Pro-Poor Partnerships for Settlement Upgrading

Funded by: Cities Alliance; US $500,000

Partners: UN-Habitat, Ministry of Urban Development, Ministry of Provincial Councils and Local Government, Cities of Ratnapura, Nuwara Eliya Batticaloa and Kotte.

Locations: (Municipalities of)

  • Ratnapura
  • Nuwareliya
  • Baticcaloa
  • kotte

Background and Objectives

While Sri Lanka has modest overall population growth, it continues to experience steady urbanization. Economic and social poverty remains extensive and the incidence of poverty high. The result is low housing standards, poor shelter conditions, infrastructure and basic urban services far below needs, with large numbers of households living without piped water supply and drainage, with inadequate sanitation, irregular solid waste collection, and poor access roads. The situation in the North and East is even worse due to years of civil war, although some degree of normalcy is being restored in the East. The objective of the project is:

  • to institutionalize participatory urban governance approaches introduced over 8 years of participatory environmental governance support;
  • to assist the Municipal Councils of Ratnapura, N’Eliya, Kotte and Batticaloa to extend such participatory governance approaches to develop Pro-poor settlement upgrading strategies;
  • to prepare settlements upgrading action plans to mobilize follow up investments;
  • to develop manuals, training models and tools and replication modalities.


The main activities include:

  • Prepare City Shelter Profiles to map the urban poor community characteristics and opportunities for shelter and community infrastructure improvements;
  • Conduct City Consultations to raise awareness on urban poverty issues and the built-in capacity for the urban poor to address their own issues in partnership with local governments;
  • Use the participatory governance processes to select an urban-poor community for sustained settlement upgrading in each city, and form Local Area Development Committees;
  • Develop the capacity of each community to upgrade their settlements through Community Action Planning and Community Contracting mechanisms;
  • Support the settlements upgrading initiatives through the creation of supplementary income earning opportunities;
  • Prepare proposals for follow-up investments in Settlement Upgrading, Livelihood development, and Community Infrastructure Improvements;
  • Mobilise the necessary resources and support demonstration project implementation by the communities and City Governments
  • Kotte has been selected as the fourth city and work initiated


Project Implementation Unit in place, including selection of partner NGOs to implement the project in partnership with the City administrations;

Shelter Profiling and Strategies prepared for the three cities;

Priority urban poor communities identified for up-grading through the Community Action Planning process.

City Consultations held and areas for community action and shelter upgrading identified


  • Shelter Improvement Trust established in partnership with the local Regional Development Bank to facilitate the low income settlements to obtain credit facilities at low interest. First round of loans granted to 30 urban poor households, who have commenced regular repayments through savings and credit schemes. Housing improvements completed, and second round of loan disbursements being planned, including mechanisms to grow the fund for city-wide application
  • Land tenure issues resolved, with the City Council granting a long term block lease to the community
  • Livelihoods support strategy to strengthen sustainability of the community upgrading scheme under final development
  • Basic Urban Services Upgrading strategy being finalised through inclusion into the City Development Budget, and possible loan support through regional development banks
  • Capacity Building (Training Programs) for community leaders as well as City officials commenced to facilitate replication and city-wide up-scaling. Monitoring and Evaluation proposal adopted by community.

Nuwara Eliya and Batticaloa

  • City and Local Area Development Committees established, with savings and credit schemes supporting some 546 (Nuwara Eliya) and 1027 (Batticaloa) households
  • Shelter, Livelihoods, Basic Urban Services Development and Community Empowerment strategy approved by the Council
  • Community Action Planning workshops completed in 3 settlements (each), as a basis for the development of local upgrading strategies
  • Community Revolving Fund established to support shelter (including sanitation) and basic urban service improvements
  • Draft settlement upgrading proposals drafted for 3 communities (each)
  • Improved water supply investment proposal for possible regional bank loan financing drafted and under detailed consideration by the Council
  • Capacity Building support provided to Council officials to roll-out lessons learned and replicate the approach city-wide


  • Updated existing city profile with information on shelter
  • Priority settlement for upgrading identified through broad-based City Consultation process
  • Detailed socio-economic, shelter, tenure data collected for the priority settlement to facilitate preparation of the shelter upgrading strategy
  • Local Area Development Committee established, with shelter, tenure, livelihoods and basic urban service upgrading discussions ongoing
  • City Shelter Revolving Fund institutional structure under discussion
    Development Partners / Partners