Security of housing tenure in the People's Republic of China: background, trends and issues Case study prepared for Enhancing Urban Safety and Security: Global Report on Human Settlements 2007

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Security of housing tenure in the People's Republic of China: background, trends and issues Case study prepared for Enhancing Urban Safety and Security: Global Report on Human Settlements 2007
    David G. Westendorff is the founder and CEO of urbanchina partners  in Shanghai, China. This is the first consulting firm in China established to assist policy makers, local authorities, international and emerging civil society organizations expand notions and practices of participatory urban governance. Prior to returning to China in 2001, David spent a decade at UNRISD, in Geneva, Switzerland, where he led internationally comparative research projects on urban governance and on data and indicators for monitoring social development. His most recent book,  From Unsustainable to Inclusive Cities  is available from UNRISD. Comments may be sent to the author by e-mail: Security of housing tenure in the People’s Republic of China: background, trends and issues David G. Westendorff Case study prepared for Enhancing Urban Safety and Security: Global Report on Human Settlements 2007 Available from    Disclaimer : This case study is published as submitted by the consultant, and it has not been edited by the United Nations. The designations employed and the presentation of the material in this publication do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations concerning the legal status of any country, territory, city or area, or of its authorities, or concerning delimitation of its frontiers or boundaries, or regarding its economic system or degree of development. The analysis, conclusions and recommendations of the report do not necessarily reflect the views of the United Nations Human Settlements Programme, the Governing Council of the United Nations Human Settlements Programme or its Member States.    Security of housing tenure in the PRC: Case study prepared for the background, trends and issues Page 3 of 18 Global Report on Human Settlements 2007 Security of housing tenure in the People’s Republic of China: background, trends and issues  David G. Westendorff 1   Conflicts caused by forced removals and demolitions are, as before, the main factor vexing social stability in Shanghai. A few private eviction companies’ methods are wanton and vicious. Some companies employ thugs in the dark of night to destroy families’ exterior stairs, doors and windows; secretly cut their electrical wires, break their water pipes ….. to make it impossible to live a normal life, forcing them to move. Even more extreme, they commit crimes taking lives. 2   The historic problem of security of tenure whether to land or housing largely solved during the early years of the People’s Republic of China has again become an issue of great concern. For anyone with a low or unsteady income in farming, manufacturing or service provision, in the city or the countryside, the fear of eviction is constant. Even economically better off residents may suffer eviction, but they are more likely to receive adequate compensation and/or better weather the negative consequences of forced eviction. This brief case study highlights the scale of the problem of insecure tenure to land and/or housing in China, the variety of forces that generate this insecurity and emerging policies and  practices that may help reverse the current negative trends. The groups of people in China most affected by insecurity of tenure in China include: ·   Farmers, whose insecurity of livelihood in the countryside forces them to migrate to the cities in search of income earning activities. Lacking an urban residence permit, and in the absence of policies supportive to rural migrants, their security of tenure to shelter in the city remains tenuous, at best. Some 150 million migrant workers live in major metropolitan centers for a large part of the year. ·   Former state sector workers who have been laid-off or paid-off  3  by their employers and are living in srcinal ‘welfare’ housing that they bought from their employer during earlier housing reforms. 4   ·    Non-state sector workers holding urban residence permits whose incomes do not allow them secure tenure to housing. These may be long-term inner-city residents who are/were employed in either collective or informal enterprises and who have been renting or subletting affordable housing from private parties or local authorities. 1. Final revisions to this paper were submitted on 15 April 2007. The author would like to thank Daniel Abramson, H.B. Shin and WU Weiping for their generous comments on an earlier draft of this paper, and to absolve them of any responsibility for errors and omissions that remain. These belong entirely to the author. 2. Shanghai Municipal Commission, Vice Secretary, Liu Yungeng, 3 February 2005. Reported in the Southern Weekend, 4 March 2005. 3. Laid-off (  xiagang  ) state sector workers receive a minimum maintenance allowance and reduced access to healthcare and other welfare benefits. Paid-off ( maiduan)  workers have agreed to free the employer from any liability to the worker after payment of an agreed upon lump sum severance payment (Wang, 2000, pp. 848-849). Those unable to find new employment may apply for social support in the form of a minimum wage ( dibao ) of approximately 300 RMB/month (US$1.25/day) in the most expensive cities. In Shanghai disposable income of 15.5 per cent of the population in 2004 was at or below this level.(SHTJNJ, 2006: DigitalShanghai graph). 4. As many as 50 million urban residents were thought to be poor in 2000, and could thus be expected to have only a tenuous grip on adequate housing. Quoted from report cited by Solinger (2006).    Security of housing tenure in the PRC: Case study prepared for the background, trends and issues Page 4 of 18 Global Report on Human Settlements 2007 ·   Registered and non-registered urban residents of informal/illegal settlements  , dangerous/dilapidated housing ( weijiufangwu ) and residences that are illegally constructed or non-compliant to the housing code (weifaweiguifangwu).   ·   All other residents of property demolished under force of eminent domain. 5  The paper is divided into the following sections. The first describes the transition from insecure pre-communist tenure systems in the countryside and the city to collective tenure systems in force until roughly the beginning of the 1980s. These assured adequate access to land and housing in the countryside and to a spartan if egalitarian allotment of housing in the cities. The second section describes briefly how tenure insecurity first began reappearing in cities with the advent of rural workers entering the cities looking for cash income in the late 1970s and early 1980s. Section three then discusses forces that began to push rural workers off their land in ever larger numbers, exacerbating livelihood concerns in the countryside and increasing the pressure on urban centers to house those leaving the countryside for work in the cities. The fourth section examines the relationship between housing reform in urban areas and increasing insecurity of tenure for the previously securely housed workers of the state and collective sectors. The final section before the conclusion discusses the role of China’s  burgeoning informal settlements that provide housing to low-income groups in and around many of the country’s growing cities. Post 1949 security of tenure (1949 – early 1980s) It is not surprising that a low-income country with as huge and diverse a land mass and  population and a history of tumultuous political and economic change would be afflicted with  problems stemming from insecure tenure. It is nonetheless surprising how quickly China has evolved from a country with relatively secure tenure for all during most of its post-1949 history to the opposite during the last decade. China’s largely successful transition to a highly globalized mixed economy from a minimally open command economy in the years since Deng Xiaoping announced the Four Modernizations in 1978 has much to do with this: land has become a scarce commodity. Prices now more accurately — if still incompletely — reflect the expected return on investment to alternate uses. Land prices have risen dramatically during the past decade, while the development of the legal and administrative infrastructure governing the allocation, transfer and conversion of rural and urban land has only just begun to adapt itself to existing and emerging economic pressures. As urban and industrial development have expanded westward in the past decade, problems of insecure tenure that were srcinally found only in the fast growing coastal cities and their suburbs, can now be found throughout the country. Among the first priorities of the Communist Party after taking power in 1949 was to reverse the age-old problem of insecurity of tenure in the countryside. Within three years, the government implemented an agrarian reform that redistributed rural land to peasants. In theory, former landlords and peasants were to receive the same land allocation; in many cases landlords got significantly less. The effect of the redistribution was to destroy the local landowning class and replace it with the Communist Party. Depending on population density and the quality of land, the distribution ranged from 0.16 to 1.1 acre per capita. Almost as 5. Local and national authorities have broad powers to acquire legally occupied land deigned to be needed for advancing the public good. This ‘eminent domain’ power is frequently used to optimize — from the standpoint of either engineering or public expenditure — the installation of: infrastructure (whether for public transport, communication, sanitation, water supply, energy generation and delivery, etc.); environmental remediation or  protection; recreational or cultural facilities; public buildings and plazas; and removal of dangerous or illegal structures.    Security of housing tenure in the PRC: Case study prepared for the background, trends and issues Page 5 of 18 Global Report on Human Settlements 2007 soon as land redistribution was complete in late 1952, the collectivization of rural land into what were to become  people’s commune s began. By the time this process reached fruition in 1957, the collectivization had passed through three progressively integrated stages of agglomeration and cooperation: mutual assistance teams, semi-socialist agricultural  producers’ cooperatives, and cooperative farms. In the final stage of agglomeration, People’s Communes grouped on average some 30 cooperative farms, comprising about 5000 households or 25,000 persons. The Communes organized all economic and political activity within the territory occupied by its constituent farms, including the administration of villages, taxation, health, education, old age care, recreation, etc. The Communes also appropriated ownership of land, housing, livestock, etc. Single persons or childless couples lived in communal dormitories. 6  In the cities, private property was gradually nationalized during the first half of the 1950s and redistributed for use by government offices, industrial departments, state and collective enterprises and residents. Investment in new housing remained minimal in most cities until the 1980s and often only kept pace with the need to take down dangerous or otherwise unsuitable structures serving as housing. Housing allocations were controlled by city housing offices and work units that were able to build housing or dormitories for their workers. 7  For the large majority of city residents, possession of an urban household registration (granted access to a welfare package that included employment, housing, health care, education and access to a minimum level of rationed goods. Either the local authority or the urban household registration   holder’s work unit (a state or collective employer) was responsible for arranging access to these goods. Despite the emergence of reforms such as the family (individual) responsibility system in agriculture and the institution of employment contracts of limited duration in the urban state sector, rural and urban collectives tended to maintain established responsibilities to their members for ensuring access to land or housing throughout the 1980s. In the countryside, families or individuals contracted with the rural collective to lease a plot of land for a fixed  price. Revenue received beyond the lease price remained in the hands of the lessee to apportion to fees, taxes, production costs, investment, etc. The family’s srcinal housing entitlement remained unchanged. In the cities, even if health and retirement benefits were among the first casualties of urban reforms, housing benefits tended to remain stable into the 1990s. When urban labor contracts were not renewed, or only done so with a drastic reduction in real income, workers’ housing entitlement was rarely affected. Top-level decision-makers perceived that adding homelessness on top of precipitously falling incomes among the traditional worker elite of the state sector was too great a threat to social stability to be considered. Emerging insecurity of tenure in Chinese cities (late 1970s – early 1980s) The spread of the household responsibility system and the growing opportunities to market excess grain and side crops in free markets during the early 1980s gave rural farmers incentives to work more efficiently on the land they tilled now that their income and individual effort were intimately linked. Many farmers found they could bring crops in with 6. Hsu, 1976:783–787. 7. In its effort to protect key industries from attack, between 1965 and 1971 the government built or moved large-scale industrial plants to remote locations in the center and far west of China. Construction of these ‘greenfield sites’ typically included dormitories for workers, many of whom vacated housing in the enterprise’s srcinal location.
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