Chapter 23: URBAN DEVELOPMENT AND HOUSING SECTOR

The Guyana Electricity Corporation (GEC) with responsibility for electricity generation and distribution country-wide.

The Guyana Water Authority (GUYWA) which has responsibility for provision of potable water outside the precincts of the Georgetown Municipality.

The Georgetown Sewerage and Water Commissioners with responsibility to control, maintain, and manage the sewerage system and water works of Georgetown.

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E. Current Public Sector Planning

Traditionally, the CH&PA prepares all the plans for the public sector. It is only recently that the New Amsterdam Town Council took an initiative in planning by securing the services of a professional (volunteer) planner for the preparation of a new development plan for the area.

The CH&PA, ironically, does not have the capacity to cope with the increasing volume of planning activities, nor can it conduct these with the professional and technical depth and expertise in keeping with the current planning theory and practice. The concept of physical planning as pro-active now seems, for the greater part, to be lost on Government agencies.

The following are the only existing examples of town planning schemes:

The Greater Georgetown Plan (originally done in 1950, unrevised).

The Greater New Amsterdam Planning Scheme (originally done in 1969; recently replaced by "A Comprehensive Community Development Plan," 1993).

The Bartica Physical Development Plan (1986, unrevised).

The Linden Physical Development Plan (1987, currently being revised).

Anna Regina Physical Development Plan (1988, unrevised).

Except the recent plan for New Amsterdam, these plans are obsolete and therefore do not provide realistic guides for development control.

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F. The Implied Framework for Planning

1. Responsibility for the Preparation of Plans and Development Schemes

Physical planning has been defined as "the organising of building and land use in pursuance of an express scheme of urban or rural evolution" and more lengthily as:

"The art and science of ordering the use of land and the character and siting of buildings and communication routes so as to secure the maximum practicable degree of economy, convenience, and beauty."

These definitions provide the guiding principles of local physical planning, which is essentially "old style" land use planning for urban areas.

Physical planning is of course intended to guide, even stimulate and facilitate actual development works that both the public and private sectors may undertake. Assignment of administrative responsibilities and development of incentives and guidelines for the private sector are required to put the plans into effect.

The following agencies may prepare plans:

Central Housing and Planning - Town and country/regional plans: Planning

Authority Section 7 of the Town and Country Planning Act (Cap 20:01)

- Housing schemes, slum clearance scheme, re-development scheme: Local Authorities and Section 12, Section 17 and Housing Associations Section 18 of the Housing Act (Cap 36:20)

Local authorities - Town and country plans: Section 5 (1) and 6 of Cap 20:01

Local democratic organs - Improvement and development plans: Section 6 (b) and Section 33 of the Local Democratic Organs Act 1980 and Articles 74 and 77 of the Constitution

2. Regulation of Development

The authorised agencies review and approve applications for specified land uses and building. They monitor development to ensure that this is carried out in a harmonious manner and in keeping with existing regulations, and to prevent unauthorised development (that includes unapproved building operations).

a. Agencies

The following are Government agencies with responsibility for regulation and monitoring of development:

Central Housing and Planning Authority - Section 21 of 20:01

Local authorities - Section 21 of 20:01

Local sanitary authorities, coterminous with - Section 13 (3) and (4) of the

local authorities Public Health Ordinance

The Mayor and City Council of Georgetown - Municipal and District Councils

Act, Cap 28:01

The New Amsterdam Town Council

The Central Board of Health - Various sections of the Public Ordinance

b. Physical planning and the regional system

The regional system suggests that planning be administered at three levels: macro, regional and local. As indicated before, the Central Housing and Planning Authority is the only public sector agency engaged in physical planning. Because of monetary constraints and poor technical capacity at the CH&PA level, macro and regional planning are suffering. Local planning (in essence, land subdivision planning for housing development) is the only type being done. However, it is being done following the elementary and mundane logic of land surveying.

It is logical that the Regional Democratic Councils (established by the Regional Democratic Organs Act) should have been involved in regional planning. (Incidentally, a regional scheme is a planning scheme for an area that is not a city or a town, according to Cap 20:01.) However, despite the avowed aims of the regional system -to wit, devolution and decentralisation- the local physical planning system is almost entirely, structurally and functionally, centrally administered; the so necessary autonomous or locally self-governing planning function is not a reality.

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II. Policies of the Sector

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A. Past Evolution of Policies

1. Slavery and Housing

Living quarters provided to the slaves by the proprietors were mostly logies or cheaply constructed ranges. After the abolition of slavery, the ex-slaves were responsible for housing themselves, having left their farm masters and their estates. With family savings accumulated between 1838 and 1949, the freed slaves purchased abandoned estates. After an attempt to cultivate the estates in common, they subdivided and distributed the plots among themselves for building houses. Thus, the Negro village came into existence. They carried out this subdivision strictly on a personal basis and so the villages and suburbs grew as the residents pleased.

2. Indentureship and Housing

East Indian indentured immigration followed the abolition of slavery. Free housing of a standard laid down by the Colonial Government, free hospital and medical assistance had to be provided to these workers.

Indentured immigration ended in 1917, and for some time a rapidly increasing East Indian population resided as tenants on the sugar plantations, and in state-owned houses. Lacking any contract or legal reciprocal obligation between estate owner and resident, those houses were free of charge. Such formal relationship ended with the cessation of indentured immigration.

After World War II, a steady effort was made on certain plantations to improve the housing accommodation of the labourer. Efforts were made to persuade estate authorities to break down ranges that were dilapidated and in other ways unsuitable from the standpoint of public health, and the building of semidetached cottages was recommended. At this time, however, there was a drop in the sugar price and the position of labour on the estate became tenuous. The estate authorities complained that the recommended building programme was too expensive. Such improvements that were made happened slowly and on a small scale.

Sir Wilfred Beveridge's memorandum of 1931 seems to have been instrumental in accelerating the improvement, although the actual progress remained small. He suggested that the construction of ranges be prohibited and that detached or semidetached two room cottages were to be built instead. His recommendation was accepted, and between 1933 and 1938 some 906 cottages and 22 semidetached houses were built.

3. Institutionalisation of Housing and Urban Planning

All the English-speaking Caribbean states have a similar history of official urban planning.

Before 1940, many countries in the "Third World" experienced great difficulty in tackling their housing problems, being the shortage of funds the main limiting factor. With the outbreak of World War II, the scarcity of building materials and technical staff seriously curtailed the preparation and execution of schemes.

Therefore, for the West Indian governments to receive financial assistance, the "Colonial Development and Welfare Act, 1949" was passed. Those countries wishing to benefit from this Act were advised to establish a "Housing and Planning Authority." Another necessary step towards a comprehensive housing programme was the enactment of housing and physical planning legislation along the lines commonly accepted by the local authorities in Britain. Such legislation would set up the "Central Authority" to control the preparation and execution of housing schemes. Regulations relating the housing and planning programmes were to be instituted by the Authority.

The Central Housing and Planning Authority (CH&PA) of Guyana was established in 1948 under the Housing Ordinance of 1946 (now Act) described as: "An Ordinance (Act) to make provision with respect to the housing of persons of the working class and for purposes connected therewith." Concomitant with this Ordinance, the Town and Country Planning Ordinance (Act) was enacted.

The year 1946 marks a watershed in the history of housing in Guyana, since the initial official step was taken then to institutionalise the administration of urban planning and housing.

4. Official Interventions in Housing

a. First studies - 1943

In 1943, Government committees made the first proper studies of the local housing situation. These studies showed a housing problem of "growing dimensions." As a result, a scheme, considered experimental at that time, was undertaken in Essequibo to build 75 houses, rehabilitate 74 and to enlarge a further 75. This was the Government's first venture into providing public housing.

b. The 1954 Housing Programme

In 1954, on the invitation from the Colonial Government, Mr. Hinckinbotham, Assistant Secretary to the Ministry of Housing and Local Government of England, accompanied by Mr. J. C. Walker from the staff of Housing Advice to the Colonial Office, visited the country to assess the housing situation and to make consequential recommendations.

A programme was organised and a target of 4,000 houses for the 1955-56 period was set. There was a strong feeling in favour of house ownership and this was provided for in the programme in three ways:

(1) By the Central Housing and Planning Authority (CH&PA) building by contract and selling by mortgage. The plot could be leased unless already owned by the occupier with the option to buy after five years.

(2) By aided self-help building. The CH&PA provided the organisation, supervision and materials, and the beneficiaries provided labour (unskilled for the greater part).

(3) By loans from the Guyana Credit Corporation. The CH&PA assisted in the purchase of land, developing it and selling plots to individuals who were able to build for themselves.

For those needs that were not met by any of these methods, the CH&PA, in consultation with local authorities, would have built rentals. Also, CH&PA provided housing units by contract, direct labour, aided self-help, developed lands for individuals and to "self-build," and to developers to establish housing estates. Consequently, town planning schemes were generally inspired by meeting the increasing needs of a growing and shifting population.

In 1961, the Town and Country Planning Department was established as an entity separate from the Housing Department to handle physical planning issues, that had become rather urgent and complex. This development resulted in a recommendation made by a working party in 1957, which observed that the Planning Section as it existed within the Housing and Planning Department was devoting a great proportion of its time to the Department's "low-cost housing programmes." Consequently, other planning needs in both rural and urban areas did not receive due attention.

c. The 1966-1972 Development Programme

The 1966-1972 Development Programme indicated that "self-help" was to be emphasised. In this programme, $G24.5 million was allocated for housing and physical planning purposes, including the purchase and development of land, aided self-help housing, construction of housing for rent, maintenance of Government housing estates, redevelopment in Georgetown and Wismar/ Christianburg, and staff development projects. Land development was really the core of the plan.

The Government housing policy position was:

- that it was a problem to be shared jointly by the Government and the private enterprise;

- that the provision of certain types of housing was the direct responsibility of the Government;

- that it had a further responsibility to see that the private sector played its part and make an appropriate contribution.

Also included in the programme were:

(1) the Greater Georgetown Scheme: the rezoning of the Greater Georgetown area;

(2) the Wismar/Christianburg Regional Planning Scheme: for the development of Wismar and Christianburg, Demerara;

(3) the Lodge Improvement Scheme: for providing improved drainage and road communication in the area;

(4) the La Penitence Village Improvement Scheme: for regularising the haphazard development of the area and for enhancing the appearance of the buildings.

d. The 1972-1976 Development Plan

The 1972-1976 Development Plan (a draft that by 1976 was "rolled over" for a further two years) included an accelerated housing programme. The projected investment to implement it was estimated at about $G250 million.

The declared basic objectives of this programme were:

(1) To "house the nation" by the end of the plan period.

(2) To develop building designs and methods that would utilise more local materials and thus contribute to the reduction and stabilisation of construction costs.

(3) To improve the level of skills and thereby contribute to lower cost of construction through increased efficiency and higher productivity in the building trades.

The plan envisaged that the Government would have ensured the availability of developed land necessary to implement the programme. The sale of such land would have been at cost per development. Also, land speculation was to be brought under strict control.

The programme of land development also took into account new settlements in hinterland areas.

The financing of the housing programme was to be done from resources of the central government, local authorities, cooperatives, private companies and individuals. Incentive in the form of tax relief was granted to developers. The Guyana Cooperative Mortgage Finance Bank was established in 1973 (on the dissolution of the Guyana Credit Corporation) and handled most of the Government's financing. It had an equity capital of $G30 million, wholly subscribed by the Government, and a loan capital of $G120 million. Not less than 80 percent of the Bank's funds were earmarked to be lent to borrowers in the low income group and especially to co-ops; the rate of interest was below the normal market rate and repayment periods extended over 20-25 years.

For all intents and purposes, however, Guyana seems to have been operating without any national plan from around 1971. The major development decisions were made in the context of the annual budget. This position was ratified in 1978 with the establishment of the State Planning Commission. The rationale was that the economic difficulties facing the country at the time did not allow for long-range planning. Management control, geared towards ensuring that there were resources to stabilise the general situation, became rather vague.

Several housing schemes were implemented in the 1970s that were, in fact, the heyday of the aided self-help housing.

e. The 1981 Housing Policy

The housing policy of 1981 was formulated by Habitat's consultant, Donald R. Hanson.

It was a programme to build 3,000 housing units in 1982, with a projection that the house building rate should be increased at 5 percent per year for the subsequent five years. A supporting mechanism for the implementation of this programme was prefigured: requisites for financing, materials, land, manpower, and infrastructure were detailed. However, this programme failed to take into account the difficult economic climate at the time and thus, in effect, was not implemented.

f. The Policy Framework of 1986

The policy document of 1986, like its immediate predecessor, was formulated from a technical point of view. It was really the first attempt to present the housing issue in a comprehensive manner. It was based on analysis of and projections from available data and additional information gained through research.

This document attempted to deal with the local housing situation in general. Since it recognises that the satisfaction of housing needs is not merely a straightforward matter of construction, it lays some stress on changing certain rules of the housing plan through institutional ejectment. Various strategies are proposed in response to the fact that a comprehensive housing framework must incorporate a wide range of simultaneous policies. Since housing is a complex area impinging on a multitude of areas that are in themselves complex, it included issues of land management, organisation, and urbanisation, that are treated with in some detail and in keeping with sophisticated and relevant town planning principles.

g. Conclusion

From time to time the Ministry of Housing and the Central Housing and Planning Authority were linked with other Ministries, for example, Health, Labour and Works (later Works and Regional Development). There was a period when the Housing Ministry (and the CH&PA with which it was always linked) stood independently and not associated with other ministerial portfolios. The Ministry of Housing itself was finally abolished in 1989 and its functions transferred to CH&PA.

The shifting and realignment of the Housing Ministry and the CH&PA seem to have been based on political expediency rather than a structural analysis of urban development and housing issues.

It has been stated that housing issues have tended in the past to eclipse wide urban development issues. Also, they have tended to give rise to policies that were a response to the particular issue of the housing deficit. This is not surprising since policy formulation for the urban development and housing sector as a professional discipline is a relatively recent phenomenon, and since improvement of the other urban infrastructure would have required substantial investments that the Government was not in a position to finance.

Some significant elements of past policies may be listed as follows:

(1) Enactment of legislation: in 1941, to control the rental of certain premises (private); in 1947, to regulate the relationship between landlord and tenant; in 1940, to make provision for the orderly and progressive development of land, cities, town and other areas whether urban or rural, to preserve and improve the amenities thereof, and for other connected matters; in 1940, to make provision with respect to the housing of persons of the working class.

(2) State control over the sale of lands formerly owned by sugar companies and measures to curb speculation in land.

(3) Public provision of subsidised rental accommodation for low income households. The sale of some of these to sitting tenants commenced around 1990.

(4) Encouragement of house ownership through various schemes, including making available serviced land and housing units at subsidised costs, and also sponsoring self-help groups and housing groups.

(5) Promotion of the private sector's involvement in the implementation of housing projects through tax relief, the provision of land, and technical assistance.

(6) The creation of formal institutions for housing development and financing and for guaranteeing mortgages for low-income housing.

(7) Measures aimed at population redistribution and development of settlements in the hinterland. Due to housing shortage and congestion in the centre of the townships, the Government developed several housing schemes to alleviate the problem, for example: Scottsburg, Amelia's Ward, North Ruimveldt, Roxanne Burnham Gardens, etc. After the development of these areas was completed, councils were given the responsibility to maintain the roads, drains, and other services in these communities. However, the councils' costs increased while revenue did not increase in the same proportion to cover the recurrent costs.

(8) Upgrading measures aimed at urban depressed areas and selected squatter areas.

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B. Description of Current Policies

The Senior Minister responsible for housing formulated current housing policy in a document titled "Government of Guyana Housing Policy." This document was finalised late in 1993 and formally laid before Parliament early in 1994. It takes into account the context of budgetary stringencies on the part of Government and the more market-oriented tenor of recent policies.

Housing needs have been projected to the year 2000 vis-a-vis anticipated effective demand. Issues such as affordability, rental markets and destitution, squatting, infrastructure, and administration, are analysed. Consequently, goals and approaches are identified as follows:

1. Institutional Relationships

- The Central Housing and Planning Authority (CH&PA) should be restructured and upgraded, so that it can continue being the Government instrument through which the housing sector will be facilitated and national policy maintained and upgraded.

- The Housing, Housing Development, Town and Country Planning, and Condominium Acts are to be brought up to date.

- A modern Building Code should be designed and implemented.

2. Financing

The Government has sought to provide low interest loans and mortgages to the building sector, focussed on low-income borrowers. However, the Guyana Cooperative Mortgage Finance Bank (GCMFB) has proven to be a high-cost institution, with a low level of activity and a declining capital base. The New Building Society (NBS) has fared somewhat better but at a cost of putting most of its portfolio into treasury bills instead of mortgages. (See Chapter 15.)

Under current policies, the specific goal is to be achieved by a mixture of the following:

- direct Government subsidies to CH&PA to provide minimal sites and services and to various allocating institutions to facilitate mortgages;

- Government's facilitation of low interest borrowing on the international market and will encourage and support national and international organisations that wish to provide low interest mortgages, especially to low-income groups;

- transference of the functions of the Guyana Cooperative Mortgage Finance Bank to another institution, and review of the purpose and function of the NBS.

3. Land Distribution

Land distribution for house construction has been emphasised in current policies. The basic infrastructure for housing lots is to be installed over a realistic period, with community participation and other institutional assistance. Such distribution is to be done through various regional land distribution committees.

4. Squatting and Community Development

The Government recognises the clear demonstration that several participants have made significant investment in providing shelter for themselves and intends to regularise selected squatter communities using the community participation strategy to properly mobilise community resources for area upgrading. This strategy is intended to be used for the upgrading of depressed urban areas as well.

5. Affordable Building Materials

Through the Institute of Applied Science and Technology (IAST), the Government has intended to facilitate the development of alternative, preferably low-cost, building materials.

6. Consumers' Protection

The Government is committed to:

- encourage the growth of a strong consumer representative arrangement;

- provide legislation for the registration and control of developers, estate agents, and landlords;

- provide a building code for developers.

These policies amount to a "statement of intents" at the political level. Important and relevant areas not addressed in the policies are:

- land use and land resources;

- environment and conservation;

- institutional strengthening vis-a-vis the regional system;

- the role of the private sector in providing housing;

- the functioning of the rental market for housing.

The inclusion of these areas will demonstrate a recognition of the interrelation of housing, physical planning, and economic and financial policies, and the need for simultaneous and mutually supporting policy orientations.

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III. Description of the Principal Issues and Constraints Facing the Sector

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A. Issues

1. Absence of Proactive Urban Planning

Proper urban planning will always be crucial and vitally important. Whatever planning is being done has not attempted to plan cohesively goals and objectives at a national level, nor to link their attainment with economic and financial policies. In practice it has amounted to sectoral planning strategies in isolation of integrated approaches to national development and with little consideration as to how the plans are to be implemented through communities and the private sector.

Guyana must emphasise "proactive planning" to rationalise the use of our available resources for improvement of the economy within the context of a market oriented economy. In keeping with Government's policy to match economic growth with human development, and at the same time continue the thrust of growth-oriented policies, linkages of short-term and long-term plans (despite limited and scarce financial resources) must be pursued, and plans must be developed in full consultation with the affected communities.

2. Infrastructure

Infrastructure facilities are essential prerequisites for the creation and maintenance of a safe, efficient and developed environment, suitable for sustaining community life. Without such facilities, life itself is miserable, uncomfortable and inhuman, resulting in great economic cost and suffering.

a. Poor conditions of roads

Existing conditions of roads indicate that no maintenance was done over a number of years and this situation gradually led to a deteriorated state, now reaching a critical point of disrepair. Increased traffic flow due to the enormous increase of automobiles, heavy duty trucks and machines, with the present use of heavy duty containers for the movement of goods, have contributed to the accelerated destruction of the poorly maintained roads.

b. Drainage

The expanded boundaries of the city of Georgetown and other councils have placed severe strain and pressure on their drainage systems, due to the increased volume of flood waters and limited capacity of the drainage infrastructure to cope, especially during periods of high tides and prolonged rainfall. Together with the heavy siltation of drainage canals and dumping of refuse, the lack of maintenance of the sea and river defences, drainage canals, and other infrastructure, is the main causes of poor drainage.

c. Sewage disposal

The sewage system of Georgetown was constructed sixty years ago and was not extended. However, refurbishing was financed by the EEC. Functioning of the sewage system depended on electrical power from the Guyana Electricity Corporation, which at the moment is having great difficulties producing stable power. Thus, the system is affected by the frequent power outages. Another problem is the increased urban population through growth and rural/urban migration, which has also overloaded the system.

It should be noted that the sewage outfall at the mouth of the Demerara River is too close to land and must be extended several kilometres more out to sea.

Other small sewage systems exist in Tucville and Timehri, servicing thousands of people without treatment plant. These systems are in various states of disrepair, suffering from blocked sewers and overflowing manholes.

Septic tanks without leaching beds and pit latrines are malfunctioning and discharging effluents into adjacent ditches and drainage canals, which is a grave health hazard.

d. Inadequate telephone services

To improve business potential, international trade and domestic telecommunication linkages via telephones are a prerequisite. The World Bank, in its study "Guyana Economic Recovery to Sustained Growth," states that the international communication by telephone, using satellite services, has improved with the new GT&T, which continues to replace cables and carry out expansion programmes. However, further improvements are desirable.

e. Inadequate power supply

The power supply provided by GEC continues to be unreliable, with power outages being a common occurrence. GEC supplies power to GT&T, GUYWA, GS&WC, and to commerce, industries, residential areas, etc. Although rehabilitation and replacement are carried out, there is still need for improvement, since the productive sector depends on the reliable output of energy. The partial divestment of GEC put forth in Chapter 39 should help greatly in securing the needed new investments and better management.

f. Unreliable supply of potable water

The water supply is irregular and at time insufficiently treated. This creates a clear public health hazard. Flow rates and pressure levels also are low.

g. Stagnant water

Stagnant canals and other still pools of water are prime breeding grounds for mosquitoes and therefore constitute potential threats to public health. The solution can be found in better drainage and measures to keep canal waters flowing.

3. Waste Disposal and Refuse Collection

Waste disposal and refuse collection in urban centres has reached a critical situation as large amounts of waste are being dumped away and outside the identified dump sites, creating nuisance and health hazards to the people. Municipalities are unable to maintain and clear the areas under their control due to lack of manpower and shortage of garbage trucks. The incinerator, which is very old, does not have the capacity to burn the very large quantities of refuse. Therefore, the municipalities have to resort to dump sites for disposal and are finding difficulties identifying new sites away from residential areas that are economical. New systems to dispose of the very large volume of refuse must be developed as economic ventures so that this service could be self-financed.

4. Municipal Services

All classes of services provided by the municipalities have gradually deteriorated, reaching a critical point of neglect as services crumbled to a very unsatisfactory state. Management is ineffective, due to unqualified staff, inadequate finances, and lack of direction to support effective and efficient services.

The wide ranging services provided by the municipalities demand greater attention to improve, organise, maintain, develop and sustain a high standard of environmental development (e.g., adequate and well-maintained drainage, roads, recreational facilities, markets, abattoirs, day care centers, waste disposal, sanitation, etc.).

5. Inadequate Rental Market

There is insufficient rental housing for those who need it, particularly the households of lower incomes, and yet at the same time the presence of onerous rent regulations discourages many property owners from putting their houses out to rent.

6. Lack of a Defined Role for the Private Sector in Urban Housing

Lack of private land markets, added to the absence of mortgage facilities in commercial banks, limits the possibilities for the private sector playing a greater role in solving the housing shortage. In general, the policy framework to date has not encouraged the private sector sufficiently in this direction.

7. Educational and Attitudinal Problems

Irresponsible behaviourial traits impact heavily on society and urban development, and their effects can be observed all too frequently in the communities. Negative attitudes of youths as they mature into adulthood, and of some adults have escalated into crimes, disregard for law and order, and lack of a sense of responsibility for other members of the community.

8. Urban Sprawl

The severity of this problem is having greater effect within the boundaries of Georgetown and, to a lesser degree, in other urban centres. Containment will be very difficult because education, technical facilities, employment, government administrative facilities are all in the capital city, where most of the commerce and industries are sited.

This situation attracts people for services and a quality of life that exist only in the urban centres, and prohibitive measures will not be successful in the long run.

Unauthorised development on the fringes of the growing urban area violates sanitation and environmental regulations, planned development, and exerts severe pressure on existing infrastructure and related services. As a result, the population becomes more susceptible to disease and flooding as uncontrolled housing development escalates. In addition, the sprawl will eventually increase daily transport times for most residents.

9. Weak Municipal Finances

The inability to attract adequate revenues from traditional and existing financial bases results inadequate fiscal earnings that do not keep pace with greater demands for improved services and development. The high ratio of poverty and a very small industrial base to rely on for substantial revenue increases, are grounds for serious concern. The problem is compounded by the fact that municipalities have few revenue sources of their own, and consequently virtually all of the tax revenues generated flow to the Central Government.

Poor tax revenue because of low taxation level and high tax arrears have forced urban centers to harness support from other sources to improve services. Non-governmental and voluntary organisations, such as SIMAP, Future Funds, Basic Need Trust Fund, etc., have had a positive impact on the scarce financial resources of our municipalities, regions, and Neighbourhood Democratic Councils. Additional improved tax base and financial assistance should become imperative to facilitate the flow of increased finances to catch up with demands at local government institutions.

Property valuation and revaluation have not kept pace with increased demands of revenue. There is an urgent need to address these two areas of concern. High interest rates on loans must be resorted to by municipalities, to smooth the cash flow to meet obligations. Poor repayments, vandalism, mismanagement, and irrational use of revenues impact negatively on financial returns as municipalities and Neighbourhood Democratic Councils continue to exist in a crisis situation.

The Central Government has a long tradition of providing financial assistance to local government bodies, although having major problems of their own. However, this flow of assistance has been negligible when taken in context of the very high costs of manpower, equipment, machinery and services, etc. Also, inflation and currency devaluation were not given due consideration as a result of financial assistance given. Future assistance needs to have greater and more positive impact to move municipalities and Neighbourhood Democratic Councils from their present weak positions to stronger ones.

Municipalities and Neighbourhood Democratic Councils' means of taxation is limited to properties and fee charges of one kind or another, to raise revenue for services they provide. This tool has not been properly capitalised, resulting in lost revenues. Rate (local property tax) collection remains poor due to lack of prompt payment, inadequate and poor staffing, malfunctioning of equipment, low morale of employees due to poor wages, absenteeism, poverty of rate payers, attitudinal problems of withholding rates, and failure to move to the judicial system for redress.

A training pool of qualified experts is needed to conduct programmes relative to effective financial management and accountability. The municipalities, regions, and Neighbourhood Democratic Councils must finance such programmes.

10. Insufficient Stock of Housing

There is generally a scarcity of affordable housing in urban areas, especially for households of the middle and lower income strata. Within the last two decades, a marked decline has been recorded in the housing construction sector in Guyana. The main causes of this decline include the declining economy (until the early 1990s), which reduced the population's ability to purchase homes; scarcity of available land; high inflation rates for part of the period, with their corresponding effects of escalating construction costs; cumbersome procedures for authorising housing construction; and the difficulty of obtaining housing finance.

11. Substandard Housing

Due to the general limited availability of housing, there has been an increase in the instances of informal housing development in urban areas. There is also the significant issue of congestion and the financial inability to physically upkeep building standards resulting in high incidences of housing decay in some areas and on a larger scale, some housing areas being categorised as "depressed."

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B. Constraints

1. Absence of Proactive Planning

There is not a tradition of proactive planning or of integrating planning by the CH&PA into national plans, nor of conducting feasibility studies for urban infrastructure projects and of developing implementation programmes, in addition to the plans themselves.

Insufficient emphasis at the University of Guyana and other relevant training institutions to develop a curriculum that includes advanced planning techniques and strategies for urban and economic development should be addressed, since there is shortage of qualified specialists to fill the key positions.

2. Infrastructure

High costs of materials, labour and machinery are the major constraints that restrict infrastructure development and execution of development work. Larceny, damage of materials and equipment for infrastructural works contribute to the financial burden of municipalities, government, and other related agencies.

3. Institutional (manpower resource)

Poorly trained staff seriously affect the performance of services provided by the municipalities, regions, Neighbourhood Democratic Councils and other government agencies in urban centres. Although educational facilities for both academic and technical training can be found in some urban centres, particularly in Georgetown, the situation is compounded by unattractive wages and salaries, and lack of incentive to attract qualified staff. The high tuition fees also discourage those that are willing to attend academic and technical institutions to upgrade their skills.

Another factor that impedes better performance is the poor working conditions found in the government agencies (malfunctioning equipment, cramped office space, poor lighting, sanitation and telephone services, etc.). Neighbourhood Democratic Councils, regions, municipalities, GUYWA, GSWC, GEC, CH&PA, Central Board of Health, etc., are operating in isolation within their own institutional framework.

Lack of full-time paid mayors and deputy mayors, chairmen and vice-chairmen of Neighbourhood Democratic Councils, also affects levels of participation and involvement for effective coordinated efforts to improve urban development.

4. Weak Economic Base

No capital is available to improve and adequately maintain infrastructure. Development has been heavily constrained due to years of economic crises in the public sector, which resulted in increased migration of skilled manpower. A high poverty ratio and a still high unemployment rate are elements of concern of municipalities, local government, and other institutions, as they affect the economic base of the urban centres.

5. Insufficient Land for Expansion of Housing

One of the limiting factors for the expansion of the supply of housing in urban areas, most particularly in Georgetown, is the scarcity of available land. Georgetown is surrounded by lands belonging to sugar estates, or other agricultural lands that belong to the State, and this situation inhibits the conversion of land to urban uses.

6. High Cost of Housing Mortgages

The currently high bank interest rates definitely mitigate against would-be homeowners, by making monthly mortgage payments extremely high.

7. Limited Tax Base for Municipalities

Municipalities do not have adequate revenue sources of their own. They have been highly dependent on the Central Government for finances, and the latter has not been able to provide assistance to the requisite levels.

8. Water and Sewerage

Some of the constraints in this area are:

Parts of the water and sewerage system date back to the late 19th century.

Adequate investment to meet increasing operational and maintenance costs has not been available over the last two decades.

Inability to provide satisfactory remuneration for senior employees is having a negative impact on the ability of the organisation to improve operations.

Poor structural conditions of most of the water distribution network, leading to water losses of up to 75 percent of total production.

Poor operation of the sewerage system due to pumps being out of service, broken sewers, and blocked lines.

Much of the electrical and mechanical plants are in very poor condition.

Undefined policies and goals for the system, with unclear strategic directions.

Insufficient trained and experienced professional staff resulting in poor productivity levels.

Uncontrolled and indiscriminant development with illegal connections of urban services.

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IV. Sectoral Objectives

So far, national efforts have traditionally concentrated on improving municipal structures and human resources with the conventional understanding that the role of local governments and municipalities is to discharge all those activities and functions -services, infrastructure development and maintenance, physical planning- that cannot be met easily and cost-effectively by the people themselves. The major challenge today, however, is not simply to do this and to train public administrators and technical personnel to carry out such functions, but to link them to what is the reality within the greater part of towns. Hence, in facing this changing urban reality, government will have to adopt a new role, a new approach that matches today's urbanisation process. Such a new role should facilitate local improvement and development activities and will require that Government adopts an enabling framework of policies and strategies targeted at supporting initiatives of communities and the private sector, rather than maintaining their conventional role of settlement planning and attempted control through sets of bylaws, which has proven ineffective in the face of the challenges.

The overriding objective is to make Georgetown and other cities more habitable places in the 21st century, meeting their citizens' requirements for improved access to basic services and amenities, and fulfilling their physical potential to be unique and attractive places in which to live and work and take recreation.

It should not be overlooked that our cities also require greater employment opportunities, especially for youths. However, the creation of such opportunities is one of the principal thrusts of this National Development Strategy, and as such it is dealt with in many other Chapters of this document, and not specifically in this one, except for the measures aimed at creation of export processing zones and industrial estates, which are mentioned both in the present Chapter and in Chapter 36.

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A. Urban Development

The principal specific objectives in the area of urban development are:

1. To improve, promote and preserve urban development, and upgrade and sustain urban infrastructure.

2. To improve the quality, efficiency and effectiveness of municipal management and services.

3. To improve the financial status of the municipalities.

4. To develop a coordinated vision of what Georgetown should look like in ten and twenty years, with what kind of services it will provide to citizens, and an accompanying implementation plan.

5. To improve the capabilities of the staffs of municipalities.

6. To strengthen the finances and management capabilities of principal agencies involved in supplying infrastructure, including GUYWA, GS&WC, and GEC.

7. To facilitate greater interagency coordination, especially as between infrastructure agencies and municipalities.

8. To embark on an environmental education programme aimed at sensitising the population about urban development and related issues.

9. To reduce the level of unauthorised development and to regularise informal development.

10. To promote higher-density development and reestablish a greenbelt around Georgetown with recreational facilities.

11. To develop an improved system for managing the city's canals and draining areas of water accumulation.

12. To zone Georgetown in a way that protects residents from noxious activities and also protects its priceless architectural heritage.

13. To develop consultative procedures for urban planning.

14. For the special case of Linden, generate increased employment opportunities through measures such as the development of an export processing zone.

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B. Housing

The principal specific objectives in the area of housing are:

1. To expand the supply of housing more rapidly.

2. To make housing as affordable as possible.

3. To provide improved access to housing for poor families.

The operational objectives that must be fulfilled as preconditions for meeting the above objectives include:

• To provide greater access to affordable funding for housing development.

• To provide greater access to serviced lands.

• To eliminate institutional delays in approval of building plans and allocation of land.

• To establish appropriate conditions that would permit the private sector to play a greater role in allocating and developing land for housing

• To develop special programmes of financial support for lower-income families that assist them to make rental and mortgage payments.

• To regularise informal housing development.

• To reform regulations governing rentals with the aim of increasing the availability of rental housing.

• To develop mechanisms for greater involvement of NGOs in housing programmes for the poor.

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V. Policy Recommendations and Their Technical Justifications

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A. Urban Development

1. Financing Urban Development

It is a known fact that municipalities and local government authorities depend heavily on the Central Government for subvention and tariffs. However, most of these institutions complain that the sums allocated along with the municipal revenue generated are not adequate to successfully carry out the municipalities designated duties.

It is now being recommended that urban centres be made financially more viable by:

(a) Broadening and strengthening the financial base of municipalities and local authorities through the revaluation of properties and road licences revenues, improved systems of rate collection and through municipalities being granted a percentage of the road licences and other such revenues being collected by the Central Government. The Government Valuation Division of the Ministry of Finance is responsible for valuing properties for rating purposes. In Georgetown, properties were revalued in 1989, but in rural areas they have not been revalued since 1975. Rates and taxes assessed on these valuations are insufficient to provide for the needs of the municipalities.

The authority to make valuations in urban areas in the future should be devolved to the six municipalities.

This strategy is proposed because:

(i) The current valuation of properties is outdated and need to be reviewed. This situation is due to the economic decline of the economy over the last decade, when there was great inflation and the valuation was not reexamined or updated, as required in the relevant Act that makes provision for the valuation of properties to be done at specified intervals.

(ii) During the interim periods when there were no property valuations, many buildings were altered and expanded, and there were changes of use without the councils approval. With the revaluation, municipalities would have a current cost of all the properties.

These comments have also been expressed in the urban rehabilitation programme, feasibility studies for which have already been completed and the implementation stage is being pursued.

(iii) Residents who made changes to properties without the previous approval of the councils, and thus are still paying the old rates and taxes, will have to pay the current rate established through the new revaluation.

(iv) Although the inter-town roads that are controlled and maintained by the municipalities are being misused and overused by vehicles, the municipalities do not receive a percentage of the road licence or other such revenues collected by the Central Government.

According to figures supplied by the City and Town Councils, in 1994 about 47 percent of the municipalities' current revenue was allocated to the Works Department for the maintenance of roads. In 1994, while the Georgetown City Council received a very small grant from the Central Government, Corriverton received no revenue grant during that year. Municipalities are faced with increased expenditure for road maintenance, but their current revenue is not increasing in proportion to inflation. The amount of Central Government grant in 1994 declined sharply from 1993 levels.

The municipalities are seeking a portion of the road licence paid by vehicle owners to the Licence Department for the maintenance of roads, since the revenue they generate and the Government grants are not adequate for that task. This issue has been fully discussed in the proposed urban rehabilitation programme and recommendations for allocation on the basis of formulas have been made.

(v) Currently, the system of rate collection is very slow, resulting in municipalities collecting only an average of 50 percent of the indicated amount of revenue on an annual basis.

In view of this last observation, the municipalities should begin to contract out the task of rate collection, with commissions paid in relation to the amounts collected.

(b) Mandating automatic grants to municipalities of Central Government revenues, in the amount of five percent of the total of these revenues, to be distributed annually to municipalities and NDCs in proportion to their respective population. This follows a model successfully implemented in Bolivia and Guatemala and other countries of the hemisphere.

Revenue grants received by the municipalities during 1993 and 1994 were less than one percent of their recurrent revenue. Georgetown City Council received a subvention of G$3M in 1993 and G$1M in 1994; New Amsterdam received G$1M in 1993/1994; Linden, G$3.7M and G$3.8M, while Rose Hall received G$0.5M and G$0.3M, respectively.

The amount of subventions given by the Central Government, when added to the revenue collected by the cities and town councils, is insufficient to provide for the efficient functioning of municipalities. Consequently, more funds are needed, especially to improve existing infrastructure and the quality of the services the Councils are offering. This proposed revenue sharing is one of the key elements of creating a more participatory economy, a leitmotif of this National Development Strategy.

(c) Initiate income generating activities of urban centres. The services provided by municipalities do not generate sufficient surplus to improve the quality or expand current operations. As a result, Central Government has no alternative but to provide subventions for urgent projects. To increase their financial capabilities, some municipalities are strongly considering embarking on income generating activities.

According to Municipal Act (Chapter 28:01), municipalities are given the mandate to venture into income generating activities such as direct engagement in commercial, productive and industrial enterprises, that would create employment and surpluses. Examples of such operations are:

- Surcharging heavy trucks that use municipalities road network.

- Selling fertile top soil to farmers in areas of poor soil, for agricultural activities.

- Exportation of sand and other products to local and overseas markets.

These activities would be under the direction of professional managers appointed by the Council and all profits would be utilised to improve the general welfare of the towns.

(d) Municipalities introducing road tax on heavy vehicles that utilise the road network. Heavy vehicles traverse the municipal road networks frequently, causing deterioration to the foundations and surfaces. The Councils have to repair and maintain the roads at substantial expenditure. With the introduction of a road tax on heavy vehicles, municipalities would be in a better position to strengthen their finances. This will permit the rehabilitation and maintenance of roads at an acceptable and functional level.

2. Making Urban Centres Functionally Viable by Increasing Employment Opportunities

(i) Export promotion zones: These are areas identified for infrastructure development by the Government for investors to establish enterprises that would produce commodities for export markets, with a rebate on the corresponding consumption taxes and import tariffs.

(ii) Industrial estates: These are areas identified by the Central Housing and Planning and Housing Authority for GAIBANK or other financial institution to develop the necessary infrastructure and provide capital as investment for interested entrepreneurs.

Export promotion zones and industrial estates assist local and foreign business entrepreneurs to establish business entities in the urban and secondary centres. The experience of the Dominican Republic, Honduras and other countries has shown that export processing zones can be very effective in creating employment and increasing household incomes. Also, they serve to alleviate poverty, improving their quality of life and enhancing the economy of the entire country. At the same time, they would help reduce the number of workers migrating to the main urban centres or abroad in search of employment.

Increased business activity will provide a source of added revenues that is essential for improving the social and economic infrastructure and services offered in the respective areas. This revenue will also impact positively on the Central Government's budget and will allow for additional expenditures on the other national physical and social infrastructure development.

Clear guidelines are required to define the kinds of enterprises eligible for participation in export processing zones. To avoid the sometimes-observed phenomenon that some firms pull up roots after a few years in the zone, and move to another country, it is important to emphasise industries that use Guyanese raw materials to the largest extent possible, i.e., wood processing, agro-processing, gold and diamond processing, and related activities.

Besides utilising the natural resources available, the entrepreneurs using the export promotion zones and industrial estates are expected to introduce new technologies that will benefit the country and the communities where they are located.

3. Improving and Operating Airport and Port Facilities

Support facilities for airports and ports exist in most of the urban centres, but the provision of services is inadequate. Among the main causes of this situation are: insufficient maintenance, low levels of investment, non-responsiveness to users in the communities, technical inefficiencies, and poor management.

Business entities need efficient means of transportation in order to deliver their commodities in a timely manner. Additional investment is needed for these facilities to become operational and thus assist in the efficient transportation and distribution of goods and services. Therefore, with the upgrading of the already existing airports and ports, enterprises can distribute their products more efficiently. See Chapter 38 for further discussion of policies in this area.

4. Upgrading and Constructing New Skills Training Institutions in Urban Centres

A few urban centres have access to technical training institutions. However, their equipment and building need upgrading and there is also a shortage of qualified staff.

Several urban centres (Corriverton, Rose Hall, Anna Regina) do not have access to technical training facilities. So, students desirous of attaining technical skills have to travel long distances or seek accommodation in other centres which posses these facilities, incurring in great expense. Those with the potential but without the financial resources are unable to benefit from such training.

With the establishment of new enterprises the demand for skilled labour would increase considerably. The Ministry of Education should ensure that the technical training institutions are accessible where needed and that their curriculum is compatible with the demands of the new businesses. This would allow the workers to remain in their communities instead of migrating to the city to seek employment and training. This recommendation complements the policies on training established in Chapter 35.

5. Curtailing Urban Sprawl

This strategy is specifically related to the city of Georgetown, which has expanded beyond its boundaries, eroding the greenbelt zone that existed around the city. Even some of the public open spaces within the city and towns are now being utilised for residential development. A mechanism should be put in place to retain existing public open spaces within urban areas, particularly in Georgetown.

To curtail urban sprawl it is necessary to carry out a three-part policy: (i) allocate State lands to a greenbelt and purchase freehold land for that purpose wherever necessary, (ii) adopt measures to encourage higher-density housing for the middle class, and (iii) establish secondary centres beyond the greenbelt with adequate roadways cutting through the greenbelt to the main city.

The need to develop secondary urban centres to relieve some of the pressures of the established urban magnets is essential. Almost all six urban areas within Guyana are accommodating populations and providing services way beyond the original design standards of the infrastructure and services systems of the municipalities in the past. Therefore, the establishment of a system of relieving the municipalities of some of these pressures is most appropriate at this time.

The secondary centres will also create job opportunities and commercial activities.

The following criteria should be used in identifying the proposed secondary centres:

(1) Population concentration

(2) Levels of existing services and facilities

(3) Distance from existing urban centres

(4) Communication linkages

(5) Functional, economic, and logistics characteristics

Based on the above criteria, the following areas are recommended for consideration: Mahaica, Mahaicony, Rosignol, Lethem, Soesdyke, Parika, Supernaam, Grove, Charity, Bartica, Vreed-en-Hoop.

The town of New Amsterdam is already being relieved of urban pressures by adequately spaced centres such as the towns of Corriverton and Rose Hall.

With the development of those secondary centres that already have the prerequisites of a town (road networks, markets, education and health facilities, etc.), pressure on the already overloaded systems would be minimised. Development of the infrastructure in these centres and provision of incentives will encourage investors to establish businesses that would create employment for the residents.

These recommended secondary centres already have access to resources such as waterways for river transports, roads, airstrips, etc.

As an initial measure, a physical development plan should be prepared for the greenbelt policy and estimates should be made of the required amounts of State land and the cost of acquiring the necessary freehold land. International donations may be sought to help defray the associated costs.

With the establishment of a greenbelt policy, the councils would be in a position to contain the haphazard expansion of the city and towns. This, along with the added responsibilities of providing essential service to new areas, will help develop a more cohesive urban structure and alleviate the problems cited above that result from uncontrolled urban sprawl. It will be essential for municipal and Central Government to collaborate in enforcing the greenbelt, even making evictions if necessary. A widespread public education campaign can help minimise the possibility of conflicts, and some jobs can be created for youths in the form of greenbelt rangers.

However, significant sums of money would be required for the establishment of secondary centres since adequate infrastructure, services, administrative, and other development facilities need to be put in place to accommodate all the urban functions that such a centre is expected to perform. The Government would need to investigate ways of funding such development through selected pilot studies.

The other element of the policy of containing urban sprawl is to create a greater density of urban settlement by encouraging the private sector to construct duplexes and condominiums for sale to the middle class. This population group would be the main target group that would need to be persuaded over time to shift its preferences (in part) away from single-family dwellings and towards structures of greater population density. This can be done only if the duplexes and condominiums that are built are relatively comfortable and attractive. To be able to move in this direction, Government needs to relax all restrictions on obtaining and utilising freehold land in urban areas, except, of course, for urban zoning rules. Higher density dwellings will have the further advantage of generating more tax revenues per acre than the current pattern of settlement does.

6. Improving Urban Infrastructure

As indicated in the foregoing discussion, improvements in this area are needed quite urgently. The Central Government and GUYWA and GS&WC need to form a high-level working group tasked with the development of far-sighted operational plans for improvement of potable water and sewerage systems, building on the plans already in place (see the section on investment programmes at the end of this Chapter). In the case of the latter, it is necessary to include measures such as extending the sewerage outfall further out to sea, providing additional processing of sewage, and developing a programme of conversion of urban households from septic tanks to the piped system. Water planning should include expanded intakes into the system, more reliable treatment and a programme of repair and replacement of derelict pipes. Eventually, dependence on aquifers as sources for potable water must be eliminated, because of their susceptibility to infiltration of various contaminants.

Given the cost of these undertakings, and their importance, it is inescapable that water and sewerage rates will have to be raised, but international donations also should be sought to defray part of the costs of the capital outlays.

For road repairs, the policies outlined above to enhance the circumstances of municipal finances should enable progress to the desired degree.

7. Improving Urban Drainage

It has been mentioned that public health concerns, as well as matters of the public's convenience, are driving the need to put in place basic improvements in the system of surface water flows in urban areas. It is a priority to eliminate breeding grounds for mosquitoes whilst maintaining Georgetown's canal network, which serves practical drainage functions and also has historical and aesthetic value.

The new policy in this regard involves two sequential steps for the case of Georgetown:

(a) With the assistance of international donors, establish an international competition with a monetary prize, open to any registered firm in the field of urban design and engineering, for the design of a system to:

(i) Improve the city's drainage system and eliminate flooding;

(ii) Eliminate puddles and all bodies of standing water;

(iii) Preserve and rehabilitate the city's system of canals, enhancing their aesthetic contribution; and

(iv) Preserve and expand Georgetown's green aspect.

Approximate cost parameters for implementation of the design will be established and announced as part of the guidelines for the competition.

(b) After selection of the winning design, it will be costed and then its implementation will be put out to international bid. Inquiries also will be made with the U.S. Army Corps of Engineers, as they have already expressed an interest in providing assistance to Georgetown.

8. Improving Garbage Collection

Garbage collection in all municipalities needs to be contracted out, with a special system of incentives for cleaning up loose paper and garbage as well as that which is deposited in designated collection points. As mentioned earlier, rates should conform to the objective of making this system as financially self-sustaining as possible.

A major coordinated effort is required of national, regional and local governments to identify new landfill sites, taking care to avoid seepage into groundwater supplies and to observe other environmental requisites.

9. Planning and Management of Urban Centres

The roles, functions, and relationships of statutory bodies related to urban development and housing within the municipalities, are uncertain. This situation, together with the presence of underqualified staff members, reflects poor planning and management of urban centres that need to be improved by:

(a) Clarifying and redefining the roles, functions, and relationships of institutions such as the regional democratic councils, local authorities, municipalities, and all other agencies that play a role in urban development and housing. See Chapters 24 and 28 on this issue.

(b) The improvement of the quality of services provided by staff through better salaries and conditions of service, internal and external job training and the acquisition of the necessary equipment.

10. Increased Awareness of Urban Planning and Environmental Issues

Generally, there is a basic disregard and lack of interest in urban planning and environmental issues. Consequently, many residents work against the developments that may ultimately benefit them. Therefore, it is recommended that knowledge and awareness of urban planning and environmental issues be increased by:

(a) The preparation of physical development plans and town planning schemes for municipalities with intensive public participation.

(b) Legislation for the reversion and/or delegation of the responsibility for town and country planning and development to municipalities and local authorities, along with a clarification and definition of the roles and responsibilities of municipalities and regional democratic councils, modifying as needed the original statements in the Municipal and District Councils Act and the Local Democratic Organs Act.

(c) The establishment of systems to monitor all physical development projects for their impact on the environment and to ensure that they operate within the established guidelines. Constant assessments of these operations need to be maintained so that all developments remain environmentally compatible and sound in the long run.

(d) Embarking on environmental and/or public health education programmes, especially on waste disposal. Disorderly solid waste disposal has become a serious problem for municipalities with inadequate resources to cope with the provision of basic services. Some municipalities can only provide minimal services on an irregular basis to their townships.

To compound this problem, residents who no longer dispose orderly of their refuse are endangering themselves and the community, causing serious public health illnesses, such as contamination of potable water system, flies and other nuisances that lead to incidences of diarrhea and other infant morbidity.

Municipalities need an effective public awareness programme through media, such as radio and television news, focussing on the consequences of careless disposal of refuse. The programme will educate residents about the benefits derived from a clean and healthy environment.

(e) Providing education on soil erosion. Flooding has destroyed many communities and caused serious contamination of the potable water system. Thus, municipalities have to relocate residents affected by soil erosion in new developments and erect infrastructure that will prevent further degradation to the areas at almost prohibitive cost. Areas subjected to soil erosion must be given special preservation attention aimed at restricting development that will interfere with the natural soil structure.

11. Updated Urban Zoning

Urban zoning regulations need to be updated and their enforcement provisions strengthened. Some municipalities are faced with atmospheric pollution that affects public health and property values. Selection sites for industries that exhale waste into the atmosphere should be chosen carefully and away from residential areas.

Special zoning provisions need to be made for Georgetown's architectural heritage, ensuring that buildings constructed or rehabilitated conform to the historical architectural style. Existing buildings that do not conform architecturally need to be required to put on specified kinds of wood facing to bring them into approximate conformance.

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B. Housing

Unfortunately, the rate of housing development and provision has not been commensurate with the rate of population growth in the urban areas. Factors such as the lack of available finances, limited access to land and overall poor planning for the provision and distribution of housing in Guyana have resulted in the situation whereby access to housing is severely restricted.

A basic factor that limits access to housing in Guyana is the limited availability and accessibility to serviced land. This factor is also related to the significant incidence of informal housing development in certain areas. Also, in some cases, where land is available, the costs required are in excess of the amounts that the average resident could afford. A system should be put in place to address the issue of providing subsidies to the underprivileged classes of society who find it exceedingly difficult to gain access to adequate housing.

Evidently, the entire system of housing allocation and access to serviced lands needs to be revised. The problems of housing shortage in Guyana and the haphazard system of distribution indicate this. Allocation of house lots has been criticised as flawed by certain circles. The present system should be reexamined to reduce the perceived political overtures in the housing distribution process. Strict criteria for allocation needs should be determined and adhered to by the relevant agencies at all times. The rigidity of the guidelines should give clear indication of eligibility or ineligibility, so that no subjective decisions would be made in the distribution process.

The housing policies of the past, while they were well-intentioned and benefitted a reasonable number of families, had the unfortunate side effect of aggravating the shortage of affordable housing in the following ways:

The emphasis on centralised allocation of house lots and houses limited the potential supply of new housing from the private market;

The controls on rentals likewise limited the supply of rental units, as they made property owners more reluctant to put their houses out for rent, and unwilling to properly maintain those that were rented;

The ways in which mortgage funds were managed resulted in financial non-viability of mortgage finance institutions in the long run, especially the GCMFB.

Drawing the appropriate lessons from these experiences, the new policies for the housing sector respond to the following basic orientations:

Provide financial assistance for rentals and mortgages directly to lower-income families, instead of indirectly in ways that lead to decapitalisation of financing institutions;

Strengthen the mortgage lending component of the banking system;

Regularise the land title for squatters and provide their lots with basic infrastructure services, with the cooperation of the communities themselves;

Whilst continuing to provide serviced lots from State lands, place some State lands into the private land market to improve the scope of the latter;

Simplify the regulations concerning construction permits and also those related to rental agreements, but at the same time step up the pace of inspections and enforcement procedures.

These policy orientations will ensure that the supply of housing is increased at the same time that the financial capacity of the lower and middle income groups to purchase and rent housing is enhanced.

Accordingly, the new policies for the housing sector include the following elements:

1. A Fund for Rental Supplements for Low-income Families

A special fund will be established for providing rental supplements to low-income families who meet strict criteria of eligibility. The Board of the fund will include representatives of CH&PA, the municipalities and NDCs, SIMAP, NGOs, and the Ministry of Finance. Once an application is approved, on evidence of the family's income levels and the rental contract, the fund will provide monthly coupons that can be redeemed through the banking system. Both renter and landlord would be required to sign each monthly coupon, and then the landlord could redeem it directly, as part of his or her rental income. It is suggested that the upper limit on the value of the monthly coupons be approximately G$15,000 at the beginning, and that this limit be revised annually in view of registered inflation rates. Contributions to the fund will be made by the Central Government and international contributions will be sought as well.

2. A Fund for Supplementing Mortgage Payments of Low-income Families

This fund will be structured in a like manner to the one described above, and its operating rules will be similar, although in this case, under the eligibility criteria, the topping-out level of family income will be somewhat higher than for the previous fund. The fund for mortgage supplements will assist families of low incomes to make down payments on houses, provided they are able to put some of their own funds into the payment, and then it will supplement their monthly mortgage servicing. It is suggested that assistance on the down payment be provided in a matching fashion, with a maximum amount of G$250,000 that could be drawn from the fund for this purpose. The upper limit on assistance with monthly mortgage payments would be established at G$20,000, made directly to the financing institution. Both sums would be adjusted annually for inflation. Again, the fund would depend on contributions from both the Central Government and the international community.

As well as assisting the poor directly, the presence of these two funds will have the beneficial effect of stimulating private investors to provide more housing, in the knowledge that the demand thereof would have increased.

3. Rediscount Line for Mortgages in the Central Bank

In addition to the aforementioned special funds, the Government will establish a special rediscount line in the Central Bank that effective provides an incentive to commercial banks to extend mortgage loans, in exchange for their reducing interest rates on mortgages, below the equivalent level for other classes of loans, by a specified number of percentage points. The subsidy inherent in this special line would be funded explicitly from the annual Central Government budget, with the possible additional contribution of international funding. Via the action of this financial facility, banks would be encouraged to place a higher share of their assets in mortgages without incurring the risk of weakening their capital base because of below-market interest rates.

An upper limit will be placed on the price of homes whose purchase may be financed through the rediscount facility. It is recommended that such limit not exceed G$1 million, pending the outcome of a careful study of the home market for lower and middle income families.

4. Reforms of Mortgage Banking Institutions

These subsidies targeted on lower income families, in the case of the two special funds, and lower and middle income families for the mortgage rediscount line, will permit the necessary reforms of mortgage finance institutions. Given the stressed state of the finances of GCMFB and its high costs of operation, Government will proceed to close it and reallocate its assets and liabilities appropriately. A probing review of the NBS will be carried out, to redefine its role and manner of operating. The goal of the review will be to seek ways to increase the mortgage content of its asset portfolio. Without prejudging the findings of the review, it can be said that the operations of the two special funds and the rediscount will at least permit NBS to raise its interest rates on loans, thus making it more feasible, financially, for it to place more funds in mortgages.

The fundamental institutional objective regarding mortgage finance is to make the institution(s) financially viable over the longer run, in keeping with one of the fundamental policy conditions established for this National Development Strategy (Chapter 3). This requires that they be efficient in their financial intermediation, capable of mobilising sufficient quantities of resources, and not dependent on recurring transfers from the Central Government. Among other things, they have to demonstrate a high level of loan recovery. If not, then they will lose the power to attract deposits as well as facing a deteriorated capital base.

If the institutions are not viable in these respects, eventually Government will find the burden of sustaining them insupportable and they will be forced to curtail operations, thereby losing the ability to provide support to the citizenry for the acquisition of homes.

Laws and regulations that would permit financial institutions to recover the collateral in cases of default need to be strengthened, or otherwise the commitment to service a mortgage would become almost a meaningless gesture from the viewpoint of mortgage finance institutions, and those institutions would be doomed to become insolvent.

5. Improvements in the Land Markets for Housing

The acute shortage of land for housing in urban areas, especially in Georgetown, must be addressed as a priority matter. Government will initiate a programme of making land available in freehold to entrepreneurs who will commit themselves to constructing housing on the lots. The preferable mechanism for providing land in this way would be through public auctions to interested investors. Government will equally commit itself to supplying infrastructure services to that land. Unutilised sugar estate lands, among others, can be dedicated to that purpose.

The programme of downsizing the sugar industry to make it competitive on world markets, which is to be initiated with the transfer of some estate lands to cane farmers (Chapter 33), undoubtedly will result in some of those lands being devoted to housing construction in due course.

6. Supplying Serviced Lots

Government will also accelerate its programme of supplying serviced lots to needy families, with priority given to those who participate in a cooperative that will assist with the labours of construction and the obtention of building supplies. Such lots will be transported in freehold to the beneficiaries, with mortgages extended through the NBS and with the financial assistance of the special fund for supplementing mortgage payments. The selection procedures for recipients of the serviced lots will be reviewed with the aim making them more rigorous and objective.

7. Regularising Squatter Settlements

This Strategy finds it imperative to regularise the situation of squatters, so that they may improve the conditions of their shelter and receive the basic infrastructure to which all citizens are entitled. In cases of occupancy of State lands, concretely this means providing them with freehold title, in exchange for a mortgage with the NBS and assistance from the special fund for supplementing mortgage payments. They need to be made fully aware of the great responsibility implied by the mortgage, and of the consequences of failing to honor it. NGOs should be encouraged to engage in educational campaigns with squatter families regarding the new policies, their benefits and their responsibilities.

Instances of squatting on private lands need to be reviewed on a case-by-case basis, and each time one of two outcomes needs to result: either i) the land is returned its rightful owner, or ii) the owner is compensated for it and the squatter is given title (plus mortgage).

Experience of many countries has shown that titling the land of squatters results in rapid and significant improvements in the quality of the shelter of those populations.

At the same time, new attempts to squat on private or public lands have to be rigorously resisted; without such a policy, zoning of State lands and the concept of property for private urban lands both will become mere ideas void of much actual content. The opening of new lands for housing and the new forms of financial assistance for housing established in this Strategy should give the poor sufficiently attractive options that squatting is no longer favoured.

In cases in which regularising squatting on private lands requires compensation to former owners, such compensation should be channeled through the NBS and a special facility should be established in the NBS for that purpose.

8. Protections for the Greenbelt

After decades of erosion, the extent of the greenbelt needs to be redefined in a realistic manner, ceding areas that are irreparably lost to urban development. However, once it is defined again, and the housing policies of this document are in place, it would be important to protect it fully, removing incursionists as needed. Community assistance can be mobilised for the greenbelt, for planting trees in it, for developing drains and paths and other simple infrastructure, and for protecting it. As indicated previously, a youth ranger corps should be formed for these purposes, and they should be given leadership roles in educating the broader public about the importance of the greenbelt.

9. Reforms in Rental Regulations

The rental regulations urgently need recasting, as they have become counterproductive, as explained previously. Landlords and tenants need to be free to reach agreement on rental levels, subject only to registering the rental contract with the CH&PA. The existence of the special fund for rental supplements for poor families will obviate the need to try to control rents, which generally leads to substandard housing maintenance. The right of the landlord to recover the property at the termination of the contract also needs to be unambiguously affirmed. Equally, tenants need the power of recourse, especially in instances of landlords failing to make necessary structural repairs.

This kind of reform should lead to an expansion in the supply of rental housing available, while deserving tenants may benefit financially from the special fund.

10. Support for Modular Housing with Guyanese Woods

A recent study by V. Molinos has shown in detail that modular housing, utilising wood from Guyana's forests, can reduce the cost of home construction by as much as half. This avenue needs to be explored, mainly for the benefits in the form of more affordable shelter, but it also could provide benefits in the form of more employment and savings in foreign exchange. Government will develop a programme to support the construction, on a pilot basis, of a number of modular homes of this nature, to be sold to low income families with the assistance of the special fund for mortgage supplements. At the conclusion of the pilot project, it will be evaluated to determine its benefits and the wisdom of repeating it on a larger scale.

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C. Institutional Policies

1. Better Planning and Management of Urban Centres

Clarifying and redefining the roles, functions, and relationships of institutions, such as the regional democratic councils/local authorities, municipalities, and all other agencies that play a role in urban development and housing, will improve the planning and management of urban centres.

The Ministry of Public Works, Communications and Regional Development (MPWCRD), according to the Democratic Organs Act, holds responsibility for local authorities, municipalities, and regional democratic councils. The key responsibilities of the MPWCRD with regards to local government include:

- monitoring the operations of local authorities to ensure compliance with legal and administrative requirements;

- advising the Government about local government reform and amendments to relevant legislations;

- planning and coordinating the training of councilors and local government officers.

The responsibilities of Regional Democratic Councils (RDC) are executive and supervisory powers over local government in the regions, including municipalities. The RDC has to approve municipal budgets, appoint senior officers, monitor major expenditures, verify and audit the records, etc., while municipal councils function as suppliers of urban services and collectors of local revenue. The operations and management system of the urban councils is broken down; there are high level of absenteeism and underqualified staff. The Department of Regional Development and Cooperatives of the MPWCRD is unable to carry out its jurisdiction over the regional democratic councils, municipal councils, etc., due to budget limitations that cause staff and equipment shortages. Officers are rarely able to make field trips to check audit reports and monitor municipal operations. Regarding RDCs, their role towards municipalities varies widely from the original objectives, since there is acute technical staff shortages and lack of equipment to supervise the councils. Therefore, direct accounting to the Ministry by the municipalities would increase administrative efficiency, reduce ambiguity, and improve decision making information flow.

2. Improving the Quality and Efficiency of the Staff

Municipalities should offer realistic salaries to attract qualified staff and improve the office conditions for staff to function efficiently. The reforms in municipal financing described earlier in this Chapter should assist materially in this regard. Also, mayors, deputies, and councilors should be given attractive honorariums to ensure their full commitment on the job.

a. In-house and on-the-job training

An in-house and on-the-job training would cater for the specific needs of municipalities such as accounting, budgeting, administration, public health, and infrastructure.

Most of the municipalities do not have the necessary staff to function efficiently. A large percentage of the municipalities' staff is not qualified for the positions they occupy. As a result, councils suffer from absenteeism, high level of turnover, high vacancy rates. Low salaries and poor working conditions are generally identified as the main reasons for the failure to recruit and retain qualified staff.

b. One-year programme at the University of Guyana

A one-year programme at the University of Guyana or other tertiary institution with special remedial curriculum aimed at improving the administrative capabilities of municipalities, could be an effective method to increase the level of staff qualification.

c. Acquisition of equipment

Inventories carried out at municipalities indicate that the equipment is obsolete and require replacement. The recurrent revenue of the municipalities cannot cover their recurrent expenditures. This has led to the general deterioration of the equipment. In order to maintain and improve the quality and quantities of services offered, municipalities need to replace their capital equipment.

3. Municipalities' Responsibilities

a. Preparation of town planning schemes and physical development plans

Municipalities need to prepare town planning schemes and physical development plans for curbing unauthorised development, thus enabling them to exercise their authority within their respective designated areas. This will provide a system for the orderly and progressive development of the physical, economic, and social facilities within the municipalities.

Municipalities and local governments lack pro-active urban and community development planning, which has resulted in the escalated incidents of unauthorised development, undesirable, and unlawful disposal of waste and squatting.

The Local Authority and Local Democratic Organs Act 1980 stated that these institutions have the mandate to prepare town and country improvement and development plans. On this basis, municipalities should ensure that during their administration they formulate and implement pro-active urban and community development plans to improve the quality of life for the residents, and take a leading role in putting into practice the policies of this National Development Strategy.

b. Delegation of responsibilities

Final approvals and processing of application for residential, commercial, and other land use activities are issued by the CH&PA. For public health purposes, the Central Board of Health and the Regional Democratic Councils issues approval, which takes considerable time. Many applicants are dissatisfied with this system and have been clamoring for a more practical solution to be implemented.

The CH&PA and Regional Democratic Councils usually prepare development programmes with minimal consultation with the municipalities. On many occasions development proposals are not compatible with the objectives of the communities, causing delays in the development and planning process.

The national, regional, and zoning plans already formulated do not include meaningful contributions of municipalities and communities. As a result, the interest and participation of residents in the implementation stages is more confrontational than cooperative.

c. Upgrading of Municipalities and District Councils Acts

Municipal and District Councils Acts were drafted during the 1960s, with considerations and recommendations relevant to that period. However, events have taken place since then that render the situation considerably different now.

The building standards set out in the relevant Act have not been upgraded to the current construction practices that are occurring recently due to lack of land space. A large number of four and five stories buildings are being erected with approvals guided by those outdated standards and not on present day engineering, architectural, and town planning practices. Individuals are not satisfied with the long processing period that the applications are subjected to before final approvals are attained. A realistic and shorter processing period is strongly recommended.

Penalty fines imposed on individuals who disobey the laws of the Councils are too low and thus non-effective as a deterrent function. An increase in fines is necessary if defaulters and potential defaulters are to adhere to the rules and regulations of the Council.

d. Coping with natural disasters

Occasionally communities experience natural disasters such as high winds, flooding and pollution of potable water system. However, municipalities do not have the resources to render assistance during such events. Government should allocate an emergency fund to assist communities during these periods. Non-governmental organisations should be encouraged to take active positions on such occasions.

4. The Central Housing and Planning Authority and the Municipalities

a. Better coordination between the Central Housing and Planning Authority and municipalities

There is an increase in the number of construction of buildings without permission of the municipalities and the Central Housing and Planning Authority. Too eliminate this practice, municipalities should be given precise guidelines concerning the issuing of building permission so that all construction and renovation follow the approved building standards. Land belonging to municipalities should not be impugned upon by residents. CH&PA has not always supported areas identified by municipalities for residential purposes or industrial sites; hence the need for closer coordination and collaboration.

b. Strengthening the capacity of municipalities to implement policies

Decisions made by municipalities regarding building construction, change of use, and alternation, are not adhered to by individuals. As a result, these structures become a threat to lives and many have businesses are operating in residential areas without permission.

Municipalities do not have the resources or the political and judicial support to take legal actions against defaulters or squatters. Once municipalities are strengthened with the appropriate manpower, equipment, and the judicial system is reviewed, they would be in a better position to implement development promotion and control measures.

c. Preparing and reviewing development plans

Development plans are designed to predict the development of a society over a certain period in time. Consideration is given to resources, needs and how efficiently they can be utilised for greater benefits. Decision-making agencies such as the municipalities need to have development plans and the mechanisms to control the decisions made by individuals and investors. Such development plans should include the most appropriate technology, ideas and theories to provide guidance (e.g., specifications on types of building materials), and should be reviewed periodically to keep abreast of the new technologies available.

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VI. Recommended Legislative Changes

Throughout this Chapter, it has been observed that a very critical element to overcoming some of the constraints faced by the urban and housing sector is the need for more effective policies.

The urban and housing sector in Guyana is generally governed by the following statutes:

Town and Country Planning Act - #20:01 of 1946

Municipal and District Council Act - #28:01 of 1969

Local Democratic Organs Act - # 12 of 1980

Public Health Ordinance - Chapter 145

Housing Act - #36:50 of 1946

The laws governing municipal councils provide a relatively strong legal base for municipalities to function in an efficient manner and do not require much change. However, there is need to modernise, implement and enforce the existing legislation. Municipal councils need to be provided with a modern comprehensive set of bylaws to regulate most urban functions, since right now only the Georgetown Municipality has such bylaws, as well as New Amsterdam to a limited extent.

Attention should be paid to bylaws governing specific urban services such as drainage, roads, sewerage, sanitation, solid waste disposal, and markets. Also, building regulations need to be implemented in keeping with current development. The penalties for violation of bylaws need to be revised and provision made for this to be ongoing.

All of the foregoing is necessary if the municipalities are to shoulder the task of controlling their own urban development so as to provide guidelines that will allow for greater control.

The new financial mechanisms to assist with home purchase and rental need to be given a legislative framework.

Another area that requires the implementation of proper guidelines and regulations is that of public health and the environment. The current legislation does not allow for adequate control on environmental issues, since there are not sufficient guidelines and regulations governing them. The negative consequence of this is vivid as we experience increase development in the industrial sector, as well as an increase in the population of urban centres. A few examples are the atmospheric pollution caused by the dust in the bauxite industry, the water pollution caused by the seepage from Omai's cyanide ponds, and the problem of solid waste disposal in Georgetown. The environmental legislation presently being drafted needs to allow for the monitoring of industries and agencies, the protection of people within the environs of such industries and the compensation of such persons and all others affected by any failure of industries to adhere to regulations. The correction of problems that may arise must be applied.

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VII. Preliminary Investment Program

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A. Water and Sewerage

A three year strategic plan, together with a supplementary action plan have been developed and implementation is in progress.

The plan seeks to address in a positive way the following:

1. Upgrade and strengthen the institutional and financial capabilities of GUYWA aimed at improving collections.

2. Improve the level of services by completing the LBI and Pouderoyen major water supply system by December 1997 at maximum cost of US$18m.

3. Rehabilitation of 100 minor water plants by 1998 at a maximum cost of US$6m.

4. Replacement of 300 miles of distribution pipelines by December 1996 at a maximum cost of US$7.5m.

5. Providing the necessary human resources, establishing efficient data collection, storage and retrieval systems.

6. Enhancing the corporate image of GUYWA by adequate public awareness programmes and improved employer/employee customer relationship.

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B. The Georgetown Master Plan Study

A significant development in the strategic planning for improvement of water supply, sewerage, and drainage services in Georgetown was the completion in 1994 of the master plan report. This study was carried out between 1992 and 1994 by UK engineering consultants Halcrow and Associates, which cost US$2M and was funded by the IDB.

The principal objective of the master plan was to define a programme of improvements in the water and sewerage systems to be implemented over a period of 25 years. This programme will enable GS&WC to define and comply with appropriate levels of internationally recognised service standards. The goal of the Georgetown Sewerage and Water Commission is to become an efficient and autonomous water and sewerage company.

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C. Remedial Maintenance Programme

The Georgetown water and sewerage remedial programme will address the short term recommendation of the master plan starting in 1995 and for a period of four years. U.S. engineering consultants Harza and Associates have been contracted to work in participation with GS&WC to enable sustainable knowledge transfer in project execution.

This remedial maintenance programme is funded by an IDB loan of US$13.5 million and a contribution of US$1.5M from the Government of Guyana. The general objective of the programme is to produce a rapid and observable improvement in the levels of services currently provided to consumers.

Specific objectives of the programme are to improve:

- critical sections of the water supply distribution network to reduce waste and leakage, and carry out basic repairs at water and sewerage treatment plants;

- the financial capability of the organisation, including the accounting, budgeting, and cost control functions;

- management capabilities of the organisation thus strengthening the institution.

The procurement of further IDB funding to finance the longer term recommendations of the master plan depends on the successful completion of the remedial maintenance programme.

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D. Urban Rehabilitation Programme

The Government is working on a broader programme of urban development, as a sequel to the remedial maintenance programme, and is holding discussions with the IDB about further funding for that activity. Also, the UNDP, in collaboration with the United Nations Centre for Human Settlements (HABITAT), advocates a community management approach to urban development and housing which emphasises the more depressed areas. In it, the communities actually take a lead role in the development activities. Though often in partnership with the Government and the private sector, including NGOs, they should nevertheless be in control of the processes of local project planning, implementation, and management.

1. Objectives

The first overall objective of the Urban Rehabilitation Programme (URP) is to promote the sustainable provision of urban services and basic infrastructure. In order to accomplish this objective, a solid institutional and financial basis for the provision of urban services and the operation and maintenance of basic infrastructure must be established.

Its specific objectives are as follows:

a. Clarification of responsibilities among national, regional, and local government concerning the provision of municipal services and the operation and maintenance of urban infrastructure.

b. Establishment of efficient sources of finance for municipal services and infrastructure.

c. Development of the organisational structure of municipalities and Central Government agencies concerned with urban management, for the efficient discharge of their responsibilities.

d. Training of municipality personnel, council members, and Central Government officials.

The second overall objective is to rehabilitate existing urban services in the five municipalities that are the subject of this programme. Urban infrastructure projects include road and drainage improvements and on-site sanitation solutions for low income households. The restoration of municipal services will include solid waste management , municipal markets and abattoirs, street lighting, and municipal buildings such as offices and workshops.

2. Costs

Total costs for physical works, institutional strengthening, programme administration, and supervision of the five-year investment programme amount to G$3,191.8 million. For the two-year programme, the estimated cost amounts to G$1,704.1 million. The foreign exchange components of the five-year programme are G$1,445.6 million and G$782.06 million, respectively.

The total costs of physical works have been calculated for all sub-project components in each town and for each sector. For the five-year programme the total cost is G$2,544.7 million, and for the two-year programme, G$1,139.1 million.

The total base cost of institutional strengthening, programme administration, and supervision is G$594.2 million for the five-year programme and the cost of the two-year programme is G$535.36 million. Interest during the construction is assumed to be capitalised, hence added to the programme costs.

Physical contingencies have been included at 10 percent of physical investment base costs. Price contingencies of 4 percent per annum for foreign costs and 10 percent per annum for local costs have also been added. Taxes and duties on programme costs amount to G$477 million and G$246.6 million for the five-year and two-year programmes, respectively.