. The boom in house prices and housing supply observed in the recent past has to be seen from this perspective, when urban housing is changing the economic outlook of cities and the nation.

Housing policies in Mexico, USA

1. National shelter policies: Mexico The right to adequate shelter was included in Mexico's Federal Constitution in 1983. A new law (Ley Federal de Vivienda), containing aspects of an enabling approach in line with the GSS, was also passed that year. The objectives of the new national shelter strategy are clearly expressed in the Programa Nacional de Vivienda 19901994 (Carmona, 1993). The basic principles of the document are: Efficiency of the public housing programmes, and extension of the coverage to low-income groups; Improved popular participation in shelter provision, and intensified collaboration between public, private and community actors.

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The first principle follows the traditional philosophy of the public sector as a provider of housing. The second opens the possibility for the government to assume the role of facilitator.
Comparison of Housing Policies and Programmes of Developed and Developing Countries

The shelter-related objectives of the National Development Plan, 19891994 include support for the shelter process so that every Mexican family obtains access to adequate housing, while it aims to take advantage of the multiplier effects of shelter delivery, in order to stimulate production and increase employment. The National Housing Policy has the following specific objectives: Modernize the institutional arrangements in the housing sector; Concentrate government initiatives to the low-income group; Improve the financial mechanisms for public housing programmes; Support the process of decentralization; Make the distribution of inputs to house-building more efficient.

In 1993 there was a change in the Federal Administration of Housing. The new authority emphasizes the following points: Establishment of more flexible and diverse modalities of guarantee for housing loans; Promotion of deregulation and simpler construction rules; Enactment of legal reforms allowing more flexible and less complex processes of housing production.

The recent formulation of the national shelter strategy is in line with the GSS, and traditional policies are gradually reduced or removed. The GSS seems to have had a positive impact on this change in the housing sector in Mexico. To underline the reorientation of policy, three specific sub-policies should be mentioned. First, there is a growing role for CBOs and NGOs in the shelter process. The key policy concept in this connection is concertacin, meaning social negotiation. Many new CBOs and NGOs have been formed recently in Mexico. There is also an apex organization, a federation of grass-roots groups, CBOs and NGOs representing more than a million people, the Coordinacin Nacional de Movimiento Urbano Popular (CONAMUP). The main tasks of this organization are to lobby the government on land and housing issues, and to provide financial and technical support to affiliated organizations. Secondly, an important change in land management in Mexico is the recently passed reform in the National Constitution with respect to ejido lands. This category of land included 99-years leases for peasants. The leases are now transformed into a flexible right facilitating a conversion of such land to urban use and development.

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Comparison of Housing Policies and Programmes of Developed and Developing Countries

Thirdly, a government programme has been established for the development of 100 medium-sized towns. The aim is to lessen the pressure on larger cities. Shelter programmes in these towns will obtain special benefits to mitigate migration flows to the metropolitan area. The costs of providing urban infrastructure and services will thus be reduced. This will be beneficial for the poor, given that they choose to settle in the towns rather than in the largest cities.

Housing policies in INDONESIA

Indonesia laid the basis for its fifth Five Year Development Plan (1989 1994), known as Repelita-V, during the International Year of Shelter for the Homeless (1987) and the year that saw the adoption of the GSS by the General Assembly of the United Nations (1988). Housing authorities were then able to develop a new policy and include it in the State National Development Goal. The change in policy is a move from the government as a "provider" to that of an "enabler". The focus is now on what people can afford and on the role of local authorities together with the private formal and informal sectors and CBOs in shelter provision. Improved building materials, standardization and land regulation and the support of the construction industry have stimulated the participation of the informal sector in housing development. More people are encouraged to build their homes through CBOs and cooperatives and with the assistance of NGOs. The Indonesian Government has endorsed the GSS, yet its Urban Renewal Programme may lead to a removal of a large number of kampungs in Jakarta (UNCHS, 1991d). The growth of private-sector house-building during 19891991 has benefited the betteroff people only. Moreover, land prices have increased as a result of this improved

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The role of the Government is mainly to create business and building opportunities, and to stimulate community participation to enable the people to build their dwellings themselves. Programmes have been initiated to enhance the professionalism of housing agencies through education and training. Perum-Perumnas was established to pioneer large-scale housing development in the urban areas. Housing-finance agencies have also been formed. To improve the shelter conditions of the poor, the Government created the "very simple house". This type of dwelling is cheaper than the previously designed "simple house". It has sufficient infrastructure and is built with low-quality materials and is expected to be finished gradually by the beneficiaries. In Repelita-V the Government minimized the subsidy to credit schemes by limiting it to the neediest people only.

Housing policies in NIGERIA, AFRICA

In Nigeria, the provision of housing has generally been seen by policy-makers as something to be tolerated rather than desired. Housing was thus given low priority in development planning. Specific output targets have for instance always been set for agriculture, manufacturing, roads etc., but housing has been treated as a "social overhead" (Achunine, 1993). A review of the past housing policies and programmes of both the public and private sectors reveals that effective solutions to the shelter problems are yet to be found. It has been assumed in Nigeria that general economic growth would eventually solve these problems. The public sector has provided only about 10 per cent of the housing stock in the country. A new National Housing Policy was launched in 1991. The ideas included in this policy imply a redirection of past practices. Shelter was for instance transferred from the consumer to the regional development sector. The ultimate goal of Nigeria's New National Housing Policy is to ensure that all Nigerians own or have access to decent housing, at affordable cost, by the year 2000. To achieve

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Comparison of Housing Policies and Programmes of Developed and Developing Countries

activity. A new policy of rental accommodation is included in Repelita-V to benefit the poor. A total of 20,000 units of rental housing are planned. Yet, this is a rather small number, relative to the need. The Government's policy is to leave the responsibility of shelter provision to the people.

this laudable goal, the Government has decided to pursue the following policy objectives:
Comparison of Housing Policies and Programmes of Developed and Developing Countries

Encourage and promote active participation in housing delivery by all tiers of government; Strengthen institutions within the system to render their operations more responsive to demand; Emphasize housing investments which satisfy basic needs; Encourage greater participation by the private sector in housing delivery.

The above objectives, among others, constitute the cardinal points for the implementation of the housing policy. To accomplish these objectives, the following strategies have been adopted: Establishment of an appropriate institutional framework to facilitate effective planning in housing supply; Restructuring all existing public institutions involved in housing delivery at the federal and state government levels with a view to making them more effective and responsive to the needs of citizens of the country; Revive existing laws and regulations such as the Land Use Decree, planning laws etc., to facilitate housing provision; Improve the finances and strengthen the executive capacity of local government to enable it to contribute more effectively in housing delivery; Mobilize private-sector participation in the provision of housing; Upgrade and rehabilitate low- quality or sub-standard houses in urban areas as a step towards improving the quality of the environment; Restructure the Federal Mortgage Bank of Nigeria to serve as an apex housingfinance institution; Mobilize savings through the establishment of a National Housing Fund; Ensure continuous flow of adequate funds from various sources into the apex institution for on-lending to other mortgage institutions; Encourage research into and promote the use of locally produced building materials as a means of reducing housing costs; Adoption of functional design standards to reduce costs and enhance sociocultural acceptability, safety and security and privacy; Increase the number and improve the quality of the workforce and personnel needed in the housing sector; Utilize the location of housing estates and other residential neighbourhoods as an instrument for balanced population distribution in order to minimize associated problems of transport and services.

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The Federal Government will initiate, define and coordinate the policy options and instruments for achieving the objectives in the housing sector, while the actual implementation will be undertaken by appropriate agencies at federal, state and local

government levels. The Federal Government will formulate policy, coordinate, construct and monitor housing programmes and projects.
Comparison of Housing Policies and Programmes of Developed and Developing Countries

Recommendations and Summary

Experiences during the 1970s and 1980s have convinced international donors and other development agencies that direct action by governments to provide shelter is not the answer to the enormous shelter need. In many countries governments have built houses for the poor for decades, constantly experimenting with building materials, types and technologies to reduce costs. Although the effort made has been considerable in many countries, the total outcome is very limited in view of the increasing urban population with inadequate shelter. In the 1980s, it became abundantly evident that the houses built by the public sector were unaffordable to the poor. Furthermore, the housing shortage resulted in political favouritism in allocation and inefficiency in reaching target groups.

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The "provider-based" solutions of the past were overtaken by events, such as rapid urban growth, rising real building costs, fiscal austerity leading to reductions in subsidies and declining real wages.
Comparison of Housing Policies and Programmes of Developed and Developing Countries

It is now widely recognized that shelter provision to the poor is beyond the capacity of local and national authorities. At the same time, evidence accumulated on the ability of poor people to shape their own environment, achieve ownership at low prices and build shelter for themselves. "Aided self-help" then became more widely accepted. This includes an important, although reduced, role for governments in shelter provision for the poor. Critics of "aided self-help" maintain that this is only promoted to relieve governments and the rich of their responsibilities to provide a better life to the poor (Burgess, 1985). Aided self-help projects were small, their replicability was low and cost recovery was difficult. A reappraisal led to the notion of enabling strategies which sought to cover a much larger proportion of the poor (eventually all), to integrate shelter strategies in macro-economic planning, to abolish laws and regulations hindering self-help and community shelter construction and to involve the private business sector in shelter provision for the poorest groups. The enabling strategy, as a "support-based" strategy, seeks to improve the functioning of markets in land, capital, building materials, skills and labour inside an appropriate regulatory framework. Governments must, in this perspective, take coherent action ensuring that land, financial and housing markets do not fail to respond to the needs and demands of the poor. In countries where the urban majority has inadequate accommodation and public funds are scarce, resources have to be distributed broadly, and people must largely be relied upon to house themselves. An appropriate national shelter strategy must take account of differences in the balance of government and private participation, the strength and characteristics of the informal sector and the operation of input markets, to ensure that innovations are not incongruent with the local context and existing conditions. Despite variations, there are principles, approaches and new perspectives which the GSS regards as applicable to most countries. Local authorities are increasingly seen as an obstacle by people who, through the informal sector, have put up illegal structures in and at the fringes of the large cities in the developing world. It is now widely realized that the main task of governments and local authorities is to enable the poor to construct their own homes themselves, in a more efficient manner.

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This is a major change from the public shelter-providing role, but it does not imply less responsibility and care on the part of governments. It is not a recipe for laissez-faire. Strong and cohesive government action is required to ensure responsive supply markets.
Comparison of Housing Policies and Programmes of Developed and Developing Countries

Moreover, legal and regulatory reform of shelter construction and housing finance is essential. In the three countries reviewed in this report the housing policies adopted by the Government during the last five years are all in line with the GSS. The most important change in policy has been a departure from the view of public provision of housing through direct construction of dwellings and site-and-service projects to private business and household involvement in a deregulated shelter sector. The new emphasis is on upgrading of existing slums if possible, popular participation through CBOs and targeted subsidies to the poorest only. The role of government authorities at various levels should be to facilitate and enable individual households and local communities to improve their shelter and settlements by their own efforts, based on local tradition and available resources. Technical assistance, training and financial inputs from the public sector and from NGOs are regarded as necessary external support. This reorientation in Mexico, Indonesia and India is partly a result of the work of UNCHS (Habitat), and partly of a realization of the inability of the public sector to meet the enormous and increasing demand for decent shelter in urban areas. Instead of people participating in governments' projects, governments need to participate in people's projects (Slingsby, 1989). A distinction should be made between self-help as an instrument of government policy to reduce costs, and genuine community involvement for the needs of the poor themselves. "In most Third World countries even the political and economic arguments for low-cost housing investment cut little ice with urban managers until the advent of aided self-help schemes which appealed because of their low cost, low commitment to social reform and high aid content." (Drakakis-Smith, 1987). Evidence from the three countries shows the merit of the new housing policy. There are government programmes and involvements of slum communities that have succeeded in improving the living conditions of poor groups. The magnitude of these positive experiences relative to the need is, however, still limited in all three countries. All aspects of the GSS have yet to be fully implemented in practice. Moreover, the complexities involved in shelter provision for the poor are so severe that a solution is a very long-term hope only. ________________________________________________________________________

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References
1. Ramakrishna Nallathiga-Housing Policy in India: Challenges and Reform i. Rakeshmohan P. 1996b. India Infrastructure Report: Policy Imperatives
Comparison of Housing Policies and Programmes of Developed and Developing Countries

ii. iii.

for Growth and Welfare, Report of Expert Group on Commercialisation of Infrastructure, Thomson Press, Delhi. Ramanathan, R 2006. A credible low-income housing policy, India Together, July 18, 2006(http://www.indiatogether.org/2005/feb/opihousepol.htm accessed on July 19, 2006) Basin SA 2006.. Draft National Housing and Habitat Policy 2006, A Proposal to the Government of India, Basin South Asia Regional Knowledge Platform, PACS, DfID.

2. National Experiences with Shelter Delivery for the Poorest Groups 3. National Urban Housing and Habitat Policy 2007

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