Urban Poverty Reduction Report E

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Five-year Synthesis Report (2008 - 2012)November 2012

PARTICIPATORY MONITORINGOF URBAN POVERTY IN VIET NAM


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TABLE OF CONTENTSPREFACE I

ACKNOWLEDGEMENTS III

ABBREVIATIONS AND TERMS VEXECUTIVE SUMMARY VII

INTRODUCTION 1Objectives o the Report 1Research methodology 2

PART 1. OVERVIEW OF URBAN POVERTY 91. Urban poverty trends: various measures 91.1. The WB/GSO expenditure poverty lines 91.2. The Governments national income poverty line 101.3 Income poverty lines de ned by localities 101.4. Peoples perception o changes in their lives in the last ve years 121.5. Reasons households have improved their living standards and escaped poverty

in the last ve years 14

PART 2. MULTI DIMENSIONAL POVERTY IN URBAN AREAS 212. Multi-dimensional poverty o local residents 212.1. Lack o labour and skills 222.2. Lack o capacity to nd alternative livelihoods 232.3. Lack o social capital 252.4. Limited access to public services 262.5. Uncom ortable and unsa e living conditions 27

3. Multi-dimensional poverty o migrants 283.1. High costs o living 293.2. Insecure jobs 303.3. Lack o social integration 303.4. Limited access to public services 323.5. Uncom ortable and unsa e living conditions 32

PART 3. KEY ISSUES OF URBAN POVERTY REDUCTION 354. Education and skills 354.1. Education 354.2. Employment and skills 42

5. Vulnerability and social protection 485.1. Vulnerabilities 485.2. Insurance 525.3. Cash trans ers 54

6. Inequality 606.1. Inequality in outcomes 606.2. Inequality in opportunity 626.3. Inequality in process 65

7. Socialization 65

7.1. Peoples awareness o socialization 657.2. Contribution and cost sharing 667.3. Diversi cation o services 687.4. Participation and empowerment 69


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8. Special issues o migrants 718.1. Origins o migrants 718.2. The role o migrants in local development 728.3. Strategies and experiences o migrants 738.4. Migrants who ace particular di culties 758.5. Disadvantages o migrant workers rom interview data 77

PART 4. TOWARD SUSTAINABLE URBAN POVERTY REDUCTION 839. Proposal or discussion 839.1. Conclusion 839.2. Toward sustainable urban poverty reduction in Viet Nam 83


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IIIAcknowledgements

ACKNOWLEDGEMENTS This 5-year synthesis report on urban poverty monitoring is a collective e ort that couldnot have been completed without the valuable contributions o many people.

We would like to thank the leadership and sta o ActionAid International Viet Namand Ox am or their valuable comments throughout the whole design process and ineldwork, and report development. Some sta rom ActionAid and Ox am participated ineldwork and contributed their knowledge and experience to the research methodologyand contents.

We are grate ul to the Peoples Committees, Departments o Foreign A airs, and variousgovernment departments at provincial and district levels or approving and creatingavourable conditions or our urban poverty monitoring. We thank the members o thecore groups in Dong Anh District (Ha Noi), Kien An District (Hai Phong City) and Go Vapdistrict (Ho Chi Minh City) including o cials in the departments involved, mass municipaland district level organizations, and ward and commune o cials who devoted their timeand e ort in working with us to complete our eld work and reports. We especially thank the street, living quarter and hamlet o cers who accompanied and supported us. Theactive participation and smooth coordination among AAVs local partners, including theCentre or Poor Workers, under the Hai Phong City Federation o Labour, Support Programor Development o Go Vap District under the Go Vap District Peoples Committee (HoChi Minh City) and the social a airs sub-department in Kim Chung Commune, Dong AnhDistrict (Ha Noi) have also been critical to the success o this urban poverty monitoring.

Last but not least, we would like to thank the poor men, women, migrant citizens, youthand children in the streets, living quarters and hamlets selected or sharing with us indiscussion and in-depth interviews their di culties, advantages in their lives, plans, and

uture expectations. None o this work could have been achieved without their lively andactive participation.

We would appreciate comments 2 rom interested readers and would like to thank you inadvance.

Consultants rom Truong Xuan (Ageless) Company:Hoang Xuan Thanh (Team Leader), withDinh Thi Thu PhuongHa My ThuanDinh Thi GiangLuu Trong Quang

Dang Thi Thanh HoaNguyen Thi Hoa Truong Tuan Anh

2 Your comments can be sent to Mr. Hoang Xuan Thanh, Team leader, Director o Truong Xuan (Ageless) Companyat the ollowing numbers: (04) 39434478 (o ce), 091 334 0972 (mobile), email: [email protected]; Ms. TranHong Diep, Advocacy and Communication Program O cer Ox am, (04) 39454362, email: thdiep@ox am.org.uk;Ms. Duong Minh Nguyet, Policy Coordinator, ActionAid Viet Nam at (04) 39439866,email: [email protected].


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VAbbreviations and terms

ABBREVIATIONS AND TERMSAAV ActionAid International Viet NamAIDS Acquired Immune De ciency Syndrome

C&DCentre or Cooperation Human Resource Development

CPI Consumer Price IndexCWR Center or Poor WorkersDecree 49 A Government policy on exemption and reduction o school

ees and support or schooling cost (based on Decree No.49/2010/ND-CP dated 14 May 2010 o the Government)

Decree 67 A government policy that supports bene ciaries o socialDecree 13 wel are assistance programmes (based on Decree No. 67/2007/

ND-CP dated 13 April 2007, and Decree No. 13/2010/ND-CPdated 27 February 2010)

DOLISA Department o Labour, Invalids and Social A airsGOV Government o Viet NamGSO General Statistics O ceHCMC Ho Chi Minh CityHH HouseholdHIV/AIDS Human Immunode ciency Virus/Acquired Immunode ciency

SyndromeHN Ha NoiHP Hai PhongMOET Ministry o Education and TrainingMOLISA Ministry o Labour, Invalids and Social A airsPC Peoples CommitteeRC Residential Cluster (Khu pho)RQ Residential Quarter (To dan pho)SME Small and Medium EnterpriseSPB Social Policy Bank TV TelevisionUNDP United Nations Development ProgrammmeVHLSS Viet Nam Household Living Standards SurveyWB World Bank WTO World Trade Organization

1 USD 20,900 VND or dong (as o November 2012)


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VI Participatory monitoring of urban poverty in Viet Nam - Five-year Synthesis Report (2008 - 2012)


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VIIExecutive summary

EXECUTIVE SUMMARYPoverty in Viet Nam is primarily considered a phenomenon in rural areas, but a ter a periodo rapid urbanization poverty is also becoming a signi cant issue in urban areas.

In the last ve years, the lives o most poor people in urban areas have improved, althoughthe pace o change is slow. Many households have escaped poverty thanks to changinglivelihoods and investments in childrens education. Rapid urbanization and landexpropriation has meant those without the skills and knowledge to adapt have struggled.Even so, some, particularly those with rooms to rent or small traders, have bene tted.Many poor households have borrowed or saved to invest in their childrens education inthe hope that their children will have a stable job with a higher income.

Although urban poverty levels based on economic indicators o income or expenditureare relatively low, a multi-dimensional assessment o poverty reveals serious problems. The ve major issues are: a lack o labour and skills, an inability to change livelihoods,insu cient social capital, limited access to public services and uncom ortable and unsa eliving environments. Poor migrants have additional disadvantages, such as high livingcosts in urban areas and a lack o social integration, leading to di culties accessing publicservices and social security.

Urban poor people are disproportionately a ected by shocks. Over the ve year periodpeople in the monitoring sites were a ected by high infation in 2008 and 2011, the globalnancial crisis in 2008-2009, and domestic economic di culties in 2012. Most poor peoplehave limited access to social protection programmes as many work in the small enterprisesand in in ormal sector. Insurance support programmes and cash trans er programmes needto be improved so as to better identi y bene ciaries and to increase the level o support.

The high cost o education is a burden or the urban poor. There is a mismatch between thequality o human resources (particularly technical skills) and market demand. Secondaryeducation graduates lack objective and in-depth vocational advice. Short term vocationalprogrammes or the urban poor are not e ective. Workers in labour intensive industriesdo not learn trans erable skills and many college and university graduates struggle to nd jobs in their areas o expertise.

People are increasingly concerned about inequality. Socialization has helped to mobilizesociety to reduce poverty and improve education and health care. However, socializationis only understood as the requirement to make contributions in return or services.Socialization as a means to empower people and increase levels o participation inthe provision o health care and education is less well understood. Socialization also

contributes to increasing inequality in access to education and healthcare.The results o urban poverty monitoring show that urban poverty reduction in Viet Namis acing new challenges and requires new approaches. I the challenges are not properlydealt with, quality o lives o the local and migrant poor will remain low, their vulnerabilitywill be high, and the inequalities will continue to be increased.

This report proposes eight areas policy makers should consider:

1. Use multi poverty dimensions to monitor urban poverty. A system o regularmonitoring and evaluation is required to design policies to address the needs o speci c groups. This should include the means to measure the impact o shockson di erent groups o poor and vulnerable people. This would be a signi cantimprovement on the annual poverty review which uses only income as an indicatoro poverty.


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VIII Participatory monitoring of urban poverty in Viet Nam - Five-year Synthesis Report (2008 - 2012)

2. Design proper support policies that do not discriminate against migrants and rely on ownership o a resident registration book. Migrants need support nding sa eemployment, accessing social protection and reducing urban living costs. Socialcapital o migrants can be improved by creating more opportunities or them toparticipate in community activities, sel -help services, peer group activities, culturaland communications activities on legal knowledge and li e skills, with the active

participation o stakeholders.3. Urban planning and budget allocations should be based on the total population,

including migrants. This would gradually solve the problem o overloaded housingservices (especially water supply and environmental sanitation), health care andeducation, with priority given to suburban areas with large populations o poorpeople and migrants, many with young children.

4. Allocate more investment to urban poverty reduction. Employment in urbanareas and remittances by migrants play an important role in the diversi cation o livelihoods or rural residents. There ore, urban poverty reduction programmesshould have greater resources. The instruction by MOLISA to hold a poverty review o

temporary residents o more than six months, regardless o the status o registrationstatus, should be adhered to.

5. Develop comprehensive and easily accessible social protection that does not discriminate against migrants in urban areas. Simpli ying the procedures andconsolidating the individual social security policies. Expanding the group eligible orsubsidized health insurance so as to reach the target o universal health insuranceshould be continued. Groups who receive cash trans ers de ned as specially pooror experiencing extremely di cult conditions, poor with young children in urbanareas should be expanded. There should be a policy to provide timely support togroups at risk, including migrants. The level o support should be increased so as tohave a practical impact, and there should be a mechanism to adjust it in responseto relevant market price movements. A mechanism to supervise cash trans erprogrammes should be developed and a mechanism to monitor the implementationo social protection policies (with tools such as citizen report cards, social audits,public debate, local budget analysis, etc.) should be established.

6. Adjust policies to support e ective vocational training or the urban poor, such

as supporting enterprises to provide training or workers, supporting studyingand working in parallel with attachment to private households business, or urbanbusiness associations (not o cial vocational training center). Provide more in-depth and objective vocational in ormation or secondary school graduates.

7. Develop a concrete policy to acilitate participation and empowerment especiallyin health care and education. Closely manage schools in mobilizing parents tocontribute to various unds, so as to reduce the costs or urban poor.

8. Create more e ective policies to support small enterprises in promotingenterprises social responsibility and promote the ormalization o in ormal activities. These policies in the medium and long term will support the poor andmigrants to reduce the risks o unemployment and to have better access to socialsa ety nets.


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1Introduction

INTRODUCTION

OBJECTIVES OF THE REPORTViet Nam has changed rapidly over the last 25 years. From being one o the worlds poorestnations, Viet Nam has made tremendous achievements in economic growth and povertyreduction. In 1993, nearly 60% o the Vietnamese population was living in poverty. Thisgure dropped to only 14% in 2008 3.

Between 2007 and 2012 the Government o Viet Nam undertook a series o re orms topromote economic development and li t remaining poor households out o poverty.Viet Nams ull accession to the World Trade Organization (WTO) in early 2007 marked animportant milestone in the countrys integration into the global economy. The countrysast changing situation brings both opportunities and challenges to people, especially topoor communities in both rural and urban areas.

In order to monitor the changes in Viet Nam a ter its WTO accession and subsequentre orms, the international NGOs including Ox am and ActionAid International Vietnamcooperate with the local partners at the provinces where these organizations have supportprograms, in order to build a participatory poverty network, this aims to:

Carry out periodic poverty monitoring o vulnerable groups in speci c communities, in the context o WTO accession and the governments projected re orm policies up to 2012, to provide analysis and recommendations or policy dialogue and implementation o programmes and projects by AAV, Ox am,and their partners.

The goals o the annual poverty monitoring are to: Provide qualitative in ormation on poverty and development, or use in

conjunction with statistical and survey data collected rom other sources, suchas the Government and other stakeholders.

Establish an early warning network to identi y changes i the living standardso the poor and vulnerable people, ollowing accession to the WTO andGovernments re orm policies.

Improve local capacity and enhance peoples participation in monitoring, witha view to making poverty alleviation more e ective and equitable.

The urban poverty monitoring network was established in 2008 in Hai Phong and Ho ChiMinh City. By 2009, the urban poverty monitoring network included to Ha Noi City. Thesynthesis urban poverty monitoring reports, Round 1 in 2008, Round 2 in 2009, Round 3 in

2010 and Round 4 in 2011 have been published4

. This report provides the results o the ve-year urban poverty monitoring ( rom 2008 to2012) in Ha Noi, Hai Phong and Ho Chi Minh City.

3 GSO, Viet Nam Household Living Standards Survey 2008, Statistics Publishing House, Ha Noi, 2010.4 See Participatory monitoring o urban poverty in Viet Nam: Synthesis Report 2008, Ox am and ActionAid

Viet Nam, April 2009, Participatory monitoring o urban poverty in Viet Nam: Second-Round Synthesis Report2009, Ox am and ActionAid Viet Nam, November 2009 and Participatory monitoring o o urban poverty in VietNam: Third-Round Synthesis Report 2010, Ox am and ActionAid Viet Nam, November 2010 and Participatorymonitoring o o urban poverty in Viet Nam: Fourth-Round Synthesis Report 2011, Ox am and ActionAid VietNam, October 2011.


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2 Participatory monitoring of urban poverty in Viet Nam - Five-year Synthesis Report (2008 - 2012)

RESEARCH METHODOLOGY

Annual repeated monitoring This poverty monitoring initiative di ers rom other poverty assessments in that it isrepeated annually in order to identi y changes at the monitoring sites. The working groupreturned to the same survey points in each round, using the same list o householdsand interviewing the same representative households and enterprises. The continuousparticipation o the core group members has been maintained in each city in order toe ectively monitor changes in poverty status at di erent times at each monitoring point.

Survey location

In each city, a typical ward or commune regarding the poverty status o local people andmigrants was chosen. Based on AAV and Ox ams working relationship withlocal partners, the ollowing monitoring locations in suburban areas with high immigrationwere chosen:

Ha Noi: Kim Chung Commune, Dong Anh, an outlying district, with oreigninvestment companies located in Thang Long Industrial Park.

Hai Phong: Lam Ha Ward, Kien An. An peri-urban district. Ho Chi Minh City: Ward 6, Go Vap. An peri-urban district.

In each ward or commune, two residential quarters or hamlets were chosen. There ore,three wards/communes and six residential quarters/hamlets participated in the project.

The goal o the poverty monitoring network is not to provide representative statistics,but rather to collect qualitative evidence and opinions rom local people to provide abasis or policy discussions and development programmes. There ore, the chosen wards/communes purpose ully refect the diversity among monitoring sites (See Table 1).

TABLE 1. Urban poverty monitoring sites

Ward/commune

KimChung

Lam Ha

Ward 6

District

DongAnh

Kien An

Go Vap

City

Ha Noi

HaiPhong

HCMC

Geographiclocation

SuburbanIndustrialized

Peripheralurbanized

Peripheralurbanized

Totallandarea(ha)

395

175

165

Totalpermanently

registered(HH)

2,822

3,344

2,600

Totalpermanently

registered(resident)

10,913

12,652

14,976

Totaltemporaryregistered(resident)

24,305

4,500

14,599

Proportion o poor (HHs) atmonitoringtime - July2012 (%)

2.1

0.4

1.8

Source: Ward/commune level in ormation cards as o August 2012


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3Introduction

City

District

Ward/Commune

Residential quarter/Hamlet

Total permanently registered households (HHs)

Total permanently registered residents (persons)

Total temporarily registered residents (persons)

Proportion o poor households in late 2011 (%)

Proportion o near-poor households in late 2011 (%)

Proportion o households using tap water (%)

Proportion o households using electricitynetwork (%)

Proportion o households using septic/semi-septictanks (%)

Proportion o households living in temporaryhouses (%)

Proportion o malnourished under ve years old (%) Total number o people receiving monthly socialallowance (according to Decree 67/CP)

O which:

Orphans

Single elderly

Disabled people

People living with HIV/AIDS

Single parent caring or young children

Proportion o children o primary school ageentering schools (%)

Proportion o children o secondary school ageentering schools (%)

Proportion o children o high school age enteringschools (%)

Number o households borrowing pre erentialloans (households, equivalent to % o totalhouseholds)

Nhue

950

3.685

2.743

1,9

0,7

65

100

100

0

1121

0

1

14

2

4

100

100

100

150

(15,8%)

RQ 3( ormer

RQ 2)

156

568

0

0

0

100

100

100

0

0

1

0

0

1

0

0

100

100

100

31

(20%)

RQ 25

60

240

405

00

100

100

100

0

0

0

0

0

0

0

0

100

100

100

5

(9,4%)

Bau

1.026

4.122

15.878

2,30,4

100

100

100

0,1

0,1

10

0

0

7

0

3

100

100

100

214

(20,8%)

RQ 14( ormerRQ 30)

166

700

130

0,61,2

100

100

100

0

0

4

0

1

0

0

3

100

100

100

5

(5%)

RQ 27

64

428

490

32,815,6

70

100

100

0

0

2

0

0

2

0

0

100

100

100

18

(28%)

Ha Noi

Dong Anh

Kim Chung

Hai Phong

Kien An

Lam Ha

HCMC

Go Vap

Ward 6

Some o the main eatures o six residential quarters/hamlets at monitoring sites areshown in Table 2.

TABLE 2. Some characteristics o the 6 surveyed Residential quarters/Hamlets

Source: In ormation sheet at residential quarter/hamlet levels, as o August 2012(Note: N/A not available)


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Poverty monitoring core group In each district, a core monitoring group o 15-20 people was established, including:

Representatives of AAVs local partners in the area, such as the Center for PoorWorkers (CWR) in Hai Phong, and The Support Programme or Development inGo Vap District, HCMC.

Representatives of municipal departments, such as the Department of Labour,Invalids, and Social A airs (DOLISA), Womens Union, and Trade Union.

Representatives of district departments, such as DOLISA, Department ofFinance and Planning, Department o Natural Resources and Environment,and Womens Union.

Representatives from wards/communes and residential clusters/quarters/hamlets selected to carry out the survey.

The core monitoring group is responsible or monitoring the poverty status at respectivemonitoring sites in its area, including organisation, data collection and eld reporting. The core group received training and technical support rom Truong Xuan (Ageless)

Consultants and Ox am and AAV programme o cers.Urban poverty monitoring ramework This urban poverty monitoring based on participatory methodology undertaken in the

th round in 2012 is organised around three main themes.

Theme 1: Overview o urban poverty: urban poverty trends using various measures,peoples eedback on the process o poverty review, awareness o changing lives;perception o inequality and socialization in urban areas. This topic aims to present anoverall picture o urban poverty and local poor residents in monitoring sites through thevoices o local residents and o cials.

Theme 2: Multi-dimensional poverty: multi-dimensions o urban poverty. This topic aimsto summarize dimensions o urban poverty and emerging issues that concern poor localresidents and migrants.

Theme 3: Urban poverty related to migrants: speci c dimensions o urban povertyrelating to migrant groups working in the in ormal sector and migrant workers. This topicexplores the eatures, education, skills, living conditions, livelihoods, and vulnerability o migrant groups in urban areas.

In addition to summarizing changes in urban poverty over the last ve years the th roundreport surveys the key themes that have had a major impact on urban poverty alleviationincluding education and skills, vulnerability and social security, perception o inequality,socialization, and speci c issues that concern migrants.

Field work The th round o urban poverty monitoring was implemented in July and August 2012. The monitoring was undertaken using participatory approaches or a week in each ward/commune. The main data and in ormation were collected via:

Group discussions conducted with groups o o cials o wards/communes, core memberso residential quarters/hamlets and local resident groups including males, emales, thepoor, the non-poor, o cials, young people and some migrant groups (migrant workers,vendors, motorbike taxi drivers, masons, masseurs, use bottle and scrap collectors).

Participatory appraisal tools used included household wealth ranking, time lines, colourcard presentation, listing and ranking, livelihood analysis diagrams. The objective wasto understand the rich-poor disparity, develop an accurate community pro le, monitorlivelihood changes and the risks people aced and record eedback on the implementation


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5Introduction

o programmes and projects. In the th round o urban poverty monitoring 63 groupdiscussions were held with the participation o 365 local people, migrant workers andlocal o cials, o which 152 were male and 213 emales. The majority o participants wereethnically Kinh.

In-depth interviews to record li e stories were undertaken with representative poorand near-poor households, households that had escaped poverty, returned to poverty,well-o households and migrant households. The objective was to urther understandpeoples perceptions o poverty, assess their living conditions, vulnerabilities and copingmechanisms. Ninety- our in-depth interviews were conducted, o which 28 were male and66 emales.

Questionnaire-based interviews with migrant worker groups. A questionnaire wasdeveloped or migrants working in enterprises with a ocus on demographic characteristics,living and working conditions, and vulnerability. The interview locations were randomlyselected rental properties in which migrant workers were living. As migrant workersrequently change their work places and accommodation the 2012 survey sample was notthe same as previous years. One hundred and eighty questionnaires were completed in Ha

Noi, Hai Phong and HCMC. O the 180 interviewees, 55 were male and 125 were emale;175 were Kinh and 5 were rom ethnic minorities.

In ormation sheets were used to record basic in ormation at the time o monitoring inrespective wards/communes and residential quarters/ hamlets. Direct observation andphotographs were used as tools to provide additional in ormation.

Interviews with o cials: In addition to the tools mentioned above, ten interviews wereconducted with o cials o district departments.

The method o cross-checking in ormation in qualitative survey is used throughout thereport in order to try to veri y responses rom those surveyed. Many in ormation sourcesare used, such as data rom local reports, group discussions, in-depth interviews, data romquestionnaire interviews and observations and survey team analysis.

This report summarizes the results o the survey at di erent monitoring sites in thethree cities. It highlights perceived changes in urban poverty and the implications o observed trends or poverty reduction policies 5. The report is in our parts: Part 1presents an overview o urban poverty trends over the last ve years; Part 2 explains themulti-dimensions o poverty or poor local residents and migrants in urban areas; Part3 discusses key issues o urban poverty alleviation; and Part 4 provides conclusions andrecommendations or sustainable urban poverty reduction in Viet Nam.

5 Secondary in ormation is taken rom separate sources. In ormation without citing sources in this report issynthesized rom eld work notes in the ve years rom 2008 to 2012 in three cities: Ha Noi, Hai Phong and HCMC.


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PART 1.

OVERVIEW OF URBAN POVERTY


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9PART 1. Overview of urban poverty

PART 1. OVERVIEW OF URBAN POVERTYViet Nam is undergoing a process o rapid urbanization. It is projected that by 2020 theurban population will account or 45% o the total population, against nearly 30% in 2009 6.Rapid urbanization means poverty is becoming as much an urban as rural phenomenonin Viet Nam.

1. URBAN POVERTY TRENDS: VARIOUS MEASURESPoverty in Viet Nam is o ten measured quantitatively using the World Bank/ GSOexpenditure poverty lines or the Governments national income poverty lines. Multi-dimensional poverty can also be measured qualitatively through peoples perceptions.

1.1. The WB/GSO expenditure poverty lines The expenditure poverty lines is de ned by WB/GSO and derived rom the Viet NamHousehold Living Standard Survey (VHLSS). According to the WB/GSO expenditure povertylines urban poverty reduced slowly between 2004 and 2008 (Table 3). The main reasonor the slow rate o poverty reduction is that the poverty rate is very low, and reducingit urther is more di cult. Recent economic shocks have disproportionately a ected thepoor, and particularly the urban poor as they are dependent on the cash economy, andsu er in a period o increasing unemployment and infation.

In 2010, the World Bank and the General Statistics O ce o Viet Nam (GSO) proposedthat the expenditure poverty line should be brought in line with the current structureo household expenditure as well as current prices and adapted to geographical areas.According to the new poverty line, the urban poverty rate in 2010 was 6% (rather than3.3% in 2008 according to the ormer poverty line). The urban poverty has higher rate insmall cities, which have similar characteristics to rural areas, is much higher than in major

cities. About 8.6% o those living in poverty live in urban areas7

.TABLE 3. Poverty incidence in Viet Nam according to WB/GSO expenditure povertylines, 19932010 (%)

6 In 2009, 29.6% o Viet Nams population lived in urban areas against 23.7% in 1999. Between the general populationcensus in 1999 and 2009, the average increase o annual population rate in urban areas was 3.4%/year, while thatin rural areas was 0.4%/year. Source: GSO, Results o general population census in 2009.

7 World Bank Well Begun, Not Yet Done: Vietnams Remarkable Progress on Poverty Reduction and the EmergingChallenges, June 2012.

National

Urban

Rural

1993

58.1

25.1

66.4

1998

37.4

9.5

44.9

2002

28.9

6.6

35.6

2004

19.5

3.6

25.0

2006

16.0

3.9

20.4

2008

14.5

3.3

18.7

2010

20.7

6.0

27.0

Source: GSO,Results of Household Living Standards Survey 2008, Statistics Publishing House, Ha Noi, 2010 World Bank, Well Begun, Not Yet Done: Vietnams Remarkable Progress on Poverty Reduction and

the Emerging Challenges, June 2012.Note:

New expenditure poverty line applied since 2010 proposed by WB/GSO is 653,000 VND/person/month.


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National

Urban

Rural

2004

18.1

8.6

21.2

2006

15.5

7.7

17.0

2008

13.4

6.7

16.1

2010

10.7

5.1

13.2

2010

14.2

6.9

17.4

2011

12.6

5.1

15.9

1.2. The Governments national income poverty lineEvery ve years, the Government calculates a new income poverty line to serve as a basisor the implementation o social security policies. According to the Governments incomepoverty line applied or 2006-2010, the urban poverty incidence reduced slightly by onepercent.

In late 2010, GOV promulgated a new income poverty line or 2011-2015 that was nearlytwice as high as the poverty line or 2006-2010. According to the new poverty line,national urban poverty incidence in 2010 increased by two percent. However, by 2011urban poverty incidence had returned to the gure or 2010, calculated under the ormerpoverty line (Table 4).

1.3 Income poverty lines de ned by localitiesEach city and province in Viet Nam is allowed to de ne its own income poverty line basedon the local cost o living and local peoples living standards, provided that it is not lowerthan the GOVs national poverty line.

In the last ew years income poverty lines or Ha Noi and HCMC have been regularlyadjusted to keep pace with rising urban living costs and local capacity to allocate undsor the implementation o policies to support the poor. In early 2011, Ha Noi set its ownpoverty line 1.5 times higher than the GOVs. HCMC has also adopted a poverty line twiceas high as the GOVs line since 2009. Hai Phong set its own poverty line or 2010 but decidedto reapply the GOVs line rom 2011 (Table 5). As the cost o living in Hai Phong is as high asHa Noi, the poverty line in Hai Phong does not refect the true poverty situation in the city.

TABLE 4. Poverty incidence in Viet Nam according to GOVs income poverty lines,2006-2011 (%)

Source: GSO, Results of the Household Living Standard Survey 2010, June 2011; Poverty statistics in 2011 in an announcement on Socio-Economic Situation, Quarter 1, 2012 by

GSO in the website http://www.gso.gov.vn/de ault.aspx?tabid=621&ItemID=12291Note:

The former income poverty line of GOV for 2006-2010 was VND200,000/person/month in rural areasand VND260,000/person/month in urban areas. The proportion o poor households in 2004, 2006,2008 and 2010 was calculated by GSO against this income poverty line with adjustments to accountor infation or each year.

The new income poverty line of GOV for 2011-2015 is VND400,000/person/month in rural areasand VND500,000/person/month in urban areas (according to Decision No. 09/2011/QD-TTg dated30/1/2011 signed by the Prime Minister).

Former income poverty line New income poverty line


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2006 2007 2008 2009 2010 2011 2012

Ward/commune

KimChungCommune

Lam HaWard

Ward 6

District

DongAnh

Kien An

Go Vap

City

Ha Noi

HaiPhong

HCMC

Geographicallocation

Suburbanindustrialized

Peripheralurbanised

PeripheralUrbanised

2005

-

-

3.6

2006

6.6

1.54

2.2

2007

3.8

0.93

1.26

2008

1.7

0.68

0

Early2009

5.0

-

9.1

Late2009

5.2

0.51

8.1

Early2010

-

1.28

-

Late2010

3.1

0.5

5.76

Late2011

2.1

0.44

2.58

Proportion o poor HHs accordingto ormer poverty line (%)

Proportion o poor HHsaccording to new poverty line (%)

200,000 in rural areas

260,000 in urban areas270,000 in rural areas350,000 in urban areas

200,000 in rural areas260,000 in urban areas

500,000


400,000 in rural areas

500,000 in urban areas550,000 in rural areas750,000 in urban areas


300,000 inrural areas390,000 inurban areas

1,000,000 (no distinction between rural andurban areas)

TABLE 5. The Governments national poverty line and poverty lines de ned by threemajor cities (average income: VND/person/month)

TABLE 6. Proportion o poor households in monitoring sites, 2005-2011

Source: Decisions on poverty line adoption o the Peoples Committees o Ha Noi, Hai Phong and HCMC

Source: Data rom poor household surveys 2005-2011 undertaken at monitoring sites

According to the poverty lines de ned by each city, the proportion o poor householdsat three monitoring sites in late 2011 continued to decline and is now at a low rate (Table6). Peoples salaries and wages have increased in line with infation, contributing to thereduction in the ormal number o poor households. In Lam Ha Ward (Hai Phong), only ahard core group o poor households remain. However, as Hai Phong applies the GOVsnational poverty line poverty rates would be higher i Hai Phong introduced a poverty linecalculated using local prices.

The poverty reviews at monitoring sites have been more care ully conducted in the last veyears. Ward 6 (Go Vap District, HCMC) used a questionnaire especially designed or urbanareas (compared to MOLISAs orm which is more suitable to rural areas). Lam Ha Ward (HaiPhong) Lam Ha Ward (Hai Phong) added a section on expenditure to enable responsesto be cross-checked to ensure accuracy. At all monitoring sites, ward/commune o cialscollaborated closely with partners in residential quarters/hamlets to visit the householdsto collect comprehensive in ormation and to ensure poor households were not missed.Some shortcomings o poverty reviews conducted in 2010 and previously, or exampleincluding social allowances in the households income and excluding households withnewly built houses rom the poverty list without taking into consideration their incomes,were corrected.

GOVs poverty

linesPoverty linesde ned by Ha Noi

Poverty linesde ned byHai Phong

Poverty linesde ned by HCMC


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However, there are still problems with poverty reviews in urban areas. It is di cult toaccount or cash income rom in ormal employment, and it is hard to veri y the claimedincomes o households.

MOLISAs manual or poverty review or 2011-2015 requires that households that residein a locality or six months or more regardless o their registration or residential status(registered or permanent, temporary residence or not registered) are included in theexercise 8. However, at the monitoring sites, only some long-term temporary residentsor those owning houses or land in the locality are included in the poverty reviews. Mostrenting households have been omitted.

Migrant households are ommitted rom poverty reviews in urban areas or a numbero reasons. First, the de nition o migrant household is not clear. Cadres in charge o poverty reviews at the monitoring sites said it is hard to identi y a migrant household andthat they do not receive guidance on the issue. MOLISAs manual provides no instructionon what is a migrant household. There ore, local cadres in charge o poverty reviews onlyinclude easily recognizable migrant households and exclude those less easy to identi y.

--- We admit that many migrants have lived here or more than six months. Thereare as many as local residents. However, the names o individuals are not included inthe poverty review, and we cannot de ne migrant households because there are noo cial documents, and the ward cannot identi y them. Only cases that are obvious- houses with husband, wi e and children, who have lived in a locality or a very longtime - are included. For others, even a ather and his children who have been livinghere cannot be certi ed as a household to be included in the exercise.

(Group o o cials in RQ 4, Ward 6, Go Vap District, HCMC)

Second, there are no procedures to cross-check migrants status with that in their place o origin. Cadres in charge o poverty reviews in urban areas are worried that some migranthouseholds might be classi ed as poor in their hometown or that although they have

poor housing in the cities, they may own good houses and have stable incomes romagricultural production at their homeland. Third, in suburban areas with large populationso migrants, it can be costly in terms o both nance and human resources to conductincome surveys. Local cadres are also worried that they do not have su cient unds toimplement support policies or migrant groups.

1.4. Peoples perception o changes in their lives in the last ve yearsMost local o cials and people think living standards have improved in the last ve years. The household wealth ranking exercise in six residential quarters and hamlets atthe monitoring sites shows that 55-65% o households have made clear improvements inliving standards; households with moderate improvements account or 30-35% ; and the

remaining 5-10% is households have made small or negligible improvements (Table 7).Households that have made clear improvements are those who rent accommodation toothers, have children with high incomes, engage in success ul business and do not su erillness. Households with moderate improvements are those who have a ew rooms orrent, have a small business, trade or work as reelance labour with a stable income. Somehave pensions or adult children with stable jobs. Households that have not improvedtheir living standards are single parents, those with elderly or ill members, and who haveunstable manual or agricultural jobs. In Quarter 14, Lam Ha Ward (Hai Phong), accordingto o cials and local residents, the proportion o households with clear improvementsin living standards is low (about 25%). These include those with transportation or othersuccess ul businesses. Most have struggled to improve their living standards as theyhave been unable to develop more prosperous livelihoods - the majority have short termemployment or are cyclo drivers with low and unstable incomes.

8 Source: MOLISAs website: http://giamngheo.molisa.gov.vn/vn/Tinhhinhthuchien/Chidaodieuhanh


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TABLE 7. Characteristics o three household groups at monitoring sites in the lastve years (2008-2012)

Source: Discussions o o cial groups and people in hamlets/residential quarters, July and August 2012

The quality o li e o the urban poor has improved over the last ten years:

--- Five years ago we did not have money to buy meat or our meals, but today wecan a ord it, our household economy is better. I a rich house buys one kg o rump pork, our household strives to have 200 grams o pork every day.

(Poor group in Bau Hamlet, Kim Chung Commune, Ha Noi)

--- Although we are still poor, we are pleased about our li e. In the past we were short o everything. Now we are poor but our house is better, road in rastructure is alsobetter. In the past we had nothing to eat; now our children are sent to school and wecan a ord pork meat and bean curd

(Di cult group, RQ 3, Lam Ha Ward, Hai Phong)

--- The rich and the poor are equal; all households have to a ord their childrens highschool education.

(Well-o group, RQ 25, Ward 6, Go Vap District, HCMC)

Local o cials and people o ten classi y the urban poor into two distinct groups: thechronic poor (households unable to escape poverty) and the temporary poor . Chronicpoor households account or 20-30% o poor households in Kim Chung (Ha Noi) and Ward6 (Go Vap District, HCMC), and most remaining poor households in Lam Ha (Hai Phong),where the GOVs national poverty line applies. The major di erence between chronic poorand temporary poor households is labour resources. Temporary poor households havemore available labour (two or three members able to work) and the will to do business,however, they also tend to have many dependents, ace un oreseen di culties haveunstable employment. The living standards o temporary poor households have improvedslowly in the last ve years.

--- Some households have many children going to school, others su er rom illnesses,but they have manpower and the will to earn their livings; i they are supported they will become better.

(Group o o cials in RQ 27, Ward 6, Go Vap District, HCMC)

KimChung(Ha Noi)

Lam Ha(Hai

Phong)

Ward 6(Go Vap,HCMC)

Group 1:Households with clear

improvements

Stable source o income: major business(construction materials);owning many rooms orrent; trading.Children having stable jobswith high income

Transportation serviceSuccess ul businesses:owning shops, kiosks, takingpart in tontine groupsNo sick amily members

Have many rooms or rent,Success ul trading business

Group 2:Households with

moderate improvements

Have ewer rooms or rentthan Group 1Small business and smalltradingAdult children with jobs

Have a stable source o income as reelancersFactory workersHave rooms or rent

Have rooms or rent, havepensionAdult children with jobs

Group 3:Households with slow

improvements

Single, elderly, sick Have many childrenDoing arming, having norooms to rentSome are drug users

Lack o labour; illness, elderly,young children, drug users.Lack business knowledge, donot dare to borrow money.Unstable jobsHaving no or ew rooms or rentChildren are reelancersElderly households, illnessesLocal residents rent rooms


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Most chronic poor households only have one main worker and no land. Many are singleparent households with young children, and elderly or handicapped members. The liveso the chronic poor have remained unchanged in the last ve years, and support policieshave had little impact (Box 1).

--- For these households, only when they die can they can escape poverty. Much

support has been given but it hasnt been e ective. They should be included in the list o social policy bene ciaries. (Group o o cials in Kim Chung Commune, Ha Noi)

BOX 1. Poorest single mothers in Bau Hamlet

Ms. N.T.H. (born in 1965) has the poorest household in Bau Hamlet, Kim ChungCommune (Ha Noi). Her husband died in 2005 o liver disease. She is now living withher daughter. As she had to sell all residential land to cover her husbands medicaltreatment ees, uneral and exhumation ceremonies, she now has to live on theedge o the hamlet in a temporary hut o 10m2 on a piece o arm land lent by herhusbands brother. Her hut has no electricity and no water supply.

At present the household relies on two sao o agricultural land and the monthlysocial allowance. On one quarter o her armland, Ms. N.T.H. grows morning gloryvegetables or sale. She also borrows some land rom villagers to grow ground nutand cassava. In recent years, due to the increasing number o vegetable sellers,and higher competition, her income has reduced. She keeps arming and sellingvegetables and hopes to earn enough to send her daughter to school so as to escapepoverty once her daughter nds employment. However, her daughter wants to dropout o school.

Its di cult to sell vegetables now. I can only sell 10-20 bundles, each 2,000 VND,and earn a maximum o 50,000 VND a day. My daughter does not want to go toschool. Last year she passed the nal exams. I dont attend the parents meeting.My daughter will possibly stop schooling to support me growing and sellingmorning glory vegetables.

The commune has had intentions to support her, but many avenues o support arenot open to her. In 2010, the Commune Fatherland Front wanted to und her housingconstruction, however, she had no land to build a house. In 2011, the CommuneWomens Union wanted to help her bore a water well. However, as she is living onarmland, without electricity, she was also unable to receive this support. She hasnever taken any loans as she ears she will be unable to repay her debts.

As her daughter grows up her expenditure is increasing. Her wish is to have a houseor her and her daughter.

It is very hard. We have no surplus money, no savings, and now everything isexpensive. A ter a market day, I only earn 20,000 VND, which is not enough or what we need. My daughter wants to have new clothing, but I cannot a ord it.No one gives us any clothing. We are now living in a hut and just wish to have ahouse to make our lives less di cult.

1.5. Reasons households have improved their living standards andescaped poverty in the last ve years There are two main reasons households have improved their living standards at themonitoring sites: (i) alternative livelihoods; and (ii) improvements in education.


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BOX 2. Extremely poor households using land compensation money to buildrooms or rent, thus improving their living

The household o Ms. N.T.L (46 years old) in Bau Hamlet, Kim Chung Commune (HaNoi) has our members, and was ormerly a chronically poor household in the hamlet.Ms. N.T.L.s husband su ers rom mental illness (receiving an allowance o 350,000VND/month) and her two daughters (one, born in 1988, has nished grade 1, theother born in 1994, has nished grade 4) are school dropouts and are unemployed.Ms. N.T.L has to eed the amily hersel : I do everything, transplanting rice, harvesting.I I allow my husband and children to tend the cows, I then have to look or them.

Be ore 2007 arming and livestock breeding provided the amilys income. By 2007,Ms. N.T.Ls 1.5 sao o land was taken over by an industrial park. Ms. N.T.L received74 million VND in compensation. Thanks to the encouragement o her brothers andsisters, she borrowed an additional 5 million VND to invest in building seven roomsor rent. In 2008, rents were low and Ms. N.T.L still had to repay her debts. She hadonly our sao o land, but hal o it could not used or growing because it is e ectedby the industrial park. The amily had to rely on two sao o armland and 1.4 millionVND earned rom rental accommodation per month.

In 2009, Ms. N.T.L sold cows and paid her debts. Rents increased, and in 2012, Ms.N.T.L began providing day-care services or young children. Be ore having rentalaccommodation, we did not have enough ood to eat and had to borrow money allthe time. When we started renting rooms we still didnt have enough ood, as rentswere low. But now we have paid all debts and the price o rental accommodation isup. We have enough ood to eat.

Alternative livelihoods

The process o urbanisation has provided households with opportunities to nd success ulalternative livelihoods. These include building rooms or rent, trans erring rom cyclos totrucks and small trading.

Building rooms or rent helps many households escape poverty. At all three monitoring

sites some households have been able to take advantage o being close to industrial parks,actories and schools and so meet the demand or rooms by migrants. In Bau Hamlet, KimChung Commune (Ha Noi) twelve households escaped poverty in 2012 by building roomsor rent. Some households that were extremely poor ve years ago are now much bettero , thanks to income rom renting rooms.

Investment in livelihoods and management o household expenditure also plays a vitalrole. Land expropriated or the building o industrial parks has caused households to loseincome rom arming. However, some have ound ways to use the compensation moneyto develop alternative livelihoods (Box 2).

2007 2008 2009 2010 2011 2012

Relativelivingstandards

Extremely poor

Poor

Received 74 millionVND as compensationfor 1.5 sao of land.Borrowed 5 million tobuild 7 rooms for rent

Sold the remainingmother cow and calf to repay debts

Husbandhospitalized

Gradual increase of rent.Life is less difficult

2 0 0 5receiveda cow assupport

Selling calf


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A ter 2010, land or building rental rooms became scarce. Pro ts rom newly built rentalaccommodation are not as high as in the past due to high construction costs. From 2005to 2012 in Kim Chung Commune (Ha Noi), the construction cost o rental accommodationincreased by 5-6 times ( rom 3-4 million VND/room to 18-20 million VND/room) while theprice o rental accommodation only increased by 2.5-3 times ( rom 200,000 VND/month to500-600,000 VND/month). Most households do not have access to long-term pre erential

loans or building rental accommodation. Some poor households who had to mortgageland or loans to build rooms or rent are acing di culties repaying bank loans.

--- 4-5 years ago, it was pro table to invest in rental accommodation. Now it is very di cult. Nearly 20 million VND is invested in a room or rent but the monthly rental ee is only 500,000 VND/room, so it will take very long time to recover the investment to pay the principal and make monthly interest payments. For rich householdshaving idle money it is OK to make such investments, but poor households who haveto borrow money dont dare to build rooms or rent.

(Group o o cials in Bau Hamlet, Kim Chung Commune, Ha Noi)

Upgrading equipment helps improve houshold living standards. From 2008 to 2012, in

RQ 14, Lam Ha Ward (Hai Phong), nine households upgraded their cyclos to small trucks,and so could carry greater loads at a aster speed. Most borrowed money rom relativesand riends, sold land, or pledged collateral given by relatives to obtain commercial bank loans. As most households ran a success ul business they have repaid the loans (Box 3). InWard 6 (Go Vap District, HCMC) some households trans erred rom 3-wheel home-madevehicles to motorbike taxi driving or small trading since 2009 and escaped poverty.

BOX 3. Moving rom cyclos to trucks helps improve amily li e

Mr. D.V.C (51 years old), RQ 14, Lam Ha Ward - Hai Phong lives with his wi e and one o his two children. The other is married and lives separately. Be ore 2007, his household

relied mainly on his cyclo driving. He also raised chickens, and his son was a taxidriver. However, because the household income was unstable, his amily aced manydi culties.

In 2009, Mr. D.V.C borrowed money to buy a truck. His household borrowed total185 million VND, o which 100 million VND came rom relatives and 50 million VNDrom a commercial bank with collateral provided by relatives in his hometown. Mr.D.V.C and his son run the truck and his wi e continues to ride the cyclo. With regulartransportation contracts or his truck he can save more than 10 million VND everymonth. By 2011, Mr. D.V.C had paid all his loans.

By 2012, the recession in the local construction market had reduced Mr. D.V.Cs

household income by hal . However, as he no longer has to pay debts, we can earnenough, 3-4 million VND/month, or our living rom the truck. We can also earn somemoney rom the cyclo or miscellaneous spending.

2007 2008 2009 2010 2011 2012


Poor

Average

Well-off

Son as taxi driver withunstable incomeHusband and wife drive cyclo

Truck brings higher income, savingmore than 10 million VND/month,paying all money borrowed to buy truck

Husband stops cyclo riding,Wife keeps riding cycloBought a small truck for 185million VND

Gives up

raising chickensbecause of lowincome

Borrowing nearly 100million VND from relatives,50 million from bank

Income falls by half because of constructionrecession, Wife does littlecyclo riding


29/98


Opening businesses. Some households have opened small businesses, particularly thosewith street acing land and capital (either savings or borrowed rom relatives or banks).Rather than work as labourers a number o households have taken advantage o theconstruction boom to supply construction materials.

Educational improvements

Many poor households, though acing economic di culties, have tried to invest in theirchildrens schooling. Some children who do well at school can secure stable jobs andsupport their parents (Box 4). (See Part 4 Education and skills or more details).

BOX 4. Success ul childrens education helps households escape poverty

Ms. L.T.D, (52 years old) lives in Nhue Hamlet (Kim Chung, Ha Noi) and is a singlemother with two children. Her husband died eleven years ago. She sent her childrento school with money earned rom selling her labour in the inner Ha Noi. In 2002, shewas hospitalized - health care cost 10 million VND and her son ailed to pass hisuniversity entrance exams. In 2003, her eldest son passed exams to the University o

Science and Technology with high marks.Every year Ms. L.T.D had to borrow money rom relatives to pay her sons tuition ees.In his third year at the university (2005), her son started to work as a tutor to earnmoney to cover his tuition ees, and Ms. L.T.D only had to give him several hundredthousand VND/month to cover his living costs. In 2006, her son was hospitalized andcould no longer work as a tutor. Ms. L.T.D had to borrow to cover her sons hospitaland educational costs. In 2007, her son received support or tuition ees rom threecompanies. Ms. L.T.D also borrowed money rom her relatives and built three roomsor rent. To prepare or her sons graduation and employment, she borrowed 20 millionVND rom the commune credit und to buy a personal computer and a motorbike orher son.

In 2008, a ter graduating rom university, her son ound a job at Thang Long IndustrialPark. Thanks to his good per ormance, he was given opportunities by the companyor urther training and received a high income. With a stable income, her sonhelped Ms. L.T.D buy urniture and repay her debts. In 2009, her son won a Young Talent Award with prize o a scholarship worth 3,000 USD and a motorbike. With thescholarship, her son studied in France. In 2010, her houshold escaped poverty. In2011, her son remitted 30 million VND which Ms. L.T.D used to repay loans used to buya personal computer and a motorbike a ter her sons university graduation, supporther household economic activities and contribute to her younger sons schooling.Because her son did well at school and won a scholarship or overseas study she eels

that, wherever I go in the village, I can hold my head high.

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Escapedpoverty


Extremely poor

Poor

Average Son working as atutor, able to cover tuition and rentalfees and food cost

Son passed university exams, borrowed money for sons university study

Son working for Panasonic, hasopportunity for further study and ahigh income. Helps family in repairinghouse and buying furniture

Son remitted 30 millionVND to repay debtsand support family

Son had anoperation,could not workas a tutor

Son received supportof 10 million VNDfrom three companiesto cover tuition feesBorrowed 20 millionVND from communecredit fund to buy amotorbike and PC for son to go to workBorrowed money tobuild rooms for rent

Son won YoungTallent Awward,receiving3000US$ and amotorbikeStudying in France


30/98



31/98

19PART 2. Multi dimensional poverty in urban areas

PART 2.

MULTI DIMENSIONAL POVERTY

IN URBAN AREAS


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33/98


PART 2. MULTI DIMENSIONAL POVERTYIN URBAN AREASIn 2008, or the rst time in Viet Nam, GSO calculated multi-dimensional poverty among

children using data compiled rom the VHLSS9

. In 2009, UNDP supported the projectSupporting in-depth evaluation o urban poverty in Ha Noi and Ho Chi Minh City (UPS-2009) implemented by the statistics o ces in the two cities. The project adopted themulti-dimensional measure o poverty and explored the eight dimensions o deprivation:income, education, health care, access to the social protection system, housing quality,housing services, participation in social activities and social security 10.

As part o the poverty monitoring initiative, Ox am and ActionAid analyze changes inpoverty dimensions in some rural communities between 2007 and 2011 combining datarom questionnaire survey and qualitative in ormation 11. The 2012 World Bank Reportupdates poverty in Viet Nam using data rom multi-dimensional poverty among childrenprovided by UNICEF 12.

2. MULTI-DIMENSIONAL POVERTY OF LOCAL RESIDENTS The various dimensions o poverty are o great concern to local people and o cials at themonitoring sites:

--- Poverty is a chain; low education leads to poor employment; poor employment means low income, then no housing then poverty.

(Group o o cials in Ward 6, Go Vap District, HCMC)

--- In poverty, every thing is equally di cult; no money to cover education and medical treatment costs. Occupation, good health and education; lack o thesethings means one remains poor.

(Group o di cult households, RQ 3, Lam Ha Ward, Hai Phong)

--- Being dependent on several sao o land and several thuoc o vegetables,illnesses and low education means poverty. With stable employment, good health,good education or children, you are not poor.

(Group o poor households in Bau Hamlet, Kim Chung Commune, Ha Noi)

In this section ve dimensions o deprivation are summarized: lack o labour and skills;lack o capacity to nd alternative livelihoods; lack o social capital; lack o access to publicservices; and uncom ortable and unsa e living (Figure 1).

The perception o local o cials and residents on the importance o di erent povertydimensions has changed in the last ve years. In 2008, lack o labour was consideredthe most serious deprivation. However, in two thirds o the monitoring sites in 2012,lack o capacity to nd alternative livelihoods was considered the greatest problem.During economic di culties livelihoods o the urban poor become unstable, and ndingalternative livelihoods becomes more di cult. Limited access to education is also o greater concern to local residents than be ore.

9GSO, Results o the Household Living Standard Survey 2008, Statistic Publisher, Ha Noi, 201010 Ha Noi, Ho Chi Minh City and UNDP, Report Urban poverty assessment in Ha Noi and Ho Chi Minh City, September 2010

11 Ox am and ActionAid International Viet Nam, Participatory poverty monitoring in some rural communities in Viet Nam, 5-yearsynthesis report (2007-2011), May 2012.

12 WB, Well Begun, Not Yet Done: Vietnams Remarkable Progress on Poverty Reduction and the Emerging Challenges, June 2012.


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Lack of labour

and skills

Lack of capacity

to nd

alterna t ve

livelihoods

Lack of social

capitalLimited access to

public services

Uncomfortable and

unsafe living

environment

Local poor

residents

FIGURE 1. Main features of urban poverty

Housing and in rastructure has much improved in the last ve years. Most o theinterviewees said that the importance o shortage on living environment in the year2012 has been reduced compare to 2008. However, shortages o entertainment andrecreation are an emerging issue. When general living standards improve, spiritual actorsbecome more important to local residents.

2.1. Lack o labour and skillsLack o labour remains the most prominent eature o local poor households. Poorhouseholds are o ten households with elderly people, single parents, disabled people andpeople with chronic illnesses. Households with drug addicts also have great di culties.In Nhue Hamlet, Kim Chung Commune (Ha Noi), 100% o poor households have onlyone worker, 40% have elderly members, and more than 70% have members with chronicillnesses or who are handicapped. Similarly in Lam Ha Ward (Hai Phong), 80% o poorhouseholds have only one worker (o which 60% are single mothers) and 80% have sick orhandicapped members.

Lack o education and skills is an increasing concern or local residents. Group discussionsindicate that residents aged over 35 eel having a limited education means they are onlyquali ed or unstable manual jobs. Most believe young people should be educated to atleast secondary level (see Part 4 Education and skills):

--- Today without good education, business is not good. It is unable to apply or a job i one has not nished high school. For people o 35 40 years o age without education, their lives are very hard now.

(Core group in Nhue Hamlet, Kim Chung Commune, Ha Noi)

--- In the past when one nished secondary school one could nd a job, just takinginto account ones health. Today even working as a actory worker, one has to nishhigh school. Now poor households are more aware o the importance o educationthan in the past. Now without education, one can do nothing. In 2008 the quali cationwas not important. 14-15 years-old boys and girls could be recruited as long as they had some skills. In the past it was easily to apply or a job, today it is more di cult

(Core group, RQ 27, Ward 6, Go Vap District, HCMC)


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2.2. Lack o capacity to nd alternative livelihoodsThe temporary poor lack the capacity to nd alternative livelihoods. In peripheralurbanised areas such as Lam Ha ward (Hai Phong) and Ward 6 (HCMC), poor residents o tenwork as small traders, shop assistants, construction workers, day labourers and motorbiketaxi drivers. Low levels o education and lack o skills make it di cult or poor people tond jobs in the ormal sector with more stable incomes and access to social protection.In urbanized areas such as Kim Chung Commune (Ha Noi), members o poor householdsmainly work in the agricultural sector and ace immense di culties because arable land isbecoming increasingly sparse, irrigation and drainage systems are congested.

The occupations o the poor are becoming more diverse (Figure 2). Some new occupationshave emerged. In Bau and Nhue Hamlet (Kim Chung, Ha Noi), ewer people work in theagricultural sector in compared to 2008. New occupations include renting accommodation(each poor household has only 2-3 rooms or rent due to limited land and lack o capital),small traders, cooks, workers and childcare. In RQ 27, Ward 6 (Go Vap District, HCMC), thenumber o poor residents selling re reshments and groceries in a local park has increased.

In 2010, Ward 6 (Go Vap District, HCMC) responded to a new law prohibiting three wheelhomemade vehicles by providing support to households to purchase new vehicles orengage in training 13. Eighteen households received unding support, o which sevenwere poor households, each receiving seven million VND per vehicle. The remaining 11households received ve million VND per vehicle. Some households did not participate inthe vocational programme as they are too old. Only two households bought motorbiketaxis to get a pre erential loan o 10 million VND rom the poverty reduction und. Theremaining households received a grant and became motorbike taxi drivers and smalltraders. By 2012, our o seven poor households had escaped poverty.

Poor people get loans more avourably. The size o loan granted to poor households hasincreased to 10-30 million VND per household compared to 5-10 million VND in 2008.

Loans rom the Social Policy Bank. In all hamlets and residential quarters, borrowersclusters have been established to make it possible or local residents to get loans romthe Social Policy Bank. The most common loans are or production and business andor students. Some people in Kim Chung Commune (Ha Noi) reported that those poorhouseholds that already have loans or students will nd it di cult to get loans orproduction and business. The size o loans rom the Social Policy Bank is small. In Lam HaWard (Hai Phong) most poor households have no need or loans or do not have accessto business loans rom the Social Policy Bank. Since June 2011 in Ward 6 (Go Vap District,HCMC) the Social Policy Bank has only grants loans to poor households as de ned by thenational poverty line, which is much lower than the poverty line in HCMC. As there arealmost no households below the national poverty line ew households receive loans romthe Social Policy Bank.

13 Decision No. 548/2009/QD-TTg dated 29 April 2009 o Prime Minister


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FIGURE 2. Employment structure o members o poor households in monitoringsites, 2008 - 2012

Nhue village - Hanoi, 2008 Nhue village - Hanoi, 2012

Bau village - Hanoi, 2008

Lam Ha Ward - Hai Phong,2008

Cluster 27 - Ward 6 (Go Vap- HCMC), 2008

Cluster 27 - Ward 6 (Go Vap- HCMC), 2012

Lam Ha Ward - Hai Phong,2012

Bau village - Hanoi, 2012


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--- Here they had construction projects or local headquarters and roads. I attended a meeting. They told me to vote and I voted. I think I did not make much o acontribution. Rich households contributed more. They speak more because i wespeak, no one listens to us.

(Group o poor households RQ 25, Ward 6, Go Vap District, HCMC)

Participation in social activities by the poor depends on local authorities and massorganizations, and particularly on the enthusiasm o the heads o residential clusters andquarters.

2.4. Limited access to public services The poor have limited access to educational and healthcare services compared to well-o residents in urban areas because they lack nancial sources and social relations.

Education: Most poor parents pay great attention to their childrens education, and boysand girls are treated equally. In the last ve years, no children o primary and secondaryschool age have dropped out o school because the amily is in di culty.

However, poor children ace many disadvantages in education. As they o ten have tosupport their parents, they have little time or homework and play. They rarely attend extraclasses and have little money to buy learning aids. Parents who are busy and parents whoare not getting along well rarely attend parents meetings or help their children with theirschool work.

The urban poor ace many di culties meeting the costs o their childrens education. Atthe start o the new school year, poor parents o ten struggle to pay their childrens tuitionees. In many cases, they have to borrow money or pay in installments. Some parentshave to delay payment until the end o the school year. Many poor households are unableto invest in their childrens higher education, and can only try to a ord or their childrento nish upper secondary school be ore they have to nd work (see Part 4 - Educationand skills).

Some policies have had positive impacts on childrens education. They include theconstruction and upgrading o school buildings and classrooms, and the exemption o tuition ees or children o poor households. Since 2010, support policies under Decree49 have helped poor households with tuition ees and other school contributions. Thepre erential student loans rom the Social Policy Bank have also helped many poorhouseholds and households in di cult circumstance to meet their childrens costsat vocational high schools, college and university. Procedures or student loans arestraight orward and available loans have increased in line with infation (the average loanis now one million VND per month).

--- My youngest daughter is now a second year college student o accounting. At rst she did not want to study because the household has no money. We are lucky to have got student loans or our semesters now. In 2010 we borrowed more than4 million VND to pay or her tuition ees, and then I got student loans rom the bank to repay the debt. In 2011, I got 8.6 million VND (2 rounds o student loans) rom thebank to pay or my youngest daughters education. I I didnt have such support romthe government I would have to borrow money rom private lenders at a very highinterest rate.

(T.T.L, Residential Quarter 4, Ward 6, Go Vap District, HCMC)

In Ward 6 (Go Vap District, HCMC), classes organized by Ky Quang Pagoda ( or children in

Grade 1 to Grade 5) and An Nhon Secondary School ( or children in Grade 6 to Grade 9) arestill in place. The class hours are fexible, and o ten held in late a ternoon or evening a terthe children return home rom helping their parents. Participants in these classes do nothave to pay tuition ees and receive some support to help buy textbooks and notebooks.


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The curriculum is similar to normal schools, enabling children to sit nal exams atdi erent levels.

Healthcare. The poor can receive medical attention at hospitals with medical insurancecards. However, they lack the unds to cover extra costs, hospitals are o ten overcrowdedand the quality o health care available to the poor is o ten worse than better o patients.In 2012, Go Vap District Hospital (HCMC) opened two new healthcare acilities or localpeople, but patients still have to wait or a long time to receive services.

At the ward commune levels acilities are overloaded. In Kim Chung Commune (Ha Noi)and Lam Ha Ward (Hai Phong), the situation has got worse in the last ve years, particularlyor immunization or children under six. Kim Chung Commune Health Station (Ha Noi)was allowed to register services or medical insurance bene ciaries, but is dependent onsupplies rom the districts social insurance und and so has to re er patients elsewhere asit does not have su cient drugs or the large number o patients. Although Ward 6 HealthStation (Go Vap District, HCMC) is being equipped with the acilities and human resourcesto provide 300-500 health checks a day, only an average o 500 patients visit a month. Themain reason is that the Station does not provide primary healthcare services or medical

insurance bene ciaries, who then have to go directly to district and city hospitals.Free o charge healthcare services are bene cial to the poor. Free health checks or theelderly and ree gynecological check-ups or women implemented by health stationsattract a lot o poor residents. Ky Quang Pagoda (Go Vap District, HCMC) provides ree healthchecks and medical treatment, including HIV/AIDS counseling. Many poor households inWard 6 reported that this is the main healthcare service they use when they all ill and arequite satis ed with the quality o the service and the attitude o health providers.

2.5. Uncom ortable and unsa e living conditions Poor people o ten live in isolated areas, along dykes and next to cemeteries. They have

poor drainage, muddy and inaccessible roads in the rainy season and an unstable waterand electricity supply.

In the last ve years, in rastructure at monitoring sites has improved thanks toGovernment investment and local contributions. In 2008, all three monitoring sites hadno access to sa e water. However, 2012 every household had access to a sa e water supply.By 2012 most roads were paved with concrete. Better solid waste collection services havehelped improve sanitation. Developments in in rastructure are most clearly seen in RQ 14,Lam Ha Ward (Hai Phong). In 2008, residents o RQ 14 used a very muddy access road andshared an electric meter with electricity prices three or our times higher than average.By 2012 the main road running through the quarter and most o inter-quarter roads havebeen newly built and each household has a separate electric meter.

The quality o housing and basic assets o poor households has improved in the last ve years. Most poor households now live in Grade 4 houses with concrete corrugatedroo ng and an average living area o 30-50 m2. Many have standard household assets (TVsets, motorbikes, telephones), however, most are old and o low value. Some householdspurchase new goods by paying in installments.

Housing support policies ( und against leakage, solidarity house, charity house,pre erential loans or house repair) have positive impacts on poor households. In Ward6 (Go Vap District, HCMC), thanks to the und to support housing leakage repair andpre erential loans rom the Housing Development Fund in HCMC 15 many poor households

15 Fund or housing development in HCMC is a public nancial organization under the HCMC Peoples committee in support o low-income people with loans o 15 million VND/household with an interest rate o 0.6%/month or upgrading, repair andrestoration o houses. Borrowers must take part in savings and payment o both principal and interest by instalments monthlyin 3-5 years. In 2009-2012, 42 households in Ward 6 got loans rom the Fund with a total outstanding o 630 million VND.


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High living

costs

Unstable

employment

Lack of socialintegra t on

Limited access topublic services

Uncomfortable and

unsafe livingenvironment

Poor migrants

FIGURE 3. Main features of poor migrants

the multi-dimensional poverty perspective, many migrants can be de nes as poor.

--- They have income much higher than local residents. Compared to the poverty line o one million VND, they are not poor. But they lead a hard li e, without social interaction and are disadvantaged in education. They are not poor in terms o money but poor in spiritual li e.

(Core group o RQ 27, Ward 6, Go Vap District, HCMC)

The poverty o migrants at monitoring sites is shown in the ve key dimensions o deprivation: high living costs in urban areas; unstable employment; lack o socialintegration; limited access to public services; uncom ortable and unsa e living conditions(Figure 3).

16 Circular 05/2011/BCT dated 25 Feb. 2011 o Ministry o Finance stipulates: every our persons who live in a dormitory, i it isapplicable (based on long-term temporary residential registration) are calculated as a household and shall pay progressiveretail electricity price. I it is not possible, the price o 1,651 VND/kWh (the retail electricity price between 151 and 200 kWh) isapplied.

17 8 10 m2, corrugated concrete roo ng, concrete or low quality fowered enameled tile foor, without attic, shared bathroomand WC.

18 About 12 m2, corrugated concrete roo ng, fowered enameled tile foor, without attic, with bathroom and WC19 About 15 m2, corrugated concrete roo ng, concrete or low quality fowered enameled tile foor, attic (about 7 m2), with

bathroom and WC.

3.1. High costs o livingMany migrants report that living costs are increasing aster than incomes. Rents haveincreased because o infation and a high demand or rental accommodation. Rentsdoubled between 2008 and 2012 (Table 8). Tenants at monitoring sites share electricitymeters and pay higher than average prices set by their landlords (2,500-3,500 VND/kWh);there are no records o tenants having a separate agreement or electricity and paying thesame price as permanent residents 16.

TABLE 8. Rental prices at monitoring sites, 2008 2012 (VND/month)

Kim Chung 17

(Ha Noi)

Lam Ha 18

(Hai Phong)

Ward 6 19

(Go Vap, HCMC)

7/2008

-

250,000

700 -800,000

7/2009

250 - 300,000

350,000

900 - 1,000,000

7/2010

350 - 450,000

400 - 500,000

1,200,000

7/2011

450 - 500,000

600,000

1,300 -1,400,000

7/2012

500 - 550,000

700,000

1,500 -1,600,000


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More migrant couples choose to live with their children in cities. According to interviewswith migrant workers with children, about 70% live with their children, and 30% send theirchildren to their hometown. Married couples with young children living in a separate rentroom have to pay more compared to a shared room. Many couples working shi ts haveto hire someone to take their children to and rom school or pay extra or childcare. As aresult disadvantaged migrant households are o ten households with 2-3 young children

and doing manual work (See Part 8 Speci c Issues o Migrants).Migrants in urban areas ace extra costs such as telephone bills, clothing and social costssuch as visits to the sick, weddings and birthday presents or riends rom the samehometown. Remittances are also a burden or some young migrants.

A ter deducting all expenditures, most migrants have an extremely modest budgetto spend on ood and other daily essentials. The survey at monitoring sites shows thatmigrants have very simple meals.

3.2. Insecure JobsIn the last ve years migrant workers have had to cope with infation (in 2008, 2011),the global nancial crisis (2008 - 2009) and declining economic growth (2012). Someworkers lost their jobs or were under-employed and had to nd new jobs or return to theirhometown.

Limited education and skills are the root cause o employment instability in urbanareas. Demand or some occupations, such as cyclo drivers and masseurs has allen orcingmigrants to nd other jobs. The incomes o reelance migrants are dependent on actorssuch as climate, the season and the progress o projects. Stricter urban managementpolicy has also limited opportunities or migrant vendors.

Changing consumption habits o urban residents will possibly have an impact on smalltraders and street vendors. Increasing numbers o people use supermarkets, as they areconcerned about ood quality and hygiene, and prices are su ciently low. By 2012 in KimChung Commune (Ha Noi), there were our mini-marts.

--- Now more and more people go shopping in supermarkets. Big C, Co-op Mart are crowded with shoppers. Around here, there are our or ve supermarkets. Peoplespend millions o Dong on their shopping, and only buy sundries outside. Everythingis available in the supermarkets, the price is not high and the price o some goods iseven lower than outside markets, with better quality.

(Core group, RQ 27, Ward 6, Go Vap District, HCMC)

Like local residents, migrants have had to diversi y their livelihoods. Some migrants work as small traders and motorbike taxi drivers to earn additional income. However, these arestill in ormal and highly unstable jobs.

3.3. Lack o social integrationLack o social integration is typical among migrants since Viet Nam still has a householdregistration system and many procedures and policies made dependant on householdregistration. Without household registration or being listed as a poor household,migrants nd it hard to rely on ormal institutions and to access social protection.

Social relations limited to their rental quarters, actories, colleagues and riends romthe same home towns. This in ormal network is very important or migrants. Migrants

who are established help new comers access employment, and adapt to their new lives. At the monitoring sites, migrants rarely participate in local social activities because: they want to earn money and have no interest in social activities; they work long hours;they are always on the move and requently change accomodation and their work place;


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they have a limited social circle; they cut down on social costs; they are not invited toparticipate by local residential representatives and mass organisations. Most migrantswant to save money and then return home so tend to give priority to maintaining socialrelations in their hometowns rather than in cities.

Some local residents are also prejudiced against migrants. In addition to acknowledgingthe positive impact o migrants, local residents o ten attribute social evils, tra ccongestion, and littering to migrants..

--- In the past, li e was peace ul here. Migrant children bring some monetary bene tsto local residents but the situation becomes more complex. Many local householdsask their children not to be riends with migrant workers or ear o learning their bad habit o alling in love early. Social evils now are more than in the past. Seeing youngbeauti ul girls wearing dcollet puts local households in a panic.

(Group o poor households in Bau Hamlet, Kim Chung Commune, Ha Noi)

Participation in residential clusters and clubs can help migrants improve their social capital. Mass organizations have established a number o groups or migrants. Theseinclude the Migrant Worker Group, the Tenant Club, the Group o Workers OvercomingDi culties, and the Club o Grandparents and Children. These residential clusters andclubs can organize regular meetings and activities or migrants with cultural exchangeactivities, legal and li e skills in ormation. However, most o the migrant groups and clubsat monitoring sites are not sustainable. Without support they are dissolved or have onlymoderate activities (Box 5).

BOX 5. Residential clusters and clubs or migrant workers are di cult to sustain

In Kim Chung Commune (Ha Noi) , ten groups o migrant workers have beenestablished with support rom C&D ( ve groups were established in 2008, vegroups in 2010) and coordinated by the commune Womens Union. Each group has30 members. Monthly meetings were organized to discuss topics o interest and orcultural and artistic activities. However, by July 2011 most groups had to close downas they had little support. At present, the migrant worker groups are maintainedthrough the management o the lane heads 20. However, their activities are onlyorganized once every three months and are incorporated into the activities o theWomens Union and so do not attract the participation o many migrant workers.

In Lam Ha Ward (Hai Phong) , the Young Tenant Club was established in 2009 underthe management o the Ward Youth Union. The club mainly organizes interactivemeetings, cultural and artistic activ

Documents

Urban Poverty Reduction Report E