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close this bookThe Human Settlements Conditions of the World's Urban Poor (HABITAT, 1996, 233 p.)
close this folderV. Reaching the urban poor
View the document(introduction...)
View the documentA. The changing international policy context for urban development and shelter
View the documentB. The sites-and-services programme in Zimbabwe
View the documentC. Brazil: the FUNACOM programme in São Paulo
View the documentD. An evaluation of the Employees’ Housing Programme (EHP) in the Republic of Korea
View the documentE. India: An evaluation of a series of Slum Improvement Programmes
View the documentF. Conclusions: Assessing the experience of projects/programmes aimed at improving the human settlements conditions of the world’s urban poor

C. Brazil: the FUNACOM programme in São Paulo

The FUNACOM programme was one aspect of a radical political programme introduced by the newly elected Partido de Trabalhadores (Workers’ Party) in the Municipality of SPaulo between 1989 and 1992. The context for the introduction of this programme was threefold:

· new central government legislation in 1988 devolving greater legislative and financial autonomy to five major Brazilian cities, including SPaulo;

· the election locally in SPaulo in 1989 of the Workers Party, which introduced a new political direction to the management of SPaulo Municipality; and

· the pre-existence of an influential local “Housing Movement” in Greater SPaulo (the UMM), consisting of many different CBOs, which effectively lobbied for a decentralized programme of self-managed housing investment.

The Workers’ Party adopted a comprehensive and participatory approach to the problems of the city, including those of the informal (and illegal) settlements. It encouraged a process of community negotiation in order to develop an Action Plan for the city, not only with a view to improving the overall environment, but also to achieve a more equitable environment. The new Action Plan comprised an urban policy which was based on the mobilization and support of local communities; it introduced a new regulatory framework for land-use, zoning and building standards; and it sought to mobilize financial resources through the restructuring of an existing fund (“the municipal fund to support housing for low-income people” - FUNAPS), and the redeployment of municipal resources; as well as seeking partnerships over land development with the private sector. The generation of local resources was seen as particularly important in that it preserved the independence of the municipal government and its urban policies from the external pressures of the central government and international aid agencies.

The Action Plan included a number of shelter programmes; it sought to regularize informal settlements; it gave priority to relocation in sites-and-services programmes to those living in hazard-prone settlements, such as flood prone areas, or on land liable to slippage; it targeted squatter settlements and tenemental dwellings for upgrading and the provision of basic infrastructure; and it continued with the provision of low-income housing using federal government resources. The FUNACOM programme, encouraging mutual aid and self-management, was thus one of a series of programmes targeted towards the urban poor. It was established in 1989 with the following specific aims:

· to increase the institutional capacity of the municipality to manage housing programmes;

· to reduce the cost of the provision of infrastructure and housing;

· to promote autonomous community participation through self-managed programmes financed by the municipality; and

· to strengthen community participation in the housing sector.

In essence, the programme allocated funds directly to the families involved in order to improve housing and infrastructure facilities throughout the city. The families formed themselves into Community Associations (autonomously functioning legal associations), and were assisted both in the formulation and implementation of local projects by Technical Assistance Teams. The projects, developed in consultation between the Community Associations and the Technical Assistance Teams, were submitted to FUNACOM for approval. Through this programme the community not only decided on the nature and standards of local projects (e.g. rebuilding, local land adjustment and infrastructural provision), but was also responsible for the management and allocation of finance and participating in the construction process.

1. The mobilization and allocation of resources

FUNACOM was funded through FUNAPS. FUNAPS had been created earlier to finance the acquisition of land, infrastructure and building materials for low-income groups and it was restructured to enable it to assist CBOs as well. FUNAPS’ resources were mobilized from the municipal budget (nearly $100 million), from the repayment of loans, and from partnership arrangements over land use arising out of the new legal framework ($67 million). Whilst FUNAPS had not been established by statute (a problem subsequently determined by the courts), it was administered by a council formed from representatives of the municipality and the community, and run from within the “Housing Superintendency” of SPaulo Municipality.

In order to seek funding from the FUNACOM programme, a local community had to organize themselves into a Community Association and link up with a Technical Assistance Team. Together they defined a draft programme and submitted it to FUNACOM. After preliminary approval, a final programme was prepared with specifications, costings, and cash flow statements. Upon approval, a loan application was sent to FUNAPS and when this was approved the Community Association signed a contract with FUNAPS. The signing implied accepting responsibility for the management of the works to completion.

A loan ceiling of $5,000 per family was instituted for projects and the loan itself was divided into different percentages for the following inputs: building materials, 82 per cent; hired labour (usually skilled), 10 per cent; site equipment, tools, etc., 4 per cent; and Technical Assistance Team fees, 4 per cent. These percentages were flexible in special cases. Both the percentages and the role of the Technical Assistance Team were set out in each project application and the Community Association was responsible for managing the financial arrangements. Loans were paid in instalments (the first in advance), and on subsequent monitored progress.

Individual loan repayments were calculated taking account of monthly income and family size. Repayment terms were negotiable (between 5 and 25 years) and loan repayments were to be not more than 25 per cent of income and not less than 10 per cent. Subsidies were available according to family income.

2. The organizational arrangements and the process of self-management

As indicated earlier, one of the conditions for the Community Association to obtain funds was to contract an independent Technical Assistance Team to assist with the formulation and implementation of a local project. The Technical Assistance Teams were:

· independent of the local government;

· associated with, or contracted by, a Community Association;

· multi-disciplinary, and able to provide technical assistance in the fields of engineering, finance and with the legal aspects of development; and

· identified with the social and political values of the Housing Movement (UMM).

The Technical Assistance Teams were obviously important in indicating to the Community Associations what the possibilities for development were within the cost limits available. The programme was flexible, however, to enable standards to be determined locally by the Community Association, and to develop local solutions to local problems. The Technical Assistance Teams often undertook training for members of the Community Association, supervised the actual construction works, and gave advice and guidance on the establishment of income generating activities.

In getting established the first task was the conceptualization of a local project. This involved considerable discussions between the Technical Assistance Teams and Community Associations. After approval of the initial submission, the detailed arrangements were worked out. Next came the definition of the construction process and agreement on building regulations and the principle of mutual help. This involved reaching agreement over tasks such as:

· the expected number of hours per week that each household should work;

· allocation of working hours between family members and minimum time to be spent on site;

· rules governing the use of equipment and access to materials;

· the role of the Technical Assistance Team, the foreman and the work coordinator;

· sanctions in case of negligence; and

· distribution of houses among members of the Community Association.

Many Community Associations also designed and built community facilities such as cres and community centres, as part of the programme. These were financed by FUNACOM. The nature of the work demanded widespread community organization and a strong sense of solidarity and responsibility amongst members of the community. The participation of workers was an integral part of the programme both in terms of determining the nature of the project, and in working towards its implementation.

3. The impact of the FUNACOM programme

Designed very much in line with the key principles of the GSS, the SPaulo Municipal programme for shelter was very effective in targeting the urban poor. Over the 1989-1992 period it is estimated by Guedes and Devecchi that 250,000 families were involved in regular discussions about the Action Plan and that the various shelter programmes funded from local sources secured the following achievements:

· squatter settlement upgrading: 47,000 families;
· tenemental upgrading: 481 families;
· sites-and-services with core housing: 7,700 families; and
· the self management and mutual aid programmes: 10,600 families.

In addition, the low-cost shelter programme using Federal resources assisted more than 25,000 families over the same period.

At the ideological core of the shelter programmes was the FUNACOM programme, tangibly demonstrating the benefits of mutual help and community mobilization in shelter provision for the urban poor. Denaldi (1994), and Guedes and Devecchi (1994), have itemized their perception of the strengths and weaknesses of the programme. The ‘strengths’ included:

· a successful enabling framework: the FUNACOM programme enhanced security of tenure and provided a legal, technical and financial framework which enabled the process of self management and mutual aid effectively to target the shelter and environmental conditions of the urban poor;

· the programme was effective in raising ‘collective consciousness’ over shelter and environmental issues; it extended the coverage of community associations, strongly promoted the role of women and genuinely mobilized support for the programme amongst the poor;

· this high level of community participation and the decentralized nature of the programme ensured that the most pertinent issues confronting the urban poor were addressed and that the programme effectively countered problems of political patronage;

· it was effective in local capacity building; it strengthened local organizational decision-making, raised the level of skills and competencies, and increased the opportunities for local economic development;

· the localized nature of the projects and the flexibility of the programme resulted in appropriate choices of standards and technologies, according to the preference, necessity and affordability of each community;

· the role of the Technical Assistance Teams ensured autonomy; promoted participation and complemented the local authority role; and

· the local authority itself adopted decentralized procedures and accepted local decision-making; it also began to develop public-private partnerships over land development.

They perceived the major weaknesses of the programme to be:

· its lack of sustainability; the strong political support of the Workers’ Party was both a strength and a weakness, the loss of office of the Workers’ Party in November 1992 has subsequently revealed the vulnerability of the programme to political change;

· the inability of the Workers’ Party to secure lasting legal and institutional reforms; whilst far-reaching legal reforms were introduced, the political opposition, systematically (and successfully), obstructed the adoption of these reforms in the Municipal Chamber;

· the weakness and lack of competence of some of the Technical Assistance Teams contributed to the difficulties of implementation of the programme; and

· the bureaucratic procedures required by the municipal authority were insensitive to the need for change and resulted in instances where they were circumvented by informal procedures.

4. Conclusions

The FUNACOM programme, as part of the overall shelter programmes initiated by the municipal authority of SPaulo between 1989 and 1992, achieved much greater success in targeting the needs of the urban poor than previous administrations. The programme was seen as an ideological one, however, and was unsuccessful in obtaining the political support of opposition parties and the private sector as a whole. It was able, however, to mobilise local communities to participate effectively and to generate substantial local resources to improve the living and environmental conditions of the urban poor.