Equitas Bird’s Nest Case Study Overview

Executive Summary

In the past ten years, India has undergone a dramatic demographic shift as millions of farmers and villagers from rural areas move en masse to the cities. This urbanisation has grown from an observable trend to an increasingly complex problem as urban infrastructure struggles to keep pace. Climate change, disputes over land rights, and a multitude of other reasons have conspired to create circumstances that make it very difficult for rural farmers to make a living through agriculture. The search for alternative sources of income, coupled with the lack of opportunity in rural areas, brings many families to the cities in hopes of a better life. Unfortunately, many find themselves ill-prepared for city life and too often end up homeless as pavement dwellers.

This ultra poor population is arguably the most vulnerable segment of modern urban society. They have no shelter from the elements, no access to clean water and sanitation facilities; they struggle daily to find food, and illness and crime are constant threats. The main source of income for most pavement dwellers comes from begging on the streets. The daily sight of entire families destitute on the streets of Chennai inspired Mr. P.N. Vasudevan (“Vasu”), a former banker, to found an organisation dedicated to alleviating extreme poverty. He started by offering microloans as a way for poor individuals to pull themselves out of poverty. However, microfinance wasn’t able to help the poorest of the poor. To refocus efforts on ultra poor populations such as pavement dwellers, Vasu created the Equitas Development Initiatives Trust (EDIT). EDIT provides a range of services to the ultra poor in Chennai around food security, livelihoods, education, and healthcare.

In 2009, EDIT partnered with Unitus, under the Sorenson-Unitus Ultra Poor Initiative, to pilot the Equitas Bird’s Nest (EBN) programme. EBN was to be an 18-month pilot programme broken into three distinct phases and focused on providing support and training to 100 pavement dwellers in five key areas: housing, food security, healthcare, livelihood skills, and supplemental education. The primary objective of the intervention was to move households off the pavement and into permanent housing. Secondary objectives included creating food security and a stable income through engaging in learned livelihood activities, and providing sustained access to healthcare and education. An additional objective of the pilot was to demonstrate that ultra poor programmes, which typically have a high cost per beneficiary, could be more cost-efficient while remaining highly effective by having participants repay some of the programme costs when they are able.

Phase One:

The plan was to move participants from the pavements into housing units in nearby slums. EDIT would secure the housing and pay the rent for the first six months. During this period, known as phase one, EDIT would provide skills training and introduce the member to a new livelihood that could double or triple the household income. At the same time, EDIT would provide the family with food, access to healthcare, and would begin offering tutoring sessions to help children with schoolwork in the hopes of re-enrolling them in school.

Phase Two:

During phase one, the household would have started their livelihood activity and begun earning a stable income. In phase two, months seven through 12, the household would be expected to take over the responsibility of paying rent and buying its own food.

Phase Three:

By phase three, months 13 through 18, the household was expected to have become much more financially stable and was expected to begin paying back the first six months of subsidised rent. By the 19th month, the household would have paid back the first six months of rent and would then begin paying back the security deposit that EDIT had paid to secure the apartment. By having participants pay back the rent and security deposit, the programme would be able to recover 75% of its costs, which could then be used to expand the programme to help more families.


Challenges Securing Housing

Lesson 1: Work with strategic partners to identify and secure housing while EDIT focuses on providing training and support around education, healthcare, food security, and livelihoods.

Securing housing turned out to be an extremely labour intensive process in which each unit took between 9 and 12 weeks to secure. With 100 units to secure, this significantly slowed progress. The team first experienced difficulty finding affordable units within the target slum areas. Once a unit was located, a litany of aditional challenges with the landlord commenced. Problems included charging inflated prices once the landlord knew an organisation was involved, not wanting families from a lower class moving into their slum, not wanting to sign any contractual agreements with EDIT, not having a bank account in which to deposit monthly rent cheques from EDIT, and numerous others. Often, even after the process of securing the unit was completed, repairs needed to be made, which took even more time. Unfortunately, each unit had to be sought out and secured individually, as such, there was no foreseeable way to speed up or scale the process.

In the future, the team may partner with another organisation to identify and secure the housing, allowing EDIT to focus on its core competencies of providing healthcare, livelihood training, food security, and education. EDIT is investigating other possible housing options and has also begun to explore the possibility of partnering with the local government to convert abandoned or vacant buildings into low income housing projects as a way of addressing homelessness.

Lead with Livelihoods

Lesson 2: When working with homeless populations, it is important to begin with skills training and establish an alternative livelihood before introducing housing.

Lesson two came as a surprise to the team. Once the arduous process of securing a rental unit was finalised, the team saw that families were not moving into the housing. After investigation, the team realised that families feared losing their place on the pavement and the means to their only source of income: begging. In order to coax the families into leaving the relative security of their pavement location, EDIT had to establish an alternative livelihood for them. This meant also securing buyers for their finished products to ensure a steady stream of income. Only once the families gained confidence in their ability to generate an income from sources other than begging, would they be willing to relinquish their place on the pavement and move into a rental unit.

The team changed their approach and began conducting the livelihood skills training while the families were still living on the pavements. Once they began their livelihood activity and saw they could earn a steady income from it, they began to move from the streets into the secured rental units.

Programme Effectiveness vs. Cost-efficiency

Lesson 3: It is possible for an ultra poor programme to be cost-efficient and highly effective by asking participants to pay back a portion of programme costs.

The pilot is slowly demonstrating that ultra poor beneficiaries are both willing and able to pay back a portion of the costs incurred to serve them, providing evidence that programmes can dramatically improve quality of life for beneficiaries while also operating under a more cost-efficient design. Instead of spending the average $600-$800 per beneficiary, EBN is on a path to achieving more economically sustainable positive change for approximately $60-$100 per beneficiary.

All households that have been moved into housing have been able to successfully take over and continue making their own rent payments. While it was determined that month 13 was too early for beneficiaries to start paying back the first six months of rent, all have committed to beginning payments once they reach the 18th month. In the original EBN model, the EDIT team had hoped to recoup 75% of the cost per household, namely the security deposit and first six months of rent. At the time of writing this case study, the programme has recovered close to 10% of its original costs and there is sufficient evidence to believe that 75% of programme costs will be recovered.

The EBN team plans to take the lessons learned from this initial pilot to formulate a revised plan and second pilot that will reach 1,000 households. The team will continue to improve the model, eventually scaling to other cities, providing a cost- effective model for successfully and sustainably elevating pavement dwellers to a higher standard of living.

Read: Equitas Bird’s Nest Case Study Report (PDF)

Equitas Bird’s Nest Project Page >
Sorenson-Unitus Ultra Poor Initiative Project Page >