Economy, Domestic Economy

Call for Overhauling Iran’s Urban Management System

Abbas AkhoundiAbbas Akhoundi

Urban management in Iran is a failure and trying to gloss over the reality of what’s happening is futile, the minister of roads and urban development said.

Abbas Akhoundi also told the Second Comprehensive Conference on Urban Management held in Tehran on Monday that urban management is neither accountable to the central government nor to the parliament and people, thanks to its complex dual structure.

Noting that local management needs local decision making, Akhoundi said incidents in metropolises—like what happened to Plasco tower—involves the central government.  

The 17-story Plasco tower collapsed on January 19 in Tehran after fire engulfed its upper floors and resulted in the death of 20 people, including 16 firefighters.

“The quality of life is subpar in urban areas; moving around is almost impossible in cities and these are the results of unwillingness of urban management to become accountable,” Akhoundi was quoted as saying by the ministry’s news portal.

“Citizens of Tehran are afraid of the air they breathe. They are facing challenges of social security and justice. Vehicle speeds are less than 7 km/h during peak hours.”

Chairman of the Iranian Parliament’s Environment Group Mohammad Reza Tabesh said in January that air pollution costs Iran about $20 billion annually, adding that the sum can be used to purchase 20,000 subway cars or establish 140 power plants, 60 stadiums with a 50,000-seat capacity and 900 60-hectare parks.

“In fact, air pollution costs are three to four times more than the government’s development budget,” he said.

In a major study of the economic costs of indoor and outdoor pollution, the World Bank found that in 2013—the year to which the latest estimates belong—Iran lost nearly 2.3% of its gross domestic product to air pollution-related costs (around $30 billion using 2011 as the base year for dollar exchange rate).

Iran’s Department of Environment releases a daily air-pollution index—also referred to as air-quality index—which rates air quality based on the health risk it represents. Anything above 100 is bad news.

In Tehran, the index regularly hits 150 in fall and winter, putting everyone’s health at risk.

Head of the department, Massoumeh Ebtekar, said environmental problems cost Iranian people about $9 billion in 2010, whereas the damage is currently estimated to hover around $30 billion per annum.

 Local Vs. National Governance

“My main critique of Urban Management Bill is that the separation of authority between local urban management and the government is blurry,” he said.  

“In western countries, there are two terms: “national governance” and “local governance”, whereas in Iran we didn’t dare use the word ‘governance’ and used ‘management’ instead. The national governance details its own duties and plans based on which it commits resources from the taxation system, while local governance is not allowed to overstep its authority.”

Akhoundi further said the fundamental difference between national and local governance is that in national governance we talk about public commodities and work out its costs.

“We need to accept that when there is local governance, there should subsequently be a local financial system to pay for its provisions and plans. On top of that, we have yet to discuss whether the administrative hierarchy in Iran accepts a local financial system or not,” he said.

  Municipality Under Fire

Referring to the profiteering nature of Iran’s urban management, Akhoundi said municipality officials do not bother to solve the problems of the city.

The capital city saw new constructions across 13,000 hectares of land in 15 years (between 2001 and 2016), of which 7,000 hectares were in urban areas and the rest in suburbs.

“As many as 4,000 hectares of agricultural land turned into residential plots,” the minister said.

Calling for greater transparency on relations between local finance and national finance that is value added tax, Akhoundi said Tehran Municipality’s share of the country’s budget stood at 45 trillion rials ($1.19 billion) in the current Iranian year whereas the Ministry of Roads and Urban Development received only 15 trillion rials ($396.82 million).

In other words, the municipality’s budget was three times more than that of the city.

“Did the municipality improve public transportation? Relocation of Tehran International Permanent Fairground to suburbs was approved in 2001. As yet, nothing has been done about suburban metro projects. In addition, there are serious concerns that the arena of the fairground would give way to even more high-rise projects,” he said.

“As many as 760,000 construction permits were issued from March 2010-11 to March 2012-13, mostly in Tehran. About 450,000 luxury homes remain vacant in the capital city. With this construction frenzy, can we fight poverty and promote social justice as advised by the Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei?”

Stressing that at present, the axiom of accountability is restricted to the president and the government, Akhoundi said when the president takes the oath of office he swears to protect people’s rights.

“But the question is: does he have the authority to defend people’s rights? Now that the municipality is selling the city, can the president ask why?” he said.

Currently, 50% of Tehran Municipality’s budget depends on the sale of construction permits. Originating in the 1990s, the most financially successful of these has been the so-called “density permits”, according to which developers can defy height, density and location regulations.

Hundreds of thousands of hectares of agricultural land and natural resources across the country have been destroyed and their use was changed illegally since 2006.

Almost all land use change and the sale of density were approved by the municipalities for which they apparently charge exorbitant amounts with little or no regard for the environment, traffic congestion, shortage of water, electricity, gas and other basic urban needs.

“I hold fast to the idea of an integrated urban management, integrated transportation network, urban governance and a revised delegation of responsibilities between the central government and local government. Above all, I root for a transparent accountable system,” he said.

“All over the world, governments allocate budget to the municipalities and demand accountability. This is while in Iran, municipalities and urban management tell the government to keep quiet, Akhoundi said.

“Under the current circumstances, it’s better to admit failure, which would make room for reform.”

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