Social Monitoring Report

Project Number: 35338 April 2008

PRC: Roads Development II Project External Monitoring Report on Land Acquisition and Resettlement For Yuanling Local Road(I)

Prepared by: Social Investigation Centre of Politics and Public Administration College in Hunan University, People’s Republic of

For Hunan Provincial Transportation Department

This report has been submitted to ADB by Hunan Provincial Transportation Department and is made publicly available in accordance with ADB’s public communications policy (2005). It does not necessarily reflect the views of ADB.

Loan Project of Asian Development Bank

The People's Republic of China Hunan Roads Development Project (II) External monitoring report on Resettlement of Yuanling Section of - Yuanling Highway

Social Investigation Centre of Politics and Public Administration College in Hunan University April, 2008

TABLE OF CONTENTS

CHAPTER 1 PROJECT INTRODUCTION 4

CHAPTER 2 IMPACTS OF LAND ACQUISITION AND RESETTLEMENT 4

CHAPTER 3 METHODS OF EXTERNAL MONITORING 5

CHAPTER4 RESETTLEMENT POLICY 5

CHAPTER5 LAND ACQUISITION, COMPENSATION AND ADJUSTMENT 6

CHAPTER6 RELOCATION, COMPENSATION AND RECONSTRUCTION 6

CHAPTER 7 INCOME RESTORATION 7

CHAPTER 8 RESETTLEMENT AGENCY 12

CHAPTER9 CONLUSIONS 13

External Monitoring Report on Resettlement of Yuanling Section of Zhangjiajie-Yuanling Highway

I. CHAPTER 1 PROJECT INTRODUCTION

The proposed upgrading of Zhangjiajie-Yuanling highway is one of the local roads components integrated into the Hunan Roads Development II Project financed by ADB. The upgrading of Zhangjiajie-Yuanling Highway will improve the existing Non-class Highway to Class III. The upgrading of the highway will be divided into two sections: Yuanling section and Zhangjiajie section. As for the Zhangjiajie section has not been relocated until now, so the report only includes resettlement condition about Yuanling section.

The proposed local road improvement is located in Yuanling County, City in HuNan Province. The total length of the alignment is 75.445 km which will cross 3 townships and 22 villages in Yuanling County.

Yuanling County, the project area, located at the west part of Hunan Province, is one of the poverty Counties designated by the provincial government in 2001. Yuanling County, which in the vicinity of Xiangxi , both they have two primary advantages: mineral depositions and tourism resources. The weak transportation links with the outside world severely constrain these advantages. The construction of project will serve as an interconnecting road between -Zhangjiajie Expressway completed in 2005 and the Changde- Expressway under construction. It will play a vital role of constructing the Golden Triangular Tourist Zone among Zhangjiajie, Fenghuang and Yuanling, and will provide a substantial boost to the economic development of the project area. The construction of the proposed project will help to improve the accessibility of people in the project area, hence increase the agricultural production and assist with poverty alleviation, improve welfare of minority nationalities in the project area.

II. CHAPTER 2 IMPACTS OF LAND ACQUISITION AND RESETTLEMENT

Impacts of land and property acquisition will be widely spread over 22 villages, and about 517 private households will require relocation. The floor space of house and building that need demolished is 52171.7 (m2). The total land acquisition area is 689.257 mu (1.1ha), 197.05mu of which is farmland， about 1103 household are affected.

The investigation was undertaken in May 2006, In addition to a few households, massive households have received compensations for land acquisition and relocation in November 2006. Until the end of 2006, besides 57 houses near Yuanling town and 9 houses at Jiemuxi Township, other houses and subsidiary buildings have been relocated. Up to now, 369 houses have been demolished (excluding subsidiary buildings), the floor space is 37,783 square meters. Among them, 247 households at Jiemuxi Township, count 23,712 square meters; 66

households at Shenxikou Township,count 7,038 square meters; 56 households in Yuanling Town, count 7,033 square meters. The permanent land acquisition project ended at the end of 2006, a total of 689.257 mu various types of land were acquired, of which 375.637 mu at Jiemuxi Township, 223.77mu at Shenxikou Township, 89.85mu at Yuanling Town. The infrastructure that will be affected includes fiber cable, power lines, telecommunication lines and cables. After continuous consultation, the cable began to remove in December 2006. Most of power, telecommunications, lines and wires have been completed diversion in May 2007. Schools and factories along the road have far away from the reconstruction project, accordingly, the highway reconstruction failed to have impacts on them.

III. CHAPTER 3 METHODS OF EXTERNAL MONITORING

As a loan project of Asian Development Bank, in order to assure the resettlement program in accordance with Asian Development Bank’s policy on Involuntary Resettlement, we carried an external monitoring survey for the resettlement project.

The major contents of monitoring include:

（1）Whether the compensation standards of land acquisition and relocation are consistent with the requirements of Asian Development Bank, that is to say, whether reflect replacement cost;

（2）Resettlement and availability of funds allocated;

（3）Livelihood comparison of land acquisition and without project;

（4）Executing agency and condition about land acquisition.

The specific monitoring methods include both quantitative and qualitative.

（1）Visited Zhangyuan Highway Construction and Development Co. Ltd in Huaihua and other staff in related department, inquired about the whole process of resettlement program.

（2）A total number of 71 affected households received questionnaire survey in March 2008. The major information include: family background, land acquisition and compensation, compensation for housing relocation and reconstruction, family property, business operating status, income and outcome and so on.

（ 3 ） 15 affected villages received questionnaire survey in March 2008,and asked something about relocation, reconstructing, income recovery etc.

The present report is based on the detailed measurement survey above.

IV. CHAPTER4 RESETTLEMENT POLICY

The project of land acquisition is accordance with the Resettlement Plan compiled in June 2006 and based on a combination of PRC laws、regulations and Asia Development Bank’s policy on Involuntary Resettlement. The following laws and regulations will be utilized for this project: z Implementation Regulations for Land Administration Law of the People’s Republic of China, effective January 1999. z Measures of Information Publicizing for Land Acquisition, No. 10 Order, Ministry of Land and Resources, effective on January 1, 2002. z Implementation Measures for the Land Administration Law of PRC in Hunan Province, effective as of March 31, 2000). z Decree 28 for Land Administration Law (Promulgated in October 2004) and Hunan Provincial Document No. 24 (February 2005) z Management Measures on Temporary Land Occupation, No. 140 Order, Human People’s Government, effective 2001. z Forestry Law.

V. CHAPTER5 LAND ACQUISITION, COMPENSATION AND ADJUSTMENT

The permanent acquisition of land in Yuanling section of Zhang-Yuan highway has been finished at the end of 2006, Land compensation and resettlement subsidies have already been allocated. Land has been transferred completely. Those farmers whom we visited have also obtained land compensation and resettlement subsidies. However, a series of farmers believed that the land compensation standard is somewhat low.

After land acquisition project, only few villages have adjustment of land, the vast majority of villages haven’t land adjustment. The compensation for the villages which have land adjustment will be distributed in the village. Villages which have no land adjustment will be paid directly to the affected families.

From the survey of 71 households, we noted that each household have acquired an approximately of 0.17mu land. Yuanling County, located in mountainous areas, hence the area of farmland is few, and lesser than other areas. The survey from 71 households indicated that the average of farmland is 2.22mu, while the per capita farmland is no more than 0.48mu. Thus long term impacts on land acquisition will be extensively. We should put emphasis on income recovery about farmers who own little per capita farmland.

VI. CHAPTER6 RELOCATION, COMPENSATION AND RECONSTRUCTION

The relocation project started in May, 2006, a wide range of houses have been demolished at present. In according to the survey from affected farmers, we get to know that all the affected households have received Houses and Buildings compensation. Among 55 families, the highest compensation hit CNY67,547 and the average of compensation is about CNY20,000. Standards of Compensation for Houses and Buildings as follows:

Table 1 Compensation Rates for Houses and Buildings Unit: CNY/m2 Brick & Brick & Clay & Wood & tile Simple Structure Concrete wood (tile) Wood (tile) roof Houses

Rate 280 220 180 160 90

According survey to 15 villages, we concluded that 79 new houses have been completed, 13 new houses are under construction and 117 households have not yet begun to build for short of alternative residential land.

From those new houses have been built, we knew that an overwhelming majority of families enjoyed better condition than the pre-project levels of vulnerability. The structure of new house changed from the original wood-tiled to new brick-wooded now, however, there were still a handful of poor families lived in old wood-tiled houses. They hadn’t enjoyed comfortable dwellings. However, farmers whose new houses have not been built have to live in the old dwellings or temporary simple houses.

More needs to be done in the course of reconstruction. The issue of alternative residential land is somewhat troublesome. Furthermore, landslide is serious from section Shenxikou to Tongcheping. On the condition of security, there are lots of troubles in this issue. The section near Yuanling county, owing to slow pace of construction, 57 households have not been relocated for alternative residential land, whereas the compensation has been paid to each household. Due attention should be paid to this issue.

A number of new houses have access to telecommunications, but the issue of drinking has not been addressed fully.

VII. CHAPTER 7 INCOME RESTORATION

The baseline survey in May 2006 showed that the per capita Annual net income in affected families in 2005 was CNY3,121.

The survey in 2008 revealed that the per capita Annual net income in affected families in 2007 was CNY4,174 (excluding relocation subsistence allowance, if including, the per capita income will be CNY5,874), Compared with that in 2005 , increased by 34%.

As is shown in monitoring survey in 2008, In per capita Annual net income, the proportion of wage income was 68% in 2007, of which migrant labor income accounts for 51%; the proportion of operating business net income was 29 %, of which agriculture activities accounts for 9% (including farm, forestry, animal husbandry and fishery) and 20% for non-agricultural activities; the proportion of property income (excluding relocation subsistence allowance) and transfer red income were 2.4%(As shown in Table 2)

As is presented in the table, the percentage of wage income accounted for 68% of household net incomes, whilst the migrant labor income highly account for 51% of household net incomes. What we have to mention is that certain farmers were working away from home when we visited. As a result, the income is estimated by their relatives and may be higher than their actual income. Nevertheless, we get to know that a multitude of affected farmers in the project area pour into cities especially developed cities at coastland. At present, migrant labor occupies an essential part in the resources of income. Under this condition, resettlement agency and government should dedicate in the issue to allow access to key employment information, as well as skill training and so on for resettlement of people.

Meanwhile, we noted that the proportion of agricultural activities net income were relatively lower, The situation out of less arable land and poor farming efficiency etc.

Due to factors above, the affected farmers adept to work away from home for income restoration. In some extend, it alleviated stress of local economic recovery, while there were still about 30% of affected families hadn’t migrant labor income. Therefore, developments of non- agricultural industries and breeding industries in local have considerably significance. The local government should draw lessons as a guide.

Wage income

2.4%

29.4% Business income

68.2% Transferred income or income from assets(excluding compensation)

(i) (i) Figure1 Distribution of income sources of surveyed family in 2007

(ii) Table2 income sources of Per Capita Annual Net Income in 2007 Unit: (CNY) amount % Total 4174 100.0% I、Income of wage 2846 68.2% including：Income of migrant working 2134 51.1% II、Income of business 1228 29.4% 1.agriculture activities (farm, forestry、husbandry and fishery) 384 9.2% 2. non-agricultural activities 844 20.2%

III、Transferred income or income from assets 100 2.4% （excluding land acquisition compensation）

The monitoring survey indicated that there were merely 2 households whose per capita national income lower than the absolute poverty line (CNY693) released in 2007, therefore, we come to know that the absolute poverty families are few. Whereas families whose per capita Annual incomes below CNY2,000 account for 25% of the whole households. It is revealed that a certain proportion of families lived in the condition of relative poverty. No doubts should we think highly of poverty and take some special supporting measures. Absolutely, there were also high income families whose incomes come from migrant labor or operating business in local.

Table 3 Distribution of Annual Net Income per Capita of surveyed households

Annual Net Income Cumulative household percentage per Capita（CNY） percentage

〈 693 2 2.8 2.8

693-1999 16 22.5 25.4

2000-2999 12 16.9 42.3

3000-3999 13 18.3 60.6

4000-4999 6 8.5 69.0

5000-5999 10 14.1 83.1

6000-6999 3 4.2 87.3

7000-7999 4 5.6 93.0

Above 8000 5 7.0 100.0

Total 71 100

The statistical analysis of surveyed households revealed that the average of household consumption expenditure in 2007 was CNY15,235.The average of per capita consumption expenditure was CNY3,437(Table4).The analysis of expenditure structure presented that the proportion on food expenditure taken up 47.6% of living consumption expenditure, Compared with the level of local economic development, it pales. In some extend, the main reason may owned to food was depend on themselves, but purchasing from the market. The ratios of education expenditure, recreation expenditure, medical treatment expenditure were 14 percentage, 14 percentage, and 10 percentage respectively. Both percentage of transportation, communication expenditure and dressing expenditure were about 7%; the percentage of dwelling expenditure was 5.9%.

Table 4 consumption expenditure of surveyed households in 2007 Average percentage item （CNY） Food expenditure 7251 47.6% Dressing expenditure 1187 7.8% Dwelling expenditure 900 5.9% Equipment, goods expenditure 504 3.3% Transportation, communication expenditure 1147 7.5% Education, Recreation expenditure 2148 14.1% Medical Treatment expenditure 1456 9.6% Other expenditure 642 4.2% consumption expenditure 15235 100.0% Per capita expenditure 3437

Food expenditure 4.2% 9.6% Dressing expenditure

Dwelling expenditure

14.1% Equipment, goods 47.6% expenditure Transportation, communication expenditure 7.5% Education, Recreation expenditure 3.3% Medical Treatment 5.9% expenditure 7.8% Other expenditure

(ii) Figure2 Distribution of living expenditure of surveyed family

In terms of production, 42.3% of the surveyed families owned thresher, 7% of them own pumps and motor. Tractors and agricultural vehicles are never held in these families.

In certain extents, durable consumption goods may imply family economic status, material life. The main durable goods were chosen in the survey to measure possessions of the durable goods among affected families. From Figure 3 ,we may knew that the rate of possession of color TV set is the highest, up to 90.1%, the proportion of owned VCD and DVD reached at 67.6% which indicated that though the rate is lower than urban family’s, it also achieved a high percentage. In terms of transportation, the ownership of automobile and motorbike rates are extremely low. There are still a couple of issues need to be embarked. The ownership of telephone and mobile phone are 53.5% and 66.5%. The phenomenon presented that rapid development of communications in recent years. The possession rate of washing machine is 12.7%，The ownership of refrigerator was 26.8%,While the ownership of computer and air conditioning rates are extremely low.

100% 90.1% 90%

80%

70% 66.2%

60% 53.5% 49.3% 50%

40%

30% 26.8%

20% 18.3% 12.7% 10% 7.0% 2.8% 1.4% 1.4% 1.4% 0.0% 0%

e r e le r g n D in c to ter o ato h o u nin ph VC er DVD icy m p ig b camera m itio mac d tele g utomobile co n obilephone refr in a color TV set M h co as air w

Figure3 Proportion of household own one kind of durable goods

VIII.

IX. CHAPTER 8 RESETTLEMENT AGENCY

Hunan Provincial Communication Department is responsible on behalf of the Hunan Provincial Government for the general administration of the local road improvement. The implementing agency for the project is Zhangyuan Highway Construction Co Ltd (ZYCC) under the Hunan Provincial Highway Bureau (HHB). ZYCC shall be in charge of the implementation of the project and the execution and coordination of land acquisition and resettlement. A LAR Division shall be set up within the ZYCC. Further, LAR Coordination Division will be established in Yuanling County. The Division will headed by 1 county leader and shall consists of several members from different government departments like the communications bureau, land administration, environment protection and forestry bureau, usually one from each department. Each affected township shall nominate four persons and each village committee shall nominate at least one person to LAR Coordination Division. The person who nominated should be responsible for all resettlement-related projects.

In the processes of land acquisition and relocation, Resettlement agencies have done a series of fruitful works, such as handling affected household’s difficulties timely and efficiently, assisting farmers do a good job of relocation.

Resettlement agencies have always been attached great importance to the anticipation of affected households and set up a transparent and effective statement mechanism. In case of any dissatisfied with the resettlement project, they can make an oral or written appeal. From the information we obtained, the problem what they reflected have got highly focus, such as the problem of alternative of residential land have been tackled properly. Some of troubles were in the process of handling. These issues free from defeated also should be set store by government in the future project.

X. CHAPTER9 CONLUSIONS

z Land acquisition and resettlement of the project is accordance with the Resettlement Plan compiled in June 2006 and based on a combination of PRC laws、regulations and Asia Development Bank’s policy on Involuntary Resettlement.

z The permanent land acquisition project completed at the end of 2006, a total of 689.257 mu various types of land were acquired, of which 375.637 mu at Jiemuxi Township, 223.77 mu at Shenxikou Township, 89.85 mu at Yuanling Town.

z Land compensation and resettlement subsidies have already been allocated. However, a series of farmers believed that the land compensation standard is somewhat low.

z The vast majority of villages haven’t make land adjustment. Yuanling County, located in mountainous areas, the per capita of arable land merely 0.48mu.

z House demolition will be widely spread over 22 villages, and about 517 households’ house will be demolished. The floor space of house and buildings that need demolished is 52171.7 (m2). Most households have received compensation for land acquisition and relocation. Up to now, 369 houses have been demolished (excluding subsidiary buildings), the area of demolished is 37,783 square meters,

z Massive new houses have been built. A large river of families enjoyed better condition than without reconstruction. The structure of new house has changed from the original wood-tiled to new brick-wooded, however, there were still a handful of poor families whose new houses have not been finished. Due attention should be paid to alternative residential land.

z The infrastructure affected includes power, communication, lines and wires have been completed diversion. Schools and factories along the project failed to have impact.

z The problem of drinking of affected population should be addressed promptly.

z The monitoring survey in 2008 revealed that the per capita annual net income in affected households in 2008 was CNY4,174(excluding relocation subsistence

allowance , if including, the per capita annual net income will be CNY5,874), Compared with the per capita annual net income in 2005 ,increased a lot.

z Analysis on income resources founded that migrant labor income highly account for 51% of household net income in 2007. At present, migrant labor occupies an essential position in the resource of income. Under this situation, resettlement agency and government should focus on the issue of how to offer more relevant supporting measures for affected households, such as skill training, employment information providing and so on.

z The proportion of agricultural activities net income is relatively lower, the main reasons for the situation due to less farmland and poor farming efficiency etc.

z On the ground of poor farming efficiency and land acquisition etc, affected families adept to work away from home for income recovery. Whereas there were remain about 30% of affected families hadn’t migrant labor income. Therefore, developments of non-agricultural industries and breeding industries in local have considerably significance. The local government should draw lessons as a guide.

z It is indicated that a certain proportion of families lived in the condition of relative poverty. No doubts should we think highly of poverty and take some special supporting measures.

z In the case of income recovery, besides effort of affected households, more needs to be done for related agencies. Such as technical training, employment and other key information. Resettlement agency also should support the vulnerable families properly.

z The survey revealed that the average of per capita family consumption expenditure was CNY3,437 in 2007, 47.6% of which was food expenditure.

z Resettlement agencies have been set up in the project. In the process of land acquisition and relocation, Resettlement agencies have done a lot of fruitful and effective work.

z Appeal procedures have been set up. As if any dissatisfied with resettlement, they can make a corresponding appeal or statement. Although some affected family’s property and interests have been affected, they have failed to express their views and resolved troubles timely. The resettlement agencies should attach great importance on this issue in the future project.

z After the projects of land acquisition and demolition, resettlement agency should devote more manpower and resources to guide the affected households' economic recovery and deal with appeal of affected households. If possible, some special assistance should be provided.