REACHING FURTHER TOWARD SUSTAINABLE DEVELOPMENT

PRESENTATION TO DBSA SPATIAL PLANNING CONFERENCE 2010

CATHERINE CROSS, EPD, HSRC 20 OCTOBER 2010

A NEW DISPENSATION FOR SETTLEMENTS

To overcome exclusionary apartheid spatial planning, the Freedom Charter provided that:
Slums shall be demolished and new suburbs built where all shall have transport

Drawing on the Charter principles, South Africas Presidency has placed housing with a new Ministry of Human Settlements
Housing is not just about building housing. It is also about building
communities with closer access to work

The Presidents statement connects housing with transport to integrate delivery around livelihoods and work access This new and wider vision of delivery points to transport, migration and housing as key factors in sustainable human settlements

Spatial planning of service delivery with housing delivery will be critical to humane sustainability

WHAT DO SUSTAINABLE SETTLEMENTS LOOK LIKE?

Government is now driving its new 12 Outcomes metricated planning policy toward sustainable human settlements
Under Cabinets 12 Outcomes metric planning approach, new emphasis is coming onto economic and human infrastructure Services goals are woven throughout the Outcomes specifications

Better spatial planning will be key

Its not clear what sustainable settlements would look like the emerging list includes: Decent housing, without crowding, tailored to the needs of the specific population being housed Good location, with decent access to jobs and economic opportunities Adequate access to infrastructure & human services especially transport More potential for asset accumulation as a ladder out of poverty

PRESENTATION
1. Defining the problem: poverty and planning strategies 2. Breaking down migration 3. The functionality of urban shacks? 4. Spatial planning for upgrading? 5. Infrastructure and the transport factor 6. Toward sustainable human futures Looking at three things Settlement constituencies and settlement needs Delivering housing + jobs for poverty population Role of infrastructure in sustainability

FINANCIAL CONSTRAINTS?
Coming out of a world recession, South Africas national budget spending risks stagnation or decline Prospects for a new budget expansion are uncertain
Spending by government per person has risen from R 6 800 in 1995 to R 10 560 in 2007 The social grant system now benefits a quarter of the population, over 14 million people The economy is struggling to expand & spending has to be more effective

Housing and transport budgets have so far continued to rise Hirschs work indicated that social spending had already become unsustainable as of 2005 To reach sustainable human settlements able to lift the poor out of poverty means more bang for less bucks Closely targeted spending on infrastructure and housing will be needed This may mean an accommodation with shack areas & informal shelter as the poor migrate around the space economy

DEFINING THE PROBLEM

What makes settlements sustainable for SAs poor and vulnerable?
Governments asset accumulation strategy has underpinned the sustainable human settlements undertaking Government provides poor families with free subsidized housing as a platform for self-investment and savings

The national route out of poverty is the housing asset Families save up further assets to protect against shocks
Sustainable settlements therefore require the right kind of housing asset along with the right kinds of services Spatial planning factors land, location, and access to employment Suitable, properly targeted housing asset thats secure, will support accumulation, can be traded on a liquid market at need Adequate physical infrastructure, and specifically affordable transport giving access to jobs And priority attention to supporting job search

PROBLEMATIZING SPATIAL PLANNING

Housing delivery is the first modality of government antipoverty delivery Service delivery ultimately depends on housing delivery The persistence of shack settlements stands out as the key problem facing spatial planning of delivery Outcome 8 will deliver 400 000 new units to try to absorb this demand Why is it proving so difficult to replace shack settlements with formal subsidy housing? Issues needing to be unpacked include location factors, delivery speed and cost, and access to transport And under these, the reasons why poor people choose different kinds of housing and location to move into

THE TRANSPORT FACTOR

Access to the economy goes through transport for the poor population in cities
Transport is how people move between where they can settle and where they can capture livelihoods Jobs are the most important single element of urban access And the cities are an exclusionary environment for the poor who migrate in seeking jobs Migration, human settlements and transport need to be spatially planned together so as to deliver access to the metro economy

Transport is one way to square the circle: location / jobs access / area functionality
And transport service infrastructure draws settlement

To achieve greater control over where shack settlements develop, transport and transport subsidies offer the best planning lever

OUTCOME 8 SUCCESS
Outcome 8 will put 400 000 formal units on well located urban land with transport and services The right commitment, but who is going to be in these units? If the planning not very sensitive to delivery implications, it likely wont be the unemployed poor Instead, will be working poor + urban elites If so, the poverty problem will not be addressed Overcoming poverty means helping the unemployed especially rural migrants Using housing vs poverty may need to go further into perceiving what kinds of housing are out there now How many types of settlement? And what do the differences mean?

URBAN VS RURAL?
Demographic hot flows are into metro peri-urban zones, + secondary cities settlements on the city fringes
The central cities resist taking large inflows

Expect to see programmes to make urban land available to the in-migrating poor, using state land as close in as possible
But rural migration crowding into small towns with no employment base will remain a problem

With heavy investment, South Africa may be able to slow rural out-migration somewhat Families losing their foothold in the farming sector will continue to move to the nearest small town Others will drift deeper into the urban zone and end up in shack settlements

LOOKING CLOSER: IPDM

HSRCs Integrated Planning, Development & Modelling project research with CSIR is sponsored by DST Results at local level show widespread changes in rural settlement and population distribution
The project is working toward a new planning aid for IDPs Based on survey data, using demographics to link migration to community profiles

Giving a new demographic typology of settlement down to micro-local level Allowing planners to read off community needs at community level With South Africa perhaps on the edge of a new migration, what settlement-related demographic trends are we seeing now in the rural source areas?

BREAKING DOWN MIGRATION

Where people live now affects the chances that they will migrate
For migration, SAs poor can be separated into several key settlement categories: Traditional rural settlement areas:
12% but traditional settlement appears to be disappearing fast families are turning to brick housing

The old townships:

27%, the largest single settlement type

Rural villages with non-traditional housing :

21% now village families are very poor but 70%+ now have decent-quality self-built dwellings

Slum areas of shack-type housing:

21% only not a large share compared to most other developing countries

Self-development areas of owner-built decent-quality housing

8 % mostly RDP standard or better, growing fast in rural

CAPITAL FORMATION ON THE INFORMAL MARKET

IPDM survey results underline the value of capital formation in informal housing assets:
Estimated total housing value for a single rural community reaches R 10-25 million on the informal market and liquid Crude preliminary estimates for the Gauteng/Sekhukhune/Northern Mpumalanga study area come back at R 12 billion in the poor communities

By complementing subsidy housing, this new government-initiated housing trend introduces a new delivery mode
Combining subsidy housing + informal self-build housing + site and service + rentals can help complete governments task of housing the poor faster

Spatial planning for land release, building subsidies, services & transport delivery can help to build on this trend But are the shacks ready? Shack housing is extra-cheap for good reasons

MIGRATION BY FUNCTIONALITY
Migration and settlement are what the poor use for antipoverty striving how the excluded overcome exclusion Different types of settlement make up a broad grid of settlement opportunities across the urban and rural sectors People migrate across this grid searching for accommodation that will locate them where they want to be
Migrating households choose the best combination of access, affordability, earning and social environment they can locate But not all households have the same needs or want the same destinations

Knowing why households have migrated tells what poor people are trying to do there
This is settlement functionality

SHACKS FUNCTIONALITY IN THE CITIES?

Spatial planning identifies the key to housing process as location All settlements have specific functionality where they are For successful delivery, spatial planning needs to match functionality to constituency
The metro informal areas split their function by where they are located

The closer in to the CBD, the more shack areas function for job search almost exclusively
Central zone shacks: Young male work-seeking constituency Living on temporary basis in harsh conditions Periphery shacks: Older on average, more stable, more women More residential constituency in slightly better conditions

FUNCTIONALITY: MOVED FOR ACCESS TO

Settlement type Informal Central Informal Periphery Jobs 56% 26% Housing 12% 51%
Schools Clinic/ health services Water or electric

15% 9%

2% 7%

11% 6%

Informal Rural Rural selfdevelopment Urbn formal rentals

27%
15%

28%
45%

23%
27%

11%
5%

7%
4%

31%

30%

29%

SPATIAL PLANNING IN THE CITIES?

The inner shack areas of the central city zone are there for job search they serve the unemployed But housings implicit bargain with the metro cities has been: Help the poor while neatening central city for investors The thinking has been that shack areas are permanent slums, poverty traps This planning approach specifies upgrading all shacks With priority to the central city zone And moves these residents out to the periphery With criticism: Do not exclude upgrade in place On the other hand Even in situ upgrading can exclude the unemployed Better-off people crowd in to replace the very poor

SHACKS FUNCTIONALITY FOR JOB SEARCH

Core zone shacks functionality is not standard residential
Central informal settlements provide temporary not permanent housing much cheaper These areas serve the in-migrant rural poor looking for jobs
Most residents are not trapped

They expect to move up to better housing once they capture a reliable income stream
Therefore: The poor in shacks can be excluded from the economy by removal/ displacement Or by upgrading before theyre ready that is, before these households can sustain formal housing If that happens, people may have to go start again in a new shack area

May need to re-sequence upgrading initiatives ?

SHACK COMMUNITY COSTS?

Swedenville is a new unserviced shack area bordering an established Gauteng township About 20 km from nearest metro CBD
Young population mean age of household head = 33 Average wage income = R 2100/ m Average education of head = Grade 11 Cost of stand to build house = R 300-600 from committee Mean replacement cost of house = R 2600 Cost of rent = 0, all housing is owned Cost of service charges = 0, area is unserviced Conditions are tough but not squalid

Possible to move in for less than R 1000, stay free of charge and catch bus or train to work: I can budget now. I am relying on my own income to make ends meet, I manage to send money to my two children. We don't intend to move, because Swedenville is a good place for people with low-income jobs.

SHACKS AS ESCALATOR AREAS?

Because the central shacks are not permanent housing: Bad conditions are tolerated by young work-seekers to save money These settlements are not the same as a lifelong sentence to poverty Most people find jobs, or return home
Using Robson et al (2008) neighbourhood functionality categories

The central shacks are escalator areas, areas occupants use to move upward out of poverty Unless the city removes them
Formal housing may not be the solution for opening up the city job market to the unemployed

Substituting formal permanent housing for quick cheap informal accommodation in the central cities can risk vital functionality?

THE MARKET VS THE UNEMPLOYED?

The unemployed need instant dirt cheap access at point of need And then medium-term housing in reach of work
No formal delivery can match access speed & cheap costs of informal systems And well located areas try to upgrade automatically into higher-priced housing The market allocates valuable properties to those who can pay
Upgrading does replace the inner shacks with decent housing and services Then these areas become unaffordable or unfunctional for job-seeking rural migrants

And the cities working poor move in, excluding both the unemployed and the insecurely employed

SEQUENCING UPGRADING?
For upgrading success, critical to identify the right point for permanent housing delivery
Many shack areas can upgrade now, but not all are suitable
The question is, which ones are ready to address first?

This means identifying the constituency of the unemployed and the insecurely/temp employed
Separate from the constituency of the working poor

At the moment, there is no neat solution for the cities conflicting upgrading priorities
The inner shacks the cities want to remove and replace are those most needed for economic access These areas offer the jobs for poor in-migrants

TRANSPORT FOR THE SHACKS

Transforming the shack areas into sustainable human settlements is a national planning priority
Most rural-to-urban migrants struggle not to wind up in transportexcluded areas With limited available transport and unaffordable costs

Right now the most popular areas for good-quality self-build housing is at the urban peripheries these are the informal suburbs Access to the citys economic core zone is a crippling cost A new transport dispensation for these peripheral settlements is critical To achieve a sustainable result against poverty in the shacks, reviewing transport delivery and transport subsidy spending will be vital

TRADEOFFS AROUND SHACKS ACCOMMODATION?

What tradeoffs would sustainable human settlements need to support jobs access?
Alongside reviewing budget spending and boosting delivery capacity in local governments ?

New planning approaches to preserve temporary access by the poor to the shacks option may prove to be critical
Migration on its own finds well-located land when formal planning cannot

If so, human settlements delivery probably needs to establish a new framework for spatial planning that engages the shacks Allowing for the different constituencies shacks attract

To make such models work, the anchor component will be ensuring affordable transport provision, because this is the way into the economy

THANK YOU!
economic performance & development hsrc 20 october 2010

WHERE SETTLEMENT IS NOW

SA has four major migration corridors
From Limpopo, from North West and Free State, and from Mpumalanga and northern KZN, all into Gauteng And from southern KZN through Eastern Cape into Cape Town

General drift toward seacoast and also to megacities

Gauteng is migration magnet for SAs north Cape Town for the southern third In 2001 study for Cabinet, half the magisterial districts in impoverished rural sector already had net out-migration based on 1996 data And population has flooded out of former homelands into formal local government jurisdictions

But the most rapid in-migration is into secondary cities largest flows go to main metros, but relatively fastest go to smaller cities

LIMITING MIGRATION?
If government puts resources into rural sector to reduce poverty and slow rural-to-urban migration?

Investment, infrastructure and services may help slow migration or may have mixed effects
When a disadvantaged region develops, migration rises as more people can cover migration costs Migration continues till high levels of local earning are reached, able to compete with urban

But delivery itself does affect and can slow migration

Infrastructure attracts where delivery goes is an active factor in migration

Careful not to deliver so as to hold people in areas with low potential for livelihoods

THE FORMAL HOUSING MARKET

The percentage of poor South Africans in formal housing is rising, but so is the delivery backlog
Recent work from Finmark Trust shows that the formal housing market is starting to work Property values are rising for the African population Bank finance is starting to come in

However, only a tiny share of transfers in communities go through the formal market
Below R 50 000-100 000, sales tend to stay informal because bank finance is not needed and the banks struggle to profit And rising formal prices can expose poorer house owners to displacement through down-market raiding
The normal function of the free market is to transfer assets to whoever can best afford them Poor urban communities use informality to protect their small share of urban land against the action of the market

The informal market will not disappear overnight