Rio mayor Eduardo Paes said residents of the Morro de Urubu favelas (shantytowns) were being evacuated starting Saturday ahead of demolitions planned for Monday.

The mayor decreed late last week that residents could be forcibly removed from their neighborhoods, perched precariously on hillsides.

"There is still a risks of rains in the city. We cannot let people stay in danger zones," he said, noting that some 10,000 people live in the designated "risk areas."

Families will receive a "social pension" of 141 dollars each month to pay for temporary housing until new houses are built, the mayor said.

On a visit to the Morro do Bumba slum in Niteroi on Sunday, Rio state Governor Sergio Cabral announced the federal government would provide a loan of some 2.3 billion dollars to cover damages.

The slum, where dozens of houses were destroyed by landslides, was built on an old garbage dump, compacted by time. The hillside gave way after the heavy rains, burying alive some hundreds of people, according to official estimates.

Labor Minister Carlos Lupi has said a 30-year credit line of 567 million dollars, with a three-percent interest rate, has been set up to finance construction of public housing.

The federal government meanwhile already released 113 million dollars in aid for municipalities in Rio state affected by the floods and mudslides.

Last week's floods tore through the metropolitan area's precarious hillside slums.

The Niteroi shantytown was hardest hit, with at least 141 dead, according to the civil defense authorities. Across the bay, another 63 bodies were found in Rio de Janeiro.

The heavy rain forced some 50,000 people to leave their homes, officials said, either because their homes were damaged or because they were ordered to leave due to fear of fresh landslides.

Focus has quickly turned on responsibility for the huge death toll and damage. Experts blamed government "complacency" for allowing the country's poorest to build housing haphazardly in areas at risk of natural disasters, such as on the sides of steep hills.

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