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Setting It Up
General Issues

There are five basic issues that are fundamental to upgrading programs. Several key tradeoffs are inherent in any project/program.

Six Basic Issues

The following six issues are fundamental to upgrading programs:

  • Costs, financing, and cost recovery
  • Water and sanitation issues
  • Land tenure and security
  • Linkages to other services
  • Institutional responsibilities and roles of different stakeholders

Costs, financing, and cost recovery

  • Importance of delinking subsidies from standards
  • Recognize role of local government subsidies and community contribution
  • Importance of mobilizing local financing to improve predictability and reduce reliance on transfers from state and central government level

Water and Sanitation

  • Role of private sector, competition, regulation, and attracting foreign investment
  • Role of capital markets and using water and sanitation sector as a way to tap into capital markets (e.g., bonds)
  • Give due importance to sanitation in order to provide environmentally sustainable solutions and also to deal with health consequences of lack of services

Land tenure and security

  • Many solutions exist and there are opportunities to learn from successes
  • Need to recognize the role of different forms of tenure and levels of security
  • Importance of taking a long term view (>20 years) when seeking solutions
  • Need to minimize relocation, keep relocated residents close to services, and maintain rental services for informal settlements
  • Availability of simple solutions with appropriate technology (e.g., photography and community verification of ground truth as substitute to aerial maps)
  • Land speculation and the need to deal with it

Linkages to other services

  • Comprehensive approach to upgrading (social, physical, economic etc)
  • Community in drivers seat to define preferences, local government as sandwich filler to ensure synergies
  • Need for microfinance to focus on savings, loans, insurance with small and frequent loans but need to link informal to formal systems--examples exist on use of intermediaries as guarantors or deliverers of collateral
  • Need clear definition of roles and accountabilities between actors in microfinance and keep costs of coordination/administration low while seeking to integrate and mainstream key elements

Institutional responsibilities and roles of different stakeholders

  • Roles and accountabilities between state government, local government, communities, NGOs and role of subsidiarity--in financing, implementation, design, maintenance etc and by who initiates, executes, supports, or finances
  • Need for agreements with utilities and other service providers, especially in the context of privatization on roles and accountabilities but also on prices/charges

Key Tradeoffs in Project/Program Definition

Cost recovery



How can you achieve financial sustainability?




Local preferences, innovation

How can you balance adaptability and replicability?




Speed of action/implementation

How can you scale-up in a sustainable way?


Capacity building


Contracting out

How can you balance ownership, efficiency, and speed?




In-situ upgrading

How can you balance between planned and evolved cityscapes?


Cure existing slums


Prevent new slums

How can you balance holistic and long-term vs short-term results?

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