College: Department:

College of Business and Economics Public Administration and Development Management

Module Title: Module Code:

Course Title: Course Code: Cr. Hrs. ECTs.

Urban Governance and Administration PADM 3082 3 5

Course Status: Core Course

Academic Year: III Semester: II

Learning Objectives At the end of this course, students will be able to:


Develop awareness of concepts, origins and development of urban centers and
issues of urbanization and urban management.
 Identify Historical Perspective and Pattern of Urbanization
 Appreciate urban sector policies and development of urban institutions, laws, rules
and regulations
 Examine interagency co-ordination with particular reference to the urban local
bodies
 Analyze the typology of urban governance and their applications
 Address the critical issues of municipal management in developing countries.
 Discuss contemporary problems facing cities of the third world.
 Understand the administrative, physical, social, economic, demographic, political
and environmental implications of urbanization.
 Review the situations of urbanization and urban management in Ethiopia
Course Description The focus of this course is on the origins and development of urban centers and their
governance. The course deals with examination and analysis of how cities have evolved
Chapters through the understanding of their structures and powers of government and regulatory
CH 1:introduction interventions that have been implemented in response to decline or the need to improve the
quality of life in cities. It also introduces to the principles of urban governance and
CH2:Causes&Consequ
administration and examines the political, social, and economic environment in which
ence of Urbanization decisions pertaining to urban centers occur.
CH3:Urban
Besides, this course will examine urban space both historically and cross-culturally. In this
Management & context, the course discusses the importance of cities to the economic, cultural, and political
well-being of modern societies and examines how forces such as industrialization,
Governance
decentralization, and suburbanization affect the structure, size, finance and function of
CH4:Urban Function cities. We will discuss classic theories and recent models of urban governance discourse in
urban studies as we look to answer questions like, “how and why cities develop and
& Finance
change, and who lives in cities and why?” By the end of the course, it is hoped that students
CH5:Urban gain a new understanding of the significant role that cities play in the vitality of urban
centers of the world in general and Ethiopian cases in particular.
Governance in
Ethiopia & selected Moreover, this course provides an overall understanding of the key aspects pertaining to
urbanization patterns, good urban governance, devolution of powers, development urban
LDC’S planning, poverty, community participation in city development and innovative illustrations
through case studies.
 CHAPTER ONE: INTRODUCTION

1.1 Defining urbanization, urban centers and related terms.

Urbanization: No universally accepted definition is available for urbanization like other

concepts in social sciences.

 Urbanization simply means the growing population living in cities or it is a place of

concentration of nation’s population in urban centers.

 Alternatively urbanization can be defined as a continuous process from being rural to

being urban. This is described in the engagement of population from primary operation
to secondary and tertiary operation reflecting the change in product and specialization

 A more elaborated definition of urbanization refers to the ‘’process which rises to the
concentration of the population economic activities such as manufacturing, services,
commerce, profession and informal sector’’.

But this definition may not be full filled in non-western countries urbanization. In non-western
countries, urbanization is the function of demographic changes but in the west it is the function
of industrialization.

Urban center, City, Town, Municipality, County, Hamlets and Borough

Urban center: refers to a settlement where by the majority of population is engaged in non-
agricultural occupations such as trade (wholesale), profession, services and other non-
agricultural activities( manufacturing, handicrafts, small scale business).However, the criteria
used to distinguish between rural and urban center is sometimes vague.

There are two reasons for this:

1. There are no universally used yardsticks
2. The classification is highly variable from place to place.
 Thus, the classification is simply contextual depending on different conditions such as
political, administrative and other factors. There are loosely used criteria which are regarded
as some general factors including;

1. Population:-is the first issue in studying urban settlement. Certain number of population
should be there for an area to be considered urban. For example in Ethiopia a population of 2000
is required where as in Ghana 6000, Uganda 10,000, Japan, 50,000, USA 25000, Canada1000,
Ireland 1500.

(NB) The range is 49000.This is because it is dictated by their country’s specific conditions.
Thus, one can easily understand that demographic and economic criteria on which definitions of
urban and rural areas are based can vary widely between different nations, making
generalizations is problematical. .

2 Density: - Measures population residing in a sq km (Km2). For instance, in Philippines, urban

areas are defined by the national census as all settlements with a population density of at least
500 persons per square kilometre. Still there is no universally accepted number of populations to
use density as universal criteria.

3 Occupation:-certain number of population must engage in non-agriculture activities

4 Infrastructure: - it can be physical or social infrastructure

Physical: - communication, road networks, power, water, sanitation, sewerage and other
facilities

Social: - health care facilities and Education

 For instance in Philippines, the urban status applies to centres with the following
infrastructure:
1. a parallel or right-angled street pattern;
2. at least six commercial, manufacturing or similar establishments;
 3. at least three of the following: a town hall, church or chapel; a public plaza, park
or cemetery; a market place or building where trading activities are carried out at
least once a week; and a public building such as a school, a hospital or a library.
 In Benin, the National Institute of Statistics and Economic Analysis considers as town
any head town of a district with a population of 10,000 inhabitants or more, and with at
least four of the following:
1. Post office, tax office, public treasury, bank, running water supplies, electricity,
health centre and secondary school.
 This is often the case in sub-Saharan Africa, where small towns are defined on the
basis of administrative, demographic and infrastructural characteristics even when the
majority of the population engages in agricultural activities.Infrastructures are more
necessary for cities than rural areas because urban people rely specially on these
infrastructures for survival.

5 Greatest isolation from nature:- There are also other manifestations of urban centers; Cities
exhibit man-made environment unlike rural settlement which in most cases is surrounded by
natural environment. Cities are dominated by man made environment as reflections of urban
settlement or reflection of urbanization such as high rise buildings, machinery, road network,
power supply, telephone services etc.

System of Interaction in cities are more numerous contacts, impersonal relations, causal
relationship, short lived relations, standardized and formal relations as compared to rural
relationships which is based on expanded family and kinship . In cities there is more
independence and self reliance.

City: is a Roman term originated from “civitas” meaning citizens.

 A city is the hub of a metropolitan area. Present-day cities are products of the industrial
revolution and are generally distinguished by land area and population. Large,
industrialized cities generally have advanced organizational systems for sanitation,
utilities, land distribution, housing, and transportation.
  A big city, or metropolis, is usually accompanied by a sub city. Such cities also contain
large amounts of urban sprawl, creating large amounts of business commuters. Once a
city sprawls far enough to reach another city, this region can be deemed a mega polis or a
cluster of urban areas.
 Older cities appear to be jumbled together, seemingly without a structural plan. This
quality is a legacy of earlier unplanned or organic development, and is often perceived by
today's tourists to be picturesque. In contrast, cities founded after the advent of the
automobile and planned accordingly tend to have expansive boulevard (a wide city street
often with tree on each side) impractical to navigate on foot.
 Modern city planning has seen many different schemes for how a city should look. The
most commonly seen pattern is the grid, favored by the Romans, almost a rule in parts of
the New World, and used for thousands of years in China.
 Other forms may include a radial structure in which main roads converge on a central
point, often the effect of successive growth over long time with concentric traces of town
walls and citadel - recently supplemented by ring-roads that take traffic around the edge
of a town. Many Dutch cities are structured this way: a central square surrounded by a
concentric canals. Every city expansion would imply a new circle (canals + town walls).
In cities like Amsterdam and Haarlem, and elsewhere, such as in Moscow, this pattern is
still clearly visible.

Town: - originated from the old English word, ‘Tun’ meaning enclosure for
protective purpose. It is associated with fortified, fenced, hedged place.

The difference between towns and cities- The difference between towns and cities is differently
understood in different parts of the English speaking world.

 There is no one standard international definition of a city.

 The term may be used for a town possessing city status; for an urban locality exceeding
an arbitrary population size; for a town dominating other towns with particular regional
economic or administrative significance. See the following specific context.
  In many U.S. states, any incorporated town is also called a city. If a distinction is being
made between towns and cities, exactly what that distinction is often depends on the
context. The context will differ depending on whether the issue is the legal authority it
possesses, the availability of shopping and entertainment, and the scope of the group of
places under consideration.
 In the United Kingdom, a city is a town which has been known as a city since time
immemorial, or which has received city status by letters patent — which is normally
granted on the basis of size, importance or royal connection (the traditional test was
whether the town had a cathedral). In the United Kingdom, when people talk about
cities, they generally include the suburbs in that. Some cathedral cities, such as St
David's in Wales and Wells in England, are quite small, and may not be known as cities
in common parlance.
 In Germany many other languages, there is no difference between city and town. The
German word for both is Stadt, while a town with more than 100,000 inhabitants is
called a Großstadt, which is the most adequate equivalence for city (in terms of
differentiating it from a town).
 In China There is a formal definition of city in China provided by the Chinese
government. For an urban area that can be defined as a city, there should be at least
100,000 non-agricultural population. City with less than 200,000 non-agricultural
population refers to a Small city, 200,000-500,000 non-agricultural population is a
Medium city, 500,000-1,000,000 non-agricultural population is a Large city and
>1,000,000 non-agricultural population is an Extra-large city. Also, there is an
administrative definition based on the city boundary too and a city has its legal city
limits. In 1998, there were 668 cities in China - China has the largest urban population in
the world

Generally, town refers to smaller settlements and city refers to lager settlements where there is
big infrastructure.

Municipality:-originated from ancient Roma “Municipium” which means administrative

office. In modern context, municipality can be defined as:
  A primary political unit usually with the power of self government and defined authority to
rule the settlements. In other words municipalities are distinguished legal entities
incorporated in to the laws of their respective state or regions. They are expected to
perform some basic administrative and political activities in the interest of the residents.
Thus, they have established boundaries, governing laws, and elected/appointed leaders,
prepare budget and implement the same.

County: is the largest territorial and political subdivision of a state. This term is used both in
USA and UK

The original term is “Comitates” means count, which refers to imperial officials.

Metropolis: has two meanings:

(1) Capital city of a state or nation

(2) Surrounding areas of a big city, (Peripheral areas). It originated from a Greek word polis
which means the ability to lead a community.

Hamlets: small villages which are not incorporated as a town or city.

They are similar to our urban kebeles.

Boroughs: are small urban settlements in early British local

government systems. Boroughs are the lowest in the urban hierarchy both in the USA
and UK.

1.2. Emergence and Historical Development of Cities

Preconditions for urban Emergence: The causes for the emergence of cities were the function
of many factors. These include:

1. The need for stationary mode of life i.e. transition from hunting to settled agriculture

 The first important step in urban development is the emergence of settled agriculture (when
people started to live in a group of community and begun to cultivate land in commune).
  Gradually those productive communities were able to produce surplus products i.e.
excess surplus over and above house hold consumptions.

 These surpluses should have been sold in the market. This necessitated middle men who
communicate between the producers and the buyers. The emergence of middle men
created a group of people who are detached from agriculture.

 Moreover, some special working groups emerged who provide services to the
community. These includes crafts men, black smith, potters and others who specialized
in non agricultural occupations. Historically, cities emerge if and only if there is a group
of community who are engaged in the provision of services. Thus, surplus product was an
important condition for the emergence of cities.

2. Increase in the number of settlers of population. The increase in population raises the
ownership
3. Favorable ecological Environment. Conducive climate, fertile soil and hydraulic resources
4. Technological development. As technology advances, people are also able to produce
goods in quantities and qualities. As these goods are produced in abundance, they must be
marketed to other communities. The diversity of products sparks off new demands and
create group of middlemen who make their living outside agriculture. Thus, the emergence
of non-agricultural communities is and important step in the development of cities
5. The emergence of special groups which led to social classification or social classes, such as
the rulers and the ruled, nobilities, princes leading o the creation of head quarters for the
rulers.
6. Administrative Reasons. Settlements are also selected on the bases of administrative
reasons to provide equal administrative services at national, regional, zonal and woreda
levels, e.g. the recent example in Ethiopia is the establishment of Samara as a regional
capital of Afar Region

Historical Development of Cities: The origin of urban center is not exactly well known.
However, there are literature myths and speculation in archaeology that indicates cities
emerged during recorded history.
 Towns and cities have a long history, although opinions vary on whether any particular
ancient settlement can be considered to be a city. Cities formed as central places of trade
for the benefit of the members living there. Benefits include reduced transport costs,
exchange of ideas, and sharing of natural resources.

The first true towns are sometimes considered to be large settlements where the inhabitants
were no longer simply farmers of the surrounding area, but began to take on specialized
occupations, and where trade, food storage and power was centralized.

Historical Development of Cities had been occurred in different time period.

Ancient times

 Among the early cities, Mohenjo-Daro of the Indus Valley Civilization was one of the
largest, with an estimated population of 41,250 as well as one of the most developed in
many ways, as it was the first to use urban planning, municipal governments, grid plans,
drainage, flush toilets, urban sanitation systems, and sewage systems.
 The formation of ancient empires concentrating political power, and the growth in
commerce and manufacturing led to ever greater capital cities and centers of commerce
and industry, with Alexandria, Antioch and Seleucia of the Hellenistic civilization,
Pataliputra (now Patna) in India, Chang'an (now Xi'an) in China, Carthage, ancient
Rome, its eastern successor Constantinople (later Istanbul), and successive Chinese,
Indian and Muslim capitals approaching .It is estimated that ancient Rome had a
population of about a million people by the end of the first century BC, after growing
continually during the 3rd, 2nd, and 1st centuries BCs. And it is generally considered the
largest city before 19th century London. Alexandria's population was also close to
Rome's population at around the same time. Similar administrative, commercial,
industrial and ceremonial centers emerged in other areas, most notably Baghdad, which
to some urban historians, later became the first city to exceed a population of one million
by the 8th century instead of Rome.
Middle Ages

 During the European middle Ages, a town was as much a political entity as a collection
of houses. City residence brought freedom from customary rural obligations to lord and
community: "Stadtluft macht frei" ("City air makes you free") was a saying in Germany.
In Continental Europe cities with a legislature of their own weren't unheard of, the laws
for towns as a rule other than for the countryside, the lord of a town often being another
than for surrounding land. In the Holy Roman Empire some cities had no other lord than
the emperor. In Italy, Medieval communes had quite a state like power.

Early Modern

 While the city-states, or polis, of the Mediterranean and Baltic Sea languished from the
16th century, Europe's larger capitals benefited from the growth of commerce following
the emergence of an Atlantic trade. By the late 18th century, London had become the
largest city in the world with a population of over a million.

Industrial Age
 The growth of modern industry from the late 18th century onward led to massive
urbanization and the rise of new great cities, first in Europe and then in other regions, as
new opportunities brought huge numbers of migrants from rural communities into urban
areas.
 In the United States from 1860 to 1910, the invention of railroads reduced transportation
costs, and large manufacturing centers began to emerge, thus allowing migration from
rural to city areas possible.
 However, cities during those periods of time were deadly places to live in, due to health
problems resulting from contaminated water and air, and communicable diseases. In the
Great Depression of the 1930s cities were hard hit by unemployment, especially those
with a base in heavy industry.
 In the U.S urbanization rate increased forty to eighty percent during 1900-1990. Today
the world's population is about half urban, with millions still streaming annually into the
growing cities of Asia, Africa and Latin America.
Urban development also premeditated based on a well thought policy and strategy. There are
different approaches in this regard.

1. Growth centre approach. It is a system where by few places are carefully selected for
their potential in developing the surrounding areas and beyond in terms of triggered
development, (Agricultural or industrial). Urban centers should be propeller of new ideas
and innovation.

2. Agropolitan approach: Developing small urban centers with industries that are highly
linked to the surrounding agricultural and natural resources

3. Administrative suitability: Establishing centers which are accessible and efficient in

their administrative services.

 In Ethiopia, cities emerged spontaneously i.e. there has not been systematic urban policy
that should guide the pattern of urban development.
1.3 Why we study cities and their management?

There are at least 5 reasons why we study cities and their management:

(a) Fast population growth in cities. Nearly 50% of the world’s population lives in cities.
Some statistics show the %age of urban population as follows:

- in 1800, about 3% live in city

- in 1900, about 13% live in city
- in 1950,about 29% live in city
- in 2005, about 50% live in city
- in 2030, about 60% live in city (Projected by UN’s 2007 World urbanization
prospects report).

According to the UN State of the World Population 2007 report, sometime in the middle of 2007,
the majority of people worldwide will be living in towns or cities, for the first time in history;
this is referred to as the arrival of the "Urban Millennium". In regard to future trends, it is
estimated 93% of urban growth will occur in developing nations, with 80% of urban growth
occurring in Asia and Africa.

(b) Cities are also the concentration of poverty, crime, and congestion and environmental
degradation. This is specifically true for cities in developing countries which attracted the
attention of researchers, politicians, managers and the public large

(c) Cities are hallmark of civilization especially where Cultural Revolution takes place. Change
in attitude quickly takes place in cities and spreads over to rural areas and small urban
centers.

(d) Cities are centers of development and innovation. New ideas originate in cities because cities
are centers of education, industrialization and Cultural Revolution. The larger proportion of
economic activities and innovation take place in major cities such as capital cities, commercial
cities and port cities. Hence, many people say that economic development is directly related to
urbanization.

The reasons given for urbanization to enhance development are that:

- It results in modern means of communication

- It results in Financial institutions and
- A concentration of trade, industry, skilled manpower and decision makers in cities
make them more important.
(d) Cities provide the advantages of economies of scale i.e. they lead to efficient allocation
and utilization of resources. Moreover, cities reduce the cost of producing services
and make easier the provision of those services.

Generally, cities play the following roles

 Cities are formed because they provide cost advantages to producers and consumers on
the basis of agglomeration economies (urbanization + localization) through backward
linkage (factors availability) and forward linkage (sale markets). Thus Cities provide
economies of scale by bringing buyers and sellers in close proximity. By doing so, cities
reduce the cost of transportation and communication. Moreover, cities make easy and less
 expensive the provision of services such as power supply, road network, water supply,
and drainage and sewerage facilities.

 According to urban hierarchy model plants in various industries have a characteristic of

market radius that results from the interplay of three factors: economies of the scale in
production, transportation costs and the way the demand for land is spread over
space. Clearly this model applies to non-export industries. According to differentiated
plane model the limited number of transportation routes linking the industries within an
economy plays a key role.Thus, under normal conditions cities and towns make vital
contribution to economic and technological development by providing public services
and infrastructures such as;

a) Physical Infrastructure: includes communication, transportation facilities like

road, telephone, power supplies, and potable water.

b) Social Infrastructure: includes health care, education, recreation, social and

cultural facilities.

The modernization of agricultural sector largely depends on the emergences of cities because
they provide markets, financial processing and distribution activities. These towns serve as
market places for the rural community both to sale products and purchase agricultural and non-
agricultural inputs.

CHAPTER TWO
CAUSES AND CONSEQUENCES OF URBANIZATION

2.1 Causes of Urbanization

 Migration
 Natural population growth

2.1.1 Migration
Some writers define migration as: Population mobility from one place to another or it is
simply a change of residence. It involves a complete change and adjustment to the new
environment. This definition assumes migration is a permanent change of residence.
Others define migration as: A casual, cyclical change of residence for temporary
reasons. Such as seasonal job search, job transfer and family movement cases. This
definition assumes migration as a short range change of residence. For our purpose the
fist definition is relevant considering rural urban migration as a complete change of
residence
Forms of Migration
Migration can take different forms:
1. Rural- Urban migration
2. Urban- urban migration
3. Rural-rural migration
4. Urban- rural migration,
The urban rural migration is the least practiced form of migration in Ethiopian context.
While international migration has attracted increasing attention in recent years (often
because of its political implications in destination countries), little is known about
internal migration despite the fact that its scale, direction and demographic
characteristics (such as sex and age composition) are fundamental to an understanding
of urbanization processes.

Factors for Migration

Why people migrate? There are two general factors.

1. Pull factors: Pull Factors include: employment opportunity in urban centers, better
facilities such as education, health care, recreational centers.
2. Push factors: Push factors include natural and man-made phenomena that force
people to displace from their origin (drought, famine/starvation, population pressure,
political instability, natural calamity i.e. earth quake, flood volcanic eruption and
others. Population pressure includes extended family population pressure leads to
land shortage, land degradation also force people to migrate.
Traditional approaches to migration have relied on the notion of "push-pull" factors as the main
explanatory elements.
In the neo-classical perspective, decisions to move are made at the individual level in response to
hardships in source areas (the "push" factors) and to perceived comparative advantages in destination
areas (the "pull" factors). Individuals rationally decide to migrate because they are attracted by the bright
lights of the city which promise, in the long-term, to offer better economic opportunities than the
countryside.
The structuralism approach to migration, on the other hand, tends to portray migrants as victims
rather than rational decision makers, since movement is determined by macro-social, historical and
dialect processes such as the socio-spatial restructuring of production at the national and global levels.
Push-pull factors are seen here as a process of polarization with respect to access to resources, and
migration as of few options available to the most vulnerable population strata.

2.2 Consequences of Rural Urban Migration and Natural population growth

Natural population growth and migration has brought severe consequences which include increased
poverty, inadequate housing, inadequate access to basic services and proliferation of squatter
settlements, urban environment degradation and increase in the informal sector.

Rural-urban migration was once viewed favourable in the literature of economic development. Internal
migration was thought to be natural process in which surplus labour was gradually withdrawn from the
rural sector to provide needed manpower for urban industrial growth.
The process was deemed socially beneficial because human resources were being shifted from lower to
higher marginal product (Lewis theory of development). In contrast to this view it is now clear that rates
of rural-urban migration continue to exceed rates of urban job creation and to surpass the absorption
capacity of urban industry and services.
Migration exacerbate rural-urban structural imbalance in two direct ways.
First, on the supply side, internal migration disproportionately increases the growth rate of urban job
seekers relative to urban population growth.
Second, on the demand side, urban job creation is generally more difficult and costly to accomplish than
rural job creation. Migration in excess of job opportunities is both a symptom of and a contributor to
underdevelopment.
The process of urbanization presents enormous challenges to governments, social and environmental
planners, architects, engineers and the inhabitants of the world’s cities.

We can generally classify these consequences into four categories:

1. Squatter Settlements, Slums and sprawls
2. Poverty
3. Informal sector
4. Environment Degradation

2.2.1 Squatter Settlements, Slums and sprawls

Squatter Settlements: Squatter settlements tend to be unplanned and are often illegal. Houses are self-
built using basic materials. Squatter settlements have few services. Squatter Settlements are illegal
occupation of public land. There are at least 3 characteristics of squatter settlements

I. physical characteristics
II. social characteristics
III. legal characteristics

The physical Characteristics: - Squatter settlements have infrastructure and service below minimum
level. They may not be connected to water supply, electricity, road, and drainage and sewerage fatalities.
Insecure because of lack of security services like police service, fire protection service. The squatter
settlements are also built in marginal lands at peripheries, river sides and dump sites.

The Social Characteristics: - Squatter settlements belong to low income groups or informal workers.
On average most residents earn a very low income and many of them are part-time workers/daily
laborers. Most squatters are predominantly migrants from rural to urban or urban to rural.

Legal Characteristics: - Squatter settlements are innately illegal because the squatters occupy public
land without any legal permission. They do not have authorized permits, ownership certificate, not
backed by legal provisions. They are against the master plans of a city which shows residential,
commercial, industrial and other plots (zones).

Slums: Slums are decayed areas, shanty areas, and rotten areas of a city. It is subjected to hazard,
overcrowded and no space for recreation. Slums are highly congested urban areas marked by
deteriorated, unsanitary buildings, poverty and social disorganization. The residents of slums face many
problems on a daily basis.
  Overcrowding-high population density
 Fire hazards: fire can spread quickly
 Overpopulation: the area does not have enough resource to support the growing population, lack
of space
 Disease: poor sanitation and limited healthcare can lead to spread of disease
 Services such as buses are overcrowded.

In Addis Ababa most kebele houses are examples of slums.

The difference between slums and squatters is that slums are legal but squatters are illegal. But they
both share physical characteristics. Slum housing is basically associated with bad housing: For instance
slum housings are dwellings that have inadequate light, air, toilet and facilities are in bad repair and
improperly heated. Moreover, slum houses do not give an opportunity for family privacy. It is subject to
hazard, overcrowded and no space for recreation. Slums are highly congested urban areas marked by
deteriorated, unsanitary buildings, poverty, and social disorganization. On the other hand, squatters
settle on a land, especially public or unoccupied land, without a right or title. Squatters include those
who settle on public land under regulation by the government, in order to get title to it.
Simply, slums refer to the environmental aspects of the area where a community resides, while squatters
refer to the legality of the land ownership and other infrastructure provision.

Sprawl: Sprawl is considered to be an unplanned outgrowth of urban centres along the periphery of the
cities, along highways, along the road connecting a city, etc. Due to lack of prior planning these
outgrowths are devoid of basic amenities like water, electricity, sanitation, etc.

2.2.2 Urban Poverty

Poverty affects many aspects of human conditions, including physical, moral and psychological, hence,
a concise and universally accepted definition of poverty is elusive. The most common practice is to
conceptualize poverty as absolute or relative.

Absolute poverty is the lack of adequate resources to obtain and consume a certain bundle of goods and
services deemed basic. Such a bundle of goods and services would contain an objective minimum of
basic necessities such as food, shelter and clothing. Absolute poverty is characterized by low calorie
intake, poor housing conditions, and inadequate health facilities, poor quality of educational facilities,
low life expectancy, high mortality, low income, unemployment and underemployment. Poverty has also
been conceptualized in relative terms as the standard of living conditions that prevails in a given society
Features and dimensions of urban poverty

Urban poverty is a multi-dimensional phenomenon. It is a deprivation of access to basic necessities that

sustain life. These include limit of access to employment opportunities and income, inadequate and
insecure housing and service, violent and unhealthy environment, little or no social protection
mechanisms, limited access to health and educational opportunities. Urban poverty is often characterized
by cumulative deprivation i.e. One dimension of poverty is often the cause of another dimension.

Urban poverty is characterized by significant and multiple deficiencies whose main dimensions
include:

 Insufficient or unstable income, which leads to inadequate consumption;

 Risks caused by deficient access to basic goods and services;
 Low-quality housing that leaves residents more vulnerable to critical sanitary problems,
contamination, crime and natural disasters

It is also useful to analyze urban poverty with reference to vulnerability. i.e. susceptibility to risk and
vulnerability is closely linked to asset ownership. The more assets people have the less vulnerable they
are. The greater attrition of people’s asset is the greater their insecurity. These assets include: Human
capital, Productive Assets and Social capital

Human capital: - health, education, skills, trainings and ability to work but the poor has no this asset.

Productive Assets: - Means of production, housing, infrastructure

Social capital: - acceptance by the society, status, dignity. Poverty means lack of the above essential
Many factors converge to make poverty an interlocking multidimensional phenomenon. (See the
following table)

Dimensions of Cause or contributing factors

Poverty

Income employment insecurity/casual work, unskilled wage labor, inability to

hold job due to bad health, lack of qualification

Health Unhygienic environment, congestion and traffic pollution, settlement on

marginal lands which are prone to hazards such as floods , landslide,
exposure to disease due to poor air, water and lack of sanitation, injury and
health rising form traffic, industrial accidents especially for those in
Informal sectors.

Education Constrained access to education due to in sufficient school size, inability

to afford school fees

Security Tenure insecurity, lack of access to houses, personal in security, due to

drug/alcohol abuse, family breakdown, reduced support for children,
income inequality in cites which increase tensions.

Poverty is not only lack of money or facilities, it is also the result of poverty of spirit i.e. attitude of
hopelessness, ignorance of available resources and dependence on others, lack of confidence, lack of
skills, lack of integrity, lack of trust. Hence, it is a combination of multidimensional factors such as
Ignorance, Apathy, Dishonesty and Dependency

Ignorance: it is lack of information and knowledge and it is different from stupidity which is lack of
intelligence, different from foolishness which is lack of wisdom

Apathy: lack of interest (people do not care when they feel powerless). Yet they do not try to changethings.
It goes with mentality of accepting existing problems and live with it because they believe that God has
decided their fate.

Dishonesty: when there is no respect for humanity and its resources. It takes place especially when
resources are abused; facilities are diverted for individual purposes. Dishonesty leads to morale decline
and leads to temptation of abusing resources

Dependency: If a person is devoid of health, self-control, he will be dependent mainly on aid.

 2.2.3. Informal Sector

Large cities attract migrants despite all their problems. People migrate to cities either in search of jobs or
to escape the agony of rural poverty. But the cities do not have available jobs in the formal sector.
When the migrants fail to be employed in the formal sector, they shift to the informal sector.

WHAT IS THE INFORMAL SECTOR?

The existence of an unorganized, unregulated and mostly unregistered business, But there is no
universally accepted definition of Informal sector so far despite that studies reveal the share of the urban
labour force engaged in informal activities is growing and ranges from 30 to 70%, the average being
50%.

Despite large number of research on informal sector as a concept, it remains illusive. The reasons are
that the sector is heterogeneous in terms of activities and scales. Sometimes it includes workers
operating in their own business, employees in small business, wage laborers and apprentices.
In other cases it includes small activities like shoeshine, petty trading and socially useless jobs
(begging, prostitutions), service people (gardeners, house cleaners, and servants’ in house, street
scavenger).

Lubanga (1992) defines informal sector as follows: “Informal sector consists of small scale self-
employment activities with or without hired workers typically operating with a low-level of the
organized form and technology to generate income for the participants. These activities are carried out
without formal approval from authorities”
The bulk of new entrants to the urban labour force seemed to create their own employment or to work
for small-scale family-owned enterprises. The self-employed were engaged in hawking, street vending,
letter writing, knife sharpening, junk collecting, prostitution, drug peddling, snake charming, etc. Other
found jobs as mechanics, carpenters, small artisans, barbers and personal servants. The self-employed
workers in informal sector have little formal education, are generally unskilled, and lack access to
financial capital.
Therefore, workers productivity and income in this sector tend to be lower than in the formal sector.
Generating activities including women and children and they often work very long hours. They usually
live in slums, which generally lack public services like electricity, water, drainage, transportation.
educational and health services.
Major Features of the Informal Sector:
1. Small scale operation
2. Self or family employed
3. Not licensed
4. easy entry and exit
5. reliance on indigenous resource
6. Labor intensive
7. Skill acquired outside formal school

In the Ethiopian context, the informal sector is viewed as sectors:

- Not registered as companies or cooperatives
- That have less than 10 personnel employees
- That have no written book of accounts
- That have no license and hence they do not pay tax

Causes/Reasons for the Emergence of Informal Sector

1. economic crisis
2. failure of formal sector to absorb labor
3. low skill and education
4. Lack of capital
5. failure of agricultural sector to create employment

2.2.4. Environmental Problems/degradation/crisis

The most serious problem of environmental degradation is its implication on health, urban sanitation and
beauty. Health concerns include air and water pollution, water supply and sanitation, Waste disposal;
chemical and food safety and other waste related problems generally environmental problems are
classified into two: indoor and outdoor problems.

I. Indoor problems (Domestic Problems): these have many dimensions like:

1) Waste water (liquid waste) and Sewage: Many even large cities of 3rd world nations have no
sewerage systems and adequate waste water treatment facilities. This had consequent health problems on
the poor with water born problems.

2) Inadequate drainage facilities: in many cities of 3rd world poor drainage system led to regular
flooding

3) Indoor Air pollution: rises from smoke, dust and other sources which lead to chromic lung problems
and Asthmatic diseases
4) Noise: in some cities the use of high-tech equipment and other instruments of entertainment damage
the hearing of those constantly exposed to that noise. noise becomes a constant source of disturbance
and leads to poor attention and poor health

II. Outdoor (Non-Domestic) Problems

Major outdoor problems:

1. Hazardous industrial solid and liquid waste: countries in the 3 rd world are finding it difficult to
control industrial wastes and release them to the nearby surrounding without recycling their toxic
content

2. Hazardous Hospital wastes: in many cities clinical wastes from hospitals and other medical facilities
are in adequately treated and often find their way to residential environments such as open dumps,
where waste pickers are exposed to serious health problems.

3. Industrial Air Pollution: Lack of adequate control of smoke and dust from industry results in air
pollution.

4. Industries release acid to the environment and to the air that affects human health. These acids also
come down in the form of rain with subsequent environmental implication.

5. Noise from Industries

6. Traffic Congestion and poor traffic management

2.3 Solutions Attempted

2.3.1 Physical Measures

Refers to Planned physical management of land applied to direct the development of cities.

Master Plan: It is a compressive document which contains physical designs of cities and which guides
the physical development of a city for certain period of time. It is usually prepared for 10-20 years to
guide the physical expansion of a city. Master plans contain plots for residence, commerce,
industries/manufacturing and plots for other purposes.

“Closed city policy”: This is an explicit administrative policy. Under this policy, migrants are required
to show residence permits. Otherwise they must return back to their origin. It is applied in China. China
has restricted internal movement in various ways. Official efforts to limit free migration between
villages and cities began as early as 1952 with a series of measures designed to prevent individuals
without special permission from moving to cities to take advantage of the generally higher living
standards there. The central government attempted to control movement through the household
registration system and promote development of small cities and towns.

In Africa in the 1960s closed city policy measures were taken in Kenya, Zaire, Ivory Coast and Ghana.
These counties deployed police force to check whether migrants qualify to reside in the city; otherwise
migrants are sent back to their original land.

Implicit administrative Measures: this refers to applying disincentives to migrants.

Eg. high taxation, discouraging migration, strict investment laws (favoring smaller cities by
providing incentives of investment).

A reason for rural-urban migration control is that if job opportunities are productive and lead to gainful
employment, urbanization becomes a catalyst for economic development. If, however, urbanization is
merely a process of transfer of rural poverty to an urban environment, it results in a concentration of
misery. This is exactly what is happening to most of LDCs.

Satellite City Policy: When there is a concentration of population in few bigger cites, regional and
central governments peruse satellite city approach to divert the direction of migration from big cities to
smaller nearby cities. These smaller nearby cities are called Satellite Towns. Satellite Towns should
grow in terms of investment, education, health and other fundamental services. This policy helps to
balance resource and population distribution across a country. Otherwise concentration of population
and resources in few towns leads to polarization. Polarization refers to unidirectional which results in
primate city. Primate city is a city which is many times bigger than the second city in a nation or
region. Primacy is a situation where population and resources are concentrated in few cities.

In the 1950s and 1960s, small towns were generally seen as playing a positive role in development as
the centres from which innovation and modernization would trickle down to the rural populations. A
more recent and highly influential contribution to this positive view was the development of the concept
of "urban functions in rural development" (Rondinelli and Ruddle, 1978; Belsky and Karaska, 1990) for
which the most effective and rational spatial strategy for promoting rural development is to develop a
well-articulated, integrated and balanced urban hierarchy. This network of small, medium sized and
larger urban centres is described as "...locationally efficient- it allows clusters of services, facilities and
infrastructure that cannot be economically located in small villages and hamlets to serve a widely
dispersed population from an accessible central place" (Rondinelli, 1985). The location of more service
supply points supplying a variety of services, agricultural inputs and consumer goods to the rural areas is
seen as playing a crucial role in rural development.

Rustication Policy: This policy is an approach where governments resettle urban population into rural
settlements where the ecology is appropriate for living. These include farming land, health and
education services. Of course this will involve high financial implications to provide social services.

Integrated Rural Development policy : is the system where a range of services are provided to rural
population to minimize migration and to improve their life. Better seeds, fertilizers, pesticides, animal
husbandry including veterinary services, improved technology. These services are called extension
services. Infrastructure (roads, communication services health care, education and others).Thus, the
farmers’ income, productivity and efficiency will increase.

Demolition policy/bulldozing illegal settlements: Bulldozing is an act of demolishing illegal houses in

a city. It is carried out by government authorities. Bulldozing is practiced in many parts of the world.

2.3.2 Population Control (Family Planning)

With few exceptions most counties can be categorized into two groups according to their rate of
population growth. The first group consists of industrialized countries (USA, Japan, Western Europe,
Australia, New Zealand, Canada and others). In these countries the rate of natural population increase is
less than 1% per annual. In fact, the population of some of these countries is declining or not growing at
all for instance, Denmark, Germany, Australia and Greek.

The second group consists of less developed countries whose rates of natural population increase in
grater than 1% per annum. These countries are found in Asia, Latin America and Africa. Many Africa
and Middle-eastern nations have growth rates that exceed 3.5% per annum. Demographers estimate that
approximately 90% of the increase in the world’s population over the next 50 years will occur in these
countries. As a result world leaders, policy makers, researchers and environmentalists have targeted
these nations for population control.
The two important measures that are used to reduce birth rate (population growth) are;

Economic Development and Family Planning

1. Economic Development: Economic development usually leads to the reduction of population

growth rate. This reduction results from different factors that are linked to economic prosperity,

In general a higher standard of living reduces the desire to have children because.
 Both sexes are usually actively engaged in work force
 Advanced economies offer Pension income at retirement
 The cost of raising a children is higher
 Children are not considered as part of family labor force
 Education and employment training delays time for marriage or having a child

2. Family Planning: It is a direct policy intervention in population control. Therefore it involves any
program that provides educational and technological services that help individuals to plan the birth of
their children.

The nature of family planning varies form country to country because of differences in economic
development, cultural values and religion.

Family planning has been very effective in developed countries. LDCs are also becoming effective in
the population control using family planning program. These include China, Indonesia, Brazil, Hong
Kong, Mexico etc.

Among the African countries Botswana, Mauritius and Tunisia are exemplary. In the remaining LDCs,
family planning programs have not been successful because of low economic status, religious and
cultural reasons.

For example India started family planning in 1951 when its population was 400 million. However this
program generally failed because of poor planning, lack of social security, gender inequalities, lack of
commitment both form the government and public and under funding. Today Indian’s population is
more than 1 billion.
Apart from family planning, some countries also use socio-economic tools to reduce their population
(fertility rate). For example China used one child policy which gives couples economic rewards for
having fewer children. The reward includes salary bonuses, extra food, high pension, improved
housing, increased medical care and school tuition for the child.

Family planning needs commitment both from the government and the public. The objective of family
planning is to have good and healthy citizens who contribute to the national economic development.
Family planning program requires
 Creating awareness to the public
 Large investment (education: health care)
 Staff
 Infrastructure

2.3.3. Employment Creation for poverty reduction

This can be done through
 Economic development -formal sector development
- Small scale business (manufacturing)
- promoting the Informal sector: Prospective informal groups can be prompted by
Creating access to finance -Access to finance may be facilitated by micro financing.

Access to market-promoting market linkages

Provision of space for their business- Providing market shelter.

Provision of training- Providing training include training them in accounting, entrepreneurship,

marketing, skills training for micro- and small scale entrepreneurs, assistance with institutional
development, addressing policy and regulation issues

 Human Development

To develop any economy, the fist issue is to develop the human resources through education, skills
development, physical and mental development because these are integral parts of nation’s economic
development in addition to infrastructure and physical resources.

Especially during our century, education skills and other knowledge became social determinants of a
person and social productivity. This has been proved true in countries like Japan, Taiwan, Hong Kong
and South Korea (they do not have natural resources but they achieved rapid growth through human
resource development). Thus, for economic and social development one has to link education to
employment, creativity and innovation, otherwise education will be irrelevant.

Policy initiatives in training and education should focus on producing employable and capable
graduates. Such policy promotes demand driven, competence based, high quality vocational education
and training system. Such policy should also establish mechanisms for effective management of
educational institutions, provision of logistics and support. The policy should ensure provision of skills
and opportunities which should respond to the need for poverty eradication. Policy should also develop a
labor force which is flexible, versatile, productive and entrepreneurial. Priority should be given to
Works related training; consideration should be given to education demand. To this end, four priority
actions can be identified:

1. Establishing an education system which provides an opportunity to learn more technical skills
through vocational training. Specialist centers and apprenticeships are some examples of services that
could be created for this purpose;

2. Supporting educational strategies, systems and processes that promote the demand for education and
the acquisition of qualifications needed to pave the way for the country's economic growth;

3. Introducing innovative approaches that go beyond the formal education sector. These could include
promoting self-employment and access to other forms of capital (land, loans, for example);

4. Introducing active policies to ensure a closer link between training and employment

This policy should facilitate partnership among various stockholders in the provision of vocational,
Technical and educational training. The ultimate objectives of this policy include the following:
 Graduates will be better prepared to become self-employed, possess positive work attitude when
employed by institutions
 Graduate will possess more creative and innovative behaviors at work
 Graduate will satisfy employers who pay the money to them or taxes to the government. It will
enhance job creation and productivity
To achieve these objectives governments and institutions should undertake need assessment and impact
assessment, before and after training respectively. They should make sure an entrepreneurship and
business skills are the integral part of the training programs. They have to introduce competence based
educational training with cross-cutting concepts of business and industrial development. They have to
introduce in the curriculum entrepreneurship as a compulsory module.
2.3.4 Waste Management

Municipal solid waste: All solid waste generated in an area except industrial and agricultural wastes.
Sometimes includes construction and demolition debris and other special wastes that may enter the
municipal waste stream. Sometimes it is defined to mean all solid wastes that a city authority accepts
responsibility for managing in some way.
Disposal: the final handling of solid waste, following collection, processing, or incineration. Disposal
most often means placement of wastes in a dump or a landfill.
Garbage: in everyday usage, refuse in general. Some MSWM manuals use garbage to mean "food
wastes," although this usage is not common.
Municipal solid waste management: Planning and implementation of systems to handle MSW.
Itinerant waste buyer: a person who moves around the streets buying (or bartering for) reusable and
recyclable materials.

Waste minimization: is a method used to achieve waste reduction, primarily through reduction at
source, but also including recycling and re-use of materials. The benefits of waste minimization are
both environmental and financial and wider in their coverage. Some of the main benefits include the
following:

 Improved bottom line through improved process efficiency

 Reduced burden on the environment, with improved public image and compliance with
legislation, better communication and involvement of employees and therefore greater
commitment to the business.
There are at least 3 types of urban wastes:
1. Solid waste includes papers, wood and metal scraps, cloths, leather, rubber and others.
2. Liquid wastes are generated by industries, households, offices, hospitals, floods and others.
3. Gas waste includes smoke emitted from households’ factories, cars and others.

Household generated waste is major source of urban waste in most cities.

Solid Waste Disposal

The ways of disposing wastes in cites

Dumping: - means collecting wastes especially solid wastes and discarding them at a
selected site usually known as land fill (selected dumping areas)

Recycling:- involves recovery of solid wastes such as rubbers, plastic, glasses, papers,
metals, card boards from waste stream (stock). Recycling gives marketable goods and
economically viable to the recyclers. Generally recycling involves the return of materials
to the previous stage by converting them to reusable items.

Composting:- is the process of converting organic wastes into humus for soil
conditioning. It includes ashes, fruits, vegetable wastes, food left over’s, leaves and other
organic wastes. Composed soil can retain more water; it is more fertile and easier to
farm.

Incineration: - is controlled burning of wastes in a purposely built facility. Incineration

sterilizes and stabilizes the waste and reduces its volume to a less than of a quarter of the
original mass. Accordingly, most of the compensable material is converted in to carbon
dioxide.
Land filling: the final disposal of solid waste by placing it in a controlled fashion in a
place intended to be permanent.
Reuse: It is the use of a product more than once in its original form, for the same or a
new purpose.
 Waste Disposal Methods:
Advantages and Disadvantages

OCEAN (RIVER)DUMPING
Advantages: Disadvantages:

 convenient  ocean overburdened

 inexpensive  distruction of food sources
 source of nutrients, shelter  killing of plankton
and breeding  desalination

SANITARY LANDFILL
Advantages: Disadvantages:

 volume can increase with  completed landfill areas can settle

little addition of and requires maintenance
people/equipment  requires proper planning, design,
 filled land can be reused and operation
for other community
purposes
INCINERATION
Advantages: Disadvantages:

 requires minimum land  expensive to build and operate

 can be operated in any weather  high energy requirement
 produces stable odor-free  requires skilled personnel
residue and continuous
 refuse volume is reduced by maintenance
half  unsightly - smell, waste, vermin
OPEN DUMPING
Advantages: Disadvantages:
 Health-hazard - insects, rodents etc.
 inexpensive  damage due to air pollution
 ground water and run-off pollution

RECYCLING
Advantages: Disadvantages:

 key to providing a  expensive

liviable environment for  some wastes cannot be recycled
the future  technological push needed
 separation of useful material
from waste difficult
 Liquid waste

Reasons: Increase in low income population, the absence of private and public toilets, the
proliferation of illegal houses some of which are without toilets, Absence of sewer lines
and Blocked ditches

Consequences: Stinking environment, Health hazards

Solutions: Building public toilets, enforcing toilets as basic requirements when houses are
constructed, providing orientation on the hazards of uncontrolled liquid wastes, availing
toilet sucking trucks and Enforcing strict laws and standards

Noise pollution

Sources of noise pollution: Religious establishments, Garages, Metal and woodworks

shops, Music shops, Grinding mills, Industries, Cars, Airplanes at airports, barking dogs
at nights

Solutions:
 Designing noise controlling policies and standards
 Allocating land in specific areas for noise creating establishments
Industrial pollution
Sources of industrial pollution:
 Using old technologies
 Emitting uncontrolled smokes, hazardous chemicals and particles
 Uncontrolled dumping of industrial wastes
 Absence of appropriate dumping places
 Absence of orientation on the side effects of the wastes
 Absence of strict control
Consequences:
 Water pollution
 Air pollution
 Soil pollution
 Noise pollution
Solutions:
 Designing appropriate industrial land use policy
 Designing waste disposal policies and enforcing them
 Using non-polluting energy sources
 Urban transport problems:
Reasons:
 Increasing number of vehicles
 The link between income and a choice of urban transport. A bulk
of urban poor choose the cheapest but the most crowded means
which leads to accidents
 Absence of urban land planning which is suitable for transport
Consequences:
 Congestion
 Traffic accidents
 Noise pollution
 Environmental pollution
Solutions:
 Responding to the rising demand for urban transport
 Aligning land use with urban transport trends
 Introducing road poll
 Pollution tax
 Parking charge
 Strict traffic control
 Improving existing roads
 Constructing new roads
 Designing roads appropriately for each traffic, namely for:
pedestrians, bicycles, automobiles ,trains, trucks etc

CHAPTER THREE
URBAN MANGMENT AND GOVERNANCE
3.1 DEFINING URBAN GOVERNANCE
Despite the recent popularity of governance at both the practical and theoretical levels, the
concept continues to mean different things to different people. Academics and practitioners
often talk past one another as do scholars in different academic disciplines and fields.
Consider the following definitions.
 The exercise of political, economic and administrative authority in the management
of a country’s affairs at all levels. Governance comprises the complex mechanisms,
processes, and institutions through which citizens and groups articulate their
interests, mediate their differences, and exercise their legal rights and obligations.
 Governance includes the state, but transcends it by taking in the private sector and
civil society. The state creates conducive political and legal environment. The
private sector generates jobs and income. The civil society facilitates political and
 social interaction – mobilizing groups to participate in economic, social and
political activities. Because each has its weaknesses and strengths, a major objective
of our support for good governance is to promote constructive interaction among all
three.
 The regularized ways of ordering human societies at all levels of organization from
family units to entire societies

(UNDP Internet Conference Forum on "Public Private Interface in Urban

Environmental Management" )

 Governance refers to the process whereby elements in society wield power and
authority, and influence and enact policies and decisions concerning public life, and
economic and social development. Governance is a broader notion than
government. Governance involves interaction between these formal institutions and
those of civil society.

(The Governance Working Group of the International Institute of Administrative Sciences

1996. )

 There is no alternative to working together and using collective power to create a

better world. Governance is the sum of the many ways individuals and institutions,
public and private, manage their common affairs. It is a continuing process through
which conflicting or diverse interests may be accommodated and co- operative
action may be taken. It includes formal institutions and regimes empowered to
enforce compliance, as
 well as informal arrangements that people and institutions either have agreed to or
perceive to be in their interest.
 Examples of governance at the local level include a neighbourhood co- operative formed
to install and maintain a standing water pipe, a town council operating a waste recycling
scheme, a multi- urban body developing an integrated transport plan together with user
groups, a stock exchange regulating itself with national government oversight, and a
regional initiative of state agencies, industrial groups, and residents to control
deforestation. At the global level, governance has been viewed primarily as
intergovernmental relationships, but it must now be understood as also involving non-
governmental organizations (NGOs), citizens' movements, multinational corporations,
and the global capital market. Interacting with these are global mass media of
dramatically enlarged influence.

(The Commission on Global Governance )

 Governance is the written and unwritten policies, procedures, and decision-making units
that control resource allocation within and among institutions

 New forms of governance allow individual organizations to contribute their strengths and
talents, to discharge their collective responsibilities and to preserve and enhance the
distinctiveness of their organizations and institutions.

 The term government indicates a political unit for a function of policy making and policy
administration. Therefore, the word governance denotes an overall responsibility of
exercising authority for both political and administrative functions. Good governance
refers to the way of carrying out state functions in a participatory, responsive, transparent
accountable, effective and equitable manner.

(Sources unknown)

"Governance" is the art of public leadership. There are three distinct dimensions of governance:

1. the form of political regime;

2. the process by which authority is exercised in the management of a country’s economic

and social resources; and
 3. the capacity of governments to design, formulate, and implement policies and discharge
functions.

3.2 DEFINING URBAN MANAGEMENT

Management: It refers to marshaling human, material, financial and other resources towards
achieving organizational goals. Management involves essential processes of planning,
organizing, staffing, leading and controlling.

In summary management is the process of seeking optimum way in achieving organizational

goals effectively and economically.

Urban Management, therefore, is a process of administering urban settlements for achieving the
objective of urban development by improving the livelihood of the residents. That is ,making the
settlements more productive and ensuring sustainable and equitable infrastructure and services. It
is defined as administrative structure of cities which provide social and physical infrastructure
services.

 Urban management includes:

 administration of urban economic resources

 provision of services
 creation of employment
 and promotion of investment

 Traditional models are associated with central government and centralized mode of
management

 Recent approaches in urban management recommend strong partnership among different

actors such as the community, the private sector, the NGOs and the government.

 There are efforts to engage NGOs, local governments, the community and the private
sector in urban government. Networking, trust and reciprocity are the key to solving
poverty, inequality and disempowerment problems.
 The effectiveness and efficiency of urban management is said to be the cumulative
product of the interaction between and among these actors.

 Many cities use a number of management models reflecting varying political and cultural
situations and pressures. One best way gives way to other innovative ideas as time
evolves.

 Modern cities demand management system that should act proactively and creatively in
setting paths.

 With the pressure for more quality services from knowledgeable citizens, challenges on
city management has increased.

Hence, management cannot be top down as usual. Steps like tax revolts, citizen charters and
home-rule legislations have initiated more demand from the city management in response to
insensitivity, bureaucracy and monopoly.

In our time, ►Business community wants quality services

► Youngsters need good education and employment
► The poor demands fairness

As city services stand between government and citizens, the quality, quantity and variety of such
service provisions became a major issue for managers and the public.

Elections are based on such issues though the availability of such services depends on resources,
capacity, legal framework, the existence of knowledgeable, analytical, responsive, acceptable
and interested management is very essential.

3.3 Politics and Management in urban governance

Some writers recommend that there must be a clear demarcation between management and
politics. Politics is considered here to represent policy whereas management refers to the
implementation of policy.

If there is a division of labor between management and politics

a. Politicians will be able to clearly define the political objectives of the city
 b. It helps politicians to concentrate on polices.
c. It helps to hold city managers to be accountable for the achievements and failures of city
objectives
d. The organization and management of services and infrastructure could be more
professional and can assure high standard of performance
e. Accountability will be enhanced because of the fact that citizens know who is responsible
for what
According to this division of labor between politics and management there are two major groups
in urban government and these are:

I. Legislators (Legislative functions)

II. Executives (Executive functions)

Legislatures constitute a council while the executive constitute mayors, officers and

department heads

The overall hierarchy of power relationship looks like the following.

Electorate (the general public or residents)

Legislative (council)

Executive (mayor)

Department heads

Generally, there are 4 models that describe the relation between the council and the mayor.
These are

1. Strong mayor model

2. Weak mayor model

3. The commission model

 4 Council manufacture model

The strong and weak mayor models constitute council mayor-model in general. The council- mayor
model is a municipal government in which the executive power belongs either to the council or to the
mayor depending on the preference of local government.

1. Strong -mayor model: In a strong mayor model the mayor has substantial power and when
compared to the council the mayor is highly visible and has the power to prepare city
budgets, control city administration, prepare and implement development projects. Moreover,
the mayor has a power to hire and fire department heads without council’s approval. In
extreme cases the mayor can veto the council. The mayor is strong figure head in the council
and in the city. He chairs councils meetings and represents the city in external affairs.

If the mayor has strong leadership quality, educational background, good personality and
behavior it is advantageous to have strong mayor, assuming that department heads are also
equally qualified. However, if the mayor is not qualified the high concentration of power in a
single hand will lead to dictatorial behavior.

2. Weak Mayor Model: Under this arrangement the power given to the mayor is strictly
limited. The council exercises general surveillance of administration through its elaborate
committee system. Weak mayors do not have the right to veto the council consequently, the
executive power concentrates in the hands of the council. In this case council preserves the
sovereignty of the residents assuming that collective decision is better than individual
deliberations.

Advantages of weak mayor model

- Everything is decided by the council

- The decision of the council represents the general public

3. The Commission Model: In this model commissioners are elected directly by the electorate
and they assume legislative and executive responsibilities.

This model is an urban government in which legislative and executive powers are combined.
The commissioners are drawn from urban councilors and are responsible to design policies and
strategies and executes them in different capacities.
The commissioners are collectively councilors and individually they are department heads. The mayor
is one of the commissioners and at the same time he is a department head.

The mayor has the following roles:

► He chairs councilors meeting and heads department,

► He represents the councilors in external affairs,

► He fires and hires staff upon recommendation.

If we take a 5 commissioner’s council, their role could be

Commission 1- Housing

Commission 2- Health and sanitation

Commission 3 -Economic enterprises

Commission 4- Road construction

Commission 5- Finance

4. Council -Manager Model: This is most widely used model in our time. It involves a small
elected council which is responsible to make municipal laws, responsible to decide on the extent
and pattern of municipal activities, controls municipal budgets and appoints the manager.

Electorate

Council

Mayor

Manager

7
Department Head
The manager has an executive power delegated to him such as appointment and dismissal of
department heads, preparing budget and controlling its administration, executing ordinances
passed by the council, serving as a bridge between politics and administration, but he is not a
politician himself. He may come from private sectors via competitive recruitment. The manager
is professionally qualified, recruited on merit basis through open vacancy announcements

The main job of the manager is to implement municipal polices and provide professional and
efficient services to residents. He is responsible for day to day activities of the city.

Advantages

The city is served by professional manager; the council concentrates on policy issues. The
model promotes commercial management sprits.

 The manager gives advice to the council on policy matters although the final division
rests with the councils
 The manager is appointed and removed by the councilors.
 The strongest side of this model is that it demarcates a line between policy and
administration unlike in the case of the commission model.

The Role of the council, mayor and manager in council-manager model:

Council

1. It is a legislative body- decision maker

2. Power concentrates in this body
3. It focuses on major community goals such as development projects, land and investment
issues
4. It hires and fires the manager
Mayor

1. Chairs councilor’s meetings

2. Links the council and manager
3. Represents the city in external affairs
4. The mayor is chief executive officer/figure head and a leader
Manager

1. Is hired to serve the council and the public in his managerial capacity
2. The manager is responsible to implement municipal functions effectively and efficiently.
3. He prepares budgets and presents for councilors consideration and recommendation
4. Is responsible to recruit, hire and supervise department heads
5. Responsible to provide complete and objective information to the council

3.4 Urban Management Models

There are four managerial models in managing urban centers

1. The Bureaucratic Model

2. The patronage Model

3. The Public Enterprise Model

4. The Public Management Model

1. The Bureaucratic Model:

This model was developed by max-Weber. It was established in response to the disorganized
way or rule of thumb in managing organizations before its inception. This model presents itself
as a rational method of organizing resources to achieve best results. The underlined principle in
this model is highly centralized, rule bound management system. Authority concentrates at the
top and rules and regulations prevail at all corners of an organization.

Advantages: Promotes consistency, stability and uniformity as opposed to rule of thumb.

Disadvantage: high concentration of power without delegation stifles the moral and innovation
of workers and subordinates. It is elitist by nature. The monopoly and secrecy of information at
the top leads to rigidity and inflexibility.

2. The Patronage Model:

It is a system whereby the winning party takes all power. Since this model is a partisan
approach, the winning party appoints its own people in the position of top management. The
appointment is made considering that the party will do better if offices are headed by its own
people. However, it is impossible to fill all positions by party supporters. Hence, in many cases
lower level positions are filled by professionals, careerists or civil servants.

Unless it is applied carefully, it leads to abuse of the public office. It is dangerous when
appointments are made based on purely political basis by ignoring professional competence
which leads to inefficiency and ineffectiveness. Moreover, patronage system leads to rotation or
frequent turnover at every election. This leads to /administrative instability.

3. The public Enterprises model

This was borne in response to the failure of the preceding models. The model emerged as the
demands of voters for effective service delivery increased. The guiding principle is value for
money. Hence, the idea of value for money is used to measure the effectiveness of urban
activities in terms of effective and efficient service delivery. This model tries to inject the
private sector principles into urban management.

Priority is given to customers and quality. Therefore, it suggests that the urban functions need
to be organized and managed by autonomous and semiautonomous enterprises directed by board
of directors and executives.

These enterprises compete with other enterprises in the market both with the public and private
agencies involved in the same activities.

4. The Public Management Model

This model views the role of government not as doer but as enabler i.e. the government should
create enabling environment than involving in service provision. The government should serve
as a facilitator, organizer and coordinator of activities performed by different actors. These
actors include the central government agencies, local institutions, private sectors, the public and
others. The model conveys a message that there is no one best away of doing things unlike the
traditional public administration concepts. Success depends on the interaction of different actors
Changing views in Urban Governance

If there is any change at national level there will usually be simultaneous change at local level.
These days change in government calls for good governance, demanding for more
accountability, fairness and responsiveness.

state

Private Civil
sector society

public

Figure 2.1 Actors of urban governance

3.5 Good Governance

There is no universally accepted definition of good governance. As the result we may

have a couple of definitions.

According to UNDP, Good governance means political legitimacy, cooperation with

institutions of civil society, freedom of association and popular participation.

For others good governance is a system of movement which operates with the consent of
the governed and the participation of all groups in the political process.

Also good governance implies a enjoying both the legitimacy and authority derived from
a democratic principles built on the liberal motion of a clear separation between
legislative, executive and judicial powers and is expected to involve plural polity, a freely
elected representatives which is subject to regular elections.

Features of good governance

1. Consensus oriented

By consensus we mean mediation of different interests in the society to reach a broad agreement
on what is to be done and what is to be achieved.

Consensus requires long-term perspectives on what is needed for sustainable development.

Local governments should achieve this consensus before attempting the application of
development programs and projects.
 Sustainable development is that which meets the needs of the present without
compromising the ability of the future generation to meet their own needs. This means
sustainable development programs aim at achieving :

1. social progress

2. effective protection of environment

3. prudent use of natural resources

4. Maintenance of high, stable and series economic growth. The ultimate goal of good
governance is to bring sustainable development

2. Participation

Participation could be either direct or through representative and intermediate institutions; the
community should involve in a major decision that affect its prospects. Participation include:

► participation of beneficiaries and affected groups

► public sector/private sector interface

► decentralization of public and service delivery functions (empowerment of local

government)

► cooperation with nongovernment organizations (NGOs

► More importantly, participation should include the most vulnerable section of the society such
as minorities, the poor and the disadvantaged.

For the effectiveness of participation, the participants must be well informed and organized, this
means there must be a freedom of association and self expression on the one hand and strong
civil society on the other.

3. Efficiency and Effectiveness

Good governance means that institutions produce outputs that meet the needs of the society
while making the best use of available resources. The concept of efficiency in the context of
good governance also covers the sustainable use of natural resources without affecting the needs
of the coming generation.
Effectiveness refers to designing the right goal and achieving it at the right time and space.

4. Transparency

Transparency means that decisions taken and their implementation are done in the manner clear
to everyone. Also it means that information is freely available and easily accessible to those who
are affected. It also calls for the provision of information in a simple and understandable manner

Transparency also refers to the availability of information to the general public and clarity about
government rules, regulations, and decisions. Thus, it both complements and reinforces
predictability. The difficulty with ensuring transparency is that only the generation of
information may know about it, and may limit access to it. Hence, it may be useful to strengthen
the citizens’ right to information with a degree of legal enforceability.

Access to accurate and timely information about the economy and government policies can be
vital for economic decision making by the private sector. On grounds of efficiency alone, such
data should be freely and readily available to economic agents. While this is true across all areas
of the economy, it is especially relevant in the case of those sectors that are intrinsically
information intensive, such as the financial sector in general and capital markets in particular.

Transparency in government decision making and public policy implementation reduces

uncertainty and can help inhibit corruption among public officials. To this end, rules and
procedures that are simple, straightforward, and easy to apply are preferable to those that provide
discretionary powers to government officials or that are susceptible to different interpretations.
However well-intentioned the latter type of rule might be in theory, its purpose can be vitiated in
practice through error or otherwise.

5. Accountability

Accountability is public officials answerability either to the higher-level government

(responsive to the entity from which they derive their authority) or to the general public.
Accountability helps to assure that whether local affairs are handled in accordance with rules and
regulations. For instance, it enables institutions to check whether fiscal transactions are
performed with due regard to financial rules and regulations. Accordingly, accountability
involves efficient use of economic resources, mechanism to evaluate economic performances,
existence of monitoring and evaluation systems and the presence of simple and comprehensible
procedures to ensure fair actions or suggestions, grievances and complaints.

Accountability also means establishing criteria to measure the performance of public officials, as
well as oversight mechanisms to ensure that the standards are met. The litmus test is whether
private actors in the economy have procedurally simple and swift recourse for redress of unfair
actions or incompetence of the executive authority. Lack of accountability tends in time to
reduce the state’s credibility as an economic partner. It undermines the capacity of governments
to sustain the long-term business confidence essential for growth-enhancing private sector
investment. Looked at from this angle, accountability can help reduce sovereign risk.

The accountability of public sector institutions is facilitated by evaluation of their economic and
financial performance. Economic accountability relates to the effectiveness of policy formulation
and implementation, and efficiency in resource use. Financial accountability covers accounting
systems for expenditure control, and internal and external audits

6. Responsiveness

Responsiveness calls for institutions and processes that are sensitive to public needs and
preferences, that is the institutions and officials must be held responsible for the actions
committed and decisions taken.

Responsive governments are sympathetic to community needs and responsible for individual
and collective actions

7. Rule of Law

Rule of law involves fair legal framework that are enforced impartially. It also requires the
protection of human rights, enforcement of laws and independent judicial systems, police forces
and administrative institutions. Generally the rule of law involves the supremacy of the law in
protecting citizens, the minorities and the most vulnerable section of the society.

Rule of law enhances predictability which refers to (i) the existence of laws, regulations, and
policies to regulate society; and (ii) their fair and consistent application. The importance of
predictability cannot be overstated since, without it, the orderly existence of citizens and
institutions would be impossible.
The rule of law encompasses both well-defined rights and duties, as well as mechanisms for
enforcing them, and settling disputes in an impartial manner. It requires the state and its
subsidiary agencies to be as much bound by, and answerable to, the legal system as are private
individuals and enterprises.

8. Equity

Equity involves that all members of the society feel that they have the stake in economic, social
and political issues and benefits. They should not feel excluded from the social, economic and
political process. This essentially means they must have opportunities to improve or maintain
their well-being.

3. 6 Accountability in Urban Government

The urban governments under many circumstances are accountable to the electorate.

Urban government is complex set of institutions and groups with various lines of accountability.
Some are directly accountable to the electorate or to the national government, whereas others are
accountable to state government or can be controlled by a unit which is at a remote distance. In
theory the extent to which urban governments are accountable to the public has a major impact
on the effectiveness of the municipal government.

Under this circumstance any local government is expected to fulfill the following factors.

1. it must be responsive to the needs and circumstances of the residents

2. it must be efficient and honest in the use of public resources

3. it must be fair and economic in providing public services.

Accordingly, the representative nature of urban government assumes that local government is
effectively controlled by local electoral choices or through ballots. However, there are a number
of factors that affect the realization of these assumptions.

External factors
1. National political climate which refers to whether there is a tendency to centralization or
decentralization.
 2. Civil liberty- Individuals right whether they have the right to association, freedom to
speech
3. The level of public awareness and educational level.
Internal factors

Which affect the representative nature of urban government and includes

1. The constitution of local government: The mode of local accountability rests on the
ideas and issues contained in the constitutions of local government. Though almost all local
constitutions give ultimate powers to the residents, and there are many instances when the central
or the state governments intervene in the affairs of municipal governments.
The central/state governments have the right to appoint and remove councilors and mayors. This
has happened in Malaysia and Indonesia in the 19970s. For instance, in Indonesia ¼ of the
municipal council/government must constitute national army. The implied reason is to
manipulate the council and the urban government. That is one-fourth of municipal space goes to
the army.

2. The Extent of Voters Choice: Elections are the only meaningful instruments of
accountability if and only if voters have genuine choice. Elections must be free and fair. There
must be fair representation of minorities and local voices. However, against this background,
most of the time elections are manipulated, vote rigging and intimidation take place. If these
things happen, elections couldn’t be fair, and there cannot be fair representation as well.

3. Regularity of Elections: Many constitutions define that elections take place regularly.
However, regular elections are undermined, when higher level government suspend elections,
and even dissolve councils. This happened in Tanzania, in Chile, Malaysia in diffident times.
The legitimate reason of delaying elections is usually only when the government is in state of
emergency. Many cities are a center of elites, economic establishments etc. hence, so many
governments do not want to let urban centers free.

4. Electoral System: There are two broad systems that are practiced in many places. These
include
(a) Geographic/spatial systems
(b) Party systems
 In Anglophone countries such as India, Nigeria, Zimbabwe and Pakistan election is carried
out on geographic basis. The municipal government is divided along zonal territories
known as wards. Each ward elects its representatives according to the number of population
in the locality.

In other countries party system is used to secure seats in the local council in proportion to
the parties share. Individuals take these seats according to their numerical positions on the
pasty list. Under moral conditions each party contested in the election will have a
proportional representation in the local council. However, this representation is possible if
and only if elections are free and air.

How to elect a mayor

There are 3 ways of electing a mayor

I. Appointment by central/ state governments. This can take place either through direct
appointment from above or the local council may present a list of nominees to the
higher government and the higher government chooses from the list.

Eg. China and former Soviet Union

II. Election by council. Urban council elects a mayor among it ranks. The election takes
place in consensus or through majority vote.
III. City-wide election. when the mayor is elected independently of the council’s election.
A separate mayoral election takes place.
CHAPTER FOUR

URBAN FUNCTIONS AND FINANCE

Urban government is nexus of agencies which provides, finances, plans and execute a range of
urban services and functions. Some functions are performed by central government, others are
performed by state governments and others are still performed by municipal government.
Central and state governments accomplish urban functions through their public agencies,
enterprise and corporations.

4.1. Urban Functions

Urban functions are generally classified into 3 groups.

I. Provision of public services.

Urban services include the following:

1. Construction of roads (feeder roads, or access roads)

- street lighting
- drainage facilities
2. Provision of clean water at individual or community level.
3. Disposal of liquid waste, solid waste and human waste

4. Provision of educational services at nursery, primary, secondary, and tertiary levels.

5. Provision of health care services including hospitals, clinics and health centers; and
provision of hygiene services to the community.

6. Provision of housing services, rental and accommodation services.

7. Recreational services such as parks, museums, galleries, sporting services

8. Fire protection services.

9. Public transport services including train and public buses.

10. Social welfare services, protection of the elderly, children, the handicapped and
generally the disadvantaged part of the community.
 II. Regulation of Public Behavior
Urban centers are responsible to ensure law and order in their jurisdiction. To this effect they
establish laws and law enforcing institutions e.g. police, court, codes and ordinances such as
building codes, traffic codes, road patterns are all mechanisms to enforce laws to ensure peace
and stability.

Some of the details of these services include:

a. Housing and land control, including the application of rules on land use, occupation,
densities, architectural and building standards.

b. Licensing of commercial and industrial activities, pollution control, including regulation

of car movements, industrial emissions/ effluents and restriction on noise.

c. Environmental protection and health including prevention of communicable disease,

inspection of restaurants and hotels, control of pests and pesticides, public hygiene.

d. Traffic management including parking sites, routing, and restrictions on vehicular

movements.

e. Vehicle licensing and safety inspection

f. Consumer protection including the enforcement of accurate weight, measures, description

of goods and services, their qualities and prices.

III. Coordination and Planning

It includes expansion and allocation of investment for capital projects that will ensure sustainable
urban development. Employment creation and infrastructure development, to this effect, urban
centers must establish a range of economic enterprises either jointly or through joint ventures or
on their own. These enterprises must fulfill among other things the creation of values and
promotion of efficiency in resource utilization and in the realization of sustainable economic and
social development. This includes investment in strategic infrastructure such as roads,
telecommunications, commercial centers, industries and crevices.

It also includes technical supports for enterprises that need credit facilities, training, business
advice, accounting and finance and incentives to investors such as tax concessions, preferential
access to public utilities and promotional services.
4.2 Urban Finance

Urban finance is concerned with the identification of revenue sources, its mobilization, allocation
and utilization. The utilization includes disbursements, accounting and auditing.

Sources of Revenues

There are two broad sources of revenues for urban governments:

 Internal source (locally raised revenues) includes taxes, user charges, fees and other
penalties.
 External source includes loans, grants and shared revenues.

Tax is a compulsory levy by public authority for public purpose without expectation of direct
return or benefit to the tax-payer. It is also said to be a burden which is only imposed by the
legislative power on persons or property to raise money for the public purpose. It is exact not on
the basis of direct quid pro quo relations. Taxes are also two types: direct taxes and indirect
taxes.

This classification of taxes is done on the basis of the incidence of Taxation. Meaning:
Authorities impose a tax on an economic unit. This economic unit is statutorily liable to pay the
tax. But this unit may not be the ultimate payer of the tax. The monetary burden of the tax may
be shifted to another economic unit. This other unit is statutorily responsible to pay the tax. This
shifting is known as “incidence of Taxes.” If the incidence of tax rests upon the person who
bears its impacts also, it is known as direct tax. On the hand if the incidence is passed on to
others, it is indirect tax.

• Direct taxes: are taxes which are directly imposed on individual’s income. These include:

 Payroll tax on monthly and annual basis

 Tax on professional and occupational services
 Tax imposed on commercial activities, personal income, land use tax, property tax.
 Sometimes tax on natural resources it is called as royalty tax (like tax mining
activities) included under direct tax.
• Indirect taxes: are imposed not on seller or producer but on the consumer. These include sales
tax, excise tax, VAT etc.

 Sales tax is a tax imposed by the government at the point of sale on retail goods and
services. It is collected by the retailer and passed on to the tax collection agency. Thus, it
is a tax based on a percentage of the selling price of goods and services. State and local
governments assess sales tax and decide what percentage to be charged.
 Excise tax is a tax imposed on the manufacture, sale, or consumption of goods, or upon
licenses to pursue certain occupations, or upon corporate privileges.
 A VAT is a way of taxing final consumption of goods and services. VAT is a tax not on
the total value of the good being sold, but only on the value added to it by the last seller.
The seller is therefore, is liable to pay a tax not on its gross value, but net value, that is
the gross value minus the value of inputs.

 Fees: - it is a “payment to defray the cost of each recurring service undertaken by the
government, primarily in the public interest, but conferring a measurable special
advantage on the free-payer. Thus, a fee is a payment charged by the government to bear
the cost of administrative services rendered primarily in the public interest, but conferring
special benefits to the individuals. Hence, fees are to be paid only by those individuals
who receive some special benefits from the services rendered by the government, e.g., a
student has to pay fee for getting the benefit of education from government colleges.

 License fee: - though a license fee is similar in nature to that of a fee, but it can be
distinguished from a fee, “a license fee is paid in those instances in which the government
authority is invoked simply to confer a permission or a privilege rather to perform a
service of a more tangible and definite sort.” The registration fee for motor vehicle, the
payment for permits to operate automobiles, and the license fee for keeping a gun can be
examples of such fees. In these cases, an individual is not forced to make payments, but if
he wishes to use an automobile, he must pay the necessary fee. The nature of the benefit
conferred up on the payer is to be found in the shape of legal practical benefit to use an
automobile or to keep a gun.
The object of such a fee may sometimes be the regulation or control of various types of activities,
e.g., licenses for guns are granted to responsible persons to maintain law and order. For the
interest of public safety, automobile drivers are asked to obtain driving licenses, and these are
granted only when an individual is fit for driving particular vehicle. Hence, the element or
regulation or control is present in license fee, which distinguishes it from fee and taxes both.

 Fines and Penalties: A fine refers to the punishment or penalty which is imposed for the
infringement of law. It is meant to serve as a punishment for and a deterrent of crime.
Fines are also compulsory payments without any quid pro quo but they are different from
taxes because fines are imposed to curb certain offences and not to get revenue for the
state.
 Forfeitures: - forfeitures of basic surety or bonds refers to the penalties imposed by
courts for the failure of individuals to appear in the courts, to complete contracts as
stipulated, etc.
 Escheat: - it refers to the claim of a government to the properties of a person who dies
without having any legal heirs or without keeping a will. Thus, a bank balances and other
properties of such a person will pass to the government.
External source: includes loans, grants and shared revenues.

 Regarding loan, municipalities can borrow money from banks as any individual
enterprise; however they must fulfill requirements such as legal personality and credit
worthiness to get loan.
 Grant is all transfer of financial resources from higher level to lower level of
governments. Grants can be provided in the form of lump sum (block grant) or can be
attached to special projects.
When grants are in lump sums they are not attached to any projects and it is
called general grant (block grant).
When grants are attached to specific projects they are called special grants.
Special grants are accompanied by specific restrictions or conditions.
 4.3. The problems of Urban Finance

1. Growing population:
A growing number of populations in almost all urban centers impose high pressure on urban
services and infrastructure. Unfortunately the majority of urban population is unproductive and
dependent, most of whom are migrants, jobless or involve in socially useless jobs.
2. The nature of intergovernmental relations:
In a highly centralized political condition, the relation between the higher level of government and
municipality is a kind of boss-subordinate relation instead of partnership. Thus, rules are highly
centralized and they do not take into account local realities, as a result municipalities highly
depend on the consent of higher government. This has an important implication on tax rate,
charge rate, budgeting and control.
3. Institutional inefficiency:
Lack of institutional capacity to raise revenues, to prepare budgets and execute them due to lack
of technical knowledge, lack of skilled manpower.
4. Subjective tax assessment:
In the absence of accurate books of account, tax collectors are forced to impose tax rates and
amounts on business establishments subjectively. The reasons of not maintaining books of
account are:
 There are some businesses which are exempted from maintaining books of
accounts.
 Those who are legally required to maintain books of account deliberately avoid
maintaining books of accounts. Even if they do, they prepare two accounts, one is
distorted and the other is accurate. They show the former to tax authorities.
5. Lack of legal backing:
Lack of legal backing for municipalities when there are tax litigations. Municipalities do not have
internal legal mechanisms to handle tax related disputes.
 6. Lack of loan:
This is due to lack of legal personality because many cities are under the tutor of higher level
government. Municipalities may not also be credit worthy.
7. Lack of adequate grants:
Grant is not mandatory for higher level governments to give to urban governments. But their
provision is important to supplement the financial capacity of cities.
8. Weak financial planning:
Weak budgeting is reflected in the discrepancy between budgeting revenue and expenditure.
The gap between financial planning and actual performance must be narrow and planning must
be proactive.
CHAPTER FIVE
Urbanization and Urban Management in Ethiopia

5.1 Historical Development of Urbanization in Ethiopia

 Historical evidences show that the origin of urban centers traces back to the time of
Axunite Kingdom (about 1000 BC).
 Following Axum: Gondar, Lalibela and a number of other towns emerged.
 However, this was marked by discontinuity because of the absence of fixed urban
centers resulting from the political nomadism that prevailed until Addis Ababa was
built as the permanent seat of King Minlik II at the end of 19th century (Akalu, 1966
and Horvath 1969).
 A combination of factors including physical, socio economic and political situations
have hampered the emergence, growth and development of urban centers in Ethiopia
until the last quarter of the 19th century.
 Rugged topography hampered easy communication and led to regional isolation,
under-development of occupations such as craftsmanship which could have triggered
large-scale industrial development and specializations.
 Moreover, internal conflicts and external aggressions had all contributed to the slow
emergence and development of urban centers in Ethiopia.
 Hence, Ethiopia entered the 20th century with a poorly developed urban system. At
the end of the 19th century only three urban centers, namely, Addis Ababa, Harar
and Mekele had a population of more than 10,000 inhabitants (see table below)
Table 1: Population estimates of selected urban centers (1850-1899)

Urban Center Population

Assab 5,000
Debremarkos 2,000
Gondar 6,000
Debretabor 5,000
Harar 35,000
Debre Birhan 2,500

Ankober 6,000
Addis Ababa 30,000
Axum 3,000
Adwa 8,000
Mekele 15,000
Source: (CSA,1984)
Despite the smallness and poor development of urban centers, some factors had
contributed to the emergence and expansion of many more towns in the country in the
same century. These include:
I. The establishment of central government that insured national unity and political
stability.
II. The introduction of modernity such as transport and communication networks,
schools, hospitals, roads and modern business. The emergence and development of
towns such as Dire Dawa, Nazareth and Mieso were the immediate result of Addis
Ababa- Djibouti railway line.
III. Ethiopia's exposure to the outside world which for centuries closed to its own
traditional system. Urbanization was further accelerated during the Italian occupation
of 1936 - 1941. The Italians built new urban centers. They also built road networks
that stimulated the emergence of new towns and the expansion of old ones.
After the 19th century, urbanization had been the produced due to three historical events.
(1) Expansion of menelik II to the south
(2) Italian occupation, which took place between 1936-1941
(3) Establishment of Ethio-Djibouti rail way.
1. Menelik Expansion
 With the expansion of menelik’s army to the south, a number of stations were
established which were gradually changed into urban centers.
 These stations essentially served as military centers, known as garrisons to control
the surrounding indigenous people during those attempts of territorial expansion.
 For instance, towns like Awassa and many other centers in the south were
garrisons. His period if marked with the establishment of Addis Ababa in
1887.The idea and practice of central government started during this period.
 2. Italian Occupation
Italians furthered accelerated the rate of urbanization and at the same time established new
centers.
 Towns which were directly associated with Italian expansion were kombolcha,
Sndafa ,Jimma, Bonga, Azezo.
 Concerning Jimma town Italian occupation accelerated the urbanization of Jimma
as it was the seat of Aba Jifar .Italians designed the master plan for Jiren in 1935.
 Before the Italian occupation, Jimma was confined to Jiren. After the occupation
they created two quarters namely Hermata and Mendera.
3. The Opening of Ethio-dipouti railway 1887-1917
 Following the opening of the Ethio-Djibouti railway, a number of nodal
settlements were established along the line between A.A and Djibouti.
 These settlements served as commercial centres and as transits to other parts of
the country.
 These towns include Debrezeit, Mojo, Adama, Metahara, Awash, Miesso,
Dengego, Diredawa. Mojo and Adama serve as transits to the south and south
east of the country.
 Now Diredawa and Adama are the tow largest urban centres in Ethiopia.
Diredawa is the 2nd largest and Adama is the 3rd largest.
 There after the rate of urbanization and the number of urban centers has kept on
increasing.

Year % No of Urban Centers

1938 5.4 63
1950 6.1 108
1967 7.6 158
1975 11.8 183
1984 10.3 297
1994 15.3 540
 5.2 Functions of Ethiopian urban Centers
Major municipalities in Ethiopia have the following responsibilities.
(1) Preparation and implementation of development plans
(2) Collection of municipal revenues
(3) Provision of services such as slaughterhouses, waste collection, housing basic
education, basic health care services, drainage facilities.
(4) Construction of access road, bridges, and parks, recreational centers.
(5) Delivery of miscellaneous services such as fire protection, street lighting libraries,
public toilets, etc.
 However the degree and services provided in urban centers varies from place to
place; the bigger the city the higher the provision of urban services.
 For example waste services is and feeder road construction are rendered in A.A
and Baherdar, but absent in Gambela and Assossa. The major reason for low
urban service or absence is because of lack of financial resources.
Urban centers in Ethiopia face the following financial problems.
- Tax bases are very narrow (number of tax payers in low).
- Tax rates are out dated and un revised
- Collection efficiency is very poor
- Enforcement of law is very poor
- Capacity to run urban affairs is poor, technical and administrative capacity
5.3 Problems of Urbanization in Ethiopia
 As discussed above, rural urban migration has often been explained in terms of
the lure of ‘bright lights’ and the tales of ‘city streets paved with gold’ contrasting
with the meager conditions in rural areas.
 Expanded family, shortage of land and decline in the agricultural productivity has
forced many people to seek alternative livelihoods in cities.
 It is now generally acknowledged that ‘bright light ‘theories do not really explain
migration.
 For one thing, most migrants are so poor to take advantage of urban facilities.
Since there is generally a serious shortage of jobs in the formal sector, many
migrants end up searching a living from casual labour or in the informal sector.
 On the other hand, urban facilities could not keep pace with number of new
comers. Hence with the increasing urbanization due to migration and natural
growth, mounting pressure is exerted on urban infrastructure posing financial and
managerial problems on urban governments.
 Hence, the economic model that argues in favour of urbanization did not prove
true in the Ethiopian context.
 Instead of benefiting urban residents and migrants; the rapid rate of urban
population has reached a level where it poses serious problems to urban
development.
 Experience has proved that as urban areas grow in population, government and
the community face increasing pressures in providing services and infrastructure
facilities and effectively manage urban centers.
 Urban problems in Ethiopia have increased in recent years as the provision of
socio-economic services such as housing, employment and sanitation are found to
be not only inadequate but also deteriorating overtime.
 Statistical evidences reveal that 90% of the country's urban population lives in
sub-standard houses (Mamo Kebede, 1992).
 Analytical reports of the 1984 census results for various regions also show the
severity of the problem of housing.
 For instance, out of the total housing units in urban areas of Shewa (central
region) 57.7% have no toilet facilities at all, 39.4% have no kitchen, 92.5% have
no bathing facilities and 34% are over crowded.
 In addition to this, urban centers lack efficient, responsive and effective
governance. They are governed by political patrons and are not accountable to the
public.
 Moreover they lack managerial autonomy to decide on their own affairs and raise
local revenue and spend on development projects. Municipalities were appended
to the central offices and perform sectoral functions, which have overshadowed
their traditional role of providing basic urban services.
  The rate of urbanizations has increased with the establishment central government
with the introduction of modern and with the explosive of Ethiopia to the external
word.

5.4 Urban Reform in recent past

Source, UDSS,2007
Background
 City /Municipal/ governments were established in Ethiopia from the early 1940s’
as a local governments with defined territorial jurisdiction ,functions, and revenue
sources.
 During the previous two regimes
 Policy of centralization
 Municipalities had no autonomy of their own
 The composition of council members and appointment of mayor and town
officers by Higher authorities.
 Their legal status was not expressly recognized
 Emphasis was on political rather than service delivery and development aspects
 No government grants nor were municipalities authorized to borrow
 The municipal tariff and tax rates was fixed in 1971 and was operational for the
last more than 30 years
5.3 The current situation: from 1991 to Present
 A policy of decentralization
 The issue of self-rule and self government at all levels has been recognized
 Establishing self-government, defining their aims, organizational structure has
been allocated to regional and local governments
 The provision of self rule has been extended to cities and municipal towns:
– Some cities have zonal and woreda administration status
– Have councils, executive bodies and judiciary within their localities
– Structures: speaker, mayor, mayoral committee ,executive agencies
– Have powers in managing resources, approval of urban master plans,
strategic plans and budgets, etc…
 – Establishing city courts and associations
– Organizing and managing urban infrastructures and services

 Ethiopia is a least urbanized country with high urbanization rate of 4.3%

 It has a total of about 910 designated urban centers of which 75 have populations
of 50,000 or more.
 Addis Ababa dominates with an estimated population of more than 3 million,
about 14 times the next largest city (Dire-Dawa).
 Total estimated numbers of employees in the variety of city governments, city
administrations, municipalities and emerging urban centers are approximately
50,000 with Addis Ababa having by far the largest number
 Professional Staffing levels are about 50% of established or planned staffing
levels in medium and smaller municipalities and cities
 Decentralisation and empowerment of urban local governments and
municipalities (since 1996 -present)
 Urban Development Policy, prepared and approved
 Completion and implementation of legal and institutional framework in all
regions.
 Prototype Financial Regulation and implementation directives prepared
 Prototype personnel regulation and implementation guidelines and
directives prepared and submitted to regions
 Review of federal urban land legislation
 Expropriation of Landholdings for public purpose and payment of
compensation proclamation.
 Regional urban planning units are established in all four major regions
 Urban Planning Manuals are developed
 Cities and municipalities have got legal status, restructured and organized
in view of the new regional city/municipal legislations
 Number of cities
Region Reform Other Total Type of city’s classification

cities cities

Oromia 36 339 375 Grade 1-4(ABC)

Amhara 12 180 192 City administration, Municipal towns

and Emerging towns

SNNPRS 19 93 112 Advanced, Medium and Emerging

Towns

TNRS 12 74 86 Urban Administration, Municipal and

Emerging towns

Afar 1 46 47 Not yet classified

Beneshangul Gu. 1 26 27 Not yet classified

Gambela 1 8 9 Not yet classified

Somali 1 58 59 Not yet classified

Harari 1 _ 1 Not yet classified

Addis Ababa 2 _ 2 Chartered Cites

and Diredawa

Total 86 824 910

Achievements…
 Conducted training for urban development sector institutions(more than 4200
participants benefited)
– Training Needs Assessment for Leadership and Professionals completed
(with IHS-Erasmus University and ECSC)
– Leadership training for councilors
– Short term (local and abroad) training for leadership and professionals
provided
– Induction training for leadership and professionals
– TOT for professionals provided
 – Experience sharing and Study tours (local and abroad) for leadership and
professionals
– Masters course for professionals both local & abroad
– A series of National, Regional, Municipal level workshops, and seminars,
conducted.
– Video conference for mayors and managers
– Modules and curriculum for specialized courses are developed in
collaboration with the ECSC
– Specialized courses for professionals are being conducted on:
 Housing and Land Management
 Solid Waste Management
 Municipal finance
 Human Resource Management
 Local Economic Development
– Independent Evaluation of training programs conducted,
– Draft National Urban Training Strategy has been developed
– Modules and curriculum for specialized courses are developed in
collaboration with the ECSC
– Specialized courses for professionals are being conducted on:
 Housing and Land Management
 Solid Waste Management
 Municipal finance
 Human Resource Management
 Local Economic Development
– Independent Evaluation of training programs conducted,
– Draft National Urban Training Strategy has been developed

 TA provided for 4 major regions, Harari and Dire Dawa in the following major
areas to deepen the decentralization process:
– Human resource development
– Financial Management
 – Municipal finance
– Infrastructure and service delivery
– Land management
– Housing strategies and development
– Urban development strategy
 MDGs needs assessment for urban sector undertaken
 Urban Poverty Action Research conducted in 5 secondary towns.
 5 year Municipal investment plans for 18 towns.
 Restructuring and Performance Improvement Plan has been prepared for 18
reform cities.
II. Major Urban Issues: Findings of Deepening Decentralization Process
 The decentralization policy and process is not complete. City Proclamations in
four regions give powers to urban authorities that are weakened by other Regional
laws and regulations. These are sometimes undermining good urban governance,
effective urban management and service delivery. Regional tariff and land lease
regulations are examples.
 Capacity is low at all levels. Resources, tools and systems are not provided.
 Training requires a more strategic approach.
 Organizations are not focused on infrastructure and services at city level.
 There are neither consistent financial or personnel management systems in place.
 There is some duplication of resources and reduced operational effectiveness in
parallel city and municipal administrations.
 Numerous opportunities exist as a result of significant achievements of and other
initiatives started over the last 5 years
a) Institutional & Organizational
 City administrative structure. There are two separate administrations in the urban
local government administration, the city administration and the municipal
administration.
 There are double Budgets and double financial systems. Personnel regulations are
not in place yet. Generally, the departments responsible for infrastructure are, in
effect, Building and Construction Departments which are inappropriate for current needs.
 Strategic planning and organizational restructuring are done without systematic
reference to each other; one does not necessarily support the other.
 Organizational structure is complex: elements of devolution, deconcentration,
delegation, and matrix structures are present. Conflict and duplication are
inherent. Low accountability and transparency are probable.
 Local autonomy is problematic where Regional and Federal governments set
resource allocation priorities for state functions, and multiple vertical reporting
relationships among Urban Authorities and Regional governments exist.
 Capacity building based on individual needs for performance improvement in
Urban Authorities is lacking.
b) Urban Authorities Finances & Financial Management
 Local urban administration contains separate administrative arrangements (State
functions, municipal functions and water agencies), each with its own sets of
functional responsibilities, sources of finance, lines of administrative reporting,
and rules for expenditure and financing approval.
 No urban authority is producing accounts or conducting its financial management,
including financial reporting systems, on the basis of a set of consistent and
comprehensive set of regulations
 The authority to establish taxes and fees, and to set tax rates and fee levels, is, at
present, a fundamental ambiguity in the municipal finance system. Only a limited
number of Urban Authorities have been granted the power to introduce the
leasehold land system.
 The existing Business License Fee has numerous serious defects.
c) Land and Land Management
 The land sales market is very active. The volume of informal transactions is high.
 There is no independent system of registering or recording real estate transactions.
 There is no independent system concluding sale transactions, and the court system
and many departments at City Administrations are directly involved in routine
transactions. Taxation of real estate transactions is high.
  The practice of allocating vacant land remains mainly administrative, as the
majority of land plots are allocated without auctions for low, administratively
defined prices or free of charge.
 Municipalities need more autonomy in land administration. They need to be able
to set permit and leasehold rent rates to fit their financial circumstances and as a
means to guide efficient land development within their towns.
d) Housing
 Housing in Ethiopia has not received much focused attention to date, both in
terms of institutional structures devoted to housing and in terms of a legal
framework for housing.
 The conditions of the existing housing stock is bad, and there is assumed to be a
considerable housing need, although it is difficult to quantify this need for cities.
 Family incomes are very low, and the amount they can afford for housing is
extremely limited
 The traditional modes of construction (mostly chicka) dominate housing
production.
 Land as an input to owner-builder housing processes can be key, and if simple
design and bureaucratic constraints were removed, land access for affordable
housing can be an extremely positive and excellent aspect of a housing enabling
strategy.
 Rental housing is a key sub-market, and already there are rental housing systems
which meet much of lower-income housing demand and should be encouraged.
 The kebele housing issue is complicated.
 Formal housing finance systems hardly exist in Ethiopia,
 There is great potential for micro-finance systems to help both new housing
creation and the improvement of existing housing.
e) Infrastructure and Services Delivery and Financing
 There is an absence of clear goals, objectives and strategies for implementation.
 The organizational and institutional structures for infrastructure delivery are weak
and inappropriate.
  There is limited knowledge at local government level as to how to develop,
implement and integrate a transparent project prioritization procedure(s).
 There is limited coordination in the provision of service delivery and capital
investment development between the Federal, Regional governments and local
levels of government.
 There is limited knowledge at Regional and local levels of government with
respect to project financial analysis..
 The lack of capacity to prepare financial or economic feasibility studies is still a
serious issue.
f) Human Resource Development
 Strong need to have in place an effective HRD function that would ensure to
establish an organizational capacity that would attract, develop, and maintain an
efficient, productive and motivated workforce.
 Absence of a well designed HRD strategy in the area of TNA, training and staff
development
 The question of which personnel management system to adopt, Civil service or
new municipal personnel service regulation
 The question as to how to link HRD with organizational development and growth
 Lack of a system that relates HRD with performance development
 The role of personnel departments’ possible transition to strategic Human
resource functions( to go beyond traditional staff maintenance function)
 The need for improved management systems as a factor in staff motivation and
need for organizational culture change

IV. Way forward: Urban Development Policy

Vision
 To see developed urban centers that are inter linked and internationally
competitive capable of serving as democracy and development centers in their
locality by ensuring efficient service delivery, suitability for residence and
adherence to plan
Objective
  To capacitate urban centers to be center of development that will have significant
contribution in urban development and national economic growth.
 To make urban residents owners of authority and beneficiaries of development
and reach development stages attained by countries with middle level of income
Way forward
Development Strategies
 Rural-Urban Linkages
 Industrial Development Strategy
 Principles
– Interlinked development of rural and urban and also between urban
centers.
– Expanding development opportunities for all towns by creating balanced
development.
– Ensuring decentralized urban settlement pattern and bringing about
forward and backward linkage effects at various levels among towns that
have different economic roles.
– Poverty alleviation and eradication
– Broadly participating the public on development and good governance
activities and strengthening development activities
– Creating strong partnership with development oriented investors.
– Establishing decentralized administration and enabling urban centers to
have broad autonomy and power of self-rule administration.
 The Role of Urban Centers in National Development
 Play indispensable Role in Accelerating Rural Development
 Serve as Market Center
 Serve as Service Center
 Serve as Industrial Center
 The Role of Urban Centers in Building of Democratic System
 Strengthen Relations Between People
 Serve as a Model for Development of Democratic Systems
 Create Strong Democratic Economic Base
  Core urban development activities to achieve accelerated and equitable
developments of urban centers are :
– Expanding micro and small business enterprises.
– Real estate development.
– Kebele development that integrates the capacity of the administration &
the public.
– Supply of land and infrastructure facilities.
– Expansion of education and training.
– Expansion of health and recreational centers.
– Industrial development.
– Urban planning and environmental protection

The urban contribution to PASDEP

THE URBAN DEVELOPMENT POLICY (COM March 2005)
The Industry & Urban Development Package
Pillars
– Integrated Housing Development Program
– Micro/Small Enterprise Program
– Land & infrastructure provision
– Urban/Rural & Urban/Urban linkages
Four Pillars of the Urban Development Strategy

I&UD Package Goals

 Goal 1: Construct 400,000 houses in 72 urban centers
 Goal 2: Create 1.5 million urban jobs in 825 centers
 Goal 3: Voluntary creation of 10,000 small enterprises
 Goal 4: Provide social facilities youth
 Goal 5: Ensure the participation in all programs.
 Goal 6: Secure funds for investment of EB 23.3 billion.
 Goal 7: Deliver 13,825 hectares of serviced land
Urban Good Governance Package
7 Subprograms
 Land management
 Financial management & urban finance
 Infrastructure management
 Development planning
 Justice
 Participation
 Organization & Human Resource Development
Organization & Human Resource Development:
National Urban Training Strategy /SHAPING THE URBAN TRAINING FUTURE/
National Urban Training Strategy has a vision that is expressed in two parts:
 Public sector employees that have the skills, experience and attitudes that best
serve the needs of urban communities; and
 Dynamic and healthy urban centers that provide economic opportunities, for
social needs and for sustainable development
Objectives
to build capacity at Federal, Regional and local government levels to:
 Establish a framework for urban governance that includes participation by and the
support of civil society and the emerging business community,
 Provide basic urban services,
 Plan for development strategically,
 Reduce poverty, Provide access to land for residential, commercial and industrial
development,
 Mobilize and apply local financial, human and natural resources, and Prevent
environmental degradation.

Urban Development Package National Urban Training Strategy

The purpose of the national urban training strategy is to establish:
– clear links between learning, skills development and employment;
– nationally recognized training standards, defined at all levels of the public
service and providing a basis for training and assessment;
 – tailored training products and services that meet the needs of client needs;
– active measures to address barriers to learning;
– rigorous quality assurance arrangements applied through nationally agreed
arrangements;
– funding allocated transparently and linked directly to need;
– a strong and proactive, national and regional, range of training providers
that give more choice in provision of training products;
– Promote networking among training institutions and strategic partnership
between training providers and ULGAs
– links between training and key targets of other national and regional
policies such as poverty alleviation, sustainable development,
decentralization, democracy and equal opportunities for women.

Organization & HRD Subprogram

HRD for Management Project (Officials & Professionals)
 Scale-up: E&T of urban management and planning professionals.
 Scale-up short term training for urban professionals and part-time delivery of
training
 Develop training for frontline operators and technicians through distance learning.
 Build capacity of construction & design sector to support the IHDP & MSE
programs
Scaling-up Urban Management E&T
 Initiated in May 2006
– 1st priority: Urban Management Masters at ECSC
– 2nd priority: Other UM E&T (undergrad, short, on-the-job, distance, part-
time)
 UMMP scale up from 25-30 pa to 1,000 pa
 Build on ECSC as a “Centre of Excellence”
– Faculty of Urban Development Studies
– Centre for Urban Management
– Postgraduate Urban Management Masters Program
 – Undergraduate program (Planning, Engineering, Management)
– + Library, distance learning, part time, etc
2nd Priority scaling-up Urban E&T
 Undergraduate programs
 Research & Doctoral programs
 Short courses, on-the-job, self study, distance & part time learning
 Technician level education
 Content development
 Scaling up & outreach at universities/institutes
Demand side aspects of Urban E&T
 Build local capacity to do TNA, develop training plans, identify training suppliers
 Link training & recruitment to HRM systems – incentives, career development,
retention strategies, performance systems, etc.
 Facilitate linkages between demand & supply
 Funding (local budgets, training funds, scholarships, etc.)
Urban Development Package…
Capacity Building training requirements for the ULGAs, Regions and Federal levels for the
coming 4-years
 leadership and councilor's short-term trainings (20000)
 Orientation workshop for executive bodies management officials on Urban
Development Policy, Industry and Urban Development and Good Governance
Packages. (6,000)
 Scaling –up the on going urban management Master’s Program intake capacity in the
coming four years from 30-1000 (already 400 participants are on training in the first
round in ECSC)
 Scale-up the existing urban planning under graduate program in take capacity from
100-1000
 Short courses on land administration and housing ,finance , project management,
contract administration, solid waste management , managing partnership, good
governance, local economic development, capacity building and HRD etc (8,000)
 Distance learning for professionals and technicians (12,000)