Infrastructure expenditure per capita

(a)Name: Infrastructure expenditure per capita. 
(b)Brief Definition: This indicator is defined as the per capita expenditure
in US dollars by all levels of government, including government-owned
companies and utilities, on urban infrastructure services during the current
year. 
(c)Measurement Unit:  $US

(a)Agenda 21:   Chapter 7:  Promoting Sustainable Human Settlement Development
(b)Type of Indicator:  Response

(a)Purpose: This indicator measures the involvement of the different levels
of the government and the private sector in the provision, improvement and
maintenance of infrastructure.  As such, it is a key measure of provision of
basic services, including housing to the population. 

(b)Relevance to Sustainable/Unsustainable Development:  Infrastructure is a
major indicator for the monitoring of the Global Shelter Strategy to the Year
2000, which calls for a fundamental shift in government's role in housing from
attempting to provide housing directly towards an enabling role, one which
facilitates, energises and supports the activities of the private sector, both
formal and informal. The enabling strategy provides the basis for a
sustainable long term approach to human settlement management. 

Total infrastructure expenditure interacts strongly with new land development
and construction, and also with improved access to services by households. 
Low levels of infrastructure expenditures result in land supply bottlenecks
and thus in higher prices for land and housing.  They also result in
inadequate provision of residential amenities, such as water, sewerage,
drainage, electricity, and transportation facilities all of which can affect
the quality and access to housing.

(c)Linkages to Other Indicators:   Infrastructure development energizes the
shelter sector, and improves housing affordability.  It is closely linked with
other socioeconomic and environment indicators, especially those associated
with human settlements, including house price-to-income ratio, land use
change, transport fuel consumption, land and area of informal settlements,
access to adequate sanitation, and infant mortality rate.

(d)Targets:  International agreements have not established specific national
and global goals for this indicator.

(e)International Conventions and Agreements:  This indicator is one of ten
"key" housing indicators approved by the Commission on Human Settlements
(Resolution 14/13), to be collected in all countries and in a number of cities
in each country, to measure progress towards meeting the objectives of the
Global Shelter Strategy. Countries are to use the indicators to provide the
basis for their country reports for the Second United Nations Conference on
Human Settlements (Habitat II).

(a)Underlying Definitions and Concepts:  Infrastructure includes operations,
maintenance, and capital expenditures on physical infrastructure such as urban
roads, railways, sewerage, drainage, water supply, electricity, and garbage
collection, but not social infrastructure such as health and education
expenditure.

(b)Measurement Methods:  Infrastructure expenditures are comprised of three
major components, capital expenditures (construction costs), recurrent
expenditures (operations, maintenance, salaries, etc.), and capital servicing
(debt service and depreciation). If there were unusually high capital
expenditures during the last year for which figures are available, then they
should not be included in the indicator.  Only their first year depreciation
should be considered as current year expenditure.  Only real outlays or real
transfers should be counted as expenditure. If debts (for example, to the
central government) are not actually paid, or depreciation payments are not
actually transferred to a sinking fund, they should not be counted as
expenditures.

(c)The indicator in the DSR Framework:  Infrastructure expenditure is a key
measure of human settlement management, as infrastructure constitutes the main
input for land and shelter development and improvement. It is a major Response
to inadequate land development, and therefore housing production, in order to
meet the increasing demand of populations. 

(d)Limitations of the Indicator:   The methodology for this indicator requires
more work in, for example, defining the scope of infrastructure to be
included, and in the treatment of interest payments and depreciation.  The
interpretation and meaning of this indicator will vary greatly by country and
geographic region. 

In many countries, infrastructure expenditure is targeted towards certain
areas of the city and specific groups of the population.  Aggregated data for
the city will not show who are the real beneficiaries of infrastructure
expenditure. Also, sectoral expenditures on different categories of
infrastructure may have very different outcomes for sustainability.

(e)  Alternative Indicator Definitions:   Under the limitations discussed
above, it may be advisable to consider a more basic definition of
infrastructure to include, for example, water supply, sewerage collection and
treatment, roads, communication, and schools.  This, however, would increase
the overlap with other existing, more disaggregated indicators, such as water
and sanitation services.

(a)Data Needed to Compile the Indicator:   Three data components are required:
capital expenditures (construction costs), recurrent expenditures (operations,
maintenance, salaries, etc.), capital servicing (debt service and
depreciation).

(b)Data Availability:  This indicator has been collected in 44 countries (one
city per country) by the Shelter Sector Performance Indicators Programme in
1992 (UNCHS, World Bank). It is being collected worldwide by the United
Nations Centre for Human Settlements (UNCHS) Indicators Programme in
preparation for the Habitat II Conference.

(c)Data Sources: This indicator is obtained from expenditure accounts of local
and central governments, and from major public agencies.  International data
is available from the Housing Indicators Programme report listed in section
7 below.

(a)Lead Agency:  The lead agency is the United Nations Centre for Human
Settlements (Habitat).  The contact point is the Director, Programme
Coordination, UNCHS; fax no. (254 2) 624 266.

(b)Other Organizations:  The World Bank.

World Bank. Housing: Enabling Markets to Work. A World Bank Policy Paper.
Washington D.C.,  1993.

UNCHS (Habitat), World Bank.  The Housing Indicators Programme. Report of the
Executive Director (Volume I). UNCHS, Nairobi, 1993. 

UNCHS (Habitat). Monitoring the Shelter Sector. Housing Indicators Review.
UNCHS, Nairobi, 1995.

LEAD AGENCY:  HABITAT

Methodology Sheets