Bowling with the Mayor: Overview of the Context, Work and

Significance of the Homeless People’s Federation of the

Philippines

Mark Swilling
Sustainability Institute, School of Public Management and Planning,
Stellenbosch University, South Africa
January 2007

Introduction

The primary purpose of this paper is to contribute to an improved understanding of the

context, work and significance of the Homeless People’s Federation of the Philippines
(HPFP). This overview was commissioned by Shack Dwellers International (SDI). Although
a specific brief related to a particular programme or grant was not provided by SDI as a way
of structuring the focus of this overview, it was my understanding that the SDI required a
succinct strategic analysis of the HPFP with respect to the following:

 Context: what are the most significant contextual changes and dynamics that contribute to
our understanding of the actions, strategies and responses of the HPFP?
 Main activities: what are the main activities and strategic actions of the HPFP and are
these appropriate for the context? To what extent are the HPFP and its various support
structures adequately configured to sustain these activities and strategic actions over
time?
 Significance: what is the historical and strategic significance of the work of the HPFP
with respect to both urban development in the Philippines, and the wider challenges that
the SDI faces at a global level?

This overview was compiled on the basis of (a) a review of a wide range of published and
web-based materials, plus published and unpublished documents provided by the HPFP,
various academics in the Philippines, and the SDI; and (b) field visits and interviews
conducted in the Philippines in various cities during November 2006.

This paper is not intended to be a formal so-called ‘programme evaluation’ as such, nor is it a
systematic ‘academic review’. Instead, the aim is to provide a ‘strategic perspective’ that
stems from an appreciative and supportive inquiry into how those involved with the HPFP
understand what they are doing, and whether this is appropriate given the changing socio-
economic and ecological context within which their various activities are located. An
underlying assumption of this approach is that social actors at any point in time only have a
partial understanding of their context, and they act in accordance with the constraints of the
institutional and financial resources available to them. Analysis should serve the purpose of
improving their understanding of the changing context, and what they should consider doing
to enhance the impact of their actions within the constraints of the resources available to
them.

The remainder of this overview is structured as follows:

First, a brief overview of the institutional and organizational structure of the HPFP and its
allied organizations will be provided. The core argument will be that the HPFP has become a
mature urban social movement with all the classical hallmarks of such a movement, including
a story of its genesis, a defined and coherent leadership, well documented standard practices
and disciplines, a substantial mass base, access to professional resources, access to financial
resources, sustained engagements with key players in the existing power structures, and a set
of stories about struggles, wins, losses and compromises.

Second, the changing context within which the work of the HPFP is located will be described
focusing in particular on two dynamics, namely: the nexus between the changing economic
structure/dynamic of the city and how this affects the strategies of homeless communities;
and the nexus between eco-systems and occupational vulnerability of homeless communities.

Third, based on some case studies of the work of HPFP affiliates, four themes will be
discussed that highlight the strategic significance of the work of the HPFP, including the
challenges that the HPFP might face in future with regard to these themes. These themes
include access to land within a context of urban economic restructuring, response to disasters,
building local economies, and the challenge of building and sustaining alliances.

Finally, a conclusion is provided that offers various reflections and recommendations that
may be useful for both the HPFP and the SDI.

HPFP: Institutional Overview

As an institution and organizational form, the HPFP is both interesting and significant from
an international social movement perspective because it has managed to combine a non-
hierarchical anti-bureaucratic organizing style with the formalities of institutionalization. This
was in part the result of a regulatory environment in the Philippines that makes it a legal
requirement that associations are registered and accredited in accordance with strictly defined
legal templates. The fact that associations handle savings and loans and therefore require
bank accounts also made it necessary to constitute formal legally recognised structures. As a
result, the HPFP is a federation of autonomous Community Associations (CA) and Home
Owners Associations (HOA) that have applied to become a member of the federation. The
HPFP is itself a registered Community Association (i.e. “Homeless People’s Federation of the
Philippines Inc.”). In Philippine law, a local association of residents can register as a CA with
the Security Exchange Commission (SEC) or as a HOA with the Housing and Land Use
Regulatory Board. In both cases there is a standard format for the constitution of the CA or
HOA that must be adhered to which, in turn, affects everyday practice – for example, via the
titles of the positions on the Executive, etc.

The HPFP has 160 member associations drawn from 18 cities, 144 of which are CAs and 16
are HOAs. Altogether, there are approximately 50 000 individual members who had saved
approximately US$3,5 million by 2005. An Urban Poor Development Fund has been
established to manage savings and loans, and to capture and manage grants from a wide range
of donors.

Besides the formal legally required constitution of the HPFP as a CA, the leadership of the
HPFP initiated in 2005 a process of drawing up what is referred to as a National Code of
Policies. This Code is significant not because of what it says, but because of the protracted
process of participatory dialogue that has resulted in the formulation of a wide range of
policies relating to the formalities of membership criteria, vision and purpose of the
federation, rights and obligations of members, financial management, accountability and
monitoring, management processes and conflicts of interest. The draft Code reinforces the
requirement that members must be registered CAs or HOAs, and that proof of annual renewal
of registration must be provided to the HPFP. However, it also adds a further requirement,
namely that a given CA or HOA that wants to be a member of the HPFP must also be
“accredited” as a bona fide association with their Local Government Unit. This reflects the
desire stated in the CODE and repeatedly referred to by the leadership at all levels to become
a major player in the “governance” of the cities. Informants were not able to say when the
Code will be finalized.

Despite the formal hierarchy implied by the legal structure, participants tend to depict the
structure of the federation as an upside down pyramid with the General Assembly of roughly
50 000 individual CA/HOA members at the top, who elect the leadership of their local
associations who, in turn, elect the national leadership of the HPFP. (Elections for the
national leadership take place every ???, and not always via a national meeting – some
elections have taken place via the internet.) It is highly significant that although in practice
the work of the federation is coordinated via regions, the national leadership are directly
elected by the local associations. In other words, the regional leadership is not elected from
the bottom up, but rather derives its mandate from the directly elected national leadership.
This is an important mechanism for preventing the development of regional powerbases or
divisions along regional lines with respect to strategy, funding, etc.

Although in certain regions the HPFP is developing its own internal professional capacity, it
is in general supported by an NGO called Philippi Action for Community-Led Shelter
Initiatives, Inc. or PACSII. Building on the capacity and networks established by the Church-
based Vincentian Missionaries Social Development Foundation (VMSDF) that Fr.
Carcellar established in Payatas in the early 1990s, PACSII was formed in 2003 and has a
board made up of individuals from the professional and development communities
(academic, legal, etc). PACSII has 4 staff in the national office in Manila, 1 in Iloilo, and 1 in
Davao. PACSII’s primary purpose is to provide a wide range of support services to the HPFP,
including professional advice, fundraising, logistics, training, learning exchanges, backup
during negotiations, and access to intermediaries in the media, government and funding
circles. PACSII is located within premises owned by the Church, and benefits from staff who
are willing to earn extremely low salaries (compared to similar NGOs in many other parts of
the world). However, it would be incorrect to assume that the HPFP and its affiliates rely
entirely on PACSII for support services – local affiliates draw support from a wide range of
sources, including other NGOs, local government officials, local church parishes, individual
professionals, various community-based social services (e.g. crèches, clinics, etc), and local
businesses.

As will become clear in the sections that follow, a significant number of the HPFP affiliates
are being drawn into complicated policy-level and project-level initiatives (e.g. the Northrail
relocations, or city-wide strategic planning in Iloilo). To be effective, these affiliates need the
advice and support of a range of specialists, in particular urban planners, but also architects,
lawyers, economists, quantity surveyors, engineers, social scientists and environmental
scientists. However, PACSII does not envisage employing these specialists, nor are HPFP
affiliates configured to employ them. Instead, inputs from specialists is ad hoc and often
accessed on a pro bono basis. There is no doubt that advice from specialists can be obtained
in this way. However, when it comes to the generation of sophisticated responses and
interventions, it will not be possible to rely on pro bono work. There is no doubt that the
HPFP and its affiliates need to have access to a permanent group of specialists who can, in
turn, cover the costs of their contribution. This can either be via the traditional route of a
‘professional service’ NGO, or via a structured network of specialists who work in
Universities, NGOs, consultancies, etc. The latter is probably preferable, but these
relationships need to be formalized via well structured contracts that specify obligations,
terms of reference and remuneration methods. However, a full-time coordinator of such a
support network will be required – neither the HPFP nor the local associations should be
expected to manage these contractual arrangements. A standardized approach for all localities
is required that minimizes the potential for misunderstanding and ensures that the system is
efficient (i.e. that fees paid are commensurate with the value of the outputs).

Like many well established social movements, the HPFP/PACSII alliance can identify and
repeatedly re-tell it’s ‘founding story’. A founding story is usually about a place where a
group of people managed to figure out a new of way of doing things that others seek to
emulate. In this case it is the story of Payatas and the work of Fr. Norberto Carcellar, a priest
who was assigned to work there in 1991. The Payatas story is significant not only because it
tells the story of the emergence of an approach that fires up an entire movement, but also
because it is a living story of a place that others from all over the Philippines can visit and
learn from other homeless people. In other words, others can visit and hear the many different
stories of ordinary people like themselves faced with the same challenges.

A key part of the Payatas story is that it is a community that does not formally exist – the fact
that it does not exist on an official map seems to reinforce the image that this is a self-made
community, created through desperation out of nothing. Located in the Quezon City area
(which forms part of wider Metro Manila), Payatas had a population of around 20 000 in the
1980s rising to about 50 000 people by the early 1990s due to the fact that it was regarded as
a ‘relocation site’ by the local authorities. At the same time, however, it became a major
dumpsite for Metro Manila’s waste. It is now dominated by a massive mountain of waste that
is mined by a group of over 4000 scavengers.

Between 1991 and 1995, Fr. Carcellar responded to the desperate poverty that surrounded
him using all the best tried and tested development practices – feeding schemes, health
projects, education, and a Grameen-bank type1 savings scheme. However, like all
development projects of this nature, it was dependent on his energy and the inflow of external
funds. Inevitably, Fr. Carcellar started to worry that his development projects were making an
unbearable situation a little easier for some, but without changing anything fundamental; nor
did they have the capacity to mobilise large numbers of people to change their conditions.
This is when he made contact via his German funders with movements who had developed
alternative practices in India and South Africa. The result was the implementation from 1995
onwards of a self-managed savings-based strategy that resulted in 5 300 depositors organised
into 540 savings groups in Payatas alone by mid-1997. The linkages between savings and
poverty eradication via land development emerged after a visit by SDI leaders in 1997. Fr.
Carcellar and the local Payatas leadership were introduced to financial systems, institutional
structures, local organizing strategies and learning approaches that were rapidly implemented
with positive results. It became clear to Fr. Carcellar and VCMSDF that they had found what
they had been looking for, namely a way of mobilizing and organizing people for

1
. A ‘Grameen-type’ micro-finance system is one that emulates the Bangladesh-based Grameen Bank founded
by Mohamed Yunus. This model requires a paid professional staff to manage the financial transactions which, in
turn, means that large volumes are required. To achieve this, large amounts of grant funding are required over a
prolonged period of time to build a large enough membership base to generate the surpluses required to finance
the paid professional staff. This is why the Grameen model is difficult to replicate.
development that depended on the commitment, solidarity and energy of the people
themselves rather than on externally funded NGO staff. By 1998 the Payatas leadership were
fanning out across the Philippines, other communities were visiting Payatas to learn, and by
1998 the HPFP had been formed.

An interesting and enduring theme that emerges in the recorded work and verbal discussions
with HPFP/PACSII leaders is the relationship between disaster and organizational strategy.
This is obviously related to the fact that HPFP members live in some of the most dangerous
and vulnerable locations in a country plagued by floods, typhoons, heat waves and soil
movements. However, it also relates back to the day in 2000 when the dumpsite in Payatas
collapsed after days of heavy rainfall killing 200 people. What was significant about this
event is that the fledgling HPFP movement was able to test and grow it’s organizational
strength as members responded to the crisis; and in the aftermath there was a massive
increase in savings and membership. Independent research confirmed that far from
destabilizing the movement, the crisis reinforced it. In a country where disasters are a way of
life, a movement that knows how to take advantage of crises in ways that benefit its members
is certainly a major advantage.

It is significant that the bulk of the national HPFP leadership are based in Metro Manila and
operate out of Church-owned premises that they share with PACSII. They define themselves
as full-time volunteers, and they meet daily at the offices. There is a formal weekly meeting
to discuss progress and strategy, a monthly meeting of leaders from the Luzon region, and a
formal meeting of the national leadership twice annually. The Manila-based group comprises
a core of highly motivated, capable and experienced women who have developed strong
personal and professional relations of trust and understanding. Benefitting from exchanges
within and beyond the Philippines, a long history of dealing with money, the harsh and often
lonely experience of community leadership, and many victories and defeats, this group knows
what it means to build an effective organization. Over time they have learnt the key personal
and logistical skills required for flexible and rapid responses – travel, telecommunications,
computing, report writing, negotiation, multiple languages and financial management and
control.

The long-term financial viability of the leadership group is not that clear. They all insist that
they are volunteers, but they also benefit from some sort of stipend and reimbursement of
costs. It is clear that most could find permanent jobs and earn more (especially given the
skills and capacities they have developed over time from their involvement in movement),
thus suggesting that their families are either cross-subsidizing their work, or paying the price
of non-earned potential income. The reason for this arrangement is obviously related to
concerns about entrenching a professionalized self-interested leadership. This advantage,
however, could either result in a loss of leadership capacity over time (if individuals are
forced by family circumstances to find more lucrative jobs), or a failure to attract new
leadership into what might be perceived to be a financially crippling role. This, in turn, could
reinforce the entrenchment of a self-interested leadership that knows how to work the stipend
system in ways that may not always be apparent to the outsider.

It is clear that the HPFP leadership and the PACSII staff that support them have paid
particularly close attention to the practices and disciplines of the movement, in particular with
respect to the savings and loans system. Compared to other countries in the SDI network, it
would appear that the HPFP has developed a particularly efficient and sophisticated set of
systems and documents for managing the recordal of savings and loans transactions. This has
been coupled to training and exchange programmes for local organizers that have generated a
sense of dedication and commitment that seems to have sustained itself over time. This has
got much to do with the fact that in communities with substantial numbers of savers, there are
women who are full-time volunteers working out of neatly organised spaces (in homes or
social facilities like crèches or dedicated offices) who earn a stipend for their efforts paid out
of the interest earned from loans and/or externally raised funds. By linking the opportunity to
earn an income and community organizing, the HPFP has created the conditions for long-
term institutional viability of the movement – this being something that has eluded many
other movements for decades thus leading to the rapid rise and decline of movements for
change. The downside, of course, is that this could entrench a self-interested group that has
the power to hide corrupt practices – there is already much experience in the movement with
such problems. However, in contrast to the mainstream (staff managed) micro-finance
movement who see savings and loan levels as the measure of success, the HPFP sees (self-
organised) savings and loans as a key indicator of social solidarity, strength and intra-
community trust.

It is clear that the HPFP/PACSII alliance does not have an easy relationship with the wider
non-profit sector in the Philippines. For some of the rights-based more radical social
movements/NGOs who rely on protest and policy lobbying, the HPFP is regarded as
reformist at best and welfarist at worst. The HPFP’s refusal to openly join street protests
against relocations related to the North Rail project is cited as an example. For the traditional
developmental NGOs and micro-finance organizations, the HPFP/PACSII alliance is regarded
as reckless because there are insufficient professional staff to support all the different projects
and programmes. The standard HPFP response to these criticisms is that the radical
movements achieve little of tangible value for the poor by protesting, and that the traditional
NGOs don’t trust the communities to figure out things for themselves outside the control of
the professionals.

The HPFP has developed an impressive range of national and international alliances and
networks. The most obvious are the SDI and the NSDF. The SDI approach of learning via
exchange visits between poor communities has clearly resulted in the development of skills,
systems innovation, vision and confidence building. The links between the HPFP and ACHR
has also helped build wider networks and access to strategic information (e.g. funding
sources, useful research, policy proposals). The HPFP is also well regarded by the mult-
lateral development institutions such as the World Bank, Asian Development Bank, UN-
Habitat and the UNDP. Specific collaborations with the ADB, for example, has resulted in
project-level financing for infrastructure (Golden Shower).

At the national level, HPFP has developed working relationships with the Housing and Urban
Development Coordinating Council (HUDCC), the National Housing Authority (NHA) and
the Housing and Land Use Regulatory Board (HLURB). Similar working relationship have
evolved at the local level between local associations and local governments. As will be shown
below, this has evolved in significant ways into city-wide alliance formation with Iloilo being
a particularly good example.

As far as the current ‘national programme’ of the HPFP is concerned, this is constantly
shifting in ways that are common to such movements the world over. On the one hand, there
is a formal programme, often formulated in a language that fits with the funding priorities of
a particular donor or group of donors. On the other, there is the reality of everyday activities
which are more driven by daily pressures and demands than by the codified structure of the
grant agreement (especially if this happens to be formulated via the highly rigid requirements
of the “Logical Framework” approach). Nevertheless, it is worth capturing the outline of the
formal programme here:

 City-wide action: this refers to the need to move from a “’micro-ized’” view of
development to a multi-stakeholder environment that addresses secure tenure through
city-scale perspectives”. The emergence of a multiplicity of nodes of project-level
activity within a city makes this move towards city-wide action possible.
 Information management: using the information generated from community-managed
enumerations, the focus here is on the building of a comprehensive “database” of
information about slum dwellers that can then inform urban planning and community-
led development initiatives.
 Productive partnerships: this refers to the wide range of partnerships with
government at the neighbourhood, city-wide and national levels that have been
established to ensure greater participation by the urban poor in policy formulation,
city-wide planning, relocation policies and implementation plans, development
finance, and in sutu slum upgrading approaches. The significance of this aspect of the
programme is that the HPFP regards engagement and negotiation with government
not as a sign of cooption, but as a means of building the capacity of leaders to
understand what government is doing and what the opportunities are for securing
concrete improvements for their constituencies. This is different to most urban poor
movements who prefer to build up extra-state oppositional bases for protest coupled
to demands for change without necessarily building up the capacity to participate in
the implementation of these changes when their demands are met.
 Policy advocacy: given that there are in theory pro-poor legal frameworks in place
such as the Urban Development and Housing Act (1992), Local Government Code
(LGC) of 1991, and the Comprehensive and Integrated Shelter Finance Act (1994),
the HPFP believes that it is necessary to actively exploit the space that these
frameworks provide for participation in governance in order to lobby for pro-poor
policy frameworks at all levels of government.
 Design of innovative strategies for up-scaling community-led slum upgrading on a
city-wide base: the central focus of this strategy is the idea of a city-wide Urban Poor
Development Fund (UPDF) that can be used to mobilise development funds for
injecting into communities to match savings collected for investment in land, services
and housing. To build up the case for a UPDF that both government and the private
sector can eventually support, the HPFP has started to raise funds to pilot slum
upgrading and relocation projects that demonstrate what can be achieved if funds are
brought into communities to match locally generated savings to finance the
construction of infrastructure and housing.
 Alliances for learning communities: this refers to the commitment to document
lessons learnt from project implementation, as well as the documentation of key
disciplines, processes and procedures such as the rather remarkable document entitled
Manual on Fund Accounting System which describes in minute detail exactly how the
savings and loans systems should work.

What is common across all six of these components of the national programme is the need to
build substantial capacity at all levels of the HPFP and within PACSII. In particular, it will
entail investing resources in specialist skills, such as financial management, policy
development, and the technical dimensions of housing and infrastructure construction
(engineering, planning, architecture, etc). As already indicated, it is not clear how this will be
achieved in institutional terms, or whether the funds available from donors or other sources
are sufficient to cover the costs of this kind of capacity building. There is significant evidence
that local and city-wide federations do require more support than they are able to obtain
and/or afford. Without access to their own specialist advice, local associations run the risk of
approving – and therefore legitimizing – processes and solutions that could in the longer run
prove to run contrary to the interests of the urban poor. For example, it clearly makes sense to
actively work with local governments to ensure that relocations are executed in a way that
benefits the urban poor, but not if this results in the establishment of communities far beyond
the outskirts of the city resulting in increased expenditures on transportation or job losses.

Changing Context

This section will cover the following:

 The impact of globalisation on Asian cities, with special reference to Manila

 The impact on the urban poor of two trends in Filipino cities: the decline in residential
development space as a result of a preference for rezoning applications for commercial
use; and related to this, the huge gap between the rate that prices of residential land has
escalated and the rate of increase of average wages and salaries, there is less land
available for middle and poor households, and what is available is extraordinarily
expensive.
 The significance of the North Rail Project with respect to both of the above themes
 The implications of global warming and eco-system degradation for the Philippines, and
the urban poor in particular
 The implications from a sustainable resource use perspective of the unrecycled waste
materials generated by economic growth and middle class consumption
 ddf

Strategic Themes

Land, Participation and the North Rail Relocations

As already indicated in the previous section, the Government of the Philippines is driving a
wide range of interventions aimed at restructuring Metro Manila. The North Rail Project is
probably the most important of these interventions. Financed by the Export-Import Bank of
China, the North Rail Project achieves a number of objectives simultaneously: it has attracted
substantial foreign investment in infrastructure; via ‘decongestion’ it temporarily ‘resolves’
the crisis of land prices that was constraining the acceleration of pro-rich economic growth of
Metro Manila by creating new outer-city spaces for residential, non-residential and tourism
activities linked via rail to Metro Manila; and it creates the opportunity to relocate some of
the urban poor into formal settlements where they will have security of tenure, services and
housing. This, in effect, amounts to quite a fundamental restructuring of Metro Manila’s
economy in order to insert it into a new set of global economic flows dominated by Chinese
investors hungry for both raw materials required by the burgeoning Chinese economy and
markets for cheap manufactured goods. To this extent, the Philippines might be the first
major regional economy to switch from being primarily an American ‘zone of influence’ to
being a key node of Chinese economic power in ‘Pacific Asia’. The obstacle in the way of
this restructuring was the homeless families living in the so-called ‘ROW’ (‘Right of Way’)
areas.
For a number of people’s organizations and NGOs, resisting relocation was about resisting
this latest urban economic restructuring which has dubious benefits for the urban poor.
Broad-based protest actions were organised at various points to resist relocations. However,
as far as the HPFP was concerned, the relocations would proceed in any case, and therefore
what made most sense was to actively participate in the governance structures that were set
up to manage the relocations in order to negotiate the best possible deal for the relocatees.
The Northrail Relocation Project (NRP) was initiated in terms of Memorandum Order No. 46
issued by President Macapagal-Arroyo in December 2001. Although the relocations were
planned to be completed by October 2005, by January 2005 they had not even begun. This
delay reflected the enormous (seemingly unanticipated) complexities involved in the
relocation of 13 000 families.

In order to implement the NRP, an elaborate participatory governance structure was

established that served three purposes. Firstly, it was primarily designed to facilitate effective
coordination of the various Government Departments involved. Secondly, it facilitated
coordination across the three levels of government. And thirdly, at the local level of this
governance structure it created a space for the involvement of certain NGOs and people’s
organizations. The National Inter-Agency Committee (NAIC) comprised representatives from
the Housing and Urban Development Coordinating Council (HUDCC), National Housing
Authority (NHA), Philipine National Railways (PNR), Presidential Commission for the
Urban Poor (PCUP), Commission on Human Rights (CHR), National Anti-Poverty
Commission (NAPC), the Technical Education and Skills Development Authority (TESDA).
Although participation in the NAIC was limited to government bodies, this was not the case
when the Local Inter-Agency Committees (LIAC) were established for each municipal area.
These LIACs included representatives from three categories of stakeholders: National
Government - HUDCC, NHA, North Luzon Railways Corporation, PNR, PCUP, CHR;
Local Government – social welfare, planning, engineering, urban poor affairs, police,
Barangay Affairs; and “others” – Provincial Government, Barangay Chairpersons, NGOs,
Community Associations, People’s Organisations and various private groups.

The HPFP was one of the people’s organizations that participated in the LIAC, and by all
accounts the most significant given it’s active presence on the ground via affiliated
Community Associations. Four issues became the focus of conflict and negotiation within the
LIACs. The first was the land that government in collusion with developers had selected as
the designated area that affected families must be relocated to. The second was the process of
selection, i.e. who has the right to decide where people move to. The third was whether
relocatees would move into their already built houses or whether they had to first move into
temporary shelter. And the fourth was the cost of the land, services and houses and how much
of this would be a subsidy and how much would be a loan. The HPFP played a leading role –
often with local mayors as allies – in contesting these issues and proposing alternatives. How
these played out tells an important story about the new terrain of struggle that the HPFP has
entered into.

As far as the relocation sites are concerned, most government agencies assumed from the
start that a site known as BUHAI located in Norzagaray would be the most appropriate. This
site was offered by the Bulacan Provincial Governor. The development of this large outer-city
site goes back to 1997 when the Bulacan Government and a private developer agreed to build
what as defined as a ‘self-contained’ community. Unconfirmed reports refer to Php 120
million being spent by NHA to buy the land. To cut a long story short, many local mayors and
the HPFP were unhappy with the site because it was inappropriately located. During the
conflict over the site, however, much information surfaced about the role that private
developers play in the land deals that determine where the urban poor end up living, i.e. on
the outer edges of the city. There is plenty of evidence that elite networks between
developers, senior officials and politicians were used by developers who had the time and
resources to prepare elaborate proposals for the development of low value land for relocatees.
Their profit margins, however, were dependent on the land price that government was
prepared to pay – the higher the land price, the less was available for households to spend on
services and top structures. This, in turn, meant that the cheapest land with the maximum
number of sub-divisions (i.e. the smaller the plots the better) would generate the best possible
return for the developer. This pitted the developers against the Community Associations and
People’s Organizations involved in the LIACs who wanted what came to be called ‘in-
town/city’ locations (which are invariably more costly), larger plots, and the lowest possible
land price.

Although the HPFP did not win all its demands, the principle of ‘in-town/city’ location was
generally accepted and recognised. However, once it was recognised, the question was who
was going to identify the alternatives. Although the HPFP and its affiliates worked hard to
identify alternatives, so did the developers and local governments. The HPFP was able to
make proposals, but not all were accepted. Nevertheless, mobilizing and organizing local
associations to think beyond the upgrading or relocation of their own little community
created significant opportunities for city-wide collaborations between associations and for
building a greater awareness of city form.

The HPFP also struggled to make sure that relocatees moved into already built houses.
Although there was general policy agreement that all the infrastructure needed to be in place
by the time people moved so that they could live in temporary shelters (tents) while they built
their own homes, this did not always work this way. However, what the HPFP wanted was for
the houses to be built prior to relocation so that people moved directly into houses – a
particularly important demand given that the relocations were due to take place during the
rainy season. One example where the HPFP did succeed in winning this was in Balagtas
where the local association agreed to move voluntarily if the houses were built before the
date of demolition. Because the Balagtas relocation is generally regarded as a ‘model
relocation’, it is worth unpacking in greater detail because it reveals the inner workings of the
HPFP at local level.

The relocation process in Balagtas began in February 2005. 1206 families were affected. The
matter was thoroughly discussed in the LIAC for the area, which included one of the HPFP
national leaders. The local government officials were particularly sensitive and keen to work
out the best possible solution and worked closely with the HPFP leader on the ground. The
Mayor also took a personal interest in the project, and developed a strong relationship with
the HPFP leader. A key to the success of the entire relocation was that the HPFP leader
actually moved to the area for two months, living in room provided by the Social Welfare
department. The officials and the HPFP worked together on a daily basis. And on some of the
nights after a hard day’s work, they all went bowling together with the Mayor.

Initially, the relocatees resisted the idea of moving, but after seeing the proposed site and
realizing they will get secure tenure, a subsidy plus a loan, they agreed to move voluntarily
on condition the houses were built prior to the date of demolition. The local authority and the
HPFP worked together to help the community set up a Community Association, and the
HPFP ran training programmes about savings, community organizing and house building.
The local authority constructed a school, a health centre and a public market. Most
significantly of all, the local authority provides so-called ‘livelihood loans’ which are
designed to stimulate local businesses and establish a viable local economy in the new area
which is in fact located on the outer edge of the built up area. These zero interest loans are
provided to individuals who are organised into groups of 5. The agreement is that it is the
group that is responsible for the loan repayments, with one person in the group acting as the
collector. A portion of the loan is defined as a saving and is retained until the loan is repayed
– the lender can access his/her ‘savings’ after the loan has been repaid. They have been
exempted from municipal tax.

As far as the relocatees are concerned, they are satisfied that they have security of tenure and
services. However, transport costs have gone up – instead of being able to walk to work, they
must now pay 30 pesos per day to get to town. For some this has been too costly and they
have been forced to give up their jobs.

Finally, it is worth noting that the final budget per household was Php 175 000: Php 100 000
for the land, Php 1000 for a water supply, Php 1500 for a power supply, Php 50 000 for
housing building materials that the households used to build houses themselves (excluding
doors and windows), Phd 10000 for community facilities, Php 10000 for dismantling and
relocation, Php 1500 to rent a tent for 5 – 7 days, Php 1000 for food assistance. Php 50 000 of
the total amount of Php175000 was a subsidy, with the remainder provided as a loan
repayable over 25 years at a fixed rate of 6% and the option of a 5 year lease prior to the
commence of the repayment period. This is regarded as quite a heavily subsidized loan from
the government. Initially, government proposed that the entire Php175 000 would be made
available as a loan, thus effectively transferring the cost of their own relocation onto the
urban poor. However, this was contested in the LIACs, and reconsidered at the NAIC level
after which it was agreed that a portion would be fully subsidized. This was regarded as a
major concession by the HPFP and a vindication of their engagement and negotiation
approach.

In summary, there is little doubt that the HPFP’s strategic starting point was correct, namely
that these relocations would proceed no matter how much resistance there was. This was not
only a reading of the strength of the ‘state-developer-Chinese capital’ alliance, but also a
recognition that many of the relocatees would be offered security of tenure and loans to live
in significantly improved conditions even though these might be in locations which might be
geographically disadvantageous. Mobilising against something that is potentially partially
attractive to the envisaged protestors can be a recipe for disaster as many a good activist has
experienced. Participation in the LIACs may well pay off over the long term. The most
significant aspect of the HPFP involvement in the LIACs is that this experience exposed
many HPFP leaders and PACSII support staff to strategic planning on a city-wide basis and
connected them into city-wide governance and policy networks. So although the LIACs are
now in decline despite commitments to work together on ‘post-relocation support’, the
networks that were established will remain and the HPFP will continue to be seen by other
stakeholders as a key player at both the project and city-wide levels. The challenge in future,
however, will be to make sure that developers do not determine the location of relocation
sites because these tend to be on the outer edge. Much more vigorous work with professional
backup is required to demonstrate the advantage of locating the urban poor on land that is an
integral part of the inner city areas. For example, it would be a very simple task for an
economist to demonstrate that it is going to cost government more to locate the urban poor on
the periphery if one takes into account the full life cycle cost of the project than it would cost
if a higher land price is paid to secure inner city land where the costs of service delivery and
transportation are lower, and where access to employment is greater.

Building City-Wide Alliances in Iloilo City

Iloilo City is a beautiful seaside city with a population of 465 000 and numerous Universities
and centres of higher learning. This was one of the first cities outside Metro Manila to
experience the growth of associations affiliated to the HPFP. This followed a visit to Payatas
in 1997 by eleven people from the Barangays Calaparan and St. Nino Norte. Working
initially via the local church, the focus was on savings. The Kabalaka Homeowners
Association was established and by 2000 had a membership of nearly 4000 with savings
above the Php 4 million mark. The founding struggle of this movement has been the defense
of a beachfront community threatened with forced relocation. After nearly a decade of
struggle, the conflict remains unresolved. However, a permanent sense of threat and crisis has
made it possible to build up a strong well organised association with an extensive and well
organised savings base. Over time, the Kabalaka Homeowners Association has helped
communities across Iloilo City to establish their own associations, savings and loans systems,
and in most cases to affiliate to HPFP.

Like in Metro Manila, land values in Iloilo City have escalated over the last ten years at rates
that far exceed the average incomes of both poor working class households and middle class
households. This, plus the fact that rezoning has tended to favour commercial rather than
residential land use over the last 15 years, has resulted not only in homelessness amongst the
urban poor, but also across significant sections of lower ends of the middle class. The result is
that both public and neglected private land has been occupied by mixed income communities.
At the same time, the steady implementation of the Community Mortgage Programme (CMP)
since 1991 has resulted in the establishment of new communities across the city financed via
government loans from the CMP. Although the beneficiaries of the CMP loans are supposed
to be the urban poor, lower middle class families unable to access land via the normal
housing market have also tended to benefit from these loans (not least because they have the
personal resources, information and networks to access loans via the establishment of
Community Associations with a similar socio-economic profile). The result is the
development over time of mixed income communities who shared a common interest in
accessing well located affordable land for residential development.2

The fact that homelessness is not only a problem for the urban poor in Iloilo City, has resulted
in the emergence of a very interesting set of urban movements in this city that raises
important strategic questions for the HPFP. There are in fact three formal housing federations
in Iloilo City, plus a handful of non-affiliated associations (both CAs and HOAs). Each
reflect quite a distinct set of social and political interests that bring into relief the socio-
economic patterns referred to in the previous paragraph. Even within and between HPFP
affiliates in Iloilo City there are noticeable differences between associations made up of long
established mixed communities resisting relocation, and associations that represent members
in relocation sites that are primarily from the poorest of the poor. Significantly, however,
these different federations have agreed to work together in a city-wide alliance that has
managed to prompt the Mayor of Iloilo to establish the Iloilo City Urban Poor Council
2
. The exact opposite pattern prevails in South Africa: high levels of socio-economic inequality are expressed
spatially in highly visible separation of the middle class suburbs from areas where both informal and formalized
slums are located. There is no shared interest in South African cities between poor and middle class households.
(ICUPC). These federations are discussed below, followed by a review of the ICUPC. For the
HPFP leadership in Iloilo City, this means accepting and working with different interests that
may for now share an interest in access to serviced land, subsidies and secure tenure, but once
these are achieved, there may be divergent interests that result in strategic differences and
even disagreements not only between different federations, but even within the HPFP
membership base. In the meantime, these federations can only benefit from the educational
skills, resources and networks that more middle class people can contribute to a social
movement.

In addition to the 90 associations in Iloilo City affiliated to the HPFP - which between them
have (??? number) of members - there are three other formations that the HPFP have allied
with, namely:

Iloilo Federation of Community Associations (IFCA): IFCA was established in 1990 to

take advantage of the state-provided mortgage loans provided via the CMP since 1991 (25
year repayment period at 6% interest per annum). IFCA has 30 affiliated CAs, and each CA
has on average 100 to 200 members. 7 of the CAs have fully repaid their loans, which means
they are full owners of their land and houses. Most of their members have incomes of various
kind from both informal sector livelihoods (like tricycle drivers and vendors) through to
formal employment. IFCA has its own support NGO, called Iloilo People’s Habitat
Foundation which also gets funding from Miserior. IFCA is actively establishing new CAs to
assist poor homeless families to access the CMP mortgages. However, quite a few of the CAs
who have paid off their loans have members that can no longer be classified as part of the
urban poor.

Iloilo City Urban Poor Federation (ICUPFI): ICUPFI was established by the Iloilo City
Government in 2001. 42 CAs are members of ICUPFI, ranging in size of membership from
59 to 600. ICUPFI’s main purpose is to assist the City Government to facilitate voluntary
relocations. Generally, this means setting up a CA in an area that has been targeted for
relocation. Once it is established, land and funding will be identified, and if possible
government support such as the CMP loan will be secured. ICUPFI has close links with the
HPFP – this is reflected in the fact that HPFP helps ICUPFI affiliates to set up savings and
loans schemes that are identical to the HPFP system. In a relocation site called SOOC, for
example, there is a very strong CA affiliated to ICUPFI. The SOOC CA has members who
are extremely poor. The CA office is located in one of the residents’ houses and they use the
HPFP savings and loans system. In fact, HPFP regards the SOOC CA as a model not least
because of the diligent way they implement the savings and loan system. The other reason is
that savings were used to build a raised bridge throughout the community so that when it
rains and floods, people can still walk around without wading through water.

Finally, there are 3 non-affiliated CAs with members who have accessed CMP mortgages to
purchase plots on land bought by the National Housing Authority from private owners. The
fact that many have already paid of their loans and have their titles, plus the fact that plot
sizes range from 30 to 130 sq m suggests that the members of these non-affiliated CAs are
better off than the average CA member in the city. Despite their autonomy, they like the idea
of city-wide collaboration within the ICUPC.

After nearly two years of discussions and meetings, the Iloilo federations and the Mayor
agreed on a terms of reference for the ICUPC captured in a document entitled Iloilo City
Urban Poor Council: Proposed Policies and Guidelines. The opening statement reads as
follows:

“The Iloilo City Urban Poor Council (ICUPC) is a body composed o federated and
non-federated CAs/HOAs that will propose, formulate, implement/execute policies,
plans, activities, programs for the Urban Poor concerns; represent and advocate for
Urban Poor issues; facilitate, service assist, and disseminate information to the urban
poor communities of Iloilo City.”

The rest of the document defines the operating principles and structure of the ICUPC. Each
federation is allowed four representatives each, while the non-federated CAs/HOAs are
allowed three representatives between them. The common issues identified in human
development, city scale solidarity with respect to livelihood, land acquisition, incentives in
processing fees, financial and technical assistance, plus matters related to relocations and
housing construction.

During a discussion that took place on 11 November 2006 with all three federations plus
representatives from the non-federated CAs/HOAs, it was clear that the overriding aspiration
was to build a sense of city-wide unity and solidarity that was inclusive of the Mayor and the
Local Government officials. The argument was that the business has its forum which has
access to the Local Government, and so the “Urban Poor” should have a similar forum to
voice its particular concerns. However, when each leadership group was asked what they
would like to achieve in specific terms, none were able to satisfactorily answer the question.
There was no sense that there was a specific agenda of issues for negotiation.

The establishment of the ICUPC will result in a new operational and political context for the
work of the Iloilo leadership of the HPFP. It is clear that the HPFP has played a leading role
with respect to the promotion of the idea of the ICUPC, but also in making sure that the
meetings happen, and the various politicians and officials lobbied and included. Clearly, good
relations between the HPFP leadership and the Mayor have been a critical success factor.
When questioned closely, it is clear that the HPFP see the ICUPC as a forum where clear
policy frameworks for guiding Local Government interventions, planning decisions and
resource flows can be formulated, proposed and negotiated. The reason why all the
federations and non-federated associations need to be included is to prevent the Local
Government from striking up separate deals with different groupings. However, more
significantly, it would appear that it has been the Mayor who has pushed hard for the ICUPC
as a way of ensuring that the federations he is required to deal with align their demands and
proposals. This is preferable in his view to a fractured approach with lots of meetings with
different groupings about the same issues.

Undoubtedly the establishment of the ICUPC confirms that the HPFP has managed to upscale
its scope of operations from project-level implementation to cite-wide policy planning and
negotiation. However, it will need to face and deal with the following challenges:

 the dynamics of alliance politics, in particular when there is a possibility that over the
longer term different interests might surface leading to divergent strategies – the
challenge will be how to weigh up the time required to sustain the alliance versus the
time required by the daily operations and work of the HPFP;
 the formulation of specific proposals for negotiation, rather than relying on broad-
based good intentions and visions;
  the establishment of a core team of specialists to support the negotiation of city-wide
policy and planning frameworks – it is not advisable for the HPFP to rely on the
technical inputs and advice of the Local Government officials no matter how
sympathetic they may be; and finally,
 it will mean developing the capacity for prolonged negotiations, which means having
available the people with the time to negotiate, as well as making sure they have the
necessary negotiation skills.

In conclusion, the establishment of the ICUPC marks the entry of the HPFP’s Iloilo
leadership into alliance politics and into processes that will require the HPFP to build the
capacity for sustained policy development. This, in turn, is a reflection of a particular pattern
of urban development that has only recently started to recognize the residential development
needs of poor and middle class households. This shared interest in access to well located
affordable land, plus funding for services and housing construction, underlies the emergence
of alliance politics. Similar dynamics are apparent in many cities around the world, including
in the developed world where neo-liberal economic globalisation dynamics are not only
marginalizing the urban poor, but also the undermining middle class lifestyles (in particular
the youth who find it increasingly difficult to find affordable accommodation). Forums
similar to the ICUPC are also springing up in response to these dynamics. How the HPFP
takes advantage of this new terrain of struggle will provide valuable lessons that many others
will be able to learn from.

St. Bernard, Southern Leyte – Grassroots Disaster Management

As argued in the previous section, global warming will result in more serious flooding,
stronger typhoons, rising water tables and more unstable mountains over the next 25 years.
Poor communities in developing countries will pay the heaviest price for eco-system changes
induced by the consumption excesses of the richest countries. This is a story of how the
HPFP crafted a grassroots disaster management strategy that triggered a developmental
process that will build the social resilience of a small community that will face many more
disasters in the years ahead.

On 17 February 2006 at 10.27, they say, “the mountain fell down on us”, burying alive at
least 1000 people. Since then it’s been called “the tragedy”. It hit world headlines, triggered
a global emergency aid campaign, and the usual caravans of journalists, politicians,
rescuers, do-gooders, aid agencies, NGOs and business representatives came through. All
stared at the damage in dismay, shook hands with survivors, made promises to help, took
pictures, shed a tea, got back into their powerful vehicles, and sped off. Some delivered,
others wrote stories, most were never heard from again.

The mountain that fell down on the village below is called Ginsaugon. The only evidence of
the village that can still be seen are the tops of trees poking out above the great river of black
mud that was once a mountain. It had been rainy heavily for days, and the normal kind of
flooding was evident for a community used to these things. But this rain was different –
thanks to the warmer seas surrounding the islands, the typhoons that came through carried
much more moisture than ever before and as they hit land, massive quantities of water were
dropped onto the towering mountains. The sodden top soil lost its grip on the rocks and
probably started to slide slowly at first from the top, building pressure on the layers below
until in a sudden rush the entire soil structure collapsed. (One can only guess that tree felling
on the mountain sides may have removed the traditional organic support matrix.)
The villagers that lived below the mountain were all poor, living in houses made of a mix of
coconut wood, bamboo, cement bricks and reeds on the roof. They cultivated rice on the
flood plane between the mountain and the river that runs through the valley below. This area
was part of the small municipality called St. Bernard, a picturesque coastal town on the
Southern tip of Samay Island which is one of the largest of the 7100 islands that comprise the
Philippines. It takes four hours to drive from Tacloban, Samar Island’s capital, to this town of
25 000 people. The drive takes you high into the mountains clad in dense tropical forests that
knit the mountainsides to the rock inner cores, bringing only slight relief from the 40 degrees
C plus temperatures in the valleys below. But the sharp descent to the coast reveals a
coastline of inlets and bays, with horizons broken by tiny islands floating in a clear, calm
blue sea. Fishing boats glide slowly to somewhere.

As you enter St. Bernard a colourful recently painted sign reads: “Thank you for visiting St.
Bernard – a child friendly municipality.” The main street is typical of any Asian town:
congested streets with hooting taxis (125 cc motorbikes with sidecars, or chromed-up
colourful ‘jeep’ taxis with covered double bench seating spaces in the back), jostling
pedestrians, crumbling street infrastructure, hodge-podged thick-set concrete buildings
smudged black by years of neglect, and that familiar stench of petroleum fumes, raw sewage,
human sweat, markets, and all manner of things being cooked for sale on the streets with
aromas that hand thickly on the humid clammy atmosphere.

Nonay-Leopold Chavez (just known as ‘Nonay’) has woken early. It’s a big day for him. This
is the first visit to St. Bernard by “the federation” since he was deployed to St. Bernard a
week after “the tragedy” to help where he could. He has rented a space to sleep from a
widow who runs a restaurant from a large run-down house. Guests eat her delicious
indigenous food sitting at rickety tables on simple aging metal chairs. Children play in the
street where mounds of unshelled rice are drying out, but trees and cool draft keep the
slightly dark and dank space thankfully cool. He finalizes arrangements for a large luncheon
that will take place later at the restaurant, and leaves to get things organised. He’s in cell
phone contact with Thomas, the PACSII coordinator from Manila travelling with the SDI
delegation.

Nonay comes from Mandave City on Cebu Island. He’s in his late 40s, but exudes the activist
energy of a man half his age. He’s had a long history as a community organizer, but after
meeting the HPFP he adopted the key practices of the movement. As he put it, “the HPFP
approach made me realize that organizing through savings is the most effective way to
empower the urban poor.” Nonay is well build, muscular and just too tall to be called stocky.
With short cropped hair, a strong square face and intense dark eyes, he’s clearly wound up
very tight. People buzz around him, instructions to others are sharp, crisp and gentle, and he
has all the key facts at his fingertips. Not much escapes his roving eye as he scans the eager
faces of the leadership group of about 30 men and women that he’s trained and built since his
arrival in February. They’re all wearing new black T-shirts with “St. Bernerd: get up and
continue” (in the local language) printed on the front, with Homeless People’s Federation of
the Philippines printed on the back.

Living the closest to St. Bernard, Nonay way the natural choice when the HPFP leaders
decided to send someone to St. Bernard. Unlike the so many others who came to St. Bernard
after “the tragedy”, Nonay arrived with nothing but an organizing methodology and, of
course, he never left. He stayed to encourage, train, rebuild, and in the process pioneer what
we might want to call “grassroots disaster management”.

First stop for the SDI delegation was the Mayor’s office. Surprisingly, the building turned
out to be a freshly painted, beautifully clean building, with posters, friendly messages and
signboards that reflected the touch of someone that cared, with an eye for the details that
matter – a far cry from the traditional tired and dusty feeling one gets at most municipal
offices across the world. But a meeting with the Mayor explains it all. She’s about 60, short
and very slight, with one of those worried deeply caring faces lit up by clear intelligent eyes
that look up at you with a quizzical expression you shake her unusually large and firm hand.
Her fragile frame is dressed simply in a burgundy blouse and mustard coloured pants made
from a surprisingly thick material.

The next stop is a temporary settlement in a school yard Nonay has helped establish for the
survivors. Led by Nonay and the Mayor, the SDI delegation inspects sturdy temporary
shelters made from coconut beams, bamboo, plywood sheets, and thick reed roofs. HPFP
raised the funds and together with the families, built shelters for 52 families in the school
yard. While Nonay hovers, the SDI delegation is ushered into a small meeting room where
the Mayor tells the story of “the tragedy”. Local leaders in their black T-shirts tell theirs.
And so the story emerges of remarkable cooperation between the Municipality and the HPFP.
This is not simply about desperate measures to provide emergency shelter and rebuild the
houses, but also how the Mayor and the local leadership used the tragedy to build a whole
new set of relations that will change what governance means in St. Bernard for a long time to
come.

Nonay moved very quickly after he arrived in St. Bernard in March 2006. While helping with
emergency shelters, he also made sure that the people started setting up Community
Associations. By November there were 7 associations that were fully operational, including
savings systems. A HPFP report on the status of membership in four of the seven as at
November 2006 was presented as follows:

No. of Members No. of

Homeowners Association Community Leaders
(HOA) Name Men Women Men Women
1. Ayahag Homeless HOA 58 36 9 6
2. Sug-angon Homeless HOA 60 54 9 6
3. Hinabian Homeless HOA 118 107 4 11
4. Magatas Homeless HOA 56 54 5 10
TOTAL 292 251 27 33

Four exchanges were arranged – 3 for local leaders to visit other areas in the Philippines to
learn about HPFP practices from other poor communities, and 1 for the municipal officials
and the mayor. Savings and loans were introduced, and people trained to manage the
systems. All this was linked to joint efforts with the municipality to identify land for new
housing, and to raise funds for construction. The Mayor focused on fundraising from
government and international aid agencies. By November 287 new houses had been built, and
121 were under construction. In addition a cluster of brand new buildings had been
constructed – one was for a health clinic, the other was a day care centre, and the third was a
school. To meet the housing needs, a total of 1070 houses will be built. The plans, but not all
the funds, are already in place to achieve this. However, it is not the buildings that will equip
St. Bernard to handle the next disaster – it’s the organizational infrastructure that has been
established, the sense of trust and cohesion, and the working relationships with the Mayor
and municipality.

One concern about the house building programme is that conventional building materials are
being used. Given the remoteness of the area and therefore the cost of trucking in cement and
cement bricks, it is only logical to conclude that building costs must be relatively high and as
oil prices rise, this trend can only continue. The alternative would be to use the high value
soils that are in the area to build houses made of adobe brick, similar to what the Malawi
federation has done over the last 2 years. (Adobe brick is the most ancient building technique
that requires a mix of sand, clay and straw. The bricks are dried in the sun, and a clay mortar
is used to lay the bricks. Cement may be used to construct the foundations.) The end result
are houses that are cool in summer, warm in winter, and they are not affected by heavy rains
if the foundations are done properly and the roof overhangs are wide enough (minimum of
600 mm). They also perform better in earthquake zones because the material can vibrate and
move without causing large cracks. Another alternative is bamboo – there are specific species
of bamboo that could be grown in the area that provide materials that are stronger than
cement walls, cheaper, more sustainable and can be used in combination with adobe or
cement materials.

In conclusion, the St. Bernard story demonstrates how effective a grassroots empowerment
response to disaster can in fact be. As already argued, the HPFP needs to accept that disasters
will become more common and they could also become more destructive. Learning from the
St. Bernard experience will contribute significantly to the next rapid response to disaster.
Furthermore, it might be an experience that could help to work out what support services are
required to support his kind of grassroots disaster management (including advice on the most
appropriate building materials).

Sustaining Local Economies – the Payatas Case

As already described, the Payatas story plays a particular role in the larger story of the
historical evolution of the HPFP. The essence of the founding Payatas story being the shift
from welfare to savings-based development, accessing land and housing via savings and self-
organisation, the crisis triggered by the collapse of the dump in 2000, and the leadership role
the federation could play in the aftermath. However, ten years later there is another story that
is emerging in Payatas that many are aware of, but it has yet to be properly documented and
used as a focus for learning exchanges. I will refer to this as the “local economic
development” (LED) phenomenon. The reason why this is significant is that the HPFP – like
most SDI-linked federations elsewhere in the world – has traditionally linked savings and
loans to accessing services, housing and land. However, as in the case of the Toi Market in
Nairobi, a savings-based approach to community-led development can over time stimulate
new local economic development processes that are not dependent on external investments or
wage incomes. Before continuing, the ‘economics’ of all this needs a short explanation.

In most poor areas, there are few places to purchase goods, and most of the income earned is
by those who leave the area each day for jobs elsewhere. This means money comes into the
community, but immediately leaves it as people buy their goods elsewhere at shops that
employ people from other areas and secure supplies from elsewhere. This is made worse by
the fact that those who do earn tend to deposit their money in banks who, in turn, refuse to
lend money to poor people in the community. Instead, the money from the community gets
borrowed by people from other communities. If for some reason there is a local government
or an NGO that manages to find development funds to improve things in the community,
these funds come in and go out very quickly, with limited circulation within the community.
Also, if the national economy grows and more people from the community start getting jobs,
their earnings hardly ever ‘trickle down’ into the community for the above mentioned reasons
– they cannot buy what they need in the community and they save money in non-local banks
so that others elsewhere can borrow the money. This is why as a country grows economically,
poor communities can get poorer. All this changes when self-managed savings and loans are
introduced. Initially, it starts off small and makes little difference. However, it slowly builds
up without anyone noticing, but quite suddenly at a certain point in time the cumulative effect
of thousands of small transactions starts to make a real difference to the way the local
economy is working (what some might call a quantum shift). Taking advantage of the build-
up of surplus savings within the local savings groups, people start getting loans to open up
local businesses to supply goods directly within the community; food starts to be grown
locally instead of bought in from outside; more people start earning their living within the
community as employees or as vendors or entrepreneurs; via working together, receiving
money for goods sold or services rendered is safer from crime than before; key services like
waste collection or local house repairs start to emerge; and because outsiders see that things
are starting to buzz, more people start getting loans from outside banks for businesses within
the community and government departments and NGOs start setting up projects that create
jobs and bring in much needed services such as health care or skills development. After ten
years of savings and self-organisation, I think there are plenty of signs of this pattern in
Payatas. At its most simple level, if a local peso can circulate more than once before leaving
the community, that is what will generate the value that makes development possible. To
illustrate: in the case of a worker who gets a wage that gets deposited in his bank and then
gets spent at shops elsewhere, this cash does not circulate through the community; however,
the opposite is the case when someone earns her livelihood in the community, saves her
money via her CA’s saving system so that others can borrow it, buys locally from the local
shops and vendors who employ people from the community, and pays the local waste
collection service to collect her waste.

If I am correct, what is emerging in Payatas is a foretaste of what could happen in other

localities as their local associations strengthen, grow in number and increase their savings.
The challenge is how to make sure others don’t move into these localities to extract these
hard won financial gains – banks or franchises that open up in developing local communities
most of the time simply extract more cash than they put in as they employ non-locals, lend
out elsewhere, buy in goods from elsewhere, etc.

To illustrate the case, I will focus on only one aspect of the local economy, namely waste
recycling. Creating value out of the unwanted wastes generated mainly by the middle and
upper classes is clearly a major opportunity for the poor in ever city in the world. Local
church leaders and NGO workers estimate that there are 4000 scavengers who work the
Payatas waste dump every day. They earn on average 200 to 350 pesos per day (to put this in
perspective, if you get a CMP loan to acquire land and build a house, your monthly
repayment over 25 years will be around 200 pesos per month). This means that
approximately 1 million pesos on average is earned each day by a group of people who live
mainly in the Payatas community. What do they do with this money? Although it would be a
very simple matter to conduct a survey of a sample group to answer this question, this has not
been done. What is evident, however, is that this income is coming into the community and
circulating locally several times before leaving the community and this may have much to do
with the fact that quite a large number of scavengers are savers and CA members. In other
words, the combination of value extracted from waste plus savings-based self-organization is
triggering a local economic revolution with major implications. How can this be
strengthened? To answer this, we need to look more closely at the recycling value chain. It
can be represented as follows:

Cart pushers waste

– all over the city consumer

Paleros – truck
drivers (collection) products

Gate keepers @
dumpsite (who require a Manufacturer
payment from truck drivers,
often in waste)

Scavengers
on the dump
itself (who must
Recycling
also ’pay’ the Junk shop firm (chip the
gatekeepers) (who buy from plastic into useable
the scavengers) powder/pellets)

Scavengers and junk

shop can be combined, i.e.
junk shop employs staff as scavengers

The scavengers must sell to the junk shop – this is ruthlessly enforced. The junk shops are a
tight closed network who control all the buying and selling operations – an entrepreneurial
scavenger wanting to get higher prices by selling to the recycler direct will be in danger. The
recyclers are increasingly Chinese operators who sell mainly to Chinese manufacturers. The
manufacturers need high value plastics from the recyclers, but when US and EU firms dump
plastic waste in the Philippines, manufacturers buy this up and prices for recycled plastic
drops causing havoc down the value chain. Scavengers are known to hoard material until the
prices are right, and if they wash the material before they sell to the junk shops they can get a
higher price. Seasons also affect prices – recyclers have to pay higher prices in winter
because the plastic has to be dried and scavengers also get lower prices in winter for wet
products.

At the moment the CAs relate to the scavengers as savers and this is certainly contributing
significantly to the build up of a local economy in Payatas. If nothing else was done but to
continue with current practices, the HPFP in Payatas will have made a massive contribution
to kickstarting pro-poor economic development. However, if the scavengers would like to
earn more from the waste value chain, they will need to get organised for this. The least they
can do is produce more dry plastic. However, if they are organised they might be able to set
up their own junk shops or even recycling plant. Alternatively, a key manufacturer could be
approached to work directly with the scavengers to set up a recycling plant in Payatas. These
are all just examples of what could be thought about if there was a desire to move the local
economy into the next level of development.

In conclusion, the Payatas story seems to confirm that over time a savings-based community-
led development approach can gradually stimulate the development of strong local economies
via the capture and re-circulation of financial resources. HPFP leaders and PACSII support
staff are aware of this phenomenon. However, there may come a time when HPFP affiliates at
the local level start to request support to take advantage of these emerging local economies.
Specialist skills might be needed not to build models or take over, but rather to help facilitate
a participatory analysis of potential value chains and what kinds of interventions could be
considered that would increase the value that accrues to the local community. The case study
of the waste recycling value chain provided in this section is an example of what could be
practically viable.

Conclusions and Recommendations

In conclusion it is clear that HPFP has growth rapidly out of its humble beginnings in
Payatas. As demonstrated via the case studies, it has become a noted and well regarded player
at the strategic policy and planning level. Its numerous affiliates have developed considerable
experience and expertise in community-led neighbourhood development, with special
reference to land acquisition, services and housing. The sophisticated attention that has been
paid to the micro-dynamics of the savings and loans systems over the years has paid off
handsomely. Across the board there are women who can meticulously manage the systems
and transfer these skills to others.

Now that the HPFP is starting to mature, the purpose of this review has been to raise
questions about the strategic context within which the HPFP operates. Three themes seem to
emerge:

 the implications of city restructuring as a result of globalisation and the penetration of

new economic forces and logics, with the North Rail Project being the most tangible and
clear;
 the implications of global warming and eco-system degradation and how well prepared
the HPFP is for an increase in the number and intensity of human-induced natural
disasters, and in particular whether HPFP/PACSII understand the linkage between the
traditional grassroots development work of the federation and the challenge of global
warming and eco-system degradation;
 finally, it is clear across the board that the HPFP at national level and at city and local
level is going to need access to specialist inputs of various kinds.

With respect to the first theme, it was suggested that the HPFP is being drawn into city-wide
policy and planning work, which includes the risky area of alliance politics. Whether this is
about sitting in bodies such as the LIACs to coordinate relocations, or in the ICUPC to
formulate city-wide urban development policies, the HPFP needs to understand what it is
getting drawn into and it needs to make sure that really is furthering the interests of the urban
poor rather than oiling the wheels of globalisation-induced urban economic restructuring
designed to benefit investors and the economic elites.

With respect to the second theme, the St. Bernard disaster and the Payatas waste recycling
cases suggest that the work of the HPFP and its affiliates is already well entrenched in what is
now generally referred to as the sustainable development field, or more specifically the
sustainable resource use challenges. There is huge potential for the HPFP to expand this area
by making it a clear and explicit field of work that would be attractive to many international
donors. Disaster manager and waste recycling are major global challenges, but both fields are
entirely dominated by armies of technical experts and consultants who make money punting
expensive interventions that will have very little benefit for the poor. The HPFP has
developed in St. Bernard what I have called a “grassroots disaster management” approach,
and in Payatas (and elsewhere) a scavenger-based approach to waste recycling is in reality a
significant pro-poor alternative to the hi-tech waste recycling systems that technical experts
recommend to governments.

Finally, it is recommended that the HPFP/PACSII alliance give serious attention to the kinds
of support services that the burgeoning movement requires at the project and city-wide level.
The danger of an accumulation of power by a professional staff concentrated in a large
service NGO is noted and accepted. However, the alternative does not work either, i.e.
inadequate access to specialist services and advice. One option worth considering would be
the establishment of a network of service providers who could be brought together to figure
out how best to finance their involvement and coordinator their activities.