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“But what about Singapore?” Lessons from the best public housing program in the world

Abhas Jha's picture
Also available in: Mongolian | Chinese
 
Photo of Singapore by Lois Goh / World Bank

 
As we approach the 9th World Urban Forum in Kuala Lumpur next week, one of the essential challenges in implementing the New Urban Agenda that governments are struggling with is the provision at scale of high quality affordable housing, a key part of the Sustainable Development Goal (SDG) 11 of building sustainable cities and communities.
 
When I worked on affordable housing in Latin America, one consistent piece of advice we would give our clients was that it is not a good idea for governments to build and provide housing themselves. Instead, in the words of the famous (and sadly late) World Bank economist Steve Mayo, we should enable housing markets to work. Our clients would always respond by saying, “But what about Singapore?” And we would say the Singapore case is too sui generis and non-replicable.

[Learn more about the World Bank's participation in the World Urban Forum]
 
Now, having lived in the beautiful red-dot city state for two and half years, and seeing up close the experience of public housing in Singapore, one is struck by elements of the Singapore housing experience that are striking for its foresight and, yes, its replicability!
 
Singapore’s governing philosophy has famously been described as “think ahead, think again and think across.” Nowhere is this more apparent than how the founding fathers designed the national housing program, and how it has adapted and evolved over the years, responding to changed circumstances and needs.

It is hard to believe today but in 1947 the British Housing Committee reported that 72% of a total population of 938,000 of Singapore was living within the 80 square kilometers that made up the central city area. When Singapore attained self-government in 1959, only 9% of Singaporeans resided in public housing. Today, 80% of Singaporeans live a government built apartment. There are about one million Housing and Development Board (HDB) apartments, largely clustered in 23 self-contained new towns that extend around the city’s coastal core.
 
How has Singapore succeeded where so many other countries have failed dismally? At the risk of over-simplification, there seem to be four essential ingredients to this astonishing success story:

1. The importance of neighborhoods.

Recent research by the Stanford economist Raj Chetty and others have underlined what many urban professionals long suspected, that, in the quest for the design of inclusive and sustainable cities, the careful bottom-up design of neighborhoods matters a lot!

Poorly designed public housing in cities ranging from the infamous projects in the New York and the banlieues of Paris have resulted in creating poverty ghettoes that intensify and amplify inequalities and fuel social unrest. Many of these have had to be demolished.

Singapore got this fundamental fact right early on. Housing estates are carefully designed with mixed-income housing, each having access to high-quality public transport and education, and the famous Singapore hawker centers where all income classes and ethnicities meet, socialize, play, and dine together on delicious and affordable food. At least two such hawker stalls have a Michelin star!

The apartment blocks are designed to encourage the “kampong” (social cohesion) spirit with the “void decks” (vacant spaces on the ground levels of the HDB blocks) and common corridors (common linked spaces that provide access to individual units on the same floor) that foster interactions between neighbors.

[Click here for a wonderful talk by Deputy Prime Minister Tharman Shanmugaratnam on the principles of design of inclusive neighborhoods in Singapore.]

2. The smart use of urban density.

From the very beginning, Singapore planners, constrained by the limited availability of land, chose to build up. As a result, this is one of the densest cities in the world. Yet it constantly scores amongst the highest in city livability rankings.

This has been done by carefully designing the height and proportion of buildings in relation to one another. Dr. Liu Thai Ker, the legendary Singaporean urban planner, compares this to a chess board where no two pieces are of the same height.

Buildings are also interspaced with high quality green open spaces. Since the very beginning, Prime Minister Lee Kwan Yew laid the highest emphasis on Singapore being a garden city.
 
3. An integrated approach to housingfrom planning and design, through land assembly and construction, to management and maintenance.

The Housing & Development Act (1960) gave the Housing and Development Board, as the apex housing agency, the lead role across the housing value chain. In most countries, access to land for affordable housing is a critical constraint. In Singapore in 1967, the Land Acquisition Act empowered the country to acquire land at low cost for public use.

Today, 90% of land is owned by the state as opposed to 49% in 1965. Great emphasis is placed on standardization and efficiencies in construction management.

For example, merit stars were awarded to contractors who performed consistently well—for every merit star earned, the contractor would enjoy a 0.5% bidding preference when tenders were evaluated. In 1982, a “Core Contractor Scheme” was introduced under which contractors with a minimum paid-up capital of S$500,000 and a minimum of five stars attained from the “Merit Star Scheme” are offered a guaranteed annual workload for a fixed number of years.

Mention the term “public housing” or “housing estate” and the vision that comes to mind is one of decrepit, poorly maintained ghettoes. Singapore housing estate are as far as you can get from this dystopian vision. They are immaculately maintained. In 1989, Town Councils were introduced to empower local elected representatives and residents to run their own estates. Today, there are 16 Town Councils managing the HDB housing estates in Singapore.
 
4. Long-term and strong political commitment. 

Harvard economist Ed Glaeser once said that economics offers tactics not strategy, which means that politics must decide what level of support, say, public housing, will receive. Only then can economics advise the most efficient way to provide this support. The popular and political support for public housing in Singapore is strong and stable. And this has meant a high level of public subsidies to HDB (in 2017 this was S$1.19 billion).
 
Did I miss any essential element in the Singapore story? How replicable do you think this experience is to other countries? I would love to hear your views.

Related links:

Comments

Submitted by Jun Zeng on

Dear Abhas,
Such a nice piece of blog and lots of in-depth thoughts, thanks a lot for sharing. Totally agree with you the "four essential ingredients to this astonishing success story", which will surely guide other governments when designing their own housing programs. Another ingredient that may also worthy mentioned here maybe "Fair, open and transparent procedure for housing distribution"? There are many papers on this and I also believe the distribution procedure helps to enhance citizen's ownership of the project and see houses provided under the program are "public goods", rather than "pure commodity". Just some thoughts, many thanks for the sharing.
Best,
Jun Zeng

Submitted by Jian Vun on

Dear Abhas, thank you for the interesting and thought-provoking take on Singapore public housing and the useful links. I wanted to also add another reason why I think Singapore public housing is successful – not only does HDB take great care with planning livable neighborhoods and maintain their assets immaculately, but Singapore also has a strong emphasis on good architectural design quality (exterior and interior). Attractive and human-centered design of public housing is often an afterthought since many believe it is cost prohibitive, which is not always the case – cities need to promote quality urban/architectural design guidelines and hire socially responsible designers. Great morning read! Best, Jian

Submitted by Gil on

It's a great idea that Singapore has a philosophy think ahead,think again and think across. I wish every leader has this king of thoughts.

I'm thinking to innovate building material that could help to reduce building cost. Anybody can help an idea to convert ashfall (vukcanic ash) to light weight cement panel through mixing if chemical hardener composition. Anyone would be intrested please feel free to contact me. I have a huge anount of ashfall in Asia.

Submitted by Mart Eftim on

I think that what makes the Singapore public housing experiment is the way that government bureaucrats experience the city they are planning for. In larger countries with many cities or a large rural population it is very hard for central planners to actually understand what the urban experience is like. Where as in Singapore it is almost impossible for the government to ignore what is going on in the urban space, and indeed the entirety of the urban space in the country. A market based approach is about decentralizing implementation in the hope (not necessarily the reality) that market participants are more effective at coordinating development in an urban space (i.e. more responsive to peoples needs and what makes a nice urban space, on a local level). But there always seems to be some kind of market failure here because individual market participants aren't able to internalize all the externalizes in urban development, and there are many potential problems that can de-rail a market. So with a centrally planned approach you have a system where the planner is responsible for the entire functioning of the market. The two big obstacles faced in this approach are 1) the central planner lacking sufficient information to run an effective policy 2) Not actually caring because of corruption. Singapore avoids these issues by having the central planners live in the city they are planning for and having an extremely professional public service

Submitted by Andrew Purves on

Abhas
Nice article, but perhaps you missed the main benefit of Singapore having acquired 90% of the land - which allows the State to benefit from the uplift in land values over time as the economy has developed. Given the high proportion of public revenue derived from land values, it means that other taxes (such as salaries tax) are very low, which gives rise to high productivity and growth in the economy. This principle lies at the heart of the teaching of Smith, Ricardo and in particular Henry George which has been largely forgotten by neo-liberal economists.
The same principle of acquiring land for development has been applied in the commercial/industrial sector by the Jurong Town Corporation (JTC) which owns and manages (and collects the rent) on its 7,100 hectares.
You can read more about this in my forthcoming article in the IJPP Special Issue: Fair Public Ownership, some examples from Hong Kong and Singapore...
regards
Andrew Purves

Submitted by Nova Camahalan on

Hi Abbas,
Thanks for your article. Am currently studying on Environmental planning and it helps broaden my knowledge.

Please share more of this strategy especially to our leaders in our country(phils), hope things will be a little help in our place.

Cheers!

Submitted by Jan Gehling on

Hi Abhas, thanks for that great post. I wanted to add the beautiful work of "Architecture of Territory" department from ETH Zürich. It may help to contextualize the Singapure case.
Best, Jan

"After its independence in the early 1960s, it looked like Singapore had low chances of survival because of its lack of natural hinterland and material resources. But today, on the surface at least, the city appears to defy limitations. Owing to its open economy and function as an entrepôt, vital resources including labour, energy and food are being supplied from the outside. No doubt, Singapore’s greatly controlled and technologically oriented urban model represents a specific answer to its restricted context.

Looking further, across the city-state’s borders, it is apparent that Singapore’s economy uses land and labour far beyond its territorial limits. Its strategic hinterlands (agriculture zones, water sources, sand quarries, etc) are found anywhere from the neighbouring areas of Malaysia and Indonesia, to sites in Cambodia, China and the Middle East.

During the ETH autumn semester 2012, the hinterland was described through the thematic lens of resources. The origin, the flows, ‘the map’ and other territorial dimensions of the five key resources for Singapore – sand, water, food, energy and human labour – were the focus of the study. The investigations have shown the manner in which each resource is increasingly sought by the city-state in a geopolitical frame in the ASEAN countries and beyond."

http://topalovic.arch.ethz.ch/projects/hinterland-22/

Submitted by Jean Chia on

One additional element (which many cities ask about) is how Singapore made its massive public housing scheme financially sustainable through the virtuous cycle of economic growth and CPF financing. Also sharing an earlier publication I did with CLC which covered the financing of public housing - https://www.clc.gov.sg/publications/uss2014-financing-a-city.htm - Jean Chia, NUS

Submitted by Chionh Chye Khye on

Interesting article that highlighted some key success factors for Singapore’s public housing. However, being concise the article have omitted several other critical factors that made public housing such a success in Singapore. One is the strong economy that created good jobs for the people allowing so many to have the income to own their owned (whether private or public). Next is deliberate policy of home ownership the benefits of which is well known. Another is pricing for affordability but also for sustainability. So public housing is affordable and cheaper that private housing but not so cheap as the bankrupt the State. Public housing currently takes up only 2-4% of Singapore’s annual budget. How much should be public housing and how much private would depend on the circumstances of each country but it is only with a strong public housing programme that any country can hope to allow their people to own homes especially those in the lower middle and lower income groups. The recent IPS survey has again highlighted the great work public housing has done in integrating the country across ethnic and income groups.

Pl let me elaborate on the comments above. Without much resources, most developing countries would heed the advice of economist Steve Mayo anyway and leave housing to the private sector. Private developers would then cater to perhaps the top 50% of the population where the profits are to be made leaving the rest of the population housed in urban slums and shanty towns. Even a developed country with a mature economy like the US can only manage a home ownership of about 60+%. Also, the private sector would not be able to plan and develop on an comprehensive and integrated manner and each private development would be gated and on its own.

For Singapore to be able to succeed on such a scale for housing requires several key success factors. The first is to have a strong economy going on for a very prolonged period. This boosted the income not just for the upper segments but also for the lower middle and lower income groups. It allowed these groups to own their own homes. A rapidly rising income also meant that the government can siphon more of their incomes into the national savings fund, the CPF. This then allowed the government to tap on the fund for most of its funding needs for housing and infrastructure. A strong economy also allowed the government to collect revenues to fund its spending including subsidies for housing without having to dip into the proceeds from the sale of land as in many other countries. Next, in the first 25 years, the government was not hesitant to use the land acquisition Act to acquire up to 30% of the country’s land for public housing and other uses despite the high political cost of doing so. Then there is home ownership as a deliberate policy and so the lower income group received a high subsidy to enable them to do so. Beyond nation building, home ownership would boost the self-esteem and psychology of this group contributing to better management and maintenance of the housing estates. Pricing of public housing while affordable is sustainable. While much subsidies are given to the lowest group there are little or no subsidies for the higher incomes. So spending on housing is limited to about 2-4% of the national budget.

It is because public housing covers more than 80% of the population that we can plan and design on such a scale to given us the vibrant towns and neighbourhoods with all their ancillary facilities. Public housing that caters to the higher income also contributed to this vibrancy in the housing estates. This in turn contribute to the success of public housing in Singapore. It also made possible the integration of different ethnic and income groups and the promotion of extended living in the country. The latest IPS survey again highlighted what public housing has done to integrate the different groups together to build a cohesive nation.

As the article rightly pointed out a successful public housing programme requires a government’s strong political commitment. It would also require the government to be capable of igniting the economy.”

-Mr Chionh Chye Khye
Fellow, Centre for Liveable Cities

Submitted by Tali Bruk on

Thank you for this article. I have a question with regard to the operational costs of the multi-storey buildings. In South Africa, there is a government grant for affordable housing. However, sectional title ownership of multi storey apartments has only been successful where a private developer has incorporated the affordable housing into a larger development that also includes apartments for gap and middle income earners. The money from the monthly levy is used to cross subsidise the maintenance and insurance required for the affordable apartments. However, this is only achieved in strategic areas where the land value is sufficient to justify and attract this kind of investment. The dilemma occurs in areas where the average income is extremely low. The collection of rates and taxes is almost non existent and the levies are therefore difficult to collect- hence the dilapidated buildings etc. Was the housing programme in Singapore accompanied by a local economic development strategy ? How was this implemented?

Submitted by Captain Bakhtyar S Kaoosji on

Dear Mr Abhas,
My daughter Tehmina Kaoosji sent me the link to read.I enjoyed the interview on Bernama..
With best wishes
Bakhtyar.

Submitted by Abhas on

Thank you Captain Kaoosji. I enjoyed meeting and talking to Tehmina. Best regards, Abhas.

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