HUMAN SETTLEMENT COUNTRY PROFILE

PHILIPPINES

Decision-Making

Programmes and Projects

A. Providing Adequate Shelter for All

B. Improving Human Settlement Management
C. Promoting Sustainable Land-Use Planning and Management
D. Promoting the Integrated Provision of Environmental Infrastructure: water, sanitation, drainage
and solid waste management
E. Promoting Sustainable Energy and Transport Systems in Human Settlements
F. Promoting Human Settlement Planning and Management in Disaster-Prone Areas
G. Promoting Sustainable Construction Activities
H. Promoting Human Resource Development and Capacity-Building for Human Settlement
Development

Status

Capacity-Building, Education, Training and Awareness-Raising

Information

Research and Technologies

Financing

Cooperation
Decision-Making: The Philippines has promoted the development of sustainable human settlements
primarily through the implementation of the Global Strategy for Shelter, and more specifically through
the following initiatives:

a) Preparation of a revised National Plan of Action for 1994-1995;

b) Enhancing the roles of government, private sector, scientific community, and NGOs;
c) Focusing on shelter-related issues including urban management, energy, transport, poverty
alleviation, health, and the environment;
d) Expanding the role of women in shelter policies;
e) Establishing a National database on shelter and services;
f) Addressing constraints in shelter production; and
g) Improving overall performance of shelters.

In terms of planning for the development of human settlements, several policy guidelines were
formulated to create a more humane and livable settlements. The Medium-Term Philippine
Development Plan 2001-2004 included the Housing chapter entitled Enhancing Shelter Security. The
MTPDP-Shelter outlined the continuing National Shelter Program’s major policies, strategies, targets,
legislative agenda for the medium-term for the housing and urban development sector.

In 2000, the National Urban Policy Agenda (NUPA) was completed. It contains broad policy sectors in the
formulation and implementation of comprehensive plans, policies, programs and projects such as in the
area of urban land use and housing. The NUPA likewise provided inputs in the formulation of the
National Urban and Development Housing Framework, which contained the strategy for the
development of environmentally sound and sustaining human settlements. The National Urban
Development and Housing Framework (NUDHF) 1999-2004 has identified the following policy strategies
to address these concerns:

a) Limit government’s activities to

(i) Providing and ensuring that enough affordable land is available for housing purposes,
(ii) Ensuring that major infra and utility support are provided to recognized housing
development areas;
(iii) Supporting housing finance systems, and
(iv) Providing mortgage guarantees.

b) Split direct public resources 80/20 percent in favor of socialized housing. Promote rental housing
options for the lowest 30 percent of income earners and provide incentives for the private sector to go
into rental housing programs.

c) Localize and decentralize urban and shelter policy. Initiate proactive local urban planning and
decentralize housing delivery systems as a means to ensure more equitable distribution of shelter
assistance.

d) Favor community-led, self-help approaches to housing, including utilization of the Community

Mortgage Program and other community-based or cooperative arrangements as well as nontraditional
housing technology.
 e) Institutionalize maximum multi-sectoral participation, including venues for civil society, the private
sector, NGOs, LGUs, and others, in formulating shelter policy.

f) Give primary consideration to upgrading informal settlements. If relocation cannot be avoided, the
resettlement area should be situated within the same city (in-city relocation) and relocation must be
carried out to approve resettlement guidelines under the Urban Development and Housing Act.

More specifically, on the issue of providing security of tenure to informal settlers, the government’s
assistance comprise the following forms of interventions:

a) Core housing which entails the acquisition and development of raw land and the construction
of housing units;
b) Sites and services development through the acquisition and development of raw land into
serviced home lots;
c) Resettlement assistance program for LGUs to assist local authorities to undertake nt of
households in unsafe circumstances or right-of-ways (RoWs);
d) Slum upgrading which involves the acquisition and on-site improvement occupied lands
through the provision of roads, alleys, basic water and power services; and
e) Medium-rise public and private housing which involves the construction of 3 to 5-storey
buildings in the city as a joint-venture with the National Housing Authority (NHA) and/or private
sector.

Another major document that espouses and supports this thrust is the National Framework for Physical
Planning (NFPP). The NFPP contains policy guidelines for settlements planning that embraces approaches
that favor effective integration of activities within and among settlements, allowing efficient production
and movement of people and commodities through the provision of appropriate land, infrastructure and
facilities. Likewise, it espouses policies that would provide access of the population to housing,
education, health care, recreation, transportation and communication, sanitation, and basic utilities such
as water, power, waste disposal and other services.

In pursuit of sustainable energy production and utilization, the Department of Energy (DOE) oversees the
exploration, development and production of local energy sources and promotion and commercialization
of new and renewable sources of energy to achieve the country’s long-term self-sufficiency objective
while implementing environmental safety and protection measures in all development projects. Further,
on the energy sector’s primordial objective of attaining sustainable, stable, secure, sufficient, accessible
and reasonably-priced energy, the Philippine Energy Plan (PEP) was developed and updated by the
Department of Energy (DOE). The 2004- 2013 PEP Update affirms the energy sector’s commitment to the
macroeconomic goals of the Arroyo administration to promote balanced economic growth, alleviate
poverty and foster a market-based industry.

Programmes and Projects:

A. Providing Adequate Shelter for All : The UNFPA-supported “Population Policy Operations Project
(PPOP)” implemented through the POPCOM. One of the areas identified to ensure operationalization
and synchronization of policies was migration and urbanization. Several activities were undertaken by
the project in relation with migration and urbanization such as the creation of an organizing committee
on urbanization; the mobilization of a sectoral task force on migration and urbanization; the collection of
and analysis of existing policies and studies on migration and urbanization; and the incorporation of
population as a key consideration in land use planning.

Country initiatives focus on two major programmes: unsustainable patterns of production and
consumption and developing national policies and strategies to encourage changes in unsustainable
consumption patters. New concepts on the production of low-cost housing were developed, paving the
way to the development and accreditation of new technologies. Proponents were also encouraged to
undertake research and development of new technologies for housing construction to make housing
more affordable to a larger segment of the society.

The Community Mortgage Program (CMP) may be considered as the most successful government
program for informal settlers in the country. It was established in 1999 and involves the organization of
communities of informal settlers for land acquisition, land development and home improvement. The
CMP and its associated initiatives (Slum Upgrading, Community Land Acquisition Support Program,
Group Land Acquisition and Development (GLAD) and Cooperative Housing) are usually directed toward
the resolution of land acquisition and tenure issues. The National Housing Authority (NHA), local
governments and NGOs act as conduits between the community association or cooperative on the one
hand, and the financing institutions, such as the National Home Mortgage and Finance Corporation
(NHMFC), Home Development Mutual Fund and other government and non-government institutions, on
the other.

The implementation of the CMP at the community level and the ability to offer security of tenure to low-
income families are often cited as the factors that have made CMP successful (ADB, October 2001). CMP
is able to reach the target poor households, although on a limited scale, mainly because of its relatively
small budget. Its subsidized loans made it an affordable program for the poor. For an undeveloped lot,
beneficiaries can avail of a loan of P 30,000 at a highly subsidized interest rate 6.0 percent. For a
developed lot, the maximum loan amount is P 45,000 also at 6.0 percent interest. In both cases, the loan
repayment term is a maximum of 25 years. In the period 1993-1998, CMP accounted for an estimated 60
percent of “completed units of assistance” targeted by the National Shelter Program (NSP). For the
period January 2001-August 2003, CMP benefited 49,635 households with an aggregate amount of P
1.784 billion.

CMP performance indicates its potential for reaching a large number of informal settlers who are in need
of housing assistance. Compared with other Government housing programs, CMP has assisted the
greatest number of families in the shortest period of time with the smallest loan fund utilization. The
average loan amount was P 27,946 per family. The average monthly loan amortization of P 185 makes it
the most affordable program for land acquisition needs of the poor (Table 1)
As of June 2000, the CMP collection efficiency ratio was 73.9 percent. In 2003, CMP collection efficiency
ration averaged 72-80 percent. In terms of collection efficiency, CMP continues to perform better than
the Unified Home Lending Program and other socialized housing programs, including those under the
NHA whose CER averaged only 35 percent.

When President Arroyo launched the Strong Republic Housing Program on July 24, 2003 to refocus the
National Shelter Program and give priority attention to the informal settlers, the CMP has remained as
the main component of the Program. The Strong Republic Housing Program (NSP) aims to provide
shelter security for the poor and vulnerable groups. The Program essentially fast-tracked Presidential
proclamations of idle government lands for socialized housing and established one-stop coordination
centers (i.e. Kaagapay Centers) in proclaimed sites.

B. Improving Human Settlement Management: Philippines launched the Social Reform Agenda
(SRA) on June 4, 1995 to enable people to have access to opportunities for undertaking sustainable
livelihoods espoused under the agenda for change. The SRA is an integrated set of major reforms to
enable the citizens to:

a) meet their basic human needs and live decent lives;

b) widen their share of resources from which they can earn a living or increase the fruits of their labour;
and
c) enable them to effectively participate in the decision-making process that affects their rights,
interests, and welfare.

These reforms are perceived to enhance democratic processes. The SRA is composed of social reform
packages providing programmes and services for marginalized sectors of society in the country’s 20
poorest provinces. The enhancement of the SRA resulted in sharper definition of the social equity,
economic, ecological, and democratizing components of the various flagship programmes. Increased
participation by civil society and major groups has been promoted. To date a total of 34 provinces (43%),
9 cities (13%) and 274 municipalities (18%) have sectoral representatives in such local bodies.

To further institutionalize the Social Reform Agenda (SRA), the Social Reform and Poverty Alleviation Act
was passed in 1997. This created the National Anti-Poverty Commission (NAPC) the lead agency for anti-
poverty policymaking, advocacy and monitoring. The role of the civil society basic sectors, which
included the urban poor with its shelter agenda, was strengthened and mainstreamed.

Under the Arroyo Administration, the Kapit-Bisig Laban sa Kahirapan (Linking Arms Against Poverty
Program) Program was launched as the country’s focused, accelerated, convergent and strategic program
to reduce poverty. In KALAHI, socialized is a major part of the human development services component.

Efforts to converge government and civil society activities to improve human settlements management
saw the establishment of the Philippine Urban Forum (PUF) as a venue aimed at enhancing poverty
alleviation and good urban governance.

The sector has also tapped Official Development Assistance (ODA) sources to support efforts to improve
access to housing and urban development services. The ADB-assisted Development of Poor Urban
Communities Sector Project (DPUCSP) is a $54 million project that provides funds for LGUs outside
Metro Manila for housing finance, urban development, and enterprise development.
To complement government efforts, the private sector and NGO have implemented urban development
related projects such as:

(i) the ADB-assisted Private Sector Partnerships for Urban Poverty Reduction in Metro Manila Project of
the Philippine Business for Social Progress (PBSP); and

(ii) the World Bank-supported Upscaling Urban Poor Community Renewal Scheme Project of the
Partnership of Philippine Support Service Agencies (PHILSSA).

These initiatives are aimed at developing various approaches for on-site community upgrading and
urban renewal.

C. Promoting Sustainable Land-Use Planning and Management: Under the auspices of the DA, the
membership of the Technical Committee on Land Use Matters (TeCLUM) has been expanded to include
other attached agencies of the department. The TeCLUM formulated a mechanism for the improvement
of ongoing review of applications for land conversion. In the Philippines, a National Land Use Act (NLUA)
has been drafted in line with the goal of strengthening the existing process of identifying, determining,
and evaluating alternative land use patterns to guide and enable appropriate land management and
development. The Act was certified as priority environmental legislation and is currently being discussed
in both houses of Congress. In the interim, strategies to implement measures on the rational conversion
of agricultural lands are being developed.

The Philippines, through the Department of Agriculture (DA), implements the Key Production Area (KPA)
Development approach to sustainable agriculture. The KPA approach is premised on the need to
optimize the use of limited land and water to provide for the food requirements of the growing
population and foster “export winners” within the context of equitable and sustainable development. It
encourages farmers and fisherfold to produce specific products suitable to the land, water resources,
and climate of specific areas in the country. The integration of environmental concerns is being
implemented through policies and programmes harnessing appropriate, cost efficient and environment-
friendly strategies and technologies to satisfactorily meet both long-term economic and ecological
needs. The country has adopted an ecological approach to crop cultivation through the following:
Integrated Pest Management (IPM) which was introduced in 1993. The programme, known as
“Kasaganaan Sakahan at Kalikasan” or “KASAKALIKASAN” represents the government’s commitment
towards promoting sustainable agriculture and rural development; Soil conversion and management.
Appropriate land use management systems and soil conservation techniques have been developed to
minimize land degradation, indiscriminate conversion, and consequent deterioration of land productivity.

In 1993, the ARC framework was launched. This is DAR’s contribution to the human settlement
development in the country by improving the land tenure of agrarian reform beneficiaries (ARBs),
providing the support services and build-up capability of ARBs in coordination with other CARP
implementing agencies (CIAs) and the foreign donor community.

Assistance given to ARBs by Foreign Assisted Projects includes physical and non-physical infrastructure
support service designed to lay the foundation for a sustainable growth in the ARCs with focus on the
development of the social and economic well being of the farmers. The FAPS intervention has six
common major components:

1. Physical Infrastructure
2. Community and Institutional Development
3. Agricultural Productivity and Rural Enterprise Development
4. Basic Social Services
5. Gender and Development
6. Land Tenure Improvement

The implementation of these components places the well-being of the ARBs at the center of
development concerns and with these in place, the productive potential of ARBs can be unleashed to
serve not only the interests of the ARCs but the areas adjacent to these communities as well.

In 1997, the Department of Agriculture pursuant to RA 8435, known as Agriculture and Fisheries
Modernization Act of 1997, identified Strategic Agricultural and Fisheries Development Zones (SAFDZs)
to ensure that all sectors of the economy and all regions of the country shall be given optimum
opportunity to develop through the rational and sustainable use of resources peculiar to each area in
order to maximize agricultural productivity, promote efficiency and equity and accelerate the
modernization of the agriculture and fisheries sectors of the country. It also implements programs on
appropriate land use management systems, soil conservation and management to promote rural
development and sustainable agriculture. It has developed soil conservation techniques to minimize land
degradation and consequent deterioration of land productivity.

D. Promoting the Integrated Provision of Environmental Infrastructure: water, sanitation,

drainage and solid waste management: The Housing and Urban Development Coordinating Council
(HUDCC), the lead agency for shelter and urban development concerns, is embarking on a proposed
Urban Shelter and Community Infrastructure Project (USCIP) with World Bank assistance as a Learning
and Innovation Loan. The $5 million USCIP seeks to pilot-test the upgrading and development of
community infrastructures: access road, water, power, sanitation, etc. in unserviced informal settlements
in 5 provinces in the country including Metro Manila.

See also under Freshwater and Sanitation Profiles.

E. Promoting Sustainable Energy and Transport Systems in Human Settlements: The New and
Renewable Energy (NRE) Programme consists of major locally-funded and multilateral assisted projects
and activities and currently supports the 100% barangay (village) electrification and the addition of
about 600MW grid-connected NRE-based power capacity in the medium term. NRE Systems (NRES) total
298 demonstration projects under the Affiliated Non-Conventional Energy Center (ANEC) Programme.
Other demonstration projects also installed include the solar home systems, photovoltaic (PV)
streetlights, PV refrigerators, PV water pumping stations, biogas systems, micro-hydro systems and
windmills for water pumping. The Area-Based Energy Technology (ABET) conducted consultations in the
provinces of Ifugao, Apayao, Abra, Batanes and Biliran to raise awareness of the local people on the
techno-economic viability of NRES. The Malampaya Deep Water Gas-to-Power project achieved a historic
milestone and engineering feat with the completion and tow-out of the 95,000-ton concrete gravity
structure (CGS) from the Subic Bay Freeport to Palawan. Higher production from geothermal facilities
could be attributed to the completion of the Leyte-Luzon interconnection project, commissioning of the
48.25 MW Mindanao II geothermal plant and the stability of existing geothermal facilities in the country.
The commissioning of Bakun I hydro power plant increased the share of hydro in the generation mix. The
Water Inventory Project was conducted in 1995 and involved the identification and assessment of 25
mini-hydro sited in the country.

The Metro Manila Air Quality Improvement Sector Development Program, a loan project funded by the
Asian Development Bank (ADB), with a duration from 1999 to 2002, aims to promote policy reforms to
improve air quality through the abatement of mobile and stationary sources of air pollution. It focuses
on the Metro Manila air shed, the location of the main concentration of air pollution. The program has
the following objectives: Mitigate air pollution from mobile sources; Mitigate air pollution from
stationary sources; Improve fuel quality; Reduce emissions from vehicular use; Reduce traffic congestion
and improve traffic flow; Strengthen ambient air quality monitoring, evaluation and reporting; Intensify
public awareness; Monitor coordination and implementation of Air Quality Action Plan; Strengthen
capacity of institutions involved. Further, government’s efforts in improving air quality through the
abatement of mobile and stationary sources of pollution is stipulated in R.A. 8749 or the “Philippine
Clean Air Act of 1999”.

F. Promoting Human Settlement Planning and Management in Disaster-Prone Areas:

Management of hazards, disasters and risks is also among the areas of concern. The establishment and
operation of centralized waste handling is in progress. This is complemented by the development of
training modules in the field. Other on-going R&D activities include: the development of efficient and
clean technologies to reduce industrial wastes (such as the development of appropriate methods for
water pollution control); utilization of renewable energy sources; strengthening of solid waste
management; and air pollution quality. Private firms are increasingly adopting voluntary environmental
guidelines such as the Philippine Business Charter for Sustainable Development (PBCSD), Responsible
Care Programme or the International Standards Organization ISO 14000, and standards set by the
Department of Environment and Natural Resources (DENR). The local chemical industry, for instance, has
adopted the Responsible Care Programme as a means of minimizing risks and potential adverse effects
associated with their operations. The recent adoption of the programme by the chemical Industries
Association of the Philippines, also known as the “Samahan sa Pilipinas ng mga Industriyang Kimika
(SPIK)”, is a commitment to continually improve their respective companies’ performance regarding
health, safety, and environmental aspects of their operations.

The Core Shelter Assistance Project is one of the interventions under the Disaster Preparedness and
Mitigation Program of the Department of Social Welfare and Development. It aims to provide disaster
victims, especially the poor, with structurally-sound core shelters. It involves, among others, the
formation of work teams of five families per group which will pool their labor and resources for the
construction of their houses.

Project Components:

1. Social Preparation/Community Organization

2. Food for Work
3. Technical Assistance in House Construction
4. Financial/Cash Grant

G. Promoting Sustainable Construction Activities: No information available.

H. Promoting Human Resource Development and Capacity-Building for Human Settlement
Development: No information available.

 Status
The MDG targets significant improvement in the lives of at least 100 million slum dwellers to be achieved
by 2015.

In the Philippines, the present environmental conditions in urban settlements are alarming. It is
characterized by poor quality housing, overcrowding, inadequate access to basic services, insecure
tenure and increased risks to public health. The lack of tenure itself delays connection to municipal
infrastructure services, leading to suppressed property values, underutilized capital assets, poor living
conditions, and high incidence of illness. Data shows that the Philippines is one of the most highly
urbanized countries in the developing world, with an average annual urban growth rate of 5.14 percent
between 1960-1995. Its urban population increased from 8 million in 1960 to 39 million (or 7.5 million
households) in 2000. At present, about 52 percent of the total population live in urban areas. There is an
estimated 1.4 million informal settler households nationwide, which accounts for nearly one-fifth of the
urban population. Hence, improving access to affordable shelter and formal land tenure will enhance
the living conditions in informal settlements and contribute immensely to the goal of poverty
eradication.

Social Reform Act: Two years after the initial implementation, the SRA was expanded to include an
ecosystem perspective, emphasizing four dimensions of poverty where reform can have the greatest
impact: On social equity, by providing the poorest of the poor with access to basic services for survival;
on economic prosperity, by ensuring that the basic sectors have access to productive assets that allow
them to contribute to National growth; on ecological security, by incorporating the parameters of
sustainable development in the management and utilization of natural resources; and on responsible
and responsive governance, by making structures and processes democratic to allow the meaningful
participation of key stakeholders in policy and decision-making. The National Anti-Poverty Summit drew-
up poverty reduction targets at the regional level to achieve a national target of 30% by 1998. It also
resolved to expand the coverage of the SRA from an initial concentration on 20 priority provinces to an
additional 57 provinces and 65 cities.

Shelter: The improved overall performance of the shelter sector is characterized by the following: a)
increased access by the poor to land, finance, infrastructures, and building materials; b) strengthened
capability of local authorities for improved management; c) regularized and upgraded slums and squatter
settlements; d) improved rural living conditions; and e) private sector involvement in shelter and service
production for the middle and lower income groups.

Energy: In terms of the power generation mix, the share of indigenous energy showed an increasing
trend primarily due to the higher share of geothermal energy (25% in 2000 from 21% in 1998). The share
of geothermal energy rose from 8,914 gigawatt-hours (GWh) in 1998 to 11,445 GWh in 2000. Hydro’s
contribution also increased from 5,066 GWh in 1998 to 7,152 GWh in 2000. As a result, the share of
indigenous energy to the total generation mix expanded from 38.9 percent in 1998 to 46.9 percent in
2000. New and Renewable Energy Systems (NRES) contributed 30% to the country’s energy
consumption. As exploration and development works progress in the Malampaya gas-to-power project,
the DOE assessed more natural gas supply and demand prospects.

 Capacity Building, Education, Training and Awareness-Raising

The recently completed USAID-funded “Philippine Renewable Energy project” introduced and conducted
appreciation trainings on the software HOMER and VIPOR which are basically simulation models for the
conduct of NRE-based village electrification projects. The ADB-ADTA Project also involves the conduct of
trainings for key stakeholders on rural electrification and NRE in aspects such as NRE technologies,
project management, policy development, sustainable development, community organizing and NRE
system repair and maintenance.

 Information
The PNOC/Winrock/US NRE Laboratory (NREL) activity developed the Philippine Wind Atlas useful in
developing wind projects. Similar activities under USAIDS’s PREP, implemented by NREL, have developed
a database on solar, biomass and micro-hydro resources. The planned UNDP-GEF Project shall establish
the Market Service Center that will manage all available NRE information in the country and to provide
support to private entities in developing NRE Projects. From 1992-2000, the combined savings of the
Don Emilio Abello awardees have reached PhP3.48B. The award is given to outstanding companies and
energy managers who have undertaken or are responsible in implementing energy efficiency and
conservation programs to achieve substantial savings in their energy consumption. Also, the DOE has
two major campaigns in energy efficiency: the Power Conservation and Demand Management (Power
Patrol) and the Fuel Conservation and Efficiency in Road Transport (Road Transport Patrol).

POPCOM developed the framework for the National Population Database Information System (NPDIS),
which forms part of the POPCOM Information System. The NPDIS will track down and monitor the
progress of its demographic and socio-economic indicators of the International Conference and
Population and Development (ICPD); policy, program and project implementation including the
accounting of population program expenditures and analysis of these data and information to
recommend appropriate policy and program reforms.

The Department of Energy on the other hand has the following information systems initiatives:

1. Renewable Energy
 a. Geothermal: Geoscientific investigation continued in the different parts of the country. A
collaborative undertaking with the Department of Tourism (DOT) and the Philippine Institute of
Traditional and Alternative Health Care (PITAHC), a subsidiary of the Department of Health
(DOH), for a project on Health Tourism was initiated in 2001. The project provides an
opportunity for the promotion of geothermal resources for spa resort development. Initial
results of the evaluation shortlisted prospects in mainland Palawan, Coron, Pangasinan and
Batangas as promising sites. In addition, the promotion of the geothermal potential of the
country is likely with the success of the Regional Geothermal Database Compilation Project of
the Coordinating Committee on Coastal and Offshore Geoscience (CCOP) in East and Southeast
Asia.

To further promote geothermal energy development, a geothermal bid round is likewise

envisioned for the sector. The geothermal bid round, just like the PCR-1, is a competitive public
contracting system which intends to improve and streamline the procedural requirements for
service contract applications and in the process encourage investors to look into geothermal
exploration and development in the Philippines.

b. Hydropower: For the promotion of hydropower projects, several activities were undertaken
including the conduct of feasibility studies on the 29-MW Timbaban hydropower project in Aklan
(Panay) and the 18-MW Catuiran hydropower project in Mindoro. On the other hand, the
development of this resource in the countryside was given impetus with the assistance of the
Japan International Cooperation Agency’s (JICA) contribution of two micro-hydropower projects
in Kalinga. The identification of 40 potential micro-hydropower sites in Northern Luzon was also
funded by JICA.

c. Biomass, Solar and Wind: The National Renewable Energy Laboratory (NREL) of the US
Department of Energy conducted an assessment study on the Philippines’ biomass, solar and
wind resource potential. The NREL study presents the biomass, solar and wind resource analysis
and mapping results for the Philippines. The maps identifying these resources were created
using a Geographic Information System (GIS) – based program developed by NREL. The mapping
program, which combines high-resolution terrain data and formatted meteorological data, is
designed to highlight areas possessing a favorable resource where specific energy projects are
likely to be feasible. The entire Philippines archipelago was mapped as part of this study. This is
the first detailed national-scale energy resource atlas for a developing country, and one of the
first in the world.

2. Fossil Fuels

a. Oil and Gas: In March 2002, the DOE completed the PhilPRA Project Study with the assistance of
the Norwegian Agency for Development Cooperation (NORAD). The study produced an updated
map of the 16 sedimentary basins in the country and established an inventory of the country’s
petroleum resources – oil, natural gas and condensate – totaling about 9.0 trillion BFOE.
As a result of this study, two Geophysical Survey Exploration Contracts (GSECs) were awarded in
the middle of the year, namely GSEC 101 to UK-based Sterling Energy Ltd. Partnership in June
2002, and GSEC 102 to Japan Petroleum Exploration Co. Ltd., Company (JAPEX) in July.
 The Philippine Petroleum Exploration Investment Promotion (PhilPRO) constitutes the second
phase of the PhilPRA project. The PhilPRO involves the promotion through international road
shows of the PhilPRA results to interested foreign oil companies for possible investments.
Among the results of the PhilPRA project are various technical maps that will aid investors in
selecting areas for investments.

The DOE has likewise continuously improving and updating its website (www.doe.gov.ph) to keep the
various energy publics updated on the sectoral developments and project implementation status. The
DOE website has links to its attached agencies, namely: the Philippine National Oil Company (PNOC) and
subsidiaries, the National Power Corporation – Strategic Power Utilities Group (NPC-SPUG), National
Electrification Administration (NEA), Energy Regulatory Commission (ERC), Power Sector Assets and
Liabilities Management Corporation (PSALM), and the National Transmission Company (TRANSCO) for
specific details and project development.

 Research and Technologies

Aggressive research and exploration initiatives were undertaken to harness the country’s indigenous
resources. Developing indigenous and renewable energy sources for energy self-sufficiency is a
continuing task in the energy sector. Data from the Philippine Atmospheric, Geophysical and
Astronomical Organization (PAGASA) showed that the national average mean wind power density is
about 31 watts per square meter (W/m2). A wind resource analysis and mapping study showed that the
country has over 10,000 square km of windy land areas with good to excellent wind resource for utility-
scale operations and village power applications, particularly in the northern and central regions. A pilot
project entitled “Study on Natural Gas Utilization in Transport” looks into the use of natural gas as an
alternative fuel to diesel for the transport sector. Jointly conducted by the DOE, Department of Science
and Technology (DOST), and PNOC, the project has successfully converted an Isuzu diesel vehicle to use
compressed natural gas (CNG) for fuel. The country’s first CNG station was commissioned last March
2000 in PNOC-EC’s gas power plant compound in Echague, Isabela. The government, through DOE,
continues to finance the implementation and strengthening of UP Solar Laboratory and the UPLB
Biomass Laboratory to further enhance the capacity of NRE sector in NRE system local manufacturing
and fabrication through conduct of performance testing and evaluation. The proposed UNDP-GEF Full
Project shall also assist the private enterprises in manufacturing and packaging NRE products and
systems.

 Financing
The energy sector offers a wide array of investment opportunities for private sector participation. For the
2004 Plan Update, investment requirement for the implementation of various energy programs and
projects over the ten-year planning period is estimated at Php 1.4 trillion.

 Cooperation
GOP, through DOE, undertakes various bilateral and multilateral cooperation activities in the field of NRE.
Ongoing cooperation includes agreement with government of UK, India and Hawaii which focus on NRE
promotion and technology transfer. DOE is also an active participant to NRE TWG of ASEAN and APEC.
Technical Cooperation/Assistance Programs on mini and micro-hydropower development were secured
from the PG-SEP, UNDP, and JICA Program. The DOE implements energy conservation and efficiency
projects such as conduct of workshops and research with the New Energy and Industrial Technology
Development Organization (NEDO), US Department of Business, Economic Development and Tourism,
and the U.S. Asia Environmental Partnership Program (USAEP).

Further, the DOE actively participated in various international cooperation activities aimed at sharing of
knowledge and experiences as well as transfer of technologies. The areas of cooperation include energy
security, energy pricing and energy sector reforms, among others, to wit:

 APEC Energy Cooperation

APEC Energy Cooperation is a collaboration of the 21 member economies comprising the Asia Pacific
Economic Cooperation (APEC) which is primarily consisted of two (2) major undertakings, namely the
APEC Energy Minister’s Meeting (EMM) and the APEC Energy Working Group (EWG). The APEC-EMM
provides political guidance and momentum for the APEC EWG in the implementation of measures
consistent with the goals set by the APEC Leaders. On the other hand, APEC EWG is a voluntary,
consensus-based regional fora, established in recognition that energy is an essential input to economic
activity and a major component of international trade.

 ASEAN Energy Cooperation

ASEAN Energy Cooperation is comprised of 10 ASEAN countries which aim to strengthen the region’s
capability in addressing global and regional issues on energy by enhancing the coordination of energy
strategies of the member countries. This initiative is guided by the Governing Council composed of the
Senior Officials on energy of the ASEAN countries and a representative from ASEAN secretariat.

 Asia Cooperation Dialogue

Asia Cooperation Dialogue (ACD) is initiated by Thailand which officially took off during the inaugural
ACD Foreign Ministers Retreat in Cham-am, Thailand in June 2002. It is composed of 17 member
countries with the following objectives:

(i) to provide a non-institutionalized arrangement for the exchange of ideas and experiences intend to
create synergy among bilateral, multilateral, sub-regional and regional strategic partnerships in areas of
common interest;

(ii) to improve national and regional capabilities to make Asia a strong partner for other regions; and

(iii) to serve as a forum for Asian countries to exchange views on international trend and development.
1. Urbanization as catalyst for inclusive growth
• Urbanization must drive and influence the creation of and transformation towards culturally,
socially, economically, and politically inclusive development.
• Citizenship and equal rights for all inhabitants whether permanent or transient, with added
focus on the right to housing and urban services; this includes women, those living in poverty or
situations of environmental risk, informal economy workers, ethnic and religious groups, LGBT
persons, differently abled persons, children, youth, elderly, migrants, and refugees

2. Climate change resilience as a base for spatial structuring and sectoral development
• Resilience as the ability of a locality and its citizens to withstand impacts and shocks, and to
rebuild, reorganize, or transform itself when necessary
• Resilience as the foundation in planning and decision-making for spaces (neighborhoods,
settlements, development areas, cities, municipalities, provinces, regions) and for addressing
sectoral and/ or cross-sectoral challenges (environment, social, economic, infrastructure,
institutional, including cultural practices or expression)

3. Spatially and thematically integrated settlements within coherent and efficient urban systems and
forms across scales
• Urban design that aids in the integration and efficient function of urban elements and ensures
social and economic inclusion
• Efficient urban planning and design should be considered across scales from the smallest to the
largest unit or element
• Physically, spatially, functionally connected and accessible systems

4. Urban areas as accessible platforms for social and economic opportunity, cultural expression, and
innovation
• Spaces for all inhabitants, with mechanisms that promote and facilitate activity and interaction
• Spaces that allow for shelter, decent work and secure livelihoods, formal and informal
economic activities
• Spaces that promote identity and pride of place and support tangible and intangible cultural
assets and creative practices and expressions
• Spaces that support and facilitate new technologies, organization models, and social,
economic, and physical facilities

5. People’s participation and empowerment as foundations of urban governance, facilitating sustainable

resource use, planning, management, and finance
• Equal and substantive participation of all stakeholders in the critique, implementation, and
monitoring of urban development policies, legislation, and actions
• Involvement of marginalized sectors in decision-making for programmes that affect their
quality of life, enabling socially responsible private sector participation and responsibility
• Support for the development of human capacity, promote integrated governance and capacity
building for government staff, and promote deliberative urban processes • Embedded
participatory and sustainable urban development processes, structures, and mechanisms

6. Sustainable urban environment

• Protects ecosystems and urban biodiversity
• Promotes efficient, affordable, and clean energy
• Promotes sustainable use of air, water, land, and resources in urban development
 • Promotes responsible production and consumption these key framework principles are
interpreted and expressed in more specific terms as thematic strategies. Together, they are
intended to realize the vision for sustainable urban development in the Philippines

Urban Planning and Design

a. Fully operationalize ridge-to-reef and/or integrated ecosystems planning. The “ridgeto-reef or

integrated ecosystems planning framework” was adopted by the HLURB for the Comprehensive Land Use
Plan (CLUP) Guidebooks 2013–2014, which utilizes system-based tools such as the ecological transect
and other tools.

b. Strengthen the mainstreaming of disaster risk reduction and management (DRRM) planning and
climate change adaptation/ mitigation (CCAM) planning with spatial and sectoral development planning.
The mainstreaming of DRRM and CCAM in the CLUP and Comprehensive Development Plan (CDP) need
to be ensured. Areas for improvement, harmonization, and rationalization, where possible, must also be
identified. This includes streamlining and harmonizing processes on CCAMDRR and capacity building for
planning offices, professionalization, and ethical accountability in the planning process and
documentation.

c. Design barangays and neighborhoods in terms of human scale and walkability. The NUDHF proposes a
return to human-scaled proportions and to design barangays in terms of human scale and walkability,
with the necessary infrastructure and services within walking distance of residents. This may be
incorporated in the local development planning process following the CLUP Guidebook, specifically
under the Special Studies on Urban Design and Development.

d. Promote adequate networks of public open spaces. The NUDHF prioritizes the identification and
protection of open spaces as a first step in designing urban areas, with built-up spaces planned around
and in consideration of this network. LGUs must establish the primacy and connectivity of public spaces,
and provide resources for their development. This also includes locating and establishing public buildings
in strategic areas, and designing public spaces in a way that supports disaster risk reduction and climate
change action (e.g., escape routes and evacuation plans).

e. Consider the water cycle in urban planning and design. The water cycle should be considered as a key
element at all levels of planning and design. Plans must support watershed improvement. Subsequently,
they must include, where possible, the development of alternative water sources other than
groundwater. In line with this, the collection of rainwater and the recycling of domestic water for
domestic use must be considered. Cities and municipalities must ensure adequate water domestic
supply without encroaching on the recharge areas of adjacent areas. Land developments must be
reviewed to ensure adequate water supply both for the development and adjacent communities.

f. Promote compact development. Compact development entails the promotion of efficient densities at
all scales of urban planning, which maintains the balance between urban demand and available
resources. Areas with efficient densities tend to cut back the cost of public services such as police and
emergency response, infrastructure maintenance, school transport, water, and sewage. This will
promote the holistic management of the urban area and reduce urban sprawl.
g. Promote mixed use. Following the principle of spatial and sectoral integration within coherent and
efficient urban systems, local government and development partners are urged to plan areas for mixed
uses and minimize highly specialized land zoning where possible. Mixing land uses allows for the
integration of complementing activities, and also supports compact development. Land use
specialization to limit single function blocks or neighborhoods is discouraged.

h. Promote social mix. Urban design at the local level should maximize the use of spaces to promote
social equality and spatial justice. Urban spaces, including buildings and residential areas, should
espouse social integration and diversity of social as well as income groups. Diversity strategies the
framework BY2050 56% WILL BE LIVING IN URBAN AREAS 75% OF THE COUNTRY'S ECONOMIC OUTPUT
ATTRIBUTED TO URBAN AREAS INFORMAL SETTLER FAMILIES NATIONWIDE 1.4 m AVERAGE ANNUAL
HOUSING NEED OF 926,077 NATIONAL URBAN DEVELOPMENT AND HOUSING FRAMEWORK 2017–2022
11 and social inclusion should be encouraged consciously by local authorities and planners especially in
designing public spaces, including streets, markets, schools and universities, parks and plazas, beaches
and waterfront zones

i. Integrate mobility and transport planning in land use planning. The NUDHF advocates the shift from
car-oriented to people-oriented mobility. A new hierarchy of transportation and mobility is introduced,
prioritizing pedestrians first, then non-motorized vehicles such as bicycles, followed by public transport,
commercial vehicles, taxis, and single occupancy vehicles.

j. Optimize use of existing spaces and structures in the built-up area through adaptive reuse, urban
redevelopment, and urban infill. To ensure the preservation of these heritage areas, the NUDHF adopts
the more sustainable policy of adaptive reuse for existing structures, urban infill, or the use of vacant
lands or underutilized property for urban revitalization rather than city extension or land reclamation.

k.Control urban sprawl by promoting planned urban expansion. Compact, mixed use development can
be complemented and made more effective by promoting planned urban expansion. Anticipating urban
growth, setting boundaries to existing areas, and providing for rational expansion in selected areas will
control urban sprawl and manage urban resources better. It will also aid in food security, maintenance of
protected areas, and the integration and linkage cities and municipalities in a coherent manner.

l. Extend capacity development programmes and projects to integrate the reduction of GHG emissions at
the local planning level: CLUP, CDP, and LCCAP. Urban planning and design must integrate low emission
development principles and strategies. Building national and local planners' capacity to understand GHG
mitigation options along with the adaptation elements of urban plans and designs is now more essential
to ensure that people will indeed live in economically, socially, and environmentally sustainable
communities.
Housing

a. Develop inclusive, integrated housing. Housing development should be culturally sensitive and must
adhere to appropriate standards and design. It should pay special attention to the needs of those in
vulnerable situations, including indigenous peoples (IPs), persons with disabilities (PWDs), the elderly,
informal settler families (ISFs), internally displaced populations from disaster-stricken or internal-conflict
areas, women, and children. Mixedincome housing is encouraged to promote inclusive communities.

b. Operationalize the National Informal Settlements Upgrading Strategy. The NUDHF recognizes the value
of providing security of tenure for urban settlers, both formal and informal. As policy reforms move
toward improving land management and land valuation, rights-based instruments (RBIs) or other forms
of secure tenure instruments— such as usufruct, other lease variants, and right to occupy or build—are
now recognized as secure tenure instruments and collateral substitutes. RBIs offer a less costly approach
to providing secure tenure to segments of society unable to secure freehold titles, particularly the urban
poor.

c. Improve affordability of housing programmes and projects. Government must seek to improve,
enhance, expand, and sustain financing programmes for government housing projects, especially those
that focus on community-based strategies the framework ©UN-Habitat/Yen Flores NATIONAL URBAN
DEVELOPMENT AND HOUSING FRAMEWORK 2017–2022 13 housing and self-help such as the
Community Mortgage Programme. More importantly, improving affordability through housing finance
must be coupled with initiatives to increase families’ capacity to pay. This means fully integrating
sustainable livelihood and employment into the housing process, and looking at economic development
as a function of shelter delivery. Operationally, this translates to the implementation of an integrated
housing strategy requiring the collaboration of shelter, economic, and social welfare agencies beyond
their current or traditional mandates.

d. Promote resilient housing. The framework promotes the development of climate resilient, affordable
housing. This can be achieved through the adoption of appropriate housing standards or building codes,
technologies, and innovations, incorporating conditions for resilience and resource efficiency. These new
standards and technologies must be in accordance with the thrust toward affordability and social equity.
For instance, retrofitting of existing housing structures based on climate change vulnerability and
disaster risk can be explored, addressing the conditions of resilience, affordability, and rights-based
housing.

e. Enforce the balanced housing provision of the UDHA. Rep. Act No. 10884, which amends the UDHA,
requires owners and developers of proposed subdivision and condominium projects to develop an area
for socialized housing equivalent to at least 15% of the total subdivision area or total subdivision project
cost and at least 5% of the condominium area or project cost. Significant in this amendment is the
inclusion of vertical housing developments in socialized housing compliance. It must be noted that these
are minimum requirements, and developers may opt to increase the percentages.

f. Update appropriate housing unit size requirements based on local context. Local governments and
developers are encouraged to further assess the needs of end users with regard to their space
requirements, without income discrimination and considering various factors such as location, culture,
economic linkages, and livelihood opportunities, among others. People-centered planning processes can
address this gap, and allow stakeholders to determine appropriate unit sizes.
g. Make land available and accessible for housing. There are several ways to increase the supply and
reduce the cost of urban land, strategies the framework Republic Act No. 10884 requires owners and
developers of proposed subdivision and condominium projects to develop an area for socialized housing
equivalent to at least 15% of the total subdivision area or total subdivision project cost and at least 5% of
the condominium area or project cost. 14 thereby addressing physical and artificial shortage of land for
development:
• Unlocking unused or underused government-owned land
• Land pooling/readjustment
• Land banking
• Land cost adjustment for affordable housing
• Reducing land speculation through fiscal measures
• Making land information accessible to the land market

h.Promote local shelter planning to encourage broad-based participation and ensure implementation of
housing and land strategies. Citizen participation and localized capacity serve as foundations for effective
and efficient shelter provision. Empowering communities also increases accountability and transparency
in the implementation and monitoring of housing strategies. Local shelter planning enables LGUs to
determine housing needs, conduct inventory of resources, identify priority housing programmes and
projects, and initiate needed partnerships for housing projects.

Urban Infrastructure and Basic Services

Water and Sanitation

a. Streamline policies and improve the regulatory framework to ensure sustainable water security in
urban areas. Water and sanitation infrastructure must be harmonized with legislation, policies, and
organizational development plans. Simplifying the regulatory framework from the approval of water and
sanitation plans to maintenance will enable proponents to protect, explore, develop, and expand water
and sanitation services for the larger urban system. Implement programmes and initiatives on watershed
protection

b. Promote and support innovative water and sanitation technologies. Cost-efficient, alternative
technologies in water and sanitation, including water recycling should be supported. This entails
investment in research, prototyping and fully developing technologies, especially localized solutions

c. Support financing for climate and disaster resilient water and sanitation infrastructure. Mobilizing
resources, including those from the private sector, would allow government flexibility in developing and
implementing high capital outlay infrastructure projects. Replicating and improving on the successes of
privately managed water utilities will further strengthen resilience of urban water infrastructure.

d. Strengthen local government capacity on water and sanitation governance. Capacity building
programmes should be in place for national, regional, and local water and sanitation personnel in critical
areas like strategies the framework coordination with national government agencies (NGAs) and other
government entities, planning, project development, decision-making, budgeting, and private sector
engagement.
Public Health

Mainstreaming of health impact assessments (HIAs). Energy infrastructure projects should mainstream
HIAs to supplement environmental impact assessments. This provides additional information for
resilience-building, including climate change vulnerability and disaster risk assessments, renewable
energy programming, and planning and urban design in consideration of public health targets.

Energy (Sustainable/Renewable)

a. Streamline procedures for the development of renewable energy projects, to improve ease of doing
business. This would entail reducing requirements and processing times, revisiting investment and
business application procedures, and making adjustments to ease start-up and operations cost, thereby
boosting the number of domestic and foreign investments in the sector.

b. Increase energy sourcing from low carbon and other clean energy technologies. Government must
adopt measures that promote better energy mix, thereby increasing energy sourcing from low-carbon
and other clean energy technologies. Identifying and mapping renewable energy resources becomes a
key technical concern for LGUs. With technical support, local governments can pursue proper
identification of land use and other requirements for renewable energy investments.

c. Promote energy efficiency. LGUs can also adopt measures that promote more efficient energy
consumption, for instance in work areas, public buildings, and settlement sites. Energy efficiency should
be considered in settlements planning, building design and construction, and transportation

d. Explore and implement technology research and funding mechanisms that support small-scale
renewable energy projects. It is necessary to develop appropriate technology and financing in support of
renewable energy for use of micro- and small and medium-sized enterprises, cooperatives, as well as
housing and settlements development. This will help reduce the demand for fossil fuel and empower
communities to produce, supply, and manage renewable energy. Encourage development of alternative
domestic power sources to augment existing supply sourced from the grid

Drainage

a. Comprehensive mapping of natural waterways, drainage and sewerage systems, including waterways
that have been built over. Mapping natural waterways would assist planners in identifying blue and
green spaces for land use planning, and urban renewal and systems upgrading programmes.

b.Improve public investment in infrastructure for drainage networks, sewerage systems, and water
treatment plants, taking into consideration sound analysis on population growth and infrastructure
demand, climate change, and disaster risk. Ensure sustainable financial investment by designing and
implementing long-term drainage infrastructure projects.

c. Ensure use of local climate change projections and disaster risks in designing drainage networks and
related infrastructure
Waste Management

a. Encourage community-based waste management programmes. As successful waste management is

about influencing human behavior to respect rules and to protect the environment and the community’s
welfare, local governments will benefit most from community-based solid waste management
programmes in accordance with applicable legislation and policies. This could also involve providing
incentives to community stakeholders in using material recovery facilities, or limiting garbage volume at
source. This is possible through advocacy and education. Cities should also explore and develop
composting and vermiculture as waste byproducts, which can be used for urban agriculture.

b. Adopt modern technology and systems in monitoring solid waste management programmes.
Government must welcome the use of better technology to make waste management more efficient, for
instance in monitoring of waste disposal activity, scheduling, and volume tracking. Cities are also
encouraged to invest in alternative green filtration systems, natural filters to cleanse waterways, which
can be part of the spatial strategy and urban design, as in the case of endemic grass-wetland species
used for grey wastewater treatment systems in riverfront development. This also complements resilience
measures and raises public appreciation for better and more appropriate infrastructure systems.

c. Develop inter-LGU coordinated waste management plans for efficient regional mobilization of
resources. Metropolitanization and similar aggrupations can act as catalysts in maximizing resources for
public infrastructure and services, particularly in urban waste management. Coordinated site planning
for sanitary landfills is cost-efficient and effective given land constraints in urban areas.

Information and Communications Technology

a.Open up Investments in ICT. The NUDHF recommends a review of competition laws to open up
investments in the telecommunications sector and allow more service providers. This will address
constraints arising from the current duopoly set-up, which has hindered the entry of alternative service
providers.

b.Establish a national broadband network infrastructure. A national broadband network infrastructure

will enhance public access to state services and global information that is free and open. It will help
provide access to areas that have not yet been penetrated. Internet access will no longer be a luxury for
the few, but a basic right of citizens. It will also encourage greater community participation through
communication and connectivity

c. Ensure access to government-owned data, including geospatial data, in order to improve planning and
ensure transparency and accountability in government services.
Urbanization presents a great opportunity for economic growth and poverty reduction in the
country.

In the Philippines Urbanization Review: Fostering Competitive, Sustainable and Inclusive Cities, the
World Bank and the Government of the Philippines analyze three challenges that need to be addressed if
the country is to reap the benefits of urbanization:

 Density. The growing population is not matched by key infrastructure investments.

 Distance. Connectivity issues increase transportation cost and impede labor mobility.
 Division. Limited access to basic services and economic opportunities especially among informal
settlers.
The review proposes a two-pronged approach to building competitive, sustainable and inclusive cities:

 In Metro Manila: address critical issues such as congestion, flooding, and slums.
 In secondary cities: balance spatial development, increase productivity, and create jobs.
The review presents key recommendations in four priority areas:

1. City competitiveness

 simplify tax regime and business regulations

 address infrastructure gridlock
 improve access to global markets
 strengthen economic local governance
 strengthen innovation and address skills mismatch

2. Inclusive urbanization

 Help the urban poor access formal jobs

 expand formal sector employment through reinvigoration of manufacturing sector
 close the gap in affordable housing and basic service delivery
 empower communities and involve them in development process
 strengthen institutions that underpin affordable housing especially the local governments

3. Urban governance and institutions

 adopt a national urban policy

 establish a lead agency for urban development
 strengthen institutions and metropolitan governance
 strengthen accountability through fiscal decentralization

4. Land administration and management

 Address growing informal settlements

 streamline institutional arrangements for land services
 develop integrated land information system
 develop a metro-wide physical planning framework
 improve property taxation and valuation
 Land Use Policy Guidelines the Land Use Policy Guidelines form the core of the NFPP. It covers the
four major land use components of Settlements development, Production Land Use, Protection Land
Use, and Infrastructure Development. As presented, each component includes discussions on the
current situation, physical planning issues and concerns, and policy options/guidelines.

Settlements Development

Settlements are areas where concentrations of population engage in economic, political, cultural, and
other social activities. They vary from small, agriculture-based villages to metropolitan urban centers
that accommodate millions of people and serve as industrial, market, and administrative centers. For the
most part, the type and scale of activities as well as the conditions of the physical environment where
these take place directly reflect the quality of life of a settlement’s population.

Settlements Development focuses on the spatial distribution of shelter, infrastructure and networks, and
services. It is also concerned with the interrelationships of settlements as they develop and establish
functional linkages based on their respective resource endowments and comparative advantages. The
primary concerns of Settlements Development are to help ensure, for the present and future
generations of Filipinos:

(a) an effective integration of activities within and among settlements, allowing efficient production
and movement of people and commodities through the provision of appropriate land, infrastructure,
and facilities; and
(b) the access of the population to housing, education, health care, recreation, transportation and
communication, sanitation, and basic utilities such as water, power, waste disposal and other
services.

The major issues/concerns and the corresponding policy guidelines in planning for settlements
development are the following:

PLANNING WITHIN THE CONTEXT OF A NATIONAL NETWORKOF SETTLEMENT.

The shift from the previous national policy of defining a role-specific hierarchy of settlement to one that
encourages local development initiatives in development planning increases the need for local planners
to make strategic decisions that involve regional or national considerations. Some of the basic policy
guidelines that need to be considered are the following:

(a) Formulate individual town or city plans within the context of a national hierarchical network
of settlements where there will always be differences in the level and scale of activities. Despite
such differences, however, opportunities for economic growth and improving the delivery of
services and the overall quality of life relative to other settlements can be locally initiated;

(b) Guide the formulation of physical plans by the close relationships between local economic
growth and production efficiency, market access, and the provision of basic services; and

(c) Establish and maintain external linkages to increase interand intra-regional integration that
leads to improvements in local production and market access.
SPATIAL DISTRIBUTIONS AND PLANNING FOR FUTURE POPULATION GROWTH.

Given demographic growth trends, virtually all settlements will experience a continuing growth of its
population. The selection of spatial strategies to accommodate future growth, however, lacks
consideration for the specific economic and environmental characteristics of the area concerned. Thus,
physical plans become unrealistic and difficult to implement. Four policy options or planning approaches
that may be utilized by planners depending on corresponding environmental and economic conditions
that coincide with the local situation are:

(a) redevelopment/renewal;
(b) growth of other towns/cities;
(c) urban expansion/metropolitan growth; and
(d) new town/city development.

INFRASTRUCTURE AND BASIC SERVICES.

There is currently a wide gap between the provision of infrastructure and basic services and the demand
of the existing population. Faced with such reality, it is essential to adopt a more strategic approach to
planning for the land and infrastructure requirements of basic services. This means maximizing the
benefits of investments in these requirements in terms of: (a) the number of people served; (b) the
extent to which they promote and support regional and local physical framework plans; and (c) the
opportunities for private sector participation.

HOUSING AND INFORMAL SETTLEMENTS.

Rapid urbanization, low income levels and lack of areas allocated for affordable residential developments
have led to the proliferation of unplanned, informal and overcrowded settlements. This may be
addressed, in part, by increasing the supply of land, particularly to those in need of affordable housing,
through

(a) direct allocation,

(b) improving infrastructure to access unutilized land,
(c) encouraging mixed use and higher density developments in selected areas, and
(d) improving services and infrastructure support to existing residential areas. In addition,
physical plans should identify disaster-prone and other environmentally-critical areas and define
appropriate residential development limits and specifications to reduce safety risks.

ENVIRONMENTAL IMPACTS.

The growth and development of settlements have adverse impacts on the physical environment. Given
current urbanization trends, and as recent studies have shown, developing countries such as Philippines
may expect or are already experiencing a shift in the type of environmental problems that need the most
attention. Physical planners need to be aware and prepared to deal with this shift, which is from natural
resource-based type of problems to those dealing primarily with urbanization and industrialization –
industrial pollution, vehicular emissions, encroachment into disasterprone areas, sanitation and health
problems caused by the lack of water supply, sewerage, and waste disposal services, and even erosion of
cultural/historical resources. These may be reduced or mitigated by

(a) delineating land available for or restricted from settlement expansion,

(b) identification and management of environmentally critical areas,
(c) matching of land uses and densities with environmental and service infrastructure capacities,
and
(d) encouraging appropriately planned mixed use developments, transit use, pedestrianization,
and cultural/ historical preservation in large urban centers.

FOOD SECURITY AND LAND CONVERSION.

Settlement planning can assist in the attainment of the food security objective by helping protect key
agricultural production sites; enhancing productivity; and improving the efficiency of the distribution
network

Infrastructure Development

The role of infrastructure in national development is to provide the built-up environment that allows
production, consumption, and service activities to take place. Infrastructure is the physical entity that
enables economic processes, supports and guides urban and rural development, integrates the various
communities of the archipelago into the Philippine nation, and links the country to the global
community. In this manner, the state of infrastructure, including the way it enhances and complements
the natural environment, provides a physical measure of national and local development and, ultimately,
of the quality of life.

Infrastructure is the common, physical link among the production, protection, and the settlements
components of the NFPP.

Infrastructure development in the NFPP covers five subsectors: transportation, communications, energy,
water resources, and social infrastructure. Its basic concerns are the provision of basic services, fostering
economic and other forms of integration necessary for producing or obtaining the material requirements
of Filipinos, and the development of an efficient, responsive, safe, and ecologically friendly built
environment. The major planning concerns and corresponding policy guidelines in infrastructure
development are:

STRATEGIC ROLE OF INFRASTRUCTURE:

(a) Prioritize and implement infrastructure projects that support the policy of national
dispersal through regional concentration;

(b) Promote inter-modal transportation systems, taking into account compatibility,

economic feasibility, comparative advantage and linkages of desired transportation
modes to facilitate smooth transfer of people and goods between designated transfer
points;
 (c) Prioritize and implement infrastructure projects that allow increased access to basic
social and other development services while catering to the productive sectors and
market-based industry putting the entire population into the mainstream of sustainable
development;

(d) Ensure compatibility of infrastructure with local land use and development plans,
giving priority to projects with the most strategic impacts; and

(e) Protect infrastructure right-of-way.

URBAN FORMS AND SETTLEMENT PATTERNS

The Philippines needs a new way of developing its towns and cities to make them more
sustainable. Introducing an alternative to the current practice of planning new communities and
redeveloping old inner-city areas is the first step in the chain of actions that will give practical expression
to our needs and aspirations, and guide future urban development in the Philippines. The underlying
goal of this alternative is to create communities that are more sustainable and function better as places
to live and work.

Philippine towns and cities face serious issues. Foremost are the worsening problems of poverty
and environmental degradation. These include: the high cost of providing services and facilities in
answer to continued rapid population growth and urban expansion; the need for greater housing
affordability; concerns about safety and security; a desire for greater social, economic and
environmental sustainability; the need for more locally based jobs; and the need to provide public
transport more efficiently. There is an increasing interest in improving the planning and development of
our towns and cities in order to respond to these issues.

Community design crucially affects the performance of towns and cities in achieving the
objectives of sustainability and a better quality of life. The design and layout of a community are
fundamental determinants of urban form and settlement patterns because they:

• set the urban character and design of an area;

• allow or inhibit social interaction and thereby influences the likelihood of community
formation;
• force motor vehicle dependence or reduces it by encouraging the non-motor vehicle
modes of walking, cycling, and public transport;
• give or deny access to facilities for all users of the urban environment;
• provide or prevent opportunities for locally based business and employment; and,
• conserve or degrade essential natural resources and ecological systems.

Objectives of Sustainable Urban Form

The challenge of sustainable development is to create an environment that not only suits our
present needs but has also the best chance of meeting our needs in the future. It must support social,
economic, environmental, and cultural prosperity, while remaining sensitive to local environmental
features, balancing our needs for social interaction, jobs, housing, transportation, recreation, and sense
of belonging.
As our needs and aspirations evolve and as conditions change, we need to facilitate the creation
of more sustainable and high quality new urban forms both at the fringes of our growing cities (which
are absorbing much of urban growth) and the revitalization and redevelopment of our deteriorating
inner city areas. We urgently need a model for urban development that is reflective of Filipinos'
economic and social needs, and is specifically suited to our unique environment. This model should
serve as a guide for the creation of new environments that are responsive to our changing social,
cultural, and economic needs, and to our natural environment.

The specific objectives of this alternative include:

• To create a strong community identity and sense of place;

• To provide equitable access to goods, services, employment, and educational
opportunities;
• To create walkable communities that reduce people's dependence on motorized
vehicles and thus reduce congestion and pollution;
• To create safe, attractive, friendly and efficient street networks where houses and
buildings enhance social interaction and personal security;
• To create neighborhoods that are supportive of public transport;
• To create diverse opportunities within local neighborhoods by allowing a mix of
compatible land uses to occur in line with community expectations;
• To provide a variety of affordable housing types and densities to suit a diverse range of
needs.
• To build cultural and environmental awareness into the urban landscape while
respecting culturally and environmentally sensitive sites.
• To combine urban waste management with the provision of public open space.
• To ensure that the development is as cost-effective and resource-efficient as possible
in order to increase the availability of affordable housing and minimize environmental
impact.

Key Differences from Current Approaches

A sustainable urban form provides an innovative approach to planning and design in several
aspects by:

• seeking a more thorough analysis of the site and its context to inform community
design and graphically explain the basis for the design;
• encouraging the greater use of structure plans as a planning framework;
• providing for an alternative approach to design of neighborhoods and towns that aims
to achieve compact, well-defined and more sustainable urban communities; and,
• moving toward a performance approach to community design to encourage innovation
in response to market needs.
The following sections provide the specific planning and design guidelines of more sustainable urban
form and settlement patterns. These are divided into the following aspects:

• Community Design
• Movement
• Lot Layout
• Public Parkland
• Urban Water Management
• Utilities

Movement Network

Emphasis on Connectivity, Amenity, and Integration

The emphasis is on connectivity, amenity, and integration to achieve safe, efficient, and
attractive street networks. The priority is to develop a street network that not only works for vehicles
and public transport provision but specifically aims to attract a high level use by pedestrians, cyclists and
the disabled.

Streets have a significant role to play in relation to social interaction, public safety and amenity,
but require continuous development frontage to do this effectively. Development with frontage onto
streets provides surveillance, activity and visual interest and, on busier streets, exposure which can assist
commercial viability. Provision of frontage helps build community focus and enables streets to act as an
integrating element within neighborhoods and towns, rather than as dividers.

Design of the street network assists in energy conservation through reduced vehicle travel,
management of natural features, provision of business and commercial opportunities, and adaptability
to changes in land use.

Key differences from current practices include the following:

• The street system is highly interconnected.

• Integrator arterial routes generally form the core or spine of neighborhoods and
towns, rather than the edges.
• Service roads or other lot layout techniques enable development to front arterial
routes.
• Traffic is distributed more evenly through a flatter hierarchy of streets.
• There are more streets per unit area of land, but lower cost per lot with greater lot
diversity and smaller lots.
• There are rear laneways in higher density areas.
• There is increased on-street parking capacity to allow fewer overall parking spaces and
to support changes in land use over time.
• Pedestrian access based on streets with development fronting and overlooking them
for personal safety through surveillance.
• The street network is designed to accommodate cyclists.
• Parklands and open spaces are fronted by streets.
• Near arterial routes, alternative parallel routes are provided for local traffic,
particularly within centers.
 • Traffic signal control rather than roundabouts is encouraged on major roads to improve
pedestrian crossing opportunities both at the signal lights and in breaks of flow mid-
block

Controlling Vehicular Access along Arterial Routes and Neighborhood Connectors

The proposed approach encourages development to front arterial routes and neighborhood
connector streets rather than back on to them. Vehicles reversing directly into the moving traffic stream
should be avoided.

The local street extends the domestic environment and should be safe for pedestrians
(particularly children), cyclists, neighborly meetings and even social events. Street trees contribute to a
pleasant walking environment, provide shade and accommodate fauna.

a. Neighborhood Connectors

Neighborhood connectors link neighborhoods and towns, are carefully designed to calm
traffic, limit noise and facilitate pedestrian use. They have frequent local street connections.
They should not attract substantial long distance through traffic, but provide for safe and
convenient local travel to and from arterial routes, usually at signal-controlled intersections.
They spread local traffic loads and reduce intersection loadings, act as bus or jeepney routes,
and support the location and viability of neighborhood centers.

b. Access Streets

The access street is the most common street in subdivisions designed under the
proposed approach. The environment of the abutting land use dominates, traffic speed and
volumes are low, and pedestrian and bike movements are facilitated by the streetscape. Vehicle
speeds should be controlled by street lengths, on-street parking intensity, variation in width and
alignment of the road, and type of road construction.

The width of typical access streets will vary depending on their function. In practice, the
wider access streets are the most common access street and will be located closer to the
neighborhood center and in streets where there is some demand for on-street parking, existing
or future capacity for mixed land uses, larger scale street trees and more flexibility for future
use.

c. Laneways

Laneways are generally used when smaller lot layouts justify access to garages at the
rear of the lots, and where alternative vehicle access is needed for lots fronting major streets or
parklands, such in higher density residential and/or mixed land uses.
Community Design
Approaches to urban development at present typically emphasize land use segregation, site
engineering, surveying, and lot yield efficiency. An alternative approach to such practice is to design a
framework for communities that are sustainable, safe, stimulating, and efficient. This is a response to
today’s need for a broader and more integrated perspective in addressing design issues at the
neighborhood level.

This set of guidelines for Community Design sets out the objective with respect to how towns
and neighborhoods could be structured, the layout of street networks and block structures, the mixing
of uses and facilitation of employment opportunities, and other design issues. They seek to provide safe,
convenient and attractive neighborhoods that meet the diverse needs of the community, are adaptable
to future change, which fit into the existing and planned urban context, and promote environmental
sustainability.

Key Differences from Current Practices

The proposed approach calls for an urban structure based on walkable, mixed-use
neighborhoods. The neighborhood and town centers are located at junctions of arterial routes or
important local streets, rather than having such roads define the edge of the development. The town
center acts as a district level community focus with a compatible mix of uses which provide a wide range
of weekly shopping needs, community facilities, and local employment, whereas the neighborhood
center caters more to the daily needs of the community. The proposed approach places greater
emphasis upon: responsive design, enhancing local identity; providing an interconnected network of
streets with perimeter block development and frontage to streets and open spaces; a wider choice of
housing types; a more significant component of other land uses to support daily needs and local
employment; and, higher levels of public transport provision.

Objectives of Community Design for Sustainability

The specific objectives of community design for sustainability are:

• To facilitate an environmentally sustainable approach to urban development by

minimizing non-renewable energy use and motor vehicle dependency; encouraging
greater self-containment of neighborhoods and towns; and protecting key natural and
cultural assets.

• To provide safe, convenient and attractive neighborhoods and towns that meet the
diverse and changing needs of the community, and offer a wide choice of housing,
leisure, local employment opportunities and associated community and commercial
facilities.

• To develop a coherent urban system of compact, walkable neighborhoods which

cluster to form towns with a high degree of street connectivity.
 • To ensure a site-responsive approach to urban development that supports and
enhances the context in which it is located, strengthen local character and identity, and
promote a sense of community.

• To provide a movement network which has a managed street layout that clearly
distinguishes between arterial routes and local streets, establishes good internal and
external access for residents, maximizes safety, encourages walking and cycling, supports
public transport patronage, and minimizes the impact of through traffic.

• To provide a network of well distributed parks and recreation areas that offer a variety
of safe, appropriate and attractive public open spaces.

• To ensure that the design of neighborhoods takes into account environmental

constraints including flooding, soil erosion, urban water management, and other natural
hazards.

• To equitably provide public utilities in a timely, cost efficient and effective manner.

Sustainable Neighborhood and Town Structure

A more sustainable neighborhood structure has the following characteristics:

• Size and shape are generally defined by a 5-minute walk from the neighborhood center
to the perimeter, typically 200 to 250 meters.

• The neighborhood center acts as a community focus with a compatible mix of uses
which provide for a variety of daily needs, and may include community facilities and
urban open spaces.

• The center is located on or at the intersection of important local streets served by

public transport in order to assist retail exposure and accessibility.

• It has an interconnected street network with strong links between town and
neighborhood centers that has good accessibility, route choice and detailing to make
walking and cycling pleasant, efficient and safe.

• It has a range of residential densities that increase toward the neighborhood and town
centers.

The town structure has the following characteristics:

• It is formed by the clustering of neighborhoods, typically with 6 to 9 neighborhoods

needed for adequate population to sustain a town center with public transport and a
wide range of goods and services.

• The town center is central to the cluster of neighborhoods, well linked and within
reasonable walking distance of most residents.
 • Major new transport routes are based on desired town and neighborhood structure.

• For commercial viability and accessibility, the town center is located adjacent to the
intersection of arterial routes and has a major public transport stop wherever possible.

• It has a range of housing types with residential densities that increase toward the
center and can, over time, support sufficient population to foster self-containment.

Lot Layout

This section principally outlines the suggestions for residential lots in a planning context where a
mixture of compatible land uses are encouraged. There is a range of suggested guidelines that differ
from current residential lot layout practice. They include:

• emphasis on greater lot size variety for housing choice and affordability;

• provision of lots in appropriate locations for mixing of compatible uses;

• allowing a variation to the minimum lot size set out in current regulations to achieve
diversity; and,

• lot design facilitating development fronting major streets and public open space to
support safety and surveillance.

Lot Layouts for Housing Diversity and Density

A mixture of lot sizes distributed throughout neighborhoods to provide housing choice should be
encouraged. A wide range of both lot sizes and housing types is needed to cater to increasingly diverse
household types. These may range from those targeted to upperincome households – including
conventional larger lots with views – but also well-located higher quality medium density housing, to
those at the more affordable end, including smaller lots, duplex lots, and possibly apartments and studio
units, sometimes over garages.

Medium density housing and small lot development should be made more appealing by placing
it in good locations such as close to town and neighborhood centers or overlooking parks. Smaller lots
need to predominate near town and neighborhood centers and public transport stops to achieve
sufficient density to support facilities. Sites intended for multi-dwellings or future small lot development
should be identified on structure plans.

Lots for Special Uses and Future Residential and/or Business Intensification

Where a structure plan has been produced, areas for business, employment, homebased
businesses, schools and other activities should have been identified. Lots with appropriate dimensions
and characteristics need to be provided to facilitate these proposed activities. Often, mixed commercial
and residential development near centers will be proposed, yet only the residential component will be
built in the first phase of the development.

Despite this, affected lots should be carefully dimensioned, and longer term Detailed Area Plans
specified to facilitate incremental redevelopment. These guidelines should provide for efficient layout
and access to rear parking together with, say, large front setbacks that would enable a business to be
constructed in front later. In some urban fringe areas, residential land may be developed on sites near
proposed railway stations or town centers well in advance of these facilities. In these areas, larger lots
could be required to incorporate Detailed Area Plans that facilitate future intensification. For example, a
house on a 700 square meter lot could be sited and designed to enable future subdivision of the lot and
an additional dwelling to be built.

Lot Layout to Front Parks and Natural Areas

Streets, with lots fronting them, should edge the majority of parkland and natural open spaces.
This provides higher amenity and greater safety for both the open space users and residents. No lot
should require a back fence onto a park, or conversely turn its back on the street. When full street
frontage is impractical, or where streets on both sides of a linear park are unnecessary, lot layouts can
provide development frontage through designs incorporating rear lanes or flag lots, with dwellings to
front the park and/or footpath.

Lot Layout to Front Major Streets

On major streets, careful lot layout is critical to achieving appropriate vehicle access, mixed use
potential, noise management, visitor parking, and urban amenity. Back fences along major streets have
become commonplace in more recently developed suburban subdivisions. This solution arose as an
initial response to prohibit vehicles from reversing out into heavy traffic. It is now recognized that there
are many economic, environmental and community safety disadvantages of the back fence response to
this problem. Reversing problems can be solved by designing alternative vehicle access methods. Service
roads, car courtyards, on-lot maneuvers for frontwards exit, rear lanes and flag lots can all provide
solutions.

Public Parks and Open Spaces

Public parks and open spaces that can be used by a wide range of people living and/or working
in urban areas contribute significantly to quality of life. Through careful placement in a site-responsive
design, they can also contribute towards legibility, identity, and a sense of place that helps build
communities.

In current conventional practice, public open spaces are derived from a quantitative calculation
and are too often inconveniently located, inappropriately sized, or poorly surveilled. Restraints on local
government expenditure with consequent limiting effects on local government’s ability to develop and
maintain open spaces has resulted in the lack of public parks and public open spaces to meet the needs
of all user age groups.

Wider Range of Parks and Other Open Spaces

A range of site-responsive urban parkland which is surveilled, safe, and conveniently located for
the majority of residents should be provided. There should be a balance between neighborhood parks,
readily accessible to residents, and larger playing fields to be shared between neighborhoods. Small
parks (up to 3,000 square meters) are encouraged for local children’s play and as resting places for
elderly or disabled people, and where maintenance arrangements can be agreed with the local
government.

Natural Areas and Cultural Features

There may be opportunities for natural areas and cultural features to be incorporated into
neighborhood and city parks. Active and passive recreational needs of future residents should be
assessed in order to adequately cater to them before the local government agrees to their inclusion
within the calculation of public open space.
PRESIDENTIAL DECREE No. 1396

CREATING THE DEPARTMENT OF HUMAN SETTLEMENTS AND THE HUMAN SETTLEMENT

DEVELOPMENT CORPORATION, APPROPRIATION FUNDS THEREFOR, AND ACCORDINGLY AMENDING
CERTAIN PRESIDENTIAL DECREES.

WHEREAS, man and his community require the fulfillment of the following basic needs and requirements
such as water, power, food, clothing, shelter, medical services, education, sports and recreation,
economic base (livelihood), mobility and ecological balance embodied in a humanistic ideology for the
realization of a New Society;

WHEREAS, it is the national policy to attain the fruits of social and economic development in our
communities within the integrative framework of human settlements; WHEREAS, it is imperative that our
development activities promote and enhance a wholesome relationship between beings and their civic
and physical environment;

WHEREAS, while the government has already addressed the problems of rural poverty and stagnation by
adopting and implementing a massive countryside development program, a proper development
perspective requires equal concern for the management of urban development;

WHEREAS, it is necessary to organize the government's policies and programs along these new areas of
concern by establishing an appropriate department and delineating its relationships with the various
agencies involved with its functions;

WHEREAS, it is also national policy to promote innovative land development and community
development controls as a technology for building communities and estates in new areas, or renewing
communities in depressed or blighted areas; and

WHEREAS, the physical planning, development and management of new communities and estates, or of
old communities and blighted areas can best be accomplished through the creation and operation of an
adequate corporate arm for the new Department.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers
vested in me by the Constitution, do hereby order and decree the following as part of the law of the
land.

Section 1. Declaration of Policy. It is hereby declared to be the policy of the government to foster the
growth, and renewal of our communities, both rural and urban, in an integrative manner that promotes
optimum land use, adequate shelter, environment protection, utilization of appropriate technology and
rational interdependence amongst self-reliant communities, all these towards the fullest development of
man as a civic person and as a human being, involving in this process the coordinated contribution of the
public and private sectors.

Section 2. Creation of the Department of Human Settlements. In order to carry out the above stated
policy, there is hereby established the Department of Human Settlements, hereinafter referred to as the
Department. The Department shall be headed by a Secretary. For purposes of coordination, the
Secretary shall serve ex-officio as Chairman of each of the governing boards of the corporation,
commissions, and authorities which are placed under the supervision of the Department. The Secretary
shall be assisted by one Undersecretary, unless otherwise determined by the President.

Section 3. Establishment of the National Capital Region. In view of the critical importance of the
Metropolitan Manila Region in human settlements development, it is hereby declared and established as
the National Capital Region of the Republic of the Philippines, and its administration as such is hereby
vested in the Secretary of Human Settlements. The pertinent provisions of Presidential Decree No. 824,
creating the Metropolitan Manila Commission, are hereby accordingly amended.

Section 4. Powers and Functions of the Department. The Department shall have the following powers
and functions which it shall undertake by itself or through the corporations, commissions and authorities
which are placed under its supervision.

a. Promulgate national standards and guidelines for human settlements which shall govern land
use plans and zoning ordinances of local governments, civil works and infrastructure programs
and projects of the National Government, and subdivisions or estate development projects of
both the public and private sectors;
b. Promulgate national standards and guidelines for environmental management relative to air
quality, water quality, land use and waste management which shall govern development
programs and projects and other activities in settled communities, urban or rural, as well as in
those areas immediately contiguous thereto and develop an environmental impact assessment
system for the operationalization of said standards and guidelines;
c. In coordination with appropriate agencies, effect a single regulatory system relative to
subdivision, zoning (including architectural design), building, fire and related regulations;
d. Prepare and submit to the Board of the National Economic and Development Authority a
National multiyear Human Settlements Plan which shall translate the Philippine Development
Plan into spatial and temporal terms, based on the locational distribution of national resource
endowments (including energy), population, climate, and production capacity;
e. Formulate plans and programs and implement, either on its own initiative and operational
responsibility or through the agencies or corporations placed under its supervision, projects for;

i. Urban renewal and development, including but not limited to the construction and
management of social and economic housing
ii. Estate or New Town development within sites designated by the Office of the
President as Bagong Lipunan sites.
iii. Land assembly and real property management
iv. Development and installation on a community scale of waste management systems
and so appropriate technologies.

f. Promulgate appropriate rules and regulations which shall have regulatory force for the
enforcement of its standards and guidelines;
 g. Enter into contracts, either domestic or foreign, under such terms and conditions as it may deem
necessary and reasonable;
h. Receive, take and hold by bequest, devise, gift, purchase or lease, either absolutely or in trust for
any of its purposes from foreign and domestic sources, any asset, grant or property, real or
personal, subject to such limitations as are provided in existing laws and regulations; and to
convey such assets, grants or property; invest and reinvest the same under this provision and
deal with an expand its assets and income in such manner as will best promote its public welfare
objectives;
i. Develop and maintain in conjunction with cooperating agencies a responsive and effective
information system through the establishment of a data bank to support the department at
various levels in the planning, monitoring, execution, coordination and control of its various
activities, programs and/or projects;
j. Determine, fix and collect reasonable amounts to be charged as filing fees, inspection fees and
other administrative or service fees necessary for the effective implementation of all the laws,
Presidential Decrees and other legal issuances enforced by the Department;
k. Supervise all corporations placed under the Department;
l. Call on any department, bureau, office, agency or instrumentality of the government and private
entities and organizations for cooperation and assistance in the performance of its functions.
m. Adopt rules and regulations for the transaction of its business; and
n. Perform such other activities which are necessary for the effective performance of the
abovementioned functions and objectives.

Section 5. Creation of the Human Settlements Development Corporation. In order to provide an

adequate corporate arm for the Department, especially in the discharge of its functions relative to urban
renewal, New Town and estate development in Bagong Lipunan sites and real property management,
there is hereby created the Human Settlements Development Corporation. The Corporation shall be
subject to the supervision of the Department.

Section 6. Purposes of the Corporation. The purposes of the Corporation shall be as follows:

(a) The development of new communities that are economically viable and environmental
sound, through innovative urban land mechanisms and self-financing arrangements;

(b) The renewal of urban communities or parts thereof, through housing and other urban
improvement projects.

The abovementioned development and/or renewal activities of the Corporation shall be undertaken or
implemented generally, but not exclusively, on land parcels or tracts which have designated as Bagong
Lipunan sites by the Office of the President.

Section 7. Powers and Functions of the Corporation. The Corporation shall have the following powers
and functions:
(a) Prepare and implement development and/or renewal project plans for Bagong Lipunan site.
The Corporation shall have as its initial project the Lungsod Silangan Townsites consisting of
20,313 hectares in the Municipalities of Antipolo, San Mateo and Montalban, Province of Rizal
and the parcel of land consisting of 160,410 hectares embraced and covered by Proclamation
Nos. 1636 and 1637 with boundaries delineated in Proclamation No. 1637 which are hereby
declared as Bagong Lipunan sites;

(b) Administer, operate and/or manage estates or New Town projects on Bagong Lipunan sites
either exclusively through subsidiary corporations or in associations with other government
(including local governments) or private entities;

(c) Provide or operate utilities services in Bagong Lipunan project sites, in accordance with law;

(d) Acquire, purchase, clear, alter construct, enlarge, occupy, mortgage, manage and dispose by
lease or sale or otherwise deal in lands and building of every kind and character, whether
belonging to or to be acquired by the Corporation; exercise the right of pre-emption, either by
agreement or by expropriation; and in general, engage in real property management;

(e) Engage in the transfer of property rights of land within designated Bagong Lipunan project
sites, when deemed necessary, such that the land is exchanged for one of similar value;
Provided, that no land acquired by the Corporation through eminent domain as provided for in
Section 13 of this Decree shall be said or the title thereof disposed.

(f) Construct, or cause to be constructed, acquire, own, lease, operate and maintain
infrastructure facilities, housing units, factory buildings, utilities and services necessary or useful
in the development of pilot communities;

(g) Fix, assess and collect charges and fees, including rentals for the lease, use or occupancy of
lands, buildings, structures, and all the facilities owned and administered by the Corporation; to
fix and collect fees and charges for the issuance of permits, licenses and the rendering of
services not enumerated herein, the provisions of law to the contrary notwithstanding,
Provided, that an equitable formula for sharing the proceeds thereof with the local governments
or other government agencies concerned shall be developed and shall be in effect upon approval
by the President;

(h) Recommend to the President the transfer to the Corporation of all foreclosed properties held
by government agencies located within Bagong Lipunan and prototype project areas;

(i) When essential to the proper administration of its corporate affairs or when necessary for the
proper transaction of its business or for carrying out the purposes of this Decree, to issue bonds
or contract loans, credits or indebtedness, domestic or foreign, the payment of which shall be
guaranteed by the government through the President of the Philippines or his duly authorized
representative; and

(j) Prescribe its by-laws; adopt, alter and use a corporate seal which shall be judicially noticed;
make contracts, lease, own or otherwise dispose of personal and real property; sue and be sued,
and otherwise do and perform any and all acts and things that may be necessary or proper to
carry out the purposes of this Decree.
Section 8. Governing Body of the Corporations. The Corporation shall be governed by a Board of
Directors, composed of seven (7) members, as follows:

1. Secretary of the Department of Human Settlements as Chairman;

2. Chairman of the Development Bank of the Philippines

3. Governor of the Central Bank of the Philippines

4. Secretary of the Department of Local Government and Community Development

5. Secretary of the Department of Public Works, Transportation and Communications

6. Secretary of the Department of Industry

The Chief Executive of the Corporation shall be a General Manager which shall be appointed by the
Board.

Section 9. Appointment, Control and Discipline of Personnel. The Board, upon recommendation of the
General Manager of the Corporation, shall appoint the officers, and employees of the Corporation and
its subsidiaries; fix their compensation, allowances and benefits, their working hours and such other
conditions of employment as it may deem proper; grant them leaves of absence under such regulations
as it may promulgate; discipline and/or remove them for cause; and establish and maintain a
recruitment and merit system for the Corporation and its affiliates and subsidiaries.

Section 10. Capitalization of the Corporation. The Corporation shall have an authorized capital stock of
Five Hundred Million Pesos (P500,000,000) divided into 500,000 shares with a par value of One
Thousand Pesos (P1,000.00) per share to be subscribed and paid for by the Government of the Republic
of the Philippines.

For this purpose, an initial release of One Hundred Million Pesos (P100,000,000) is hereby authorized for
CY 1978 chargeable against the Special Activities Fund of P.D. 1250.

Additional capitalization in the nature of

(a) properties as may be contributed to the Corporation by the government through further Presidential
Proclamation designating Bagong Lipunan sites and other prototype project sites
(b) all capitalize surplus and
(c) contributions by government financial institutions are also hereby authorized.

Section 11. Borrowing Power. With the prior approval of the Secretary of Finance, the Monetary Board
and the President of the Philippines, the Corporation may borrow from foreign public or private financial
institutions such amounts as may from time to time be required for its operations, or issue bonds
promissory notes, debentures, certificates of indebtedness, and other debt instruments in foreign
currency. Notwithstanding the provisions of any law to the contrary, the Central Bank is hereby
authorized to extend loans and advances to the Corporation under Section 38 of Republic Act No. 265, as
amended, otherwise known as the Central Bank Charter, subject to such terms and conditions as may be
prescribed by the Monetary Board.

No part of the proceeds of domestic and/or foreign borrowings shall be used for operating expenses of
the Corporation.

The bonds, promissory notes, debentures, certificates of indebtedness and other debt instruments
issued in local or foreign currency shall be at such interest rates, maturities and other terms and
conditions as the Corporation may determine. The debt instruments may be secured by the assets of the
Corporation and shall be fully exempt, both as the principal and interest, from any and all taxes imposed
by the government of any of its subdivision. The debt instruments shall be fully negotiable and shall be
unconditionally guaranteed both as to principal and interest by the Government of the Republic of the
Philippines, which guaranty shall be indicated on the face thereof.

A sinking fund is hereby created for the payment of the Corporation's bonds issued under the provisions
hereof in such manner that the total contribution thereto accrued at such rate of interest as may be
determined by the Secretary of Finance in consultation with the Monetary Board shall be sufficient to
redeem the bonds at maturity. The said fund shall be under the custody of the Central Bank of the
Philippines which shall invest the same in such manner as the Monetary Board may approve; shall
charge all expenses of such investment to the sinking fund and shall credit the same with the interest on
investment and other incomes belonging to it.

A standing annual appropriation is hereby made out of any general funds in the National Treasury in such
amount as may be necessary to provide for the sinking fund created herein and for the interest on bonds
issued by the Corporation by virtue hereof.

Section 12. Profits of the Corporation. Profits which may be realized from the operations of the
Corporation shall accrue to and be automatically appropriated as part of the corporate earnings of the
Corporation, any provision of law to the contrary notwithstanding.

Section 13. Eminent Domain. The Corporation shall have the power to acquire any property required for
the establishment and expansion of Bagong Lipunan sites and facilities by purchase by negotiation or by
expropriation proceedings. To promote maximum development of these areas, the properties acquired
may thereafter be resold, or leased by the Corporation to any enterprise, private or government, under
such terms and conditions as it may be impose, except those acquired through expropriation
proceedings which cannot be resold or the title thereof disposed.

Section 14. Corporations, Authorities and Agencies Under the Supervision of the Department. The
following corporations, authorities and agencies are hereby placed under the supervision of the
Department and their respective charters are correspondingly amended to the extent that the pertinent
provisions thereof are inconsistent with the provisions of this Decree. The specific amendments to be
affected in the respective charters of the affected corporations and authorities shall be provided for in
the Letters of Implementation to be issued by the President to implement this Decree, which legal
issuance shall form part of this Decree.

(a) National Housing Authority

(b) National Home Mortgage Finance Corporation

(c) Home Financing Commission

(d) National Housing Corporation

(e) Technology Resource Center

(f) National Environmental Protection Council

(g) National Pollution Control Commission

(h) Human Settlements Commission

The president shall, in the light of the provision of Section 2 of this Decree and, whenever necessary in
order to maintain the odd number in the membership of the governing boards of the above corporations
and commissions, appoint an additional member each to the said Boards. In the case of the Human
Settlements Commission, in addition to the Undersecretary of Energy who shall be made an ex-officio
member, a Deputy Chairman shall be appointed by the President.

Section 15. Relationship Between the Department and the Supervised Agencies. The supervision of the
government corporations and authorities listed in Section 14 shall be for the purpose of policy and
program coordination and integration. The formulation and implementation of the policies, plans and
projects of the attached agencies shall conform to the overall policies and plans of the Department.

To give effect to the foregoing, a centralized administrative and management office known as the
Corporate Planning Office is hereby created in the Department.

Section 16. Regional Offices. There shall be established as many regional offices as are necessary and
consistent with the requirements of economy and efficiency; Provided, That they are established in
accordance with the regional pattern as described in Paragraph 1, Article I, Chapter III, Part II of the
Integrated Reorganization Plan, as amended. The regional office shall be headed by a Regional Director
who may be assisted whenever necessary, by one or more Assistant Regional Directors.

Section 17. Counterpart Units and Sub-Regional Offices. The regional office shall have such counterpart
units as may be necessary, corresponding to the major functional areas and responsibilities of the
different corporations and agencies attached under it.

The Department shall, within each region, establish such sub-regional offices as may be necessary for the
accomplishment of its declared objectives and policies.
Section 18. Conversion of the Human Settlements Commission. The Human Settlements Commission
established pursuant to Presidential Decree No. 933 is hereby renamed as the Human Settlements
Regulatory Commission and shall accordingly be the regulatory arm of the Department.

Section 19. Appointment of Department Personnel. The Department shall have an adequate personnel
complement. Its officers and employees shall be appointed by the Secretary, except those whose
appointments are vested by law in the President of the Philippines. The Office of Compensation and
Position Classification, Budget Commission, shall consider professional and technical qualifications and
competence in fixing the salaries of the corresponding personnel.

Section 20. Appropriations. To carry out the purpose of this Decree, there is hereby appropriated out of
any funds in the National Treasury not otherwise appropriated the sum of FIFTY MILLION PESOS
(P50,000,000) for the operation of the Department and its regional offices. This shall be in addition to
whatever applicable appropriations may be transferred to it from among the government agencies
reorganized under this Decree. Thereafter, the appropriations for the Department and its regional offices
shall be included in the National General Appropriations Act. The regional offices may likewise utilize the
Local and the Regional Development Funds as may be necessary in the implementation of projects at the
regional level.

Section 21. Repealing Clause. All laws, decrees, executive orders, rules and regulations inconsistent
herewith are hereby repealed, amended or modified accordingly.

Section 22. Separability Clause. If for any reason, any section or provision of this Decree is declared to
be unconstitutional or invalid, the other provisions hereof not affected shall continue in full force and
affect.

Section 23. Effectivity. This Decree shall take effect immediately.