International workshop Venice - March 11-12 1999 Concepts and Paradigms of Urban Management in the Context of Developing Countries
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Carole Rakodi (Department of City and Regional Planning, Cardiff University)

"Key elements of a European urban management approach for the developing countries: priority to the poor"

The lessons of experience in implementing projects designed to improve the living conditions of the poor and recent research on the characteristics of urban poverty and deprivation suggest a number of principles on which urban poverty projects should be based, a range of possible components, and possible approaches to project design and implementation. However, these raise a number of issues or dilemmas for potential funders, which may require changes in practice by the latter.

Although I would argue that a specific project focus on poor people is appropriate in many cases, this is never sufficient and may, in certain circumstances, be less effective than city-wide (sectoral?) approaches which fully take into account the needs of the poor. Finally, the nature, extent and dynamics of urban poverty are the outcomes of both the patterns and levels of economic and social development and different levels of policy: macro, meso and local/city level. Urban programmes can only tackle local and some meso-level policy issues, so they will not be more than ameliorative if the causes of poverty are left intact, redistributive issues are not tackled, and/or the impacts of macro-economic and national level meso-policies outweigh the impacts of urban programmes.

1. Improving the wellbeing of the poor

a) Principles of project/programme design

Experience of past projects and programmes aimed at improving the living conditions of the poor, including the sites and services and upgrading projects supported by the World Bank and UNICEF in the 1970s and 1980s, and support programmes to informal sector economic activities tells us that project design processes which do not involve those who will be responsible for implementation, do not allow for intended beneficiaries to play a role in identifying needs and appropriate solutions, and are undertaken by central ministries or consultants (or worse still, foreign consultants) produce inappropriate decisions. In addition, projects which involve the setting up of new organisations, include capital costs but pay little or no attention to operation and maintenance, and are based on unrealistically high unit costs do not deliver sustainable and replicable improvements (see, for example, Rakodi, 1991). Finally, external evaluations of projects may not identify impacts as perceived as critical by the poor, may generate resentment and may fail to maximise learning from experience.

Much research in the past has been based on the definition of a Poverty Line, and this is still the basis for poverty monitoring using large scale sample surveys. Expenditure-based PL monitoring does capture some important aspects of deprivation and provides a useful, if costly, monitoring tool. However, even with methodological refinements, sole reliance on PL measurements causes a number of problems (see, for example, Rakodi, 1995; Hanmer et al, 1997; Booth et al, 1998), especially

• it is defined by outsiders and neglects people's own definitions of poverty, which incorporates lack of access to assets and services, ill health and insecurity, and recognises different degrees of vulnerability relating, for example, to household composition and its implications for the availability of labour
• it does not provide a sufficient basis for understanding the causes of impoverishment (or improved wellbeing) for individuals, households and communities; the causes of persistent poverty and deprivation (and its reduction or deepening); the intergenerational transmission of poverty; or the immediate triggers of impoverishment
• it implies that the poor are passively waiting to become beneficiaries of external interventions, when they in practice adopt positive strategies for coping with impoverishment and securing improved wellbeing (Rakodi, 1995; Moser, 1998). Policy should be informed by an understanding of the ways in which households cope, adapt and manage in deteriorating economic situations, in circumstances of personal adversity and in response to opportunities for increasing their wellbeing, so that it supports rather than damages the efforts of the poor themselves (Amis and Rakodi, eds, 1995; Satterthwaite, 1997).

This experience and increasing understanding suggests a number of principles on which the design of interventions, including those supported by external agencies, should be based:

1. Both primary stakeholders (poor people and households and their organisations) and local secondary stakeholders (local authorities, NGOs, private sector organisations) should be involved in project/programme planning, not merely as consultees but with an active role in decision making.
2. Projects need to be based on an adequate understanding of the situation and priorities of the poor, recognising that these may vary between groups and communities over time.
3. Local ownership of the proposals is vital to sustainability and replication, implying the prioritisation of negotiation and compromise over technical superiority.
4. As important to sustainability and replication is institutionalisation, implying a preference for working with existing and ongoing rather than project-specific organisations and matching activities to their capacities rather than to an ideal of maximising effectiveness.
5. Success should be assessed primarily in terms of local stakeholders' perceptions of the extent to which interventions have improved wellbeing and not merely in terms of externally defined criteria, implying participatory design and implementation of outcome and impact evaluation.

b) Potential components

Poverty is rooted in the labour market position of members of urban households - it is associated with their exclusion from better paid, better quality urban jobs or from lucrative opportunities for economic enterprise (Figueirendo et al, 1995). Selection of appropriate components for projects or programmes which aim to increase the wellbeing of the poor can only be made at the city or local level but, on the basis of existing knowledge (which is weak in terms of assessing the relative cost effectiveness of alternative interventions in addressing the multi-dimensional characteristics of deprivation), it is possible to suggest a menu of potential components (see also Vanderschueren et al, 1996).

1. promoting the growth of good quality urban employment (ILO, 1995), linked to the implementation of a local economic development strategy (see below). However, the scope for municipal action is often limited to provision of land and infrastructure, which may be of little use if political instability or macro-economic policies generate disincentives to investment in formal sector economic enterprise and/or policies of public sector retrenchment are being pursued.
2. enabling people to take advantage of opportunities in the formal wage sector, for example by equipping them with education and skills. However, it is rarely the poor who get access to high quality jobs so, although this may be appropriate, it does not necessarily form part of a direct poverty reduction strategy.
3. direct employment promotion, for example, labour based approaches to public works or community contracting for infrastructure and service provision and management (Barros and Camargo, 1995; Stewart, 1995). Although such employment may be temporary, it has potential multiplier effects within communities and is more realistic, equitable and beneficial than expecting extensive free contributions of community labour to infrastructure installation and service delivery.
4. creating an enabling environment for the informal sector (e.g. an appropriate regulatory regime, land, infrastructure) and enabling people to take advantage of the opportunities
   • general support e.g. savings and credit mechanisms, upgrading technology, business and skills training, child care
   • particular support to disadvantaged groups e.g. women, the disabled, young people/school leavers
5. creating opportunities for poor households to increase their physical assets, especially
   • land, for housing and possible cultivation
   • a house, for occupation, renting, home based enterprise and security
   • equipment for small and microenterprise
6. provision of basic utilities and services, including water and sanitation, solid waste management, access, energy, education and health (Amis, 1995), designed to improve access by the poor by, for example,
   • appropriate pricing policies (see, for example, Gertler and Rahman, 1994)
   • attention to complementarity e.g. between improvements to water and sanitation and community based health care; school feeding programmes are potentially cost effective, easy to target and increase the effectiveness of investment in primary education (Stewart, 1995)
7. support to community self-organisation: relying on the self organisation of the poorest can simply perpetuate their deprivation, if not accompanied by redistribution of resources. It can also reinforce patron-client relations in the political system and increase inequalities between communities with different capacities for organisation, but also has potential for strengthening the ability of poor residents to (Mitlin and Thompson, 1995; Anzorena et al, 1998):
   • articulate their needs
   • make demands on the public sector/re-negotiate their relationship with local government
   • manage their own affairs and solve those problems which may be amenable to solution at community level with limited resources
8. provision of access to legal entitlements and safeguards
   • arguments are advanced by some analysts for improved employment protection and the institution or reinstatement of minimum wages (e.g. Guhan, 1994; ILO, 1995; Shaheed, 1995), flying in the face of the current conventional wisdom of structural adjustment policies
   • formulation and implementation of controls and incentives to improve the safety of workplaces and living environments
   • property rights, including regularisation of tenure (Durand-Lasserve and Clerc, 1996) and reducing discrimination against women, although care needs to be taken with regularisation, which may have adverse effects on poor house owners and particularly on tenants
   • protection against violence and insecurity at household and city levels (Wratten, 1995; Moser, 1996; Vanderschueren, 1996)
   • rights to legal representation and access to justice, for example by supporting legal aid services accessible to the poor
   • political/democratic rights and responsibilities via appropriate arrangements for elections and accountability, in both city-wide and neighbourhood systems of political representation, for example by promoting awareness of rights and responsibilities amongst elected representatives and the population at large.
9. establishment and maintenance of safety nets accessible to the most vulnerable and the poor in times of stress or crisis, for example
   • growth monitoring and feeding programmes, linked to promotive and preventive health services
   • direct employment promotion (see above)
   • crisis credit, as an aspect of general improvements in the financial services available to the poor
   • basic pensions and income subsidies for the most vulnerable groups are advocated by, for example, Guhan, 1994, and Schubert, 1995.
   • community-based care for vulnerable groups e.g. the elderly without family support, the chronically sick and disabled, children not attending school, backed up by external support mechanisms
   • compensatory and preventive approaches to street children (Blanc et al, 1994).

c) possible approaches to programme/project design and implementation

Local government generally lacks policy formulation, administrative and financial capacity. In addition, some of the above potential policy and programme components fall outside its traditional reponsibilities and areas of competence. To an increasing extent, NGOs, CBOs and the private sector have been trying to meet previously unmet needs and to compensate for public sector deficiencies. They cannot ensure systematic coverage, redistribute resources or enforce regulations. However, for some tasks, such as financial services and other support to micro-enterprise, the supply of large quantities of low cost housing, area-based improvements in informal settlements, the operation of public transport and solid waste collection, one or other of these generally demonstrate greater capacity than government.

The evidence does not support a doctrinaire approach to privatisation (e.g. Nickson, 1996), abandonment of public sector agencies in favour of NGOs, or reliance on CBOs and it is easy to romanticise ideas of 'partnership'. Nevertheless it is essential to involve a range of local actors in collaborative approaches to project design and implementation, redefining roles and responsibilities to make the most of their relative strengths, developing new working relationships between them and further developing the capacity of each to perform suitable tasks (see also Finsterbuch and Van Wicklin, 1989; Abbott, 1996; Healey, 1997, Reilly (ed), 1995)a. Hadenius and Uggla (1996) argue that external agencies should focus on reducing the transactions costs of cooperative organisation i.e. their infrastructural and administrative costs.

Although collaborative approaches to policy making and project design may be initiated by public sector agencies, new mechanisms to involve other stakeholders in decision making and implementation on a less unequal basis than in the past are likely to be needed. Experience with such approaches is growing (e.g. DFID's attempts to design an urban poverty programme in Kenya, the Urban Management Programme's city-based poverty programmes) but independent documentation and evaluation of such processes is needed.

Application of the principles set out above implies that interventions should be demand driven i.e. firstly, that control over decision making should be exercised by a local mechanism representing relevant stakeholders (such as the Nairobi Informal Settlements Coordinating Committee), which takes responsibility for seeking external support and negotiating with potential donors; secondly, that participatory approaches should be adopted to meeting the needs of the poor (by means of participatory urban appraisal and community action planning); and thirdly, that projects should be able to respond flexibly to the differing priorities of groups in space and over time. There is a potential intermediary role for NGOs in facilitating the process, especially if local government is associated with unsuccessful past interventions, has to undergo a learning process in appropriate methods, or if political control at the city level is not pro-poor.

Negotiated decision making, coordination of implementation, and design and use of monitoring and evaluation are likely to be carried out by mechanisms established by local stakeholders rather than costly and unsustainable project-specific implementation units established for donor convenience. Given the lack of experience of such approaches, the coordinating mechanisms and the planning and implementation process is likely to need support, perhaps including both technical expertise and neutral outsiders to assist and mediate as new 'partnership' relationships between public sector organisation, NGOs and CBOs are developed.

At settlement or group level, it is unrealistic to expect poor residents to come up with fully formed community action plans before funding approval or at the beginning of an implementation process. Poverty reduction projects and community action plans are not blueprint plans and so a project design is needed which can respond flexibly as community priorities, appropriate solutions and suitable funding arrangements are agreed, although there may be scope for designing some components for which universal demand is clear, sectoral provision is effective and city-wide support systems are needed at the outset for community-level improvements. Mechanisms will also be needed to identify and address the needs of poor residents who live in mixed income areas and those who are not geographically concentrated. The required flexibility has implications for planning and implementation processes and for funding mechanisms. Funding arrangements are needed which can be accessed as planning and implementation by CBOs, NGOs or individual public sector agencies progress, in relatively small amounts (as loans or grants as appropriate), and for which decision making on allocation and accountability are transparent and procedures unbureaucratic. One possible avenue for funding CBOs and local NGOs is a community development fund operating (probably) at city level (Anzorena et al, 1998).

d) Issues for external funders

There is a mismatch between a number of the characteristics of this approach to urban poverty reduction and traditional donor procedures for project design and implementation. Some of these are identified here. Addressing them in future support programmes will require changes in the ways in which external agencies operate, many of which are structurally embedded in operating directives and institutional cultures and therefore difficult to change. i.

i. support for bottom-up initiatives

It has been persuasively argued (Anzorena et al, 1998) that the most effective initiatives to reduce urban poverty will come from local level groups/CBOs, working with local NGOs, with some support from one or more external agencies. The role of the external agency should be

• to support such CBO/NGO initiatives in the early stages
• to provide a source of funds which local organisations can easily access, with simple and transparent procedures, available in small amounts, and as either loans or grants

• a critical element of such a bottom-up approach to poverty reduction is re-negotiation of the power relationships between CBOs and local government. The latter is the usual partner of donor agencies, which may be unwilling to challenge local political relationships.
• community development is an uneven, slow and messy process, rather than a discrete event
• the funding needed by communities is small scale, incremental and flexible
• a relatively large proportion of the funding needs to be spent on capacity building activities, particularly in the early stages, rather than delivery of practicable, measurable benefits to the poor. Such capacity building may be essential to sustainability but measurable benefits count for more in project appraisal.

These characteristics of bottom-up approaches cause difficulties for external agencies, who need to specify outputs, schedules and targets at project appraisal and to keep administrative costs below strict (and sometimes unrealistic) ceilings. The social development fund has recently become a popular mechanism to overcome similar problems at national level and may, as noted above, have potential at the urban level, but any attempt to replicate the model should take note of the findings of evaluation such as that by UNRISD (Vivian, 1995).

ii. funding participatory approaches to urban poverty reduction

If advocacy of participatory approaches to poverty reduction is not going to pay mere lip service to the principle, there is a need for participatory urban appraisal and perhaps community action planning to inform project design prior to approval of funding. In some circumstances this may occur through the political system and existing processes of consultation and planning (for example, in some Brazilian cities). However, in many places it is not institutionalised and so is a necessary part of project planning, although

• there is a potential problem of disappointed expectations if funding is not forthcoming, which may cause political difficulties for the elected local government
• it may be necessary to undertake capacity building activities before the secondary (and primary) stakeholders are equipped to undertake PUA and CAP

Thus a staged project design is needed, in which funds are committed for the whole package, initially for capacity building and project design, and then for implementation of interventions, the precise content of which is unknown at the outset. These may include sectoral (city-wide programmes and provisions to address the needs of poor communities/groups. At settlement level it is unrealistic to expect poor residents to come up with fully formed CAPs at the outset, given their likely disillusion with the ability of government to keep its promises, transient populations and high proportions of tenants, especially where community organisation is weak and fragmented. Precise detail on project components is, therefore, unlikely to be available at the time of approval, and external agencies need procedures which are sufficiently flexible to deal with evolving rather than blueprint project designs.

iii. the need for multisectoral interventions

Residents see poverty, deprivation and wellbeing in multi-dimensional terms. Whereas a supply driven project typically includes one or a few interventions determined by the remit of an outside agency or NGO, a demand-driven approach requires a flexible response in terms of both project components and which agencies will respond, as the needs of households and communities will vary between areas and over time. If a project is only able to offer solutions to one or two problems following a needs assessment, residents will become frustrated. Yet not only local authority departments and NGOs tend to operate within their own sectors, but so also do external agencies, where sectoral organisational structures deter a multi-sectoral response.

iv. support for a special project unit vs ongoing administration

Special project units are often adopted for implementation because of the lack of capacity in ongoing administrative departments, difficulties of coordination and the accounting requirements of the funder. However, implementation by ongoing administrative departments, agencies and NGOs is preferable if developing institutional capacity and relication without further large injections of external resources are considered important. New mechanisms are, however, likely to be needed at city and neighbourhood level, as a basis of developing new working relationships between stakeholders, for coordination, and to increase transparency, especially if local government is distrusted. If these have to be established from scratch, the process is likely to be slow, and progress incremental rather than dramatic. These characteristics may not match donor preferences for short disbursement periods, rapid progress and clear achievements. While it may be possible to use established reporting and financial arrangements (e.g. local authorities and their treasuries), this may be inappropriate if other stakeholders are suspicious of the local authority. However, alternatives pose difficulties for the accounting rules of external agencies.

v. constraints on urban poverty reduction project approaches

Constraints on the effectiveness of project-based approaches to improving the wellbeing of the poor are signficant. These may include the capacity of the agencies involved in such projects (especially local government), the undeveloped nature and/or patchy coverage of NGOs, the legal and financial framework for urban administration, and national macro- and meso-policies. On the one hand, policies and practices which increase poverty or hinder the implementation of interventions designed to enhance wellbeing may outweigh the effects of project-based measures. On the other, improvements at the city-wide level which are designed to take into account the needs of the poor and to improve the operation of city-wide administrative systems may be more effective ways of reducing poverty than projects focussed solely on poor areas or people. Thus poverty reduction projects or programmes should not be considered in isolation, but backed up by strengthened urban management and appropriate national policies.

2. Strengthening urban management

The critical task is to define appropriate allocation of responsibilities for urban management tasks at city level, between the public sector, NGOs, CBOs and large and small scale private sector organisations, followed by support to strengthen the capacity of these actors to fulfil their roles. There is scope for supporting individual actors, but advantages in working with more than one together, as a basis for developing new working relationships. It is clear that a change in emphasis from the traditional controlling/direct provider roles of government to enabling/indirect provider roles implies a continued need for strong public sector agencies, especially urban local government, and that such roles are equally demanding in terms of public sector capacity. Support is needed to local authorities to make informed rather than ideological choices about the allocation of responsibilities for service delivery and then to develop their capacity to perform the relevant tasks.

Principles of sustainability and replication may imply support to capacity building agencies instead of/as well as to individual local authorities, including continuing professional development of staff, dissemination of research findings and the lessons of experience, and support to take advantage of recent developments in ITb. The adaptability and capacity of public sector training agencies has, however, proved in many cases to be limited and they may exclude NGOs and CBOs from training opportunities. While reform may be desirable and possible, the development of alternatives may be more productive. The role of local government associations in capacity building appears to be growing and independent evaluation of their comparative advantage and effectiveness is needed.

Priority sectors for support include

• land administration and management, which is linked to
• finance: revenue generation, planning and budgeting, and administration
• development of strategic planning and policy making capacity, probably attached to the office of the chief executive or mayor
• local economic development: the labour market position of poor people and the resources available to local government both depend on the health of the urban economy. Local authorities traditionally saw their roles in terms of regulation, provision of land and infrastructure, and extraction of revenue. However, regulatory regimes often hinder development of both the large and small scale private sector, and promotional measures are not based on adequate understanding of a city's economic potential, labour market trends, or the constraint on economic enterprise. Evaluations of attempts to develop city economies are available but limited (e.g. Edralin, 1997) and little guidance is available on how to increase understanding of urban economies, or select and implement appropriate policies to encourage economic growth and restructuring, including policies which will increase access by the poor to economic opportunities.
• infrastructure and service provision: while it is often possible to achieve improvements to water supply, sanitation, drainage, solid waste management and aspects of health and education services at community level, all these need to be backed by city-wide supply, operation and maintenance systems and it may make more sense to improve provision at city level, allowing for cross subsidies etc. Research is starting to demonstrate not only that 'privatisation' may take a variety of forms and have a variety of outcomes, not always resulting in cheaper or more effective provision, but also that consumer resistance to privatisation (especially for services to the poor) is considerable, despite the current poor performance of public sector providers (e.g. Silva et al, 1997; Rakodi, 1998). Support to service delivery needs to be based on thorough review of experiecne, not standard prescriptions based on over-simplified theoretical assumptions.

3. Support to national governments

There is an important role for policy dialogue (both with the governments of recipient countries and within donor agencies) in

1. the design of macro-economic policies to take account of their impact on the demand for urban labour and real incomes, reducing the speed of a) liberalisation, to allow manufacturing and other sectors to adjust (Goetz and O'Brien, 1995; Hoeven, 1995), and b) the reduction of fiscal imbalances, to avoid harmful cuts in 'soft' sectors such as social services or maintenance, and promoting expansionary policies and redistribution (Stewart, 1995).
2. the design (and support for the implementation) of meso-policies (fiscal and public expenditure policies) to compensate for any poverty-increasing effects of macro-policies. Specific attention should be paid to their impact on the urban poor, through their impact on disposable incomes, and the prices of goods and services (especially those which constitute a relatively large proportion of the expenditure of poor households, whether provided by the private or public sector e.g. food, health, education and water).
3. the establishment of legal, policy and financial frameworks for autonomous local government for urban areas. The ministries responsible need to back up such frameworks with provision of policy guidance, technical support, and an appropriate level of financial resources to local authorities, as well as appropriate checks and balances on the exercise of their powers and responsbilities by local authorities. There may be a role for external agencies in assisting central government evaluate alternatives, learn from international experience, design policies and programmes, and develop appropriate procedures, although such activity by central ministries is often constrained by political and institutional resistance to decentralisation.

Notes a. A comparative research programme funded by the British Dept for International Development (1998-2000) is examining relationships between these actors and their relationship in turn to decision making and policy implementation with respect to poverty reduction, initially in nine cities in Asia, Africa and Latin America. A consortium comprising the School of Public Policy, University of Birmingham, Dept of City and Regional Planning, Cardiff University, Dept of Social Policy, LSE and International Institute for Environment and Development is working with colleagues in each city. b. The Dept of City and Regional Planning, Cardiff University, in partnership with the Urban Management Centre, AIT, is developing a pilot interactive internet-based teaching and learning module for use in urban management capacity building.

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