National Land Use Act and Policy

Recommendations

Arturo G. Corpuz

2nd Paderanga-Varela Memorial Lecture

Foundation for Economic Freedom

October 25, 2017

Outline

• Introduction: National Land Use Act (NALUA)

status summary

• Comments on the proposed NALUA and policy

recommendations (HB5240 as bench reference)

– Supply

– Protection

– Planning structure

– National land use policy directions

• National Physical Framework Plan (NPFP):

proposed focus areas (strategies)

• HB 5240: National Land Use Act: An act instituting a national

land use and management policy, providing the implementing

mechanisms, and appropriating funds therefor.

• Objective: “A national land use policy that shall end the degradation of the

country’s land resource and optimize balanced development.”

• Passed in lower house (March 24, 2017)– Sponsors: Reps. Bag-ao, Quimbo, Tugna, Biazon, Baguilat, M Rodriguez,

Villarin, JC Belmonte

• 5 Senate bills filed– Hontiveros (copy of HB 5240); Villanueva and Zubiri (virtually the same);

Legarda; Honasan

– Overall: little substantive difference among the bills approved and filed in

terms of wording, content and approach to land use policy.

• Certified priority bill by President Duterte (July 4, 2017)

IntroductionBackground

Introduction

Agricultural Forest/Timber Mineral National Parks

Alienable and disposable 48% Non A&D 52%

Built up land 2.3%

Agricultural/Fishery 43% Forest/Pasture/Water 54.7%

Total land area = 30M hectares

1987 Constitution

Land Classifications

NAMRIA

Land Cover

Urban

• Residential

• Commercial

• Industrial

• Institutional

• Utilities/infra

• Tourism/recreation, etc

Rural

• Agriculture

• Fishery

• Industrial/mining

• Forest

• Utilities/infra

• Tourism/recreation, etc

Typical Zoning Land Uses

(MM=0.2%)

(Converted=0.07%)

1 Supply side bias

Underlying philosophy: land should be used based on

what it is physically suitable for regardless of demand.

Land characteristics/

suitability

Land use

Land value

http://www.expatch.org/wp-content/uploads/2014/12/Ayala1938.jpg

Land value

Land use

Land characteristics/

suitability

But the world

often works

differently . . .

1 Supply side bias

Low income housing: Primary issue with low income housing

is low income, not housing.

Ignoring demand means you lose

sight of market drivers/constraints.

https://i1.wp.com/8list.ph/wp-content/uploads/2013/07/8-Mind-Blowing-Realities-No-One-Told-You-About-Informal-Settlers-8b.jpg

Food security

Land suitability approach leads to self-sufficiency

(locking up irrigated and irrigable land, alluvial plains,

croplands, highlands) instead of focusing on raising

productivity and farmers’ incomes.

https://societyofhonor.files.wordpress.com/2013/06/negros13-sm-500.jpg

1 Supply side bias Ignoring demand means you lose

sight of market drivers/constraints.

• “Market is first; crop suitability

next.” . . . “We should have learned

our lessons by now. Most of our

agricultural programs . . . failed

because we got our sequence of

priorities wrong.” (Dr. Emil Javier, NAST, CAMP)

• Allow/encourage land

consolidation

‒ Avg farm size: 1980=2.84 ha;

2012=1.29 ha

‒ 99% of farms are operated by HH

or individuals, 1.23 ha avg farm size (PSA 2015)

• Boost non-farm income https://societyofhonor.files.wordpress.com/2013/06/negros13-sm-500.jpg

https://2.bp.blogspot.com/-LTtIJ0bogmA/Wb-p2FpuA2I/AAAAAAAAlFk/AB3SfLvLAVcLJLywI2-HI5eYNtsVEMM-wCLcBGAs/s1600/image009.jpghttps://cdn.agriland.ie/uploads/2016/03/tillage-plough-in-field.jpg

1 Supply side bias Ignoring demand means you lose

sight of market drivers/constraints.

• Tendency to condemn the land market if it is not understood, e.g.:

– Demand for urban land leads to land conversion therefore demand for urban land is bad.

– High demand for urban land is very bad.

– But high demand leads to high density which reduces demand for urban land . . . density can be good.

1 Supply side bias

https://upload.wikimedia.org/wikipedia/commons/thumb/f/f1/Global_Citizen_Festival_Central_Park_New_York_City_from_NYonAir_%2815351915006%29.jpg/1599px-Global_Citizen_Festival_Central_Park_New_York_City_from_NYonAir_%2815351915006%29.jpg

City/

Metro

Resi-

dential

Com-

mercial

& ports

Indus-

trial,

other

urban

land

Institu-

tional

Ports,

roads,

others

Agri,

forest,

undeve

-loped

land

Total

(sqkm)

Hong Kong

76 20 77 25 6440=road

845 1,107

7% 2% 7% 2% 6% 76% 100%

Metro Manila

278 76 47 43 178 0 622

45% 12% 8% 7% 29% 0% 100%

Kowloon = 51,050 persons/sqkm

Urban area = 44,500 persons/sqkm

Hong Kong = 6,405 persons/sqkm

Hong Kong: 32,000 people/MTR km

Manila City = 40,400 persons/sqkm

Urban area = 20,400 persons/sqkm

MManila = 20,400 persons/sqkm

MManila: 387,000 people/LRT km

Kowloon

Manila

Land Use Distribution, 2010Sources: AKI, IDRC, CRDI, Asian City Innovations Systems Initiative, 2010; HK Statistics

(http://www.pland.gov.hk/pland_en/info_serv/statistic/landu.html)

1 Supply side bias

• Supply side (land suitability) approach is valid but it

should be balanced with an explicit recognition of

the demand side.

– Leads to better understanding of land use drivers, e.g.:

– How much agricultural land do we need (under different

food security scenarios)?

– How much settlement land do we need (under different

density scenarios)?

• Limitations to more efficient use of land (e.g.

holding period, area limit, buyback option, property

rights and titling, rent control) should also be

considered.

2 Protection focus

• The dominance of protection in HB5240:

– Protection land use prevails over any other activity. All

other uses are residual to protection.

– 8 of 13 policies/principles are about protection.

– DAR, DA and DENR control the supply of land (any use).

– DTI, DOT, DOTr, DPWH, DOF are not members of

National Land Use Policy Council (NLUPC). (Members: NEDA, DAR, DA, DENR, DILG, NCIP, HUDCC, HLURB,

NAMRIA, LCP, 12 sector reps)

No room to grow?

NPAAADNetwork of Protected Areas for

Agriculture and Agro-industrial Development18% slope plusSource of maps: NEDA-RDCS

2 Protection focus

• Nothing wrong with protecting and using land only for forests

and agriculture but it has to be balanced with the

requirements of growth. Otherwise:

– Growth (spatial) unlikely to follow desired directions.

– Corruption is encouraged. If legitimate growth cannot be

accommodated legally, incentives to do things illegally are

created.

– Protection itself is compromised. Restricting growth,

especially in large cities, can lead to more land

conversion.

4.00

4.50

5.00

5.50

6.00

6.50

7.00

7.50

0.00 1.00 2.00 3.00 4.00

Log P

op

Log Rank

Base Case 2010 & Growth Scenarios 2040 (Philippine cities/municipalities, Pop = 142M)

2010 BaseCase

2040 NoGrowthMManila

2040 No AddlSettlements

2040 Trend

Base Case:

Y=-0.823x+6.695

R2=0.8543

TrendTrend 2040

2010 Base

Case

2040 No

Growth MM

2040 No Addl

Settlements

2040 Trend

2 Protection focus

Base 2010

M Manila

M Cavite

M Cebu

4.00

4.50

5.00

5.50

6.00

6.50

7.00

7.50

0.00 1.00 2.00 3.00 4.00

Log P

op

Log Rank

Base Case 2010 & Growth Scenarios 2040 (Philippine cities/municipalities, Pop = 142M)

2010 BaseCase

2040 NoGrowthMManila

2040 No AddlSettlements

2040 Trend

Base Case:

Y=-0.823x+6.695

R2=0.8543

TrendTrend 2040

2010 Base

Case

2040 No

Growth MM

2040 No Addl

Settlements

2040 Trend

2 Protection focus

2040 Trend Scenario

• Built up land expands

by 44% (84% if MM not

allowed to grow)

• 5% of total agri land

converted (9% if MM

not allowed to grow);

Number of settlements

increases 13%;

• Regl-Prov centers

increase pop 2-3X

• Mega Manila grows 2X

(2.3X if no new

settlements) (Corpuz 2015)

Restricting growth can lead to

more land conversion.

Base 2010

2 Protection focus

• Protected areas, danger zones, settlement expansion areas

have to be identified at ground level.

• Top priority: safety– E.g. Clear danger zones; relocate as necessary to accessible sites with

appropriate service infrastructure; higher density developments.

• Infrastructure as integral part of protection and disaster risk

reduction. – Plans should direct and not merely prevent.

– Channel growth to avoid key production areas.

– Build redundancy into regional routes and lifeline systems.

• Build up market value of protection areas, e.g. eco-tourism

and urban amenities.

• No need to stick to these traditional classifications.

– Appropriate only at national (maybe regional) level.

– Not mutually exclusive.

• Use more specific and mixed use classifications, especially

at the local level, that can be aggregated.

3 Planning structure/bureaucracy:

Production Protection Settlements Infrastructure

Land use classifications

?

Need to

update

3 Planning structure/bureaucracy:

• Physical separate from sectoral (supply separate from demand)

• Too many plans (20-30/term) with too few planners (2,433 licensed in 2017)

• Repetitions/overlaps among plans

Physical Sectoral Investment

MTPIP

RDIP

PDIP

M/CDIP

NPFP

RPFP

PPFP

C/MCLUP

MTPDP

RDP

PDP

C/MDP

National

Budget and

implementation

Hierarchy of Plans

Regional

Provincial

City/Mun

Zoning Ord

• Glaring absence of metro level plans (Metro: 42% pop)

Metro?

Need to

update

3 Planning structure/bureaucracy:

Physical-Sectoral Investment

MTPIP

RDIP

PDIP

M/CDIP

National

Budget and

implementation

Regional

Provincial

City/Mun

Zoning Ord

• Simplify: combine/integrate physical and sectoral (e.g. PDPFP)

‒ Agencies responsible for determining supply should also be responsible for

accommodating demand, i.e. NLUPC = NEDA Board

• Integrate local into metro plans

• Increase efficiency: training, maps and data, transparency

C/MDPFP

PDPFP

RDPFP

NDPFP

Hierarchy of Plans

Need to

update

CLUP (Comprehensive Land Use Plan)

• Ground zero of land use planning and regulation; basis of

zoning ordinance.

• With 1,600+ LGUs, there is room for improvement.

– Updated HLURB guidebooks with DRR integration

– But only 22% of 1,634 LGUs have approved CLUP (2017)

– Current political economy is a major constraint. (E.g. Zoning

used for rent seeking through negotiation: land classification,

parking requirements, building heights/densities, reclamation)

• Increasing need for transparency and to be inter-LGU

oriented.

3 Planning structure/bureaucracy

4 Lack of national development directions

NALUA is not a plan; but its policies and principles should frame

and guide the NPFP and other plans.

• Some policies/principles are outdated; should be more

forward-looking.

• No recognition of increasingly important role of urban sector.

• No reference to competitiveness, innovation and technology.

(Use PDP/Ambisyon 2040 drivers of future growth as takeoff

points.)

• Policies and principles should be revised . . .

NALUA HB5240 Principles

1. Maintain and preserve environmental integrity.

2. Sustainable and just management and utilization

of natural resources.

3. Protection of prime agricultural lands for food

security with emphasis on self-sufficiency . . .

4. Protection and conservation of country’s natural

heritage, permanent forest lands, natural forests,

critical watersheds, key biodiversity areas . . .

5. Sustainable development and management of

water resources.

6. Preservation and conservation of parks and

protected areas to keep the scenery, natural and

historical objects, and biodiversity therein in their

natural state . . .

7. Disaster risk reduction and climate risk-based

planning.

8. Respect for and protection of traditional resource

right of ICCs/IPs to their ancestral domain . . .

9. Equitable access to land through state

intervention that guarantees its affordability to the

basic disadvantaged sectors . . .

10. Energy security or energy self sufficiency.

11. Settlements, transportation and infrastructure

development in support of inclusive growth and

rural/urban and regional development.

12. Improved access to affordable housing by

increasing the supply thereof . . .

13. Meaningful participation of the basic sectors.

• Simplify and combine some

principles, e.g. #2 and #5.

• Primacy of protection but reconcile

with demand.

• Food security through domestic

production and importation.

• Metro and inter-local planning.

• Long term trend and role of urban

sector; PDP/Ambisyon priorities and

growth drivers as takeoff points.

• Strategic geopolitical considerations,

e.g. national security.

• Critical role of connectivity, ICT, IOT,

infrastructure.

• Build physical environment: human

capital, innovation, competitiveness.

Indonesia: National Spatial Planning Act (amended 2007)• Top priority issue: response to rapid progressing urbanization

• Contains transport plan, green space plan and information related to informal sectors; goal to secure 30%

of the city land as open space (city parks, green roads, cemeteries, etc.)

• Metropolitan spatial plans are required for large cities such as Jakarta and Surabaya.

• Strategic Development Framework national land strategy: achieve security, economic viability, land use

sustainability in archipelago to enhance national cohesiveness and stability.

Malaysia: National Physical Plan (NPP-2, August 2010)• Goal: establish an efficient, equitable and sustainable national spatial framework to guide overall

development towards achieving developed and high-income nation status by 2020.

• Development strategy Peninsular Malaysia): Concentrated Decentralisation by 2020

• 75% urbanized; 70% of urban population in four conurbations: KL, Georgetown, Kuantan, Johor Bahru.

• Key strategy: concentrate nation's scarce resources in a few priority urban areas with the greatest

potential for job creation along key economic corridors (while protecting rural areas and natural

environment); urban areas ; growth through high-impact flagship infra projects.

Thailand: 50 year National Spatial Development Plan• Vision (2057): world leader in agriculture, agro-industry, food technology, health services, tourism; good

quality of life in a pleasant environment; sustainable growth.

• Development frameworks: economic potential zone development; regional growth distribution; linkage to

other ASEAN countries

• Key issues: population/workforce distribution; economic devt; urban-rural roles and functions;

efficient land use; development of transportation, technology, communication, energy

Vietnam: Adjustment Master Plan Urban System Development to 2025 with 2050 Vision• Now to 2015, key economic regions and large urban areas are high priority; 870 urban areas

• 2015 to 2025, develop urban area to disperse development; 1,000 urban areas; 45% urban

• Urban population forecast: 52M (2025) accounting for 50% of total.

• 2025: 450k ha demand for urban land, (1.4% of nationwide land), average 85m²/capita

NPFP focus areas

1 Scale and agglomeration: make cities and production areas

work much more efficiently, and mitigate negative impacts

of increasing population. As a city’s population doubles:

• Wages, GDP, patents

produced, service output

and so on tend to increase

by 115% per capita.

• You only need an 85%

increase in the amount of

infrastructure (roads, power,

water, drainage, etc.).

• But diseconomies—e.g.

congestion, pollution,

disease and crime—also

tend to increase by 115%. (West 2017)

‒ Local/metro level: transport and com, affordable

housing, disaster risk reduction

NPFP focus areas

2 Nationwide connectivity: physical and digital

San Fernando

Baguio

Urdaneta

Dagupan

Naga

Ligao-Oas

Legaspi

Tabaco

Tacloban

Ormoc

Marawi

Cotabato

Gen Santos

Koronadal

M Angeles

M Malolos

M Manila

M Antipolo

M Dasmarinas

M Calamba

M Iloilo

M Bacolod

M Cebu

Zamboanga

City

M Davao

M CdO

Maximize

connectivity

within one-

two hours

NPFP focus areas

3 Sustainability and

disaster risk

reduction:

– Protection

– Redundancy

– Market shaping

Riverbasins and Coastal

Plains in the Philippines. (Source: E. Paringit et al., 2016; with

the assistance of NEDA-RDCS)

http://img1.thelist.com/img/gallery/what-happens-to-your-body-when-you-quit-smoking/intro.jpghttps://www.soulseeds.com/wp-content/uploads/2013/08/quit-smoking.jpg

Shaping the

Market

Native trees and

vegetation

Detention ponds for

flood management

and water protection

Natural erosion and

sedimentation control practices

Natural infrastructure

https://farm4.static.flickr.com/3432/3817873624_a59af68d17_o.jpg

Medium density housing

http://www.dmcihomesresidences.com/wp-content/uploads/2016/01/original-20161018141240.jpg

Ambisyon 2040 Survey

• 92% prefer to live and

work in city

• 73% prefer big

residential lot with

small house

• 65% want to own at

least one car

The value of efficient and

well-managed public spaces

and facilities

PDI 09/072008

https://farm3.static.flickr.com/2940/14701887611_753d2a4cc0_b.jpghttp://www.thestar.com.my/~/media/online/2016/05/04/20/05/indo_bike_gerijah_1.ashx/ http://3.bp.blogspot.com/-1I-b5YjFyhc/Um9y4TxgnII/AAAAAAAABps/ToJp62CsuSI/s1600/861289115_1364271221.jpg

Source: Rocky Mountain Land Use Institute, 2008

Shaping the

Market

. . . to accept

sustainability

and disaster

risk reduction

as social

norms.

Green Roof

http://www.brookings.edu/~/media/research/images/d/

df%20dj/disaster_drill001/disaster_drill001_16x9.jpg

Source: Rocky Mountain Land Use Institute, 2008

Green Roof

Thank you