Calculating resettlement costs

What should we consider when calculating relocation and resettlement costs from a best-practices point of view?

Numerous considerations are applicable in answering this question, specifically because the IFC performance standards indicate that resettlement must leave all parties with equal or better circumstances than before. In order to highlight the total effort and cost implications of a resettlement, SRK recommends a comprehensive accounting investigation with the purpose of identifying all possible cost implications of resettlement.

During such an exercise, information could be gathered through a range of investigative methods, such as:

• Analysis of aerial photos showing structures and land use
• Detailed on-site asset surveys and inventories
• Interviews with specialists to determine costs
• Interviews with residents to determine income generating activities

Investigation activities could be pursued to reveal a wide range of costs relevant to relocation. They include:

Structures including
• Houses and additional structures
• Schools and clinics
• Churches, sites of worship, cemeteries and graves
• Commercial buildings

Landscapes including
• Fields
• Gardens, parks and playgrounds
• Sports fields and halls

Utilities including
• Electricity, waterworks and sewage
• Roads, sidewalks and signage
• Development and integration efforts
• Transport and setup costs

Project including
• Coordination site offices, staff and equipment
• Overall project management costs
• Independent review costs

Business including
• Entrepreneurial compensation for lost business
• Inventory replacement
• Shop or office fittings and furniture

Specialists in each area are essential in validating local prices and costs associated with resettlement items. However, in cases where specialists are difficult to locate, estimations can be made from national figures with an allowance for uncertainty. Previous projects of a similar nature also provide essential information on costing and its accuracy. For example, SRK Johannesburg has strong competency in resettlement costs in Africa, and personnel evaluating new projects are able to draw information and calculate costs with reduced effort and research.

Raoul de Villiers: rdevilliers@srk.co.za



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