Addressing Urban Poverty Through Strengthening Assets

Habitat International 27 (2003) 393–406

Addressing urban poverty through strengthening assets$

Diana Mitlin*

International Institute for Environment and Development (IIED), 3 Endleigh Street, London WC1H 0DD, UK

Received 16 June 2002; received in revised form 19 August 2002; accepted 23 September 2002

Abstract

The importance of urban poverty is increasingly recognized. This paper seeks to learn from theexperiences of eight urban poverty reduction programmes to understand how effective developmentprogrammes can be instituted. The emerging lessons emphasize the use of three strategies to enhance theasset base of the urban poor: strengthening grassroots organizations, transforming relations with the stateand developing new alternatives to conventional urban development practices. The experiences offerinsights into strategies to secure poverty reduction within the broad framework of sustainable livelihoods.r 2003 Elsevier Science Ltd. All rights reserved.

Keywords: Poverty; Livelihoods; Development assistance

1. Introduction

This paper reviews eight detailed studies of urban poverty programmes in the South and aresearch programme on urban poverty and governance in nine cities, primarily in Africa andsouth Asia in order to learn more about poverty reduction. A particular interest is how theyaddress the development needs of the poorest and most vulnerable families?On the one hand, this set of studies reinforces the complexity of experience and the infinite

number of contextual differences that in turn influence how poverty can be addressed. Strategiesvary according to opportunity. The political situation in South Africa has opened up possibilitieswith state support for low-income housing. The lack of state investment coupled with the

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$This paper draws on research sponsored by the UK Government’s Department for International Development

(Urban Poverty Reduction Programmes: Lessons of Experience—R6859 and Urban Governance, Partnership and

Poverty) and the Swiss Agency for Development and Cooperation. The author gratefully acknowledges the very helpful

comments of two anonymous referees.

*Corresponding author. Tel.: +44-20-7388-2117; fax: +44-20-7388-2826.

E-mail address: [email protected] (D. Mitlin).

0197-3975/03/$ - see front matter r 2003 Elsevier Science Ltd. All rights reserved.

PII: S 0 1 9 7 - 3 9 7 5 ( 0 2 ) 0 0 0 6 6 - 8

availability of development assistance finance has resulted in Care International sponsoring one ofthe largest community water supply initiatives that exist in Lusaka. On the other hand, needsdiffer. In Nicaragua, 10 per cent of the housing stock in cities included in phase one of Prodel wasdamaged or destroyed by Hurricane Mitch. In Faisalabad, a lack of water and sewerage resultedin high costs for residents as they struggled to cope with the consequences for health and incomeearning activities.Despite these differences in context and needs, there are similarities in approaches to poverty

reduction among the programmes considered here. This paper explores these similarities anddraws out some potential lessons. The role of communities emerges as critical. Section 2 considerswhy so many poverty reduction initiatives face difficulties in supporting representative inclusivecommunity organizations that address the needs of the poorest citizens. It describes how, whenthere are large gaps between the cost of conventional infrastructure and service provision andwhat can be afforded, the residents of low-income settlements compete for limited publicresources, usually through informal and often clientelistic arrangements. Having described someof the difficulties, Section 3 then moves on to considering the attention given by the eightprogrammes to strengthening the asset base of the poor (including financial, human, physical andsocial assets). Section 4 examines the strategies that are used for asset development andconsolidation. The discussion explores how programmes seek to reconstruct grassrootsorganizations and transform relationships between communities and the state. In part, theyachieve this by ensuring that the urban development processes build on the strengths andcapacities of the urban poor themselves.The importance of strengthening assets to improve livelihood opportunities has now been

accepted by many development interventions. The discussion in this paper considers how eightpoverty reduction programmes have used the principles contained within this framework. Theexperiences here offer an analysis of what works, and why it works, in regard to assetenhancement. The discussion assesses the significance of the strategies used by the programmesand highlights emerging lessons of potential value to a wide range of urban developmentprofessionals.The final section offers some concluding remarks and considers the role of international

development assistance.

2. Urban development and urban poverty: the problems

Prior to analysing these programmes, it may be useful to briefly summarize the context in whichdevelopment professionals and practitioners are working.The scale of need is immense. The 1999/2000 World Development Report (World Bank, 1999)

suggests that there were 495 million ‘urban poor’ among low- and middle-income nations by theyear 2000. However, this is likely to considerably under-estimate the scale of urban poverty. Theincome level at which the poverty line is set may be unrealistically low in relation to the costs ofnecessities in many cities and income measure of poverty do not consider other aspects of poverty(Hardoy, Mitlin, & Satterthwaite, 2001). Poverty has been recognized to be multi-faceted(Satterthwaite, 2001) and may include:

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D. Mitlin / Habitat International 27 (2003) 393–406394

* inadequate income (and thus inadequate consumption of necessities including food and, often,safe and sufficient water);

* inadequate assets for individuals, households or communities;* inadequate shelter (typically poor quality, overcrowded and insecure);* inadequate provision of infrastructure;* inadequate provision for basic services such as day care/schools/vocational training, health-care, emergency services and law enforcement;

* limited or no security to ensure consumption can be maintained when income falls;* inadequate protection of citizen rights such as occupational health and safety and pollutioncontrol; and

* voicelessness and powerlessness within political systems and bureaucratic structures (state andprivate), leading to a reduced possibility of receiving entitlements and of organizing, makingdemands and getting a fair response. Limited accountability from aid agencies, NGOs, publicagencies and private utilities. Little opportunity to participate in defining and implementing‘urban poverty’ programmes.

Regardless of the precise number of those in poverty, there is an immediate need for povertyreduction. One of the first problems faced by poverty reduction programme is the lack ofmunicipal finance verified by Devas (2001) and exemplified in this set of studies. In part to addressa lack of money, development agencies have sought to support participatory development andcollaboration with grassroots organizations (in some case supported by NGOs). Such formalengagements may offer something to the urban poor. Etemadi (2001) describes how many years ofstruggles by the trade associations in Cebu (the Philippines) have resulted in an increasingwillingness of the part of local authorities to demarcate areas for informal trading and hold backfrom demolishing stalls. However, a second problem is that many (often the poorest) citizens donot take part in these collective activities and hence do not benefit. In Cebu, for example, averagewages of traders in the city-wide vendors association are several times those of a random sampleof informal traders (Etemadi, 2001).A third problem for poverty reduction programmes is that many conventional development

‘‘solutions’’ are often unaffordable to the poorest citizens without a subsidy (Choguill, 1996).With limited scope to programmes, the poorest citizens may struggle for inclusion, particularly ifthere is competition from higher income groups. In both South Africa and the Philippines, forexample, there are national programmes offering, respectively, interest rate and capital subsidiesto support access to land and housing (and in the case of South Africa infrastructure as well). Butthere are long delays in securing access to this finance (see, for example, Baumann & Bolnick,2001).A fourth problem is that the level of infrastructure required by conventional urban

development may not be affordable to the poor. Even if they can afford the monthly charge,they cannot afford the capital charge to connect to the system. Undoubtedly the subsequent lackof provision works in favour of maintaining relations of clientalism and patronage as politicians(and sometimes officials) dispense infrastructure on an irregular basis. In Faisalabad, for example,there are small funds that councillors can allocate as they wish but no comprehensive basicinfrastructure (Alimuddin, Hasan, & Sadiq, 2001).

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D. Mitlin / Habitat International 27 (2003) 393–406 395

Hence, whilst lack of money is an evident problem, the nature of social relationships bothwithin low-income settlements and between community members and the local authority, isimportant in understanding the outcomes that perpetuate poverty and exclusion. A recent multi-city research programme on urban poverty and governance suggests that the more formalnegotiations between community organizations and local government may be relativelyinsignificant when compared to the informal often clientalistic relations between communityleaders and politicians and sometimes officials.1 Benjamin and Bhuvaneshari (2000) discuss howexisting leaders in Bangalore consolidate their position and secure greater benefits by placing theirfemale relatives in leadership positions within Community Development Societies set up within agovernment employment programme. Politicians and officials may negotiate for financial or forpolitical benefits. Roderiguz, Winchester, and Richards (2000) explain how community leaders inSantiago receive ‘‘rewards’’ (generally public sector jobs, access to public grants and subsidies,and social investment funds) in return for managing votes at election time. ‘‘The political relationin the comunas establishes a reciprocity model—that has an implicit character—based on a mutualfavour policy.’’Even if they want to, it can be difficult for grassroots organizations to operate differently. In

Colombo, development agencies have sought to strengthen community participation indecision-making through supporting neighbourhood-based Community Development Councils(CDCs) (Russell & Vidler, 2000). However, when grassroots organizations threatenedclientalist arrangements, they may be undermined: ‘‘Some politiciansy. actively seek to weakenCDCsy. They don’t want a competitor taking credit for improvements.’’ (Russell, 1999).In this situation, it is perhaps inevitably that some leaders agree to become co-opted and in turnare viewed as ‘‘gatekeepers’’ by the local communities. As described by Melo, Rezende, andLubambo (2001) there may be considerable opposition to participatory initiatives by establishedlocal politicians. In Recife, councillors sought to abolish the participatory budgeting schemeintroduced by the mayor through an amendment to the budget. The mayor then vetoed thisamendment but allowed the councillors to change the rules enabling them to propose locations forinvestments.In summary, the emerging picture is one in which need is acute and diverse. Generally the

poor in Southern towns and cities are dependent on informal commercial markets to haveaccess to land, housing and infrastructure. Many government agencies and departmentsattempt to put in place programmes but the need for subsidies limits programme scope andsuch subsidies may result in a further problem of the benefits being ‘‘captured’’ by higherincome groups. The grassroots organizations that might be thought likely to represent theneeds and interests of those living in low-income neighbourhoods may instead be dominatedby self-interested and/or elite leaders who tend to form clientalist relationships with localpoliticians and officials with little interest in developing alternatives that better meet the needs ofthe urban poor.

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1Urban Governance, Partnership and Poverty undertaken by the University of Birmingham, International Institute

for Environment and Development, University of Wales (Cardiff) and the London School of Economics and funded by

the Department for International Development (DFID).


3. Assisting the poor

This set of urban poverty reduction programmes has been selected for study because of theirrelatively high level of success. On investigation, the programmes were found to share a set ofstrategies that build assets, thereby enabling the poor to transform the conditions that cause andperpetuate their poverty. This paper argues that the emphasis on asset creation and developmentis significant when understanding their success. The significance of strengthening the assets isdiscussed in Moser (1998). Four of the five asset groups within the livelihood framework werefound to be of particular and consistent importance (see Box 1):

* resources for investment capital and other kinds of asset (financial capital);* skills, capacities and experience of local residents for employment, child rearing, communityactivities and other kinds of paid and voluntary work (human capital);

* infrastructure, services, buildings and public space (physical capital); and* groups and/or informal networks for enterprise development, community activities andemergency assistance (social capital).

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Box 1

Programme strategies to secure assets

Financial: Programme staff encourages savings, offer loans for investment (and consumption) and secure

government investment finance in the communities (often added to by household contributions). People’s Dialogue

on Land and Shelter in South Africa and SPARC in India support community-managed savings funds. In cases such

as PRODEL in Nicaragua, the Carvajal Foundation in Cali and the Anjuman Samaji Behbood in Faisalabad,

programmes encourage the accumulation of household assets through borrowing and loan repayment (Stein, 2001;

Davila, 2001; Alimuddin et al., 2001).

Human: The community themselves are at the centre of the plans and improvements that are undertaken. The

processes of managing savings and loan finance, developing houses, establishing and enhancing enterprises,

strengthening social organizations and participationy all influence residents’ capacity to plan their lives and realize

their goals. At the same time, several programmes seek to develop collective knowledge and learning with new

solutions to traditional urban development programmes (such as the water systems of Anjuman Samaji Behbood in

Faisalabad). The health workers (reproinsas) in El Mezquital are a further example of an investment in human

capital, both for the workers themselves through their training programme and for those that they are able to assist

(Diaz, Grant, Vargas, & Velasquez, 2001).

Physical: Programmes encourage households to add to their own physical assets particularly through investments in

housing and infrastructure. Community assets such as water supply networks and community centres are developed

to improve neighbourhoods. In Nicaragua, for example, 260 infrastructure and community projects were carried out

over four and a half years with an average investment of US $ 17,000 (Stein, 2001). Loans enable small and medium-

sized enterprises to build up their physical capital, thereby reaching new and expanding markets; or enable

households to improve their housing. For several foundations in Cali, this means training to manage self-help

housing in order to realize cost savings and improve quality (Davila, 2001). In India, SPARC and the National Slum

Dwellers Federation toilet blocks improve local services and provide the basis to renegotiate relations with the state

(Patel & Mitlin, 2001).

Social: Programmes strengthen local organizations, improving accountability, encouraging leaders to represent their

members’ interests and adding to their capacities. New relationships with local authorities develop. As the report on

the Programme of Support to Vulnerable Groups in Buenos Aires illustrates, one small and effective step is simply to

bring different community associations into dialogue with each other (Schusterman, Almansi, Hardoy, Monti, &

Urquiza, 2001). Both SPARC and the People’s Dialogue have gone one step further as they work with, and build,

federations of grassroots organizations.


In the programmes considered, the creation, consolidate and enhancement of assets emergesthrough conscious strategies to achieve social change. Programmes rarely address a single type ofasset. Rather each strategy tends to support a set of social change processes that are mutuallyreinforcing. For example, group savings and credit can provide financial capital, strengthen socialcapital, teach skills increasing human capital and provide capital for investment in buildings,productive equipment and stock.Three general strategies for asset-building emerge from the programmes studied: reconstructing

grassroots organizations; transforming relationships between grassroots organizations and thestate; and re-conceptualizing urban development strategies notably organizational, financial andtechnological aspects. These are used by the majority of the programmes studied to increasedevelopment opportunities for the poor through a number of mutually reinforcing activities.These three strategies are explored in the following Section.

4. Strategies for asset development

4.1. Reconstructing grassroots organizations

The programmes share a common goal to strengthen grassroots organizations. In general, theydo not directly seek to replace existing organizations. In this respect their starting point issimilar to that of Howes (1997) and Christian Aid (1993) who argue against the formationof new organizations as it may create resistance and suspicion in existing organizations. Insome cases, the programmes involve the creation of new and more specialist organizations towork alongside existing community organizations; for example, the network of reproinsasin El Mezquital has become a force for women’s emancipation, working with and within othergrassroots organizations (Diaz et al., 2001). The need for new forms of organization thatinclude some of the poorest and most vulnerable groups is emphasized by many of the studies.In San Fernando (Buenos Aires, Argentina) few of the most vulnerable people targeted by astate programme turned up to participate in a conventional planning process (Schustermanet al., 2001).These programmes seek to develop or augment a number of capacities within organizations.

What are these capacities?

* Managing practical self-help development activities in addition to activities such as lobbyingthe state for more resources.

* Competent community financial management through community contributions for self-helpactivities. Financial management skills help to ensure that local communities can manageexternal funding once secured.

* Greater transparency and accountability within the organization. Financial contributions arejust one strategy to increase the stake that local residents have in their organization.

* Greater and more active participation from members especially those with lowest incomes.

The programmes are, to differing extents, seeking to reconstruct grassroots organizations andthe ways in which they operate within local neighbourhoods. Grassroots organizations in someshape and form exist throughout low-income urban settlements but many do not appear to be

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effective in increasing the development options the families have and realizing the best of theseoptions (Mitlin, 2001). In particular, and as noted above, existing organizations may simply offerlegitimacy to the elite in the settlement who dominate negotiations with external agencies toadvance their own interests.Within the programmes that are the subject of study, practical local activities help to

consolidate a leadership concerned to secure immediate and continuing local benefits. Theseneighbourhood-based activities help to increase knowledge and confidence between residents andbuild solidarity. Financial commitments from external groups change the relationships further.Leaders and members learn the skills needed for financial accountability. Box 2 below illustrateshow People’s Dialogue on Land and Shelter sees and addresses these challenges. As explained inthe study, the NGO has been seeking to support grassroots organizations to evolve ‘‘democraticinternal organizational capacities’’ (Baumann, Bolnick, & Mitlin, 2001). The communityorganizations supported by People’s Dialogue ensure high levels of women’s participation(Baumann et al., 2001). A concentration on the needs of women is one more shared characteristicof these initiatives. The savings schemes that People’s Dialogue support work alongside existingcommunity organizations in low-income settlements.An important and fairly consistent element in reconstructing grassroots organizations has been

the encouragement of federating and networking activities between groups. Federating strength-ens the solidarity between groups, breaking down the isolation faced by individual grassrootsorganizations and their leaders and enabling the group to negotiate on city-wide issues withcredibility. In India, the National Slum Dwellers Federation has linked local communities toachieve a mass movement; they have secured housing and services with the strengthening ofneighbourhood groups and a new sense of confidence among leaders.The lack of grassroots strengthening may help to explain the demise of some of the social

programmes in Cali, Colombia. Davila (2001) describes how the programmes of variousfoundations in the city provide valued services to the poor. However, he also notes that economicrecession has resulted in the scaling down of some foundations and that at least one has ceased

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Box 2

Organizations of the urban poor

When the staff of People’s Dialogue on Land and Shelter assessed existing grassroots organizations, they quickly

realized that many of the residents, particularly women and the poorest citizens, did not take part. To ensure

participation, they had to change the way in which these groups were operating. Learning from Mahila Milan, a

collective of women’s savings schemes in India, they introduced savings schemes to help to draw women together to

collectively address their problems.

Savings schemes are a place in which women can begin to address the multitude of their needs. Members save to

establish small revolving funds for emergency loans, income generation and housing development. Women talk about

their difficulties and how to address them, gaining strength from common activities. Together, women learn skills of

book-keeping and financial management. They help each other build strong organizations.

As more and more savings schemes in South Africa began to access housing loans and state housing subsidies, women

began to be active in housing developments within their communities. With the support of their neighbours, they

began to find their voice. In many cases, this was the first time they had been able to participate in public life.

Within 2 years, there were over 100 savings groups with 90 per cent women membership. Women played a leadership

role, first within the savings schemes and then within the emerging network of the South African Homeless People’s

Federation.


operating (Davila, 2001). Despite this situation and the related withdrawal of what in some casesare essential services, there does not appear to have been significant pressure from residents’associations on the state to maintain activities.

4.2. Transforming relationships

A second similarity of strategy occurs as these programmes systematically seek to change thenature of the relationships between grassroots organizations and local authorities and, in somecases, other organizations (state and private).Many of the programmes put emphasis on reforming relationships between the state and the

urban poor. Programmes seek such reforms to secure a more equitable division of resources, moreeffective development expenditures and better dialogue between communities and the state. Thetransformation changes the way in which the state undertakes its formal developmentprogrammes as well as preventing individualistic bargaining by leaders and local politicians. Asshown by the case studies, the willingness to restructure relationships may come from either party.In the case of PRODEL (Nicaragua) and PAGV (Argentina), the lead is taken by the governmentwhilst SPARC (India), People’s Dialogue (South Africa) and ASB (Faisalabad) work withgrassroots organizations as the key group to initiate change.Neither of these processes is easy to achieve and the studies themselves acknowledge the

problems and the difficulties that programmes faced. In the case of El Mezquital, Diaz et al.(2001) describe how the community and government agencies generally failed to work welltogether. The authors explain how community members felt undermined by officials andpoliticians alike (with some exceptions). Stein (2001, p. 17) cites a community in one town inNicaragua that did not want to take part in PRODEL activities believing that they couldfind a state agency that would offer them money without requiring ‘‘yanything in exchange oreffort.’’Despite these exceptions, the majority of the programmes prioritize the development of new

relationships between the poor and the state in order to secure large-scale long-lasting reductionsin poverty. Box 3 demonstrates how such processes work in the city of Faisalabad.Through working together on practical activities that involve high levels of local participation,

new perspectives are gained by both the poor, state officials and politicians. On the onehand, joint activities help the local authority to see that grassroots organizations and theirmembers have their own resources to contribute and that they are neither criminals nor illegalcitizens who should be pushed away from the city. They start to consider organizations of theurban poor as potential partners in the development process. With the active collaboration oflocal grassroots organizations and new ideas for addressing poverty, officials may recognizethat their responsibilities are not as difficult to achieve as they previously believed. At thesame time, local residents start to view their relationship with the local authority (and sometimesother state agencies) differently. They see that officials and politicians are not simply thereto secure personal or political profit. They may realize that state funds can provide auseful additional contribution to their own scare monies in improving their local neighbour-hood. Residents may also be more willing to pay the service charges that are required. Box 4describes how residents began to pay their rates as a new relationship with the municipality wasforged.

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Through building a closer and more open relationship between politicians, officials andgrassroots leaders, programmes seek to alter the way in which development activities take place inorder to make outcomes more favourable to the poor.In some cases, this change in relationships may extend beyond government agencies. PRODEL,

for example, is also working to change relationships between low-income citizens, the state

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Box 3

The poor and the state

In Faisalabad, the ASB (a welfare organization run by local residents) sought to improve water and sanitation

provision in low-income settlements. Initially local authorities showed little interest in their work. One official

demanded a bribe when the household needed a license to bring a water pipe across a road in order to provide a water

network to one neighbourhood. The community decided to do this portion of their work at night, confident that once

it was completed they would be able to keep the pipe and pay a fine. Through a combination of clandestine activities

and occasional bribes, the community completed the connection to the mains’ water supply. Their first successes were

judged by some to be more of a threat than an achievement. One local politician sought to undermine their activities

by promising households free connections if they stopped participating in the ASB programme.

In addition to a skeptical local authority, ASB faced local households who were unwilling and unable to invest a large

amount in water and sanitation. A grant from WaterAid enabled the organization to construct secondary pipes,

thereby establishing the beginnings of a network that families could connect to. Families were asked to pay the

connection costs for their house to the lane sewer and repay their share of the cost of the secondary pipe, enabling

further expansion of the network. ASB found that families were willing to do this. External donor finance and local

visionaries were successful in catalysing a change in attitudes. More and more families became interested in taking

part.

As the local authority began to see that families were willing to pay the cost of piped water, they also became

interested. Nazir Wattoo, the leader of the organization was invited to participate in a number of government

activities. Within a few months, he had been offered state funds to carry on his work, extending activities to other

settlements. At the same time, interaction increased between local staff of the water authority and ASB staff. ASB

offered their own area plans to assist in state-financed improvements. They were asked to assist in monitoring private

contractors on a state programme to improve their neighbourhoods.

Box 4

New relationships, new possibilities

At the heart of many of PRODEL’s strategies lies the need to restructure the relationship between citizen and the

state. Once a project has been approved, PRODEL signs a contract with the municipal government and places their

share of the project costs in a special account. The contract makes the obligations on both sides transparent and helps

to improve accountability. The community and municipality then have to contribute their own shares prior to

PRODEL’s own funds being released. Finance is only forthcoming if the project addresses local need. Prior to the

signing of the contract, there is a participatory planning process with the local communities and local authority staff.

Politicians often take part. This helps to ensure that activities are relevant and affordable.

Over time, members of the municipal staff have begun to use the participatory methodologies that characterize their

work with local community through PRODEL in other spheres. Through their experience with PRODEL, they realize

that local residents often have many good ideas about what needs to be done and how the activities should be

completed. Instead of believing that they know best, they have learnt new skills in listening and consultation.

At the same time, citizen’s attitudes have also begun to change. In Ocotal, the municipal government was able to

increase its tax collection rate by 30 per cent as a result of this new relationship. According to one of the leaders in the

Barrio Hermanos Zamorain (in which there was a project, part-financed through PRODEL, to upgrade streets)

‘‘ywe realized that our taxes were being invested in works in which we ourselves had participated in the

identification, definition, execution and auditing of the projects.’’


commercial bank and micro-finance NGOs (Stein, 2001). Staff hope that the banks will go on tolend to the poor of its own accord as it gains greater familiarity with their financial situation andcredit needs. The Carvajal Foundation in Cali seeks to address the exclusion of the poor frommany large-scale commercial processes. In particular, they have encouraged large materialproduction companies to supply direct to centres in low-income settlements, thereby reducing thecost of building (Davila, 2001).

4.3. Redeveloping urban solutions

Turning to the physical process of urban development, it has long been recognized thatthere have been a dichotomy between conventional professionally led urban developmentstrategies and the realities of urban development as experienced by the poor (Choguill, 1996).However, although John Turner (1976) highlighted these problems several decades ago, therehas been limited action to address this situation. The programmes profiled in this study canbe seen as joining (to different degrees) a relatively under-used tradition that has sought tobring the resources of the state behind the development strategies that are being used by localpeople.Whilst these programmes seek to support the urban development strategies as they emerge from

the people’s own activities, none of them accept present solutions in their entirety. Rather theyseek to improve self-help solutions to better meet the basic needs of the poor. As SPARC explains,as an NGO they support circumstances in which the poor themselves can develop a range ofimproved options for themselves (Patel & Mitlin, 2001).Are there any emerging generalities about such new solutions? These solutions, for the most

part, address very basic needs. They are concerned with sanitation, housing, water supplies andother basic services and infrastructure. In a few cases, they are also concerned with economicdevelopment and livelihood opportunities. The solutions may involve new technological optionsand/or new financing options. But, leading on from the section above, perhaps their mostoutstanding characteristic is that they involve a new division of responsibility between the citizenand the state, with a more substantive role for collectives of the urban poor.The urban development strategies being used by many professionals are based on urban

development as practiced in Northern towns and cities. The model is one in which thestate provides and local residents pay for services. It presupposes a state with a capacity to collecttaxes, invest and maintain these services. It also presupposes a populace that is, for the mostpart, able to pay the state for infrastructure and services. There is often a cross-subsidy fromricher to poorer families. As argued by Choguill (1996), in many Southern cities, none of thesepre-conditions holds. Nunan and Satterthwaite (2001), for example, describe the manydeficiencies in water and sanitation provision in nine Southern cities. In this situation,characterized by low levels of income, reaching the poor with infrastructure and services requiresconsiderably more flexibility, diversity and ingenuity. Working with the existing improvementstrategies of the poor brings cost savings. These are exemplified by Stein (2001)—he estimated thatcosts fell by 20 per cent when a paving project was carried out by a local community instead of aprivate contractor.These programmes are not unique in seeking to increase communities’ collective responsibilities

for infrastructure management. There have been many such initiatives as exemplified by

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Etemadi’s (2001) discussion of how the Cebu municipal government encourages communitieswithout water to establish a Communal Water Association and apply for a communal standpipe.However, this experience also points to distinctive characteristics of programmes studied whencompared to other initiatives. Without investments in community capacity, the experience inmany cases is negative. Etemadi (2001, p. 134) notes that leaders can once more be a problem with‘‘yundemocratic if not oppressive managementy, and a lack of financial transparency andaccountability.’’ She adds that it is not unusual for leaders to disappear with the money of theassociation. These and similar experiences suggest that simply passing over funds and/responsibilities is unlikely sufficient. It is only once localized management capacities exist withingrassroots organizations that they can negotiate for, and then sustain, a new relationship with thelocal authority.There are evident synergies between these three strategies that have been described in this

section. Stronger grassroots organizations are able to create new relationships and more activelymanage urban services. Better relationships help to minimize the risks of more traditionalclientalist influences from politicians and state officials, and build grassroots organizations toaddress the needs of their members. Strong grassroots organizations and new relationshipswith municipalities enable both parties to contribute to new solutions to urban development.New ways of undertaking urban development can themselves strengthen grassroots organizationsas the people become involved in managing collective resources. Box 5 describes how thesesynergies are realized by SPARC and one of the two community networks that they work with(Patel et al., 2001).

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Box 5

Toilet provision in Dharavi (Mumbai)

Mahila Milan members faced an acute problem in Dharavi because there was less than one toilet for 700 people. With

high densities and shacks packed tightly against one another, there was little space for individual toilets. However,

there were the vacant plots that had been left on public land or small spaces that could be used for communal toilets.

As they considered alternative designs, the women began to realize the advantages of communal toilets. Managing the

toilet would help to bring them all together. They would have a collective responsibility to manage the facility that

would strengthen the organization. Women would come together regularly to pay their contributions and decide

management issues. In addition to saving together, they would see for themselves what more they could do. The toilet

blocks might be the first step to other ideas that could be realized for the development of the community. Moreover,

communal toilet facilities were cheaper and more hygienic than individual provision, particularly given the lack of

living space.

Families would pay a monthly fee to contribute to the cleaning and maintenance of the toilet. These funds could

provide a livelihood for one of their poorest members.

The women discovered that the city had funding to improve toilet provision from the state but that the municipal

officials had no idea how these funds could be used. Sometimes the funds were returned to state budgets despite the

acute need in the city. The first Mahila Milan toilet blocks in Dharavi were constructed with a mixture of resources,

land begged for from the state, and some small state funds supplemented by donor grants. From the first experiences,

Mahila Milan improved their model. Within 5 years they found themselves being asked to tender for a city-wide

World Bank financed programme to improve provision for one million ‘‘slum’’ dwellers. The municipal government

realized the advantages that an alliance with the poor could offer. If the city provided land, materials and funds for the

labour costs of construction, the community could maintain and manage provision far more efficiently that the city

authorities could ever hope to do.


5. Conclusion

This analysis of successful projects in urban poverty reduction suggests that a number ofcommon themes may be important in explaining their achievements. These common themes arenot of prime importance in every case nor are they alone in being the factors that are important.Nevertheless, there are some remarkable consistencies in these studies. Three significant strategiesemerge as being of persistent importance; together they enhance two assets (social and financial),and enable these assets to be used more effectively. First, strategies strengthen social capital withinlow-income neighbourhoods, and strengthen political capital (a component of social capital)between low-income neighbourhoods and relevant state authorities. Second, strategies buildfinancial capital enabling communities to invest in their own neighbourhoods and homes. Third,strategies influence the approach to urban development so that it is affordable, ensuring thatexisting financial capital can be used more effectively and reinforcing social capital within andbetween communities.As significantly, the studies themselves suggest that some programme limitations may be

because of a lack of focus on the approaches explored here. In El Mezquital, for example, the lackof success in rebuilding relationships with the state may have resulted in the stagnation ofactivities. And in Cali, the pre-dominant focus on improving the inclusion of the poor within themarket may have been one of the reasons why there was a lack of pressure on the state to takeover needed services when the Foundations withdrew.Whatever the generalizable conclusions, it is also evident that it is not possible to be

prescriptive. Perhaps one of the most important features emerging from this overview is thatgrassroots organizations and local authorities need to change their existing relationships. For thisto happen, there needs to be a process flexible enough to accommodate each of their needs andresponsive to each of their perspectives and demands. The lessons here might be most usefullyconsidered to be indicative, explaining and exploring how some programmes are approachingurban poverty reduction.What does this imply for donor assistance? As argued by Satterthwaite (2001), these experiences

highlight two points of particular relevance to international donors seeking scale. First, there is aneed for donor programmes to involve local institutions that are able to spread success beyondone settlement or activity. Second, donors need to build or otherwise support the capacity of thelocal (non-government or community) institutions to change the way that local governmentoperates and interacts with the urban poor.Amis (2001) assesses poverty reduction strategies within the DFID-funded Indian Slum

Improvements Programmes. His conclusion is that infrastructure investment improves thequality of life, although it does not bear directly on any aspects of poverty as defined by thepoor themselves (Amis, 2001). The experiences considered in this paper emphasize the willingnessof the poor themselves to invest their scarce funds in local infrastructure improvements. Thisreinforces Amis’s conclusion about the importance of infrastructure investment. As importantly,the nature of these programmes is flexible, responding to need as it arises (Satterthwaite, 2001).Whilst there is a strong focus on infrastructure and neighbourhood improvements, theprogrammes extend in one direction to address housing need and in another for incomegeneration activities. And perhaps as importantly, the strengthening of social organization helpsto address other needs.

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Many of the donors have supported the Social Investment Funds promoted by the World Bankfrom the late 1980s. Tendler’s recent analysis (Tendler, 2001) suggests that many such Funds maynot be an effective use of development monies. She suggests that they may struggle to reach thepoorest districts and/or communities, and they often pay very low wages to those that theyemploy. At the same time, she argues that their lack of decentralization has meant that no localfunds have been forthcoming for maintenance (due to a lack of community pressure) and hencethe investments may soon be worth little. Unlike the Social Investment Funds described byTendler, these programmes discussed here are all decentralized, either intentionally or simplybecause they have expanded from grassroots initiatives.Hence, the experiences emerging from these programmes reinforce some existing messages.

Donors can help to address urban poverty if they invest in locally driven processes that offerflexible funding. But to do so they need to identify local organizations that are prepared tosupport community led development and rebuild relationships between the urban poor and thelocal authorities. If such institutions do not exist, they can be supported. This process may taketime (and may be unsuccessful) but once such institutions are in place, effective assistance is ableto support a process of progressive pro-poor change.

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