Integrated Approaches to Poverty Reduction at the Neighborhood Level – a Cities Without Slums Initiative



Approval Date
Proposal Focus
Core Focus
Secondary Cities
Country Type
Lesson Learned for Cities Alliance Members and Partners
• The shelter strategy for each of the selected cities has been found to be a critical element in the overall process. It was demonstrated that such a strategy can act as a powerful framework to rally all stakeholders to support housing for the urban poor. It served not only as a planning tool but also as an advocacy instrument for institutionalising programmes through legislation, budget allocations and strengthening the Housing Board/ Office and the other involved departments within the Local Government Unit (LGU). The strategy must, however, be consistent with other city plans and thereby not undermine parallel commitments, and must be subject to periodic review to react to changing circumstances and implementation experience. The strategy should be locally-driven and formulated in stages based on the readiness and absorptive capacities of all stakeholders, with the external support also acting as a capacity-building intervention. • Financial packaging under the DPUCSP through the Development Bank of Philippines (DBP) for the divergent group of borrowers (LGUs, MFIs, private sector and HOAs) with their uneven creditworthiness proved not to be practical. Precisely targeted financing with effective technical assistance for HOAs and the associated carefully-tailored capacity-building would be one possible better way forward. • Affordability-based, incremental development should be the primary consideration when preparing investment designs. HOA project self-management requires prior capacity-building. The project confirmed that some HOAs continue to have a weak understanding or insufficient information on housing laws and technologies. Formal financing institutions such as DBP were constrained by standards requiring a complete house structure but it was found that, through support from HUDCC and the DBP/DPUCSP approval for direct HOA lending, the project could successfully negotiate approval of core house structures. • House construction and community-level infrastructure are natural options for job creation, given the employment profile of the target communities. Integrating community investment with community contracting enhances incomes. It also improves the management skills of HOAs and promotes ownership and accountability. The project found that community contracting may be gainfully expanded to cover a wider range of enterprises such as food catering and tool/material fabrication. However, transforming the residents and their HOAs into entrepreneurs proved to be a daunting challenge, requiring an extensive range of business training and advisory interventions. • Although communities readily accepted the importance of “savings”, external pressures can easily lead to a top-down approach and undermine participation - requiring the project to respond with increased advocacy. It was found that livelihood activities were effective entry points for community saving schemes and that gaining immediate economic benefits facilitates the establishment and sustainability of community savings. • Institution-building at the community level relies on strong LGU participation. Local NGOs also play a crucial role, with their apolitical nature promoting confidence and trust. Active involvement and support of the Baranguay local government was found to be a necessary factor in advocacy for land provision and funding for site development. • National level support is essential for the provision of enabling policies and more appropriate regulations. Given the increasing demand for HOA direct borrowing the available DBP/DPUCSP funds may not be sufficient, therefore related policies will need to be reviewed. The project found that it could not depend on its own technical assistance resources. Private sector contributions must always be explored as additional sources of learning and material assistance.


While the Philippines continues to urbanise rapidly, the housing and land markets have not kept pace with the rapid urban growth. As a result, more than 40 percent of urban poor families live in informal settlements with inadequate basic infrastructure. While the national policy and legal framework for addressing these issues are in place, the capacities at the local level remain weak. In order to build Local Governments’ capacity, the Cities Alliance supported the Integrated Approaches to Poverty Reduction at the Neighborhood Level-A Cities without Slums Initiative (IMPACT). The project aims to provide technical assistance to the Philippine Government to develop the capabilities of the Local Government Units (LGUs) to work together with the organized urban poor communities (Homeowners Associations - HoAs) in seven cities outside Metro Manila. These cities include Puerto Princesa, Iligan, Science City of Munoz, Iloilo, Escalante, Zamboanga, Valenzuela and municipality of San Vicente.
The objective is to institutionalise asset based approach to poverty reduction at community level through ‘Cities without Slums’ approach: i)Shelter and Neighborhood Upgrading Component: Assist LGUs and communities to institutionalise a city-wide process for upgrading of shelter and neighborhood infrastructure; ii)Social Development Component: Provide better access to services and strengthen social networks; iii)Income Security for the Poor Component: Foster improved livelihood opportunities; iv)Policy Learning Component: Strengthen project monitoring arrangements and facilitate improved policy analysis.
Shelter and Neighborhood Upgrading Component: 1) Developing CWS strategies into pro-poor shelter plans following a comprehensive shelter overview of each city 2) Identifying and prioritising slum areas to be upgraded 3) Providing assistance in securing land tenure 4) Identifying investment required and mechanisms for financing basic infrastructure in neighbourhoods Social Development Component: 5) Developing the capacity of urban poor communities to access services, strengthen social networks and social safety nets 6) Broadening LGU/urban poor community partnership to address health and education aspects at neighbourhood level 7) Identifying existing programmes of decentralised health, non-formal education and social services and also the mechanisms to link them with the communities Income Security for the Poor Component: 8) Skills training and linking urban poor with business and other institutions including micro-finance institutions 9) Enhancing community savings schemes 10) Using project investment activities including in-house upgrading and infrastructure construction (such as community contracting, community operations and maintenance & community enterprise) as catalyst for skills development Policy Learning Component: 11) Documenting best practices in upgrading including processes for building the physical, human, social, financial capital of the poor 12) Preparing manuals documenting processes
Expected Impacts and Results
i) Shelter Strategies/Plans were institutionalized through ordinance passed by the legislative council of the cities: a) Shelter Strategy of Science City of Munoz is now supported through an ordinance with an allocation of US$ 14,286 for various projects detailed in the Shelter Strategy to be implemented in 2007; b) Puerto Princesa created a Housing Department as recommended in the Shelter Strategy; and, c) Iligan intends to present the Shelter Strategy to its City Council for adoption and budget allocation. ii) Capacity building plan for LGUs were made and 161 staff members benefited from the workshops, learning exchange and training activities in shelter planning, environmental assessment, project financing, estate management urban shelter upgrading and financing. iii) Improved local governance structure (Local Housing Board) was created to support the participatory planning processes. iv) HOAs are recognised as legal entities and more than 4000 families became members of Home Owners’ Association. This enabled them to partner with NGOs for community development projects. v) IMPACT piloted “savings mobilization schemes” in 8 HOAs that used community-based systems, policies, and resources to support families in case of emergencies, sickness, and death. Around 1,800 families have benefited from their community-based savings and more are expected to gain from such activities as the HOAs fully roll-out their savings projects. vi)With a private sector partner, “Mortgage Redemption Insurance (MRI)” was piloted for the urban poor shelter projects where daily payment schemes based on the earning profile of most of the families was used. Around 35 families of PFNAI (Pinagmangalucan Fishermen and Neighborhood Association Inc ) in San Vicente Palawan are expected to benefit from this pilot initiative when DPUCSP (Development of Poor Urban Communities Sector Project – $30M loan to Philippine govt. from ADB that is in pipeline) loans get released and their MRI policies get approved consequently. vii)Resources were mobilized from NGOs and business groups to pilot and implement community level livelihood activities. Around US$ 40,000 were contributed to skills training for individuals. A Memorandum of Agreement (MoA) between the community and the LGU of Valenzuela City is expected to benefit at least 500 skilled and non-skilled women and men workers in the IMPACT assisted communities. viii) IMPACT through the support of HUDCC and ADB, initiated a policy reform at the local level and achieved a remarkable advocacy gain when Development Bank of the Philippines (DBP) approved the “Direct HOA lending track” as part of the DPUCSP financing scheme in August 2007.