Stakeholders in Urban Renewal in East Central Europe – changing positions of the public and civil sectors

Krisztina Keresztély, 2016

The Public sector

Following the political transition of 1989/1990, the systemic withdrawal of the public sector could have been observed in all countries, in terms of urban planning and housing policies among others. This withdrawal can also be regarded as a ‘logical’ consequence of the transition from the state socialist system based on central planning and the overwhelming position of the state (although not unique, as the private sector had already re-emerged by the 1970s and 1980s in almost all countries).

The position of the public sector was strongly influenced by the changing political and economic potentials of the different levels of public administration. After 1990, following the creation of autonomous local governments in almost all countries, a large number of competencies were transferred from the central state to the local level. These competencies were variable according to the countries, but the main elements were quite similar. In the case of competencies related to urban renewal, this transfer concerned the management of public housing, housing privatization, urban planning, regulation of constructions, local social care system, basic social institutions (elementary schools, kindergartens, general health care system, etc.)

In spite of this large-scale decentralization, financial tools often failed to be assigned to the competencies. Therefore in many cases the adoption of a strategy or a plan on the local level does not automatically mean the existence of the financial and technical capacities for its implementation. In many cases, strategies remained general, without emphasizing the concrete tools of implementation, indicators of measurement of the results, etc. Partly as a result, local governments are often driven to establish more or less advantageous partnerships with the private sector in order to make certain improvements in their territories. The lack of regulation and monitoring of these partnerships resulted in some very negative consequences such as the selling of historical buildings to private investors (for instance in the Jewish quarter of Budapest), corruption, mushrooming of market-oriented investments, such as parking garages or shopping areas, etc.

As a result of European integration, the role of local governments has changed slightly (see the analysis sheet on European challenges). Through ERDF funding, they have been provided with a new tool for planning and financing urban regeneration programs. This new situation has decreased their autonomy with regard to urban renewal, as obtaining European financing is regulated by serious conditions such as the preparation of detailed plans, integrated development that couples physical renovation with the social dimension, introduction of civil participation in planning and implementation, etc. The strengthening of regulatory conditions has had a positive effect on the character and objectives of urban regeneration programs through the introduction of social elements among those related to physical renovation, construction of partnerships between civil stakeholders and other representatives of the local communities and the public and private actors, and strengthening of the importance of quality of life in neighborhoods. But these programs could not fundamentally change the overall system of local development, nor help overcome general problems related to the lack of overall housing and urban renewal policies, of strategic partnerships between the public, private and civil sectors. The results of urban regeneration programs remained rather superficial, as several cases presented in this dossier will illustrate.

Civil Society

The role and the capacities of civil society in the former state socialist countries have been subject to various analyses representing often opposing opinions. It is of course clear that the civil society has a different meaning with different competencies and roles in Eastern than in Western democracies. According to some extreme opinions, civil society is the ‘product’ of the latter: “Civil society both as a theoretical construct and a practical reality, comes from the particular historical experience of the West” (Howard, 2002, p.41). Would this statement mean that in any other regions of the world with different historical and social development paths, civil society is an unrooted, artificial copy of the Western one? Definitely not. Civil society was of course an important force even during the state socialist system, and it was a leading force for the transition from state socialism to the democratic system at the turn of the 1980s-1990s. To some extent its role was even stronger than in classical democracies. According to Petrova and Tarrow (2007), civil society has always had a strong capacity for building networks between associations for a given purpose (for instance, fighting against an investment, etc.), compensating for the lack of mass mobilisation.

On the other hand, this civil society always remained in large part informal, or at least weakly organised/institutionalised, and as a result had a much weaker position in local decision making, and the representation of public interests, than the NGO sector in Western countries. In the freshly constructed democratic structure, the role delegated to civil society in terms of local development has always been less important than that of other sectors, namely, that of local governments. “As opposed to Western European models, in Hungary – similar to other post-socialist countries – the general weakness of civil society elevated local governments to play a dominant role in local development” (Keller et al. 2016, p. 81)

Strangely though, according to Keller et al. (2016), the role of civil society in local development has continued to decrease since the political transition, and this tendency has become particularly clear in the light of European integration. “Asymmetries in power relations between local governments and local non-state actors were less visible in the early 1990s as regulations did not favour any particular local actor” whereas after 2000, the “European Commission redefined its principles governing accession by changing its priorities within regional policy from political to financial accountability. This ultimately gave central states the prerogative to control regional policy making, the distribution of resources and implementation (…) The new institutional framework of regional policy provided privileges in financial assistance and interest representation for local governmental partnerships without offering non-government actors similar mandates (…) and (…) generated asymmetrical bargaining positions between the two sectors” (Keller et al., 2016, p.79).

This statement seems strange at first sight, as one visible advantage of European-funded urban regeneration for example is the obligatory integrated character of these programs, with a relatively strong dimension given to the empowerment of local civil society. On the other hand, as also illustrated by several case studies, this empowerment often remains superficial, only concerning NGOs that have close ties to the public sector, and/or are considered as ‘deserving’ of their support.

This ambiguous position notwithstanding, the character and image of civil society have changed greatly since the 1990s. In the urban context, the turn of the millennium was the first time a critical mass of civil protest movements appeared for the defense of urban rights. During the 2000s, these movements still mainly concentrated on the defense of the physical environment: green areas, cultural heritage, urban landscape, etc. But soon after, there appeared the first movements concentrating on social challenges – homelessness, housing rights, public participation, etc. Today a wide variety of local NGOs, often connected to international networks, are active in different aspects of neighborhood development in most East Central European cities (see Civil organisations and actors list).

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