federal republic of nigeria file cop' water supply ... official use only federal republic of...

Report No. 4696-UNI

Federal Republic of Nigeria FILE COP'

Water Supply & SanitationSector Memorandum

October 30, 1984

West Africa Region

FOR OFFICIAL USE ONLY

Document of the World Bank

This document has a restricted distribution and may be used by recipientsonly in the performance of their official duties. Its contents may not otherwisebe disclosed without World Bank authorization.

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CURRENCY EQUIVALENTS(As of October 1984)

Currency Unit - Naira(N) = 100 Kobos (k)US$ - N 0.75N - US$1.333

MEASURES AND EQUIVALENTS

1 millimeter(mm) - 0.04 inches (in)1 meter (m) - 3.23 feet (ft)1 kilometer (km) - 0.62 miles (mi)1 square meter (m2 ) - 10.8 square feet (sq. ft.)1 hectare (ha) (10,000 - 2.47 acres (ac)1 square kilometer (km ) - 0.386 square miles (sq.mi)c liter (1) - 0.264 US gallons (gal.)

1 cubic meter (m3) - 35.3 cubic feet (cu.ft.)- 264 US gallons (gal)

1 cubic kilometerdkm3 ) - 264.000 million US gallons1 cubic mete; per - 22.8 million US gallons per day (Mgd) or

second (m /.aec.) 35.4 cubic feet per second (cu.secs)

liters per capita per day (lcd) - 0.264 US gallons per capita per dayliters per second (1/sec.) - 15.8 US gallons per minute

PRINCIPAL ABBREVIATIONS AND ACRONYMS USED

ASWC - Anambra State Water CorporationBSWB - Borno State Water BoardBSWC - Benue State Water CorporationFDWR - Federal Department of Water ResourcesFGN - Federal Government of NigeriaFMAWRRD - Federal Minist"ry, of Agriculture, Water Resources and

Rural Development (since January 1984)FMF - Federal Minis';ry of FinanceFMNP - Federal Minis-try of National PlanningFMWR - Federal Ministry of Water Resources (to December 1983)KSWB - Kaduna State Water BoardLGA - Local Government AreaRBRDA - River Basin and Rural Development AuthoritySWB - State Water Boards/CorporationsWRECA - Water Resources and Engineering Construction Agency, Kano

FISCAL YEAR

January 1 - December 31 (since January 1, 1981)

This Sector Memo was written by R.A. Andersen with assistance from E.Aikins-Afful and S. Katsu of WAPIIS and M. Jackson of the WHO/IBRD CP Geneva.

FOR OFFICIAL USE ONLY

FEDERAL REPUBLIC OF NIGERIA

WATER SUPPLY & SANITATION

SECTOR MEMORANDUM

Table of Contents

Page

I. SUMMARY AND RECOMMENDATIONS ................................ 1

Introduction .1Sector Organization. 1Water Utilities: Organization and Performance. 1Sector Investment Programs. 2Overview and Recommendations. 2

II. SECTOR ORGANIZATIONS AND RELATIONSHIPS. 4

Introduction. 4General Sector Organization. 4River Basin and Rural Development Authorities. 5Organization of State Wa-ter Utilities. 5Organization of Rural Water Supply. 7Organization of Sanitation Services. 7Health Education. 7Water Quality Control...8 .................................. 8Summary ..................................................... 9Recommendations ............................................. 9

III. SECTORAL INVESTMENT PROGRAMS ... 10

Introduction .10Existing Levels of Service .10

Existing Development Priorities. .10Design Parameters and Investment Criteria .11Alternative Service Levels .12Water Supply Investment Requirements .12Recent Procurement Experience .13Summary .14Recommendations .14

IV. PERFORMANCE OF STATE WATER UTILITIES .15

Introduction .15State Financial Guidelines .15Recurrent Costs Subvention .16Financial Performance and Tariff Policy .17Operation and Maintenance .18Water Quality Control .19Manpower and Training .19Performance Indicators .20Summary .21Recommendations ...................................... 21

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization.

Table of Contents (continued)

V. BANK'S LENDING STRATEGY ......... ................. . ... . 22

Bank's Sector Strategy . .. ................... . 22Present and Future Bank Activity in Nigeria ................ 22Recommendations ... ....... . 24

List of Annexes

Page

Annex 1 Letter from Federal Ministry of Agriculture,Water Resources and Rural Developmen-t ................. 25

Annex 2-1 Sector Background . .......... ......... ............ . 27Annex 2-2 Rural Water Supply and Community Participation 30Annex 2-3 Sanitation Services ...... .. ............... . ... 33Annex 2-4 Health Education ............................ .... ...... 34Annex 3-1 Water Supply Investments to Meet Different

Service Levels . . ....... ...... # ............ 36Annex 3-2 Extracts from World Development Report (1983) 38

Maps

IBRD 18668 Nigeria

CHAPTER 1

SUMMARY AND RECOMMENDATIONS

Introduction

1.01 This sector memo is written to summarize the common issues in thewater supply and sanitation sector in Nigeria. The main problems beingencountered in the sector are identified and discussed with the objective ofproviding some suggestions and guidance for the introduction of measuresrequired to facilitate an improved development of the sector.

Sector Organization

1.02 in 1984, the Federal Military Government of Nigeria (FGN) merged theMinistry of Agriculture with the Ministry of Water Resources (FMWR) to createthe new Ministry of Agriculture, Water Resources and Rural Development(FMAWRRD). The FMWR was responsible for the national and internationalaspects of water resources allocation and for approving large water resourceprojects to be funded by the FGN. Eleven River Basin Development Authoritiescreated in the decade to 1983, which were responsible to the FMWR for theplanning and development of water resources on a regional basis throughoutNigeria, were split into 18 River Basin and Rural Development Authorities(RBRDAs) on a State boundary basis (except Lagos State) in 1984. The watersupply utilities which have been established in each of the 19 states do nothave a direct linkage to the Federal Government, except loosely through theFederal Department of Water Resources (FDWR) in the FMAWRRD. Additionally,they have no common reporting point at the federal level or formal relation-ship with the RBRDAs. ',inkages with other agencies responsible for otheraspects of the water supply and sanitation sector are weak.

1.03 Although a basic foundation exists for urban water supply there is nosuch institutional arrangement for rural water supply. The multiplicit:T ofagency responsibility for operations and maintenance, as well as capitalinvestments, reflects low state institutional priority and produces ineffec-tiveness through small coverage spread. Responsibility for solid and liquidwastes collection and disposal in urban areas rests mainly with the LocalGovernment Authorities (LGAs). The lack of funds has left execution of theseservices in an abysmal state in many locations. Very little conventionalsewerage exists outside the centres of some main cities. Health education andhygiene promotion activities are often not in concert with the water suipplyand sanitation developments.

Water Utilities: Organization and Peformance

1.04 The state water utilities have, in general, been established underwell-conceived legislation as parastatal Boards/Corporations to develop andmanage water supply facilities in their respective areas and to meet soundfinancial objectives. In reality their autonomy is severely limited due tothe legislation not being observed by their parent ministries; insistence on

the use of civil service regulations and compensation; almost complete depen-dence on state subventions for recurrent and capital expenditures, due to lackof cost recovery mechanisms or adequate tariffs, and low expenditure authorityceilings inducing interference by state government in contract awards.

1.05 The water utilities also suffer from overmanning especially in thelower levels; lack of manpower development and training capabilities; inade-quate accounting systems; poor billing and collection systems; high un-accounted-for water; lack of funds for spare parts and to effect satisfactoryoperations and maintenance of their facilities. Recommendations have beennoted in the text against these issues.

Sector Investment Programs

1.06 Of the urban population of Nigeria es-timated at 24 million in town-ships of 20,000 and above about 55% have access to a piped public watersupply. In rural areas access is thought to be about one-third, mainlythrough standpipe/handpump supplies. Most states are giving priority todeveloping services outside of the State capitals. None of the water uti-lities studied had submitted programs to their parent ministries which posedalternative levels of service or development programs. Often the designparameters for the new or augmented system were set too high for the presentstage of development, ignored economnies of scale or failed to address leastcost solutions. Guidance on these basic matters should be an essential func-tion of the FDWR. The investment requirements by the year 2000 amount toabout N5.0 billion for even the lowest level of service; if Nigeria is todevelop its water services consistent with other sector activities the invest-ment should be more in the order of about N9.7 billion (1983 Prices). A four-to seven-fold increase in 1983 revenues from tariffs and subventions wouldalso have to be managed to cope with the consequential increased recurrentcosts.

Overview and Recommendations

1.07 There is an overwhelming need to provide assistance to the FederalGovernment through FMAWRRD. A single organization must be responsible fordetermination of sector standards, policies and programs and to coordinate theinvestment and manpower development and training needs of the sector. It isrecommended that the Bank provide that assistance through a project whichincludes funds for (a) substantial technical assistance (project preparation;manpower training and accounting systems), (b) preparation of projects by thestates for external funding, (c) special studies (such as for rural watersupply) and (d) assisting the states to meet their rehabilitation needs.

1.08 At the same time the Bank should continue its sector work and lendingprogram at the level of the States. This would be achieved by financing watersupply projects in each of about 6 States, with which the Bank is presentlyinvolved, and following up with repeater projects in those states to ensuresatisfactory institutional development. It is expected that with the enhancedcapabilities of the FDWR in FMAWRRD, the emphasis and blend of Bank lendingwould change over several years in favour of the Federal level by way ofprogram or sector type loans.

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1.09 The draft sector memorandum was reviewed extensively by the Federal

Government and by the State Water Utilities both individually and collectivelyin a national form. There is considerable support for the report's recommen-dations as indicated in the letter dated 28 September 1984 from the PermanentSecretary in the FMAWARRD (see Annex 1).

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CIIAPTER 2

SECTOR ORGANIZATIONS AND RELATIONSHIPS

Introduction

2.01 The purpose of this Sector Memo is to summarize common issues experi-enced by the sector which have been identified:

(i) by the planning exercises undertaken mainly through the WHO/IBRDCooperative Programme in Cross River, Anambra, Kano, Borno, Oyo,Niger and Benue States;

(ii) by the results from the nationally prepared Rapid Assessment Survey;

(iii) by preparation of prospective projects for Kano, Lagos, Borno andBenue; and,

(iv) by the experience gained in implementing Bank-assisted projects inKaduna and Anambra States.

The main problems being encountered in the sector are identified and discussedwith the objective of providing some suggestions and guidance for the intro-duction of measures required to facilitate an improved development of thesector. Sector background material is contained in Annex 2-1.

General Sector Organization

2.02 Under Nigeria's federal system of government, the 19 individualstates (see Map) have the primary responsibility for the development of thewater supply and waste disposal sector. However, the Federal MilitaryGovernment through FMAWRRD is responsible for the national and internationalaspects of water resources allocation and for approving large water resourceprojects for which Federal Government financing is requested. FMAWRRDcontrols and has representatives on the Boards of the Eighteen River Basin andRural Development Authorities (RBRDAs), created in 1976 by Federal decree (asamended in 1984), for the planning and development of water resources on anational basis throughout Nigeria.

2.03 The water supply utilities which have 'been established in each of the19 States do not have a direct linkage with a Federal Ministry. Neither havethey hitherto had any common reporting point at the State level. Until 1984,individual utilities reported to various State authorities such as the DeputyGovernor's Office, the Ministry of Works and Housing, the Ministry of PublicUtilities, the Ministry of Water and Electricity, etc. In 1984, the newMilitary Government reduced the number of State Ministries to nine.Invariably, the State Water Boards/Corporations (SWBs) have been assignedreporting responsibility through the State Ministry of Works; already thereare signs that this is not working well. Additionally, there is littlecommunication, at the State level, between the RBDAs and the water utilities

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on matters of common interest such as the allocation of water resources or thecontrol of pollution: this has led to conflicts of interest between variousabstractors or delays in preparing public water supply projects. Theseproblems could be reduced by appointing the respective General Manager of theSWBs and RBDAs on to each other's Board.

2.04 During 1981, the-then FMWR convened the first of what has becomeb-annual joint meetings of the FMWR, RBRDAs, State water utilities andMinistries of Agriculture--this is a key step in bringing some formality andcoordination to the sector. It is necessary to rationalize the operations andoptimize the investments of the State water utilities and to provide anational focal point for the dissemination of information; the preparation anddistribution of Federal administrative and technical policy directives; thecollection, analysis and storage of countrywide data relative to the sector aswell as to coordinate required support functions. Legislation is needed toestablish a more formal role for the FDWR in FMAWRRD in coordinatingstandards, etc. to be pursued by the SWBs and RBRDAs.

River Basin Development Authorities

2.05 The three northern RBDAs (pre-1984 boundary alterations) had been inexistence for nearly a decade, but many of the other RBDAs were not able tofully discharge their responsibilities. These consist mainly of obtaining andrecording basic hydrological, meteorological and hydrogeological data andallocating water resources for development schemes as well as control ofpollution in rivers and lakes. The main work of the RBRDAs has so far beenlargely directed towards the development of irrigation projects and in somecases to the provision of multipurpose surface water impoundments, which areoccasionally utilized for public water supplies. Very little work has beendone regarding the development or control of underground resources or in thedevelopment of national standards for the control of effluent/pollutantdischarges. Many of these problems stem from the lack of qualified malpower(see para. 4.19) and uncertain budget allocations from the Federal Govern-ment. The RBRDAs should now be focussing on the enforcement of pollutioncontrol, income generating activities through cost recovery, such as fromwater abstraction licensing arrangements, to reduce the dependence on theFederal budget.

Organization of State Water Utilities

2.06 Administratively each State has a number of Local Government Areas(LGA), the principal towns of which are Local Government Headquarters, onebeing designated as the State capital. These towns are generally consideredto be the principal urban centers in the State and historically the majorwater supply undertakings have been established in them. In general, theState water utilities are organized on the basis of a headquarters office inthe State capital with zonal or area offices based at the sites of the largersupplies to control day-to-day management within one or more LGAs.

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2.07 Each SWB is controlled by a Board comprising a number of membersappointed by the State, 1/ one of whom is designated as Chairman, and a numberof ex-officio members designated by title (e.g. the Permanent Secretary,Ministry of Finance, etc.) including the General Manager. The Chief ExecutiveOfficer is designated as General Manager and is normally required to be aprofessionally qualified engineer. Other Chief Officers include a Secretary,a Chief Financial Officer and Depar;mental Heads (e.g. Chief Design Engineer,Chief Electrical and Mechanical EngLneer, etc.) all of whom are responsible tothe General Manager.

2.08 The State water utilities have, in general, been established underwell-conceived legislation as parastatal Boards/Corporations to develop andmanage water supply facilities within their respective areas of responsibilityand to meet sound financial objectivres. In practice the autonomy of theutilities is severely limited due to:

(i) the legislation not being observed by SWB parent ministries;

(ii) their almost complete dependence on State subventions for capital andrecurrent expenditures;

(iii) their being governed by civil service establishment and compensationregulations; and

(iv) the low ceiling of their authority to incur expenditure allied totheir having to obtain approval from State Tender Boards, on whichthey often have no direct :.epresentation, for entering into all butthe most minor of contracts.

2.09 Whilst it is unlikely that full autonomy can be placed with the uti-lities so long as they remain so heavily financially dependent on the StateGovernments there appear, however, .o be a number of areas in which relaxationof the present stringent controls could be considered. If, for example, theBoards of the undertakings were considered, or could be strengthened, to fullyrepresent public, private and other agency interests, there would seem to belittle need for the extensive intervention of the Commissioner of the parentState Ministry or in the low level of expenditure authority. In two Stateswhere the SWB reported to the Deputy Governor, there was a better relationshipand demarcation between Government and SWB responsibilities. This has beeneroded with the recent change in reporting relationships.

2.10 Linkages between the water utilities and those responsible for otheraspects of the water supply and san:tation sector are weak and in generalthere is little, if any, communication between the water supply agencies andthe State Ministries of Local Governlment, which are generally responsible forsanitation, and the State Ministries of Health, which are responsible forhealth education, primary health car-e and the monitoring of drinking water

1/ Many SWBs are presently without; Board Members as all were dismissedwhen the new Government came into power on December 31, 1983. The new

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quality. Although State committees, with representation from concerned agen-cies/ministries, could be formed to establish policies for the sector andpromote linked programs through increased coordination, it would be preferableto achieve the proper representation through better composition of the Boardsof State water utilities.

Organization of Rural Water Supply

2.11 A basic foundation exists for providing urban water supply facili-ties. No such foundation is available for rural water supply. In manyStates, there is a sharing cf responsibility of the water agency with LGAs andRBRDAs; in some States rural borehole drilling and other rural water supplyconstruction may also be undertaken by Ministries of Community Development andCooperatives in aided self-help schemes and by the Ministry of Agriculture inIntegrated Agricultural Development Project (IADP) areas. On top of all thiseffort, there has been the Federal Government directly sponsored boreholedrilling program in all States. Some thoughts on rural water supply andcommunity participation aspects are set out in Annex 2-2. It is considerednecessary to resolve several institutional issues before there could be areally effective rural water organizational structure. A full study should bemounted to review all aspects of the rural water supply sector, after whichmore informed advice could be proferred.

Organization of Sanitation Services

2.12 LGAs, which report to State Ministries of Local Government, areresponsible for the provision of solid and liquid wastes collection and dis-posal services in most urban areas. Such facilities are in general not pro-vided in the rural areas. The standard of service provided is often extremelylow and in particular the urban environment is characterized by large quanti-ties of solid wastes which litter highways and open spaces, block drainagechannels and serve as breeding places for flies and rodents. The night soilcollection and disposal systems which are operative do not, as a general rule,incorporate adequate public health precautions and the manpower required tooperate them is becoming progressively more difficult to obtain. Moredetailed comments are given in Annex 2-3. The fundamental reasons for thepoor standards of sanitation service are that the LGAs do not have theresources to carry out their responsibilities effectively and that they do notreceive support from a technical ministry; the State Ministries of LocalGovernment being mainly administrative in nature. The LGAs, as in the case ofthe RBRDAs and SWBs, may wish to look to internal cash generation, throughmunicipal cost recovery and property tax systems, in order to cushion theuncertainty of Federal and State Funds. They might also want to explorecloser working relationships with the State Ministry of Works or of Health.

Health Education

2.13 Several actions are required to improve health education and hygienepromotion in Nigeria as indioated in Annex 2-4. Adequate staff and budget are

State Governments (with the exception of Kaduna) have been slow to makenew appointments.

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obvious and fundamental needs. Elually important is the design and implemen-tation of State health education programs, so that the resources are utilizedin a way that the greatest possible health benefits can be obtained. Thiswill require full cooperation and collaboration with other Ministries and withother departments within the Ministry of Hea:Lth. In particular it will benecessary to:

(a) improve the quality of the health education curricula and teaching inthe schools. Every effort should be made to ensure that schools haveadequate and well maintained water supply and sanitation facilities;

(b) improve collaboration ani cooperation with State water supply cor-porations to ensure that continuing information on the health bene-fits of safe water supply is transmitted to the population served bypublic water supply systems (State water utilities themselves shouldtake the initiative in liaising with the Ministry of Health, regard-ing the importance of avoiding contamination of public water suppliesbetween the tap and consumption, as water supplies are commissionedor rehabilitated in different locations);

(c) improve collaboration with Sanitation Units in the Ministry of Healthand/or the Ministry of Public Works and strengthen health educationdelivery supportive of sanitary excreta and waste disposal; and

(d) expand the flow of health information to the public in an effort togenerate an increased public demand for safe water supply andimproved sanitation facilities, especially in rural areas wheredevelopment is supported by Communi-ty Development Departments andsimilar agencies of Government.

Water Quality Control

2.14 Surveillance of public water supplies by Ministry of Health labora-tories is considered to be inadequate. No specific surveillance programs havebeen established and the practice is to wait for samples to be brought to thelaboratory by health inspectors and others. Interest in water quality is at amaximum when there is a cholera outbreak and epidemic threatens. Healthinspectors are sorely pressed with a heavy workload and are able to devoteonly minimal time to routine water sampling. Their task is made more dif-ficult by shortages of transport and a large number of water sources in addi-tion to the public system.

2.15 Although Government laboratories have, in general, adequate numbersof staff with academic qualifications in chemistry and bacteriology, staff'sknowledge of production techniques for water examination tends to be weak andas a result samples are tested on a "one-at-a-time" basis. Some laboratoriessuffer from a shortage of equipment and supplies. The reporting of laboratorytest results is often made through a complex bureaucratic hierarchy thus pre-venting the rapid implementation of corrective measures when the test resultsare unsatisfactory.

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2.16 Ministries of Health should review their policies on public watersupply quality surveillance and decide whether or not they wish surveillanceto be a part of their disease prevention programs. If it is to be included,consideration must be given to the establishment of a program that can, infact, be implemented, and sufficient resources must be allocated to it. Inany case the State Ministry of Health must provide a speedy reportingmechanism whereby unsatisfactory test results are quickly conveyed to theperson who can take the corrective action in a water works (piped supplies) orto the health inspector who can chlorinate the faulty water source or well(individual supplies).

Summary

2.17 In the context of the overall sector, there is clearly a need forgreater coordination of sectoral issues at the Federal level and for a returnto prescribed roles at the State level. These needs are reflected in the mainrecommendations below.

Recommendations

(i) At the Federal level legislation should be promulgated to establish amore formal role for the FMAWRRD to coordinate sector standards,policies, programs and training for the RBRDAs and SWBs;

(ii) At the State level, the SWBs must have autonomy to exercise profes-sional public utility practices in accordance with their enablinglegislation; and

(iii) A nationwide study must be undertaken before recommendations can bemade for the future direction of the rural water supply sub-sector.

The FMAWRRD also adds a fourth recommendation arising out of its deliberationson the draft report (see Annex 1). "A nationwide survey must be undertaken toidentify sanitation problems before recommendation can be made for futuredirections and policy on sani-tation sub-sector for Nigeria."

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CHAPTER 3

SECTORAL INVESTMENT PROGRAMS

Introduction

3.01 In this Chapter, the existing levels of service, development prio-rities, design parameters and investment criteria are reviewed. This isfollowed by alternative level service targets and sector investment implica-tions.

Existing Levels of Service

3.02 In the urban areas, two broad levels of service are identifiable:namely house connections and public standpipes. A house, however, can beserved by either a single tap (courtyard connection) or multiple tap (fullservice). The estimated average water consumption for each category is in thefollowing ranges: for a House (i) multiple tap 125-270 lcd (ii) single tap50-60 lcd; and for a Standpipe 20-34 lcd.

3.03 Presently about 30% of the urban population of about 24 million isprovided with water through house connections and the same percentage throughstandpipes. The remainder of the urban population (approx. 9 million) doesnot have access to the public piped water supply systems, and relies on othersources (wells, streams, vendors, etc.). It is the goal of most water supplyentities to provide house or yard connections for about 70-85% of the urbanpopulation by the year 2000. There is no reliable information on the levelsof service in the rural areas (population approx. 70 million), but it isbelieved to be mostly equivalent to or below service obtained by standpipes.

Existing Development Priorities

3.04 All States have been programming medium to high standards of waterservice to their capital cities. Standards of service vary considerably inother urban areas both within and between States. Most States are givingpriority to developing services -n the rapidly growing semi-urban areas.Rural areas have been relatively neglected and in a number of States evenexisting capacity for constructing rural water systems has been run down. Thepriority of the rural sub-sector varies considerably between the States.

3.05 Sanitation has been given a relatively low priority up to recently;sanitation, drainage and waste disposal had been written into the Third Plan(1975-80) projects for many States, but actual expenditure was low to nil.Significant sanitation projects in the Third Plan most often meant sanitarysewerage systems for the central areas of principal towns. The proposals havein a number of States been rewritten into the Fourth Plan (1981-1985) but,because of their high cost, now probably underestimated due to inflation,these schemes have no more chance of final approval in the current Plan thanin the last Plan. Smaller sanitation schemes, drainage and waste disposalprojects have not been given annual allocations to match the Third Plan

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priority. This could be a result of agency unpreparedness or Treasury prio-rities being different from those in the Plan. The higher priority of sanita-tion and waste disposal amongst Local Government Councils is manifested intheir list of projects for the Fourth Plan (the current Plan is the first timethat Local Government Councils have been able to include their projects withinthe Five Year Plan document).

3.06 None of the water agencies studied had submitted programs to theirresponsible authorities wbich posed alternative levels of service or devel-opment programs. The WHO/World Bank mission form of presentation has demon-strated a useful tool for indicating alternative programs to Governments,using level of service, coverage and capital expenditure as variables. Mostof the State Capital Development Programs have assumed a continuation of highwater losses, 50% and over, that prevailed in most States.

3.07 The reduction of these losses, recommended in Bank and WHO Reports,especially in the State capitals, has had a marked effect on forecast watercapacities and augmentations required to meet 1985 and 1990 demands. Futurecapacities were unduly inflated by water agencies and were frequently foundnot to be necessary; discounting costs also demonstrated that the expense ofsustaining immediate surplus capacities to cater for future demands was under-estimated. The reduction of unaccounted-for water must be accorded highpriority on a continuous basis in SWBs.

Design Parameters and Investment Criteria

3.08 The parameters used for the design of new systems or the augmentationof existing supplies have frequently been too ambitious for the present stageof development. High per capita allowances, assumption of a large percentageof service through private house connections and long-range planning horizonsall tend to result in the design of projects with excess capacity and over-designed reticulation systems in relation to demand. As a result, capitalinvestment is under-utilized and operating costs inflated. The sector plan-ning exercises in a number of States have examined in detail the consequencesof introducing varying levels of service and have demonstrated the capital andrecurrent savings that can be achieved when design parameters are more closelyrelated to a practicable level of consumer demand based on a higher proportionof service through public standposts. The same rational approach should alsobe applied as to establishing investment criteria, such as:

- implicit recognition of economies of scale (per capita investmentcosts tend to be less in bigger centers than in smaller ones, giventhe same service level design),

- vigorous search for least cost solutions (surface water suppliesoften involving full treatment are in most cases not only more expen-sive, but also more complex in their operation and maintenance thanborehole systems).

Guidance to the State authorities on basic matters, such as that of nationaldesign parameters, and investment criteria should be an essential function of

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the FMAWRRD (para. 2.04). Consideration could be given to linking financialsupport from State, Federal or external sources to projects which have beendeveloped using such national norms and guidelines.

3.09 Water sector capital programs as a proportion of total State capitalprograms in the revised Third PlarLs have varied considerably (from 6.5% to12.8%). The addition of planned sanitation and waste disposal expenditures donot greatly alter these proportions. However, actual capital expenditures inevery State examined have been corLsiderably lower than planned even withoutallowing for inflation. Part of this low absorbtive capacity is due to theinternal implementation weakness cf the water agencies, some is due to thelong delivery dates of consultantE and contractors, and part to the annualbudgetary restraints of the State Ministries of Finance which have resulted incontract periods being extended or in some cases in contract terminations witha consequent loss of the mobilization funds initially paid to contractors.Obviously, an investment review mechanism (which would naturally have to drawon the investment criteria/design parameters mentioned in para. 3.08) at thetime of initial investment budget allocation (inscription into the Plan) isrequired. It would review the investment proposals, the readiness of them,assess the financial and institutional absorbtive capacities of the executingwater utilities, and then provide appropriate recommendations as to the amountto be allocated. Further, a sericus commitment is needed from State Govern-ments to finance the project with a steady flow of funds.

Alternative Service Levels

3.10 As already indicated, no attempt has been made in any of the Statesto establish long-term service level targets, a timetable or to assess invest-ment needs. The investment implications of alternative service level targetsfor the year 2000 are tabulated in Annex 3-1. It is indicated that on thebasis of a low level of service (10% house connection and 90% serviced bystandposts) the overall development cost per capita is N43, for medium levelof service (30% : 70%) N81 and for high level of service (90% : 10%) N142 percapita, all at 1983 prices. For rural areas the average cost is estimated atN34 per capita.

Water Supply Investment Requirements

3.11 The following table summatrizes the total water supply investmentrequirements for both urban and rural areas for the stated populations at thealternative levels of service (1983 prices):

YEAR 1985 1990 1995 2000(inMi lions)

Low-Service Level (N) 653 1,821 3,215 4,974Medium-Service Level (N) 926 2,547 4,431 6,794High-Service Level (N) 1,365 3,712 6,385 9,716

Population Forecast 103 121 143 169

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At present levels of investment there is little prospect of the low-servicelevel target being met by the year 2000 when in fact a target beyond themedium-service level is required to make a real impact in the sector. How-ever, many states recognized the political popularity to be gained throughpublic water supply projects and accorded it a high priority and an increasedshare of state investment since 1979. However, the cash flow problems at thestate level have undermined the little progress made. Using figures of 3% perannum for operations and maintenance costs and 4% for depreciation, recurrentcosts of about N350 million per annum would have to be met by the States andtheir SWBs for even the low level of service by the year 2000 (N680 millionfor high level of service). Collectively subvention and SWB tariffs probablyproduced less than N100 million in 1983; the prospect of a seven-fold increaseat constant prices is daunting, but the challenge must be met at the earliestopportunity by the introduction of proper approaches to cost recovery (seeparas. 4.08 and 4.10). Certainly the State Governments in Anambra, Borno andKaduna have set off on the right track for their water utility tariffs,although they have faltered during 1984.

Recent Procurement Experience

3.12 Even if all the country's investment requirements could be met, theinadequate and unacceptable procurement procedures would militate againstefficient and timely implementation. State water utilities have witnessed inthe last four years the whit-tling away of their responsibilities to makecontract awards, as parent Ministries and other offices have seized this roleunto themselves. If it was in the sake of efficiency, then it could be under-stood but it is not; all that is accomplished is further delay and the worsen-ing plight of the consumer wh1o has the least consideration. In one state, bidevaluation and processing through the many layers of approval to contractsigning frequently takes 15 months against a bid bond validity period ofusually 90 days; in all this time there is generally no change in the recom-mendation.

3-13 In some cases the takeover is for genuine reasons because of theweakness of the institution, but often the state bureaucracy is no betterequipped, it just believes it is--it is worth remembering some of the stepstaken by other countries who themselves have passed through the developmentera because they took the time to address their bureaucratic weaknesses (SeeAnnex 3-2 (A)). In other cases, the takeover is purely to seek involvementfor reasons best known to themselves. Corruption is a serious problem, but isostensibly being addressed by the new Federal Military Government.Contractors and consultants working in Nigeria freely admit a substantialprovision in their bid prices for "other payments"--again an excerpt from theWorld Development Report 1983 provides an overview (See Annex 3-2 (B)).

3.14 Although contract award has sometimes been long and tortuous forWorld Bank assisted water supply projects, the integrity of the InternationalCompetitive Bidding process has been preserved, often with substantialfinancial savings to the borrower.

- 14 -

Summary

3.15 This chapter has presented a plethora of problems, all of which areleading to suboptimal strategies and uneconomic use of resources. There mustbe clear demarcation of responsibilities especially within the States andgreater professional influence in sector investments as conceived by thelegislation of SWBs.

Recommendations

(i) At the Federal level, some involvement and influence must be exer-cised over levels of serrice targets, investment strategy, statebudget allocations for sector investment, and preparation of pro-posals for external financing. The Federal Government must recon-sider its position with a view to reinstating direct grants forpublic water supply projects.

(ii) At the State level, annual budgets and annually updated five-yearplans including financing, tariffs, etc. should be agreed with theState water utilities ani adhered to. More appropriate powers forcontract award, say, NlOmn for any one contract should be delegated tothe water utility; and

(iii) At the water utility level greater attention will have to be paid toalternative service levels, least cost solutions, preparation ofcorporate plans, including forecasting manpower and financialresource requirements, and meeting performance criteria agreed withthe State and Federal Governments.

- 15 -

CHAPTER 4

PERFORMANCE DF STATE WATER UTILITIES

Introduction

4.01 Whereas Chapters 2 and 3 focussed on the overall problems of thesector and its interrelationships, this chapter takes a look at the internalproblems of the State water utilities. The organizational structure of theutilities is in theory considered satisfactory, but a number of factors are inforce which make for difficulties in acceptable and practicable application.Finance and manpower are perhaps the two most limiting constraints to waterutility development and the two areas most prone to political interference.Unless these utilities are strengthened dramatically, Nigeria's developmentefforts will be held back.

State Financial Guidelines

4.02 The various water agency statutory enabling edicts set out the prin-cipal financial objectives and guidelines that the agencies must follow; thesemostly have a standard format. The water agency will have under thesestandard edicts powers to receive rates and other revenues from any relevantsource and borrow money from any source, including Government. However,borrowing is only possible with the approval of the State Executive Counciland at its discretion, the Executive Council can also guarantee the repaymentof principal and interest on loans. Rates and scales of charges should "asnearly as may be" such as to cover working expenses, interest and loan prin-cipal repayment as well as any sums set aside for depreciation, reserve orother funds determined by the Corporation. The water agency can levy dif-ferent rates or charges for localities or systems although, over the longterm, they are generally to equalize tariffs throughout the State. Industrialwater charges should be metered and are normally higher than domestic charges,but should not be so high as to be a significant disincentive to industriallocation or operation. Domestic charges for medium and high density areasshould be mainly levied on property. The firm location of responsibility inthe water agencies for their own financial viability implied by the abovelegislation is somewhat undermined by the right of the Commissioner of theresponsible Ministry to make binding executive orders covering almost anyportion of the water agency's activities, although of a general nature.

4.03 The founding edicts of the water agencies have barely changed sincethe early 1970's and although they generally cover the main needs for finan-cial autonomy, they are weak in two major aspects. First, the responsibleCommissioner has assumed undue scope for intervention in the day-to-dayaffairs of the water agency. Second, the limits for funding capital andrecurrent expenditures of water agencies by the State Governments are not

closely enough circumscribed.

4.04 Paras. 2.08 and 2.09 commented on the autonomy of the SWBs and theneed for them to be allowed lo operate as conceived by their enabling legisla-tion. The Government's propensity to want to give directions to water

- 16 -

agencies should be curtailed so that interventions become less frequent and bemore in the nature of policy guidelines than orders covering individualprojects or technical questions. Indeed, it could be further argued thatthere would be less need to have a State Ministry of Water where the Corpora-tion or Board of the water agency and the agency executives were allowed tocarry out their joint and separate responsibilities. Some parent Ministriesduplicate the work and staffing of the SWB; they are an expense item whichmany States can ill afford to continue.

4.05 To encourage a strong sense of financial self-reliance in wateragencies, both capital and recurrent State government assistance should becarefully delineated. The assistance should be limited to covering lifelinesupplies in rural and semi-urban areas and to the urban poor. Exact criteriacould either be the boundaries of the semi-urban and rural areas (acknowledg-ing for the capital city and other major towns cross-subsidy to assist theirurban poor 1/), or by, for example, the number of standposts and yard faucets(at a lower estimated per capita subsidy than standposts). For rural bore-holes and wells which come within the responsibility of the water agency,assistance could be rendered in the form of capital grants and a recurrentsubvention estimated to cover the costs of support activities, including adecentralized maintenance support service.

4.06 The autonomy of the water agencies would also be increased if insteadof receiving capital grants for all types of investment, they instead receivedmostly loans. The guidelines for the loans or grants could be made to dependupon policy considerations. For example, loans at just below market rates andwith a medium repayment period would be made for urban schemes; the termscould soften for semi-urban and become grants for some or all rural schemes.It might be possible to actually vary the loan terms according to the level ofservice proposed for a particular system 2/. The effect of Government makingloans on varying terms to water agencies would be, firstly, to prune designcriteria to realistic service levels and, secondly, to provide an incentive towater agencies to charge tariffs which covered the costs of systems plus thedebt servicing on the loans. Because of their close ties to Governmentaccounting convention, many water agencies have not been at all favorabletowards accounting for depreciation even for urban systems. If however agen-cies had to recover the costs of debt servicing, then this element of costrecovery would be largely taken into account.

Recurrent Costs Subvention

4.07 The recurrent budget constraint on further growth of capital programslies only just below the surface of the absorbtive capacity constraint of

1/ It is not easy to identify urban poor areas exactly, however, it maybe possible to use a criteria of 'high density' population areas orIareas other than those in the Government Residential Zones'.

2/ 'Soft' loans at below 60 lcd, 'medium' terms from 61 lcd to 100 lcdand 'hard' terms above 100 lcd.

- 17 -

water agencies (see also para. 3.09). Nearly all agencies are experiencingparallel difficulties in revenue collection and in obtaining sufficient Staterecurrent cost subventions, although most water agencies visited were attempt-ing to strengthen their revenue collection.

4.08 In almost all States, WHO/World Bank missions have forecast growingoperating deficits even without allowing for depreciation or debt servicepayments due on new projects financed from loans. Recommendations to reducelevels of service to minimize unit capital cost and extend coverage wouldtighten the recurrent revenue constraint often arising out of the difficultiesin cost recovery of public standpost-served communities. If there is no meansof further reducing unit cost for supplying especially the semi-urban areas,which is the main block of unserved customers of the water agencies, thendependence on State subventions will continue and even increase. The probablerapid growth in semi-urban settlements will influence the growth of demand forstandpost service and hence agency needs for recurrent subventions or meteredstandpost charging arrangements with the municipalities. For certain, SWBswill require continued subvention into the foreseeable future. State Govern-ments must adequately address and fund the recurrent subvention needs of Statewater utilities so as to ensure service delivery, so that the SWBs can main-tain that service and implement cost recovery through tariffs.

Financial Performance and Tariff Policy

4.09 Deficiency in the enabling legislation is only a minor factor in thegenerally poor financial performance of the State water agencies. A majorfactor is the vicious circle between service delivery and tariff restructur-ing; it is necessary to improve performance before increasing tariffs orchanging tariff structures. In preparation for this, internal agency pro-cedures can be improved, unaccounted-for water investigated and new tariffstructures prepared in outline.

4.10 In most of the agencies studied, although actual revenues collectedwere sometimes as much as one-third below their full potential, even if allpossible revenues were collected, cost recovery at prevailing tariffs wouldhave been still a small fraction of recurrent expenditure. Government sub-ventions, although inadequate, have been the major portion of income and theforecast operating deficits, using current tariff levels and structures, wouldincrease sharply by 1985 unless action is taken urgently to adjust thetariffs.

4.11 Some water agencies have introduced accruals-based income, cash flowand balance sheet accounts; others have maintained a Government cash account-ing structure or try to keep two sets of accounts. Water agencies which moveto a higher level of autonomy will need more elaborate and articulated doubleentry accounts. Relatively new and small water agencies which have to reportfrequently to Government and depend upon them greatly for recurrent andcapital subventions are a more difficult case. Proper accounts combininginternal management and external reporting needs are being developed forAnambra and possibly in the near future for Lagos and Benue which could beexamined for their more general application. To ensure consistency, a commonform of accounting should be prepared for all 19 water utilities (and the 18

- 18 -

RBRDAs) to follow and be implementeDd under the guidance of the FMAWRRD. It isalso important for all water agencies to maintain separate annually auditedaccounts including Income Statements, Balance Sheets and Cash Flow Statementsfor the major areas of operation covering (a) the capital city, (b) othermajor towns, (c) semi-urban areas, and (d) rural areas in order to enhancemanagement control and review. The auditing provision of S79(2) of theConstitution is being too narrowly interpreted in one or two states, therebydepriving the water utilities the benefit of independent audit by professionalaccounting firms and assistance to move towards a more commercial approach.

4.12 Water agency capital and recurrent cost programs for the next 5 yearsor so should be agreed from time to time with Government and a tariff ceilingset based on those programs. The SWBs (or RBRDAs) would then be free toincrease tariffs within the ceiling. Once the ceiling is reached the agencywould have to justify its next period programs to Government (and perhaps tothe public). This procedure would allow more flexibility and be accompaniedby less administrative and political encumbrance. This could be achieved by aStatutory Order allowing the water agency to raise tariffs along agreed linesand subject to a few minimum restrictions.

4.13 Metering should be the rule for low-density housing areas where thereare relatively few connections and much water is being used per connection.The flat rate tariff system for higher density water supply areas should notbe discouraged, as the cost of metering is likely to be greater than the extrareturns, although the situation should be periodically re-examined.

4.14 Where the per person or tax payer charges still exist they should beformally abandoned and replaced by an approved system for paying for standpostwater on the basis of measurement. The cost would be recovered by the wateragency from the State in its annual recurrent subvention probably as a chargeagainst LGA budget allocations. Metered standposts would also be chargedallowing free or at a lower charge the first estimated 20 lcd (calculated asan amount per standpost). Local Governments could be encouraged to seekreimbursement for standpost water charged by forming standpost community waterassociations. The officers of the association would collect from householdsin the community on a basis to be agreed by them and approved by the SWB.Alternatively, the SWBs could licence public standposts to vendors for say6-month periods and set down conditions of operation including chargingceilings; the vendor in turn pays the SWB based on metered consumption at thestandpost.

4.15 A major difficulty facing many SWBs relates to implementing debtrecovery due to restraint, particularly of disconnection, exercised by Govern-ment over the SWBs. Furthermore, State Governments must address theirambivalence towards their own delinquency of payments. A parallel review ofexisting legislation to simplify court procedures against defaulters is alsoconsidered a high priority.

Operation and Maintenance

4.16 A recurring problem mentioned in the State Sector Reports prepared bythe WHO/World Bank Cooperative Program is that there is a severe shortage of

- 19 -

most types of maintenance facilities in the shape of adequate workshops, toolsand plant. Spare parts are also in short supply as are sufficient recurrentfunds to adequately carry out routine maintenance or to deal with emergencyoperational repairs. In consequence, it is not unusual to find that contrac-tors are being utilized to undertake such simple and routine tasks as vehicleservicing, that expensive equipment essential for the proper operation oftreatment facilities is non-operational for extended periods whilst spareparts are awaited, or that a lack of routine maintenance has led to such adegree of deterioration that replacement or rehabilitation of the item con-cerned is now required. The FMAWRRD and FMF have a responsibility to ensurethat adequate import facilities and foreign exchange are available forcontinuous supply of spare parts for SWBs (and RBRDAs). Often it has beenstated that it is easier to obtain capital funds for new equipment or worksthan to obtain much less funds for satisfactory maintenance requirements andfor spare parts; a sharp reorientation of perspective is required.

4.17 A number of utilities have recognized the problem and are in theprocess of establishing workshops and stores. However, more general attentionis required by State Governments and SWBs to the need to make available ade-quate sums for operation and maintenance so as to ensure continued operationof plant and equipment. There must also be a realization at the design stagethat the use of sophisticated imported equipment is not always appropriate andthat whenever possible its substitution by locally produced or equally ade-quate, but simple, plant is preferable if continuity of service and minimiza-tion of the cost of such continuity is to be achieved.

Water Quality Control

4.18 State water corporations have laboratories at most of their majorwaterworks and, in principle, water is regularly tested in order to controlthe dosage of treatment chemicals and to determine the bacteriological qualityof the water pumped to the distribution system. None of the supplies seenduring the course of missions apart from Lagos were being sampled forbacteriological testing with the frequency recommended by InternationalStandards for Drinking Water (WHO, 1971). Few, other than Lagos, were beingsampled at more than 5% of the recommended frequency and most were relying onchlorination to maintain bacteriological quality throughout the distributionsystem. State water utilities must adequately staff and equip theirlaboratories to improve sampling and respond spontaneously with chemicaldosage changes at the treatment plants.

Manpower and Training

4.19 Many State water utilities are encumbered by too many low-level staffand a general shortage of trained and experienced staff in the senior cadres.In order to improve their efficiency, SWBs should consider shedding largenumbers of these low-level staff as was done in Benue in 1982. The difficultyof recruiting and retaining those senior staff that are available in the faceof the more generous and flexible employment conditions to be found in theprivate sector, together with difficulties in forecasting manpower require-ments, due to uncertainties in development programs because of budgetaryconstraints and limited local facilities for appropriate training, all

- 20 -

militate against development of the State water utilities (and RBRDAs). TheFederal and State Government must free water utility (and RBRDA) staff fromcivil service regulations and compensation arrangements to enable them to bemore competitive in the open market for qualified and experienced staff at alllevels. Some utilities are curren;ly meeting their establishment difficultiesthrough the use of technical assistance arrangements, expatriate contractstaff and consulting engineers. Whilst this is overcoming immediate needs,especially in the professional cad:7es, a longer term perspective is requiredwhich will only be overcome through the recognition of the problem as anational issue.

4.20 Manpower Development and Training is a national problem in the sectorand deserves a national focus. To this end, the FDWR should establish:

(a) a long-term program for manpower planning and development which willmeet the needs of the State utilities (and RBRDAs) in relation towell-established development programs, and

(b) in association with the manpower development program establish andstaff adequate training facilities to cater for all groups of staff,from management to semi-skilled workers, at centers selected toensure ready access from all States.

Performance Indicators

4.21 Apart from the establishment of design parameters related to percapita allowances and the percentages of population to be served by private,shared or public connection from systems, further norms can be developed uponwhich to gauge the design and operational efficiency of utilities. Forexample, it has been demonstrated by the WHO/IBRD studies that the length ofdistribution main required per consumer varies from 0.6 meters per capitawhere 90 percent of the population is served by public standposts to almostfour times that amount when the same percentage is served by private houseconnections. Additional work by the Federal Ministry on the reinforcement ofthese and other similar parameters would over time result in the establishmentof guidelines which could be applied to project proposals in order to deter-mine whether or not they have been economically designed.

4.22 Similar research by the Federal Ministry could also be applied toitems such as production costs so as to ensure that the utilities were operat-ing within reasonable economic limits. Present indications from the WH0/IBRDplanning reports show, for example, that the operation and maintenance costsof the typical pumped supply requiring chemical treatment are of the order ofNaira 0.60 per cubic meter (US$0.80) of water produced, including utilityoverhead costs but excluding depreciation or capital recovery. Clearly therange of acceptable operating costs for any particular supply must beconsidered in the light of circumstances, such as extraordinary pumping orchemical treatment requirements, buit nevertheless, over time, bands ofacceptable indicators could be established as guidance for the operatingutilities.

- 21 -

4.23 Similarly, indicators for staffing levels could be established by ananalysis of data derived from the operating agencies to confirm the figure ofone employee (excluding unskilled personnel) per 1000 persons served as pre-sently suggested by WHO/IBRD manpower studies.

Summary

4.24 The foregoing comments have drawn attention to the undermining byState Governments in general and SWB parent Ministries in particular of thelegislated autonomy and responsibilities bestowed on SWBs. There is a lack ofrecognition of operations and maintenance needs or of the importance of waterquality control. Funds, whether by subvention or internally generated throughwater tariffs, often do not even cover basic recurrent cost requirements.Accounting systems are mostly inadequate to produce any kind of performancemonitoring and audited accounts are in arrears. Manpower development andtraining are approached very casually in many states and a national effort isneeded.

Recommendations

(i) At the Federal level the FMAWRRD should coordinate:

(a) the development of common accounting systems for SWBs (andRBRDAs);

(b) the training of all sector staff through the setting up ofregional training centres; and

(c) with the FMF the provision of adequate import license andforeign exchange requirements to meet the needs of SWBs andRBRDAs for spare parts, chemicals, etc.;

(ii) At the State level:

(a) the respective roles of SWBs and their parent ministries must beclarified having regard to the legislation;

(b) State Governments must take a realistic view of subvention, costrecovery and tariffs of SWBs; and

(c) the State Governments must consider ways and means of improvingthe performance of SWBs, including the introduction of morecompetitive salary scales;

(iii) At the SWB level:

(a) SWBs must take the initiative to reduce costs such as byshedding unwanted manpower and to increase revenues by improvedbilling and col-Lection systems; and

(b) SWBs must be more responsive to operations and maintenance andwater quality aspects of their activities.

- 22 -

CHAPTER 5

BANK'S LENDING STRATEGY

Bank's Sector Strategy

5.01 Generally, the Bank's strategic objectives in West Africa are inessence to build on recent initiatives and experiences in the areas of (i)institution building, and (ii) improvement and extension of water supplyservices. These two objectives merit equal attention; however attainment ofthese two goals will probably not le simultaneous, as adequate institutionbuilding is a prerequisite for sustained wide coverage of beneficiaries.Different countries having attained, varying degrees of sectoral development;strategies have to be tailored to the individual country and state needs.

5.02 Sector work as such in the past has taken a secondary role because ofthe higher priority attached to lending activities, in view of the vast needsof the sector in the West Africa Region. Even without detailed sector work,the most common issues in the Regicn were fairly evident for staff who havebeen working in the Region for some time. Thus, it was consistent to spendmore energy preparing substantive projects to alleviate the existing needs formore water. In that context, sectcir work in Nigeria mainly in the form ofWH0/IBRD CP activities, took on the form of somewhat general Sector Planningexercises as a primer for the lending activities. With the growing realiza-tion of need for more intensive sector policy dialogue, and to view the sectormore from a macro-perspective going beyond the targets of individual projects,the Bank is entering a phase of re-orienting and reinforcing its sector workactivities through more direct involvement of its staff as has been done morerecently in Niger State, Cameroon and Sierra Leone.

Present and Future Bank Activity in Nigeria

5.03 The present pipeline of water supply projects has concentrated onurban needs with emphasis on the urban poor. Some States are beginning toplan rural water schemes on a systematic and individual basis. Prior to this,limited Bank support has been given to the rural areas through the watercomponents in the agricultural development projects which constructed smallmulti-purpose dams, wells and boreholes. However, as the size and the com-plexity of the rural development projects grow, and in line with the FGN'spolicy, specific responsibility for rural water supplies is being assigned insome states to the water authorities. These activities would suggest that theBank can expect to receive requests for assistance for rural water schemes.

5.04 The ongoing and envisaged major sector activities are listed below:

(a) Under Implementation

(i) Kaduna Water Supply Project (Board May 1979 - US$92m Loan);

(ii) Anambra State Water ',upply and Sanitation Project (Board July1981 - US$67m Loan);

- 23 -

(b) Appraised

(i) Kano State Water Supply Project - Awaiting Government responseto outstanding issues (US$115m Loan);

(ii) Borno State Water Supply Project - Appraisal report beingwritten (US$70m Loan);

(iii) Benue State Urban Development Project - Water Component (US$13mof US$50m Loan) - Appraised June/July 1983.

(c) Apart from the foregoing, the Bank has also had discussions withCross River, Oyo and. Niger States through sector studies, and hasreceived requests for such studies to be carried out in Gongola andKwara States. Discussions were also held in Washington in 1983regarding a supplemental loan for Kaduna and in Lagos for providingassistance to the FDWR of the FMAWRRD. Additionally, a major projectis being prepared with the Lagos State Water Management Board at therequest of the Lagos State Government. Also, the Bank itself willcarry out a preliminary assessment of the rural water supply andsanitation sub-sectors in early 1985.

It is the Bank's intention to concentrate its direct involvement in about 6states in Nigeria which, with repeater projects, would translate into aboutone lending operation per annum.

5.05 Because of the lack of coordination in the sector, the Bank con-comitant with its continued lending program with the States, should assist theFDWR to bring about some order and focus for the countrywide development ofthe sector. This can be achieved by the promulgation of a project whoseobjectives would be to stengthen the FDWR's technical capability:

(a) to advise and guide State water authorities on project identificationand preparation;

(b) to advise both FMF and FMNP on the adequacy and feasibility of waterresource development plans, and to lead the orderly development ofthe water supply/sanitation sector;

(c) to develop common accounting systems for SWBs;

(d) to establish a sector manpower training and development capability;

(e) to provide assistance to FDWR so that it may directly supportrehabilitation of existing water supply systems of the States; and

(f) ultimately, as FDWR's capability develops, to undertake continualmonitoring and evaluation of projects and project entities.

- 24 -

5.06 In the longer term the objsectives would be:

(a) to foster increased coordination and cooperation by all entitiesresponsible for water control and usage. This should includenational and regional advisory bodies already in existence or to beestablished to promote the adoption of equipment standardization,realistic service levels, manpower training and development, harmoni-zation of tariff policies, environmental protection standards, andthe development of local s-pporting industries;

(b) to increase a FDWR capability to appraise and monitor watersupply/sanitation projects for external financing;

(c) to create a capability in F?DWR to monitor the physical and financialperformance of the SWBs; and

(d) to replicate the experiences gained with the SWBs and extend theFDWR's capability to similarly upgrade its relationships with andperformance of the RBRDAs.

Recommendations

(i) Because of the needs manifested in this report for sector coordina-tion the Bank should give strong support to a project which is pre-sently under discussion with the Federal Government to pursue theforegoing objectives. Funds would be needed; to help states meet therehabilitation needs of existing water supply facilities; forsubstantial technical assistance (project preparation, manpowertraining and accounting systems), funds to assist the States toprepare projects for external funding and funds for special studies(such as rural water); and

(ii) Simultaneously, the Bank saould continue its operations at the statelevel by financing of Water Supply projects in about 6 States withemphasis on repeater projects to ensure institutional development.The blend between Federal and State lending would move over the nextseveral years more in favour of the Federal level, once a satis-factory capability has been developed to handle program or sectortype loans.

- 25 - ANNEX 1

Page 1 of 2

L£c.FEDERAL MINTST LRC RESOURCES

DEPARTMENT OF WATER RESOURCES43, BaOVILLLN ROAD,

D<OYI, UGO....... .. .. ...... .. .... ............ .... _.

PJI{B~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~. ...... ..... 17...0 e

P.M.8. N.. 12700?Pq .. F1 /S/173/Vol. 1084FEDWATE Ref. No.I -_

28th September, 84

Ur. A. Amir Al-Khefaji,Chief of Water SUpply DivisionWest Afrioun RegionThe World Bank1818 H. Street N.W.lashington D. C. 2Q433

U. S. A.

Thro:

The Resident RepresentativeThe World Bank,Plot 1309AKarimu Kotun Street,P. 0. Box 127Victoria IslandLagos.

NIGERIA: SECTOR MEMORADU ON AT SPY AND SANITATION

I write to acknowledge receipt of the Sector Memorandum for Weter Supplyand Sanitation which was prepared by the Wbter Supply Division of theBank.

2. The contents of the Memo were extensively studied by the Water SupplyDivision of the Department of Water Resources, members of the NationalSub-Gommittee on Water Supply and Sanitation who met on 6th and 7th ofJuly 1984 in Ilorin to delibrate add pass their comments on the momo.The memo was finally retified with amendments on 14 July in Kano bythe Nbtionel Technical Comrmdttee of the National Cbuncil on WaterResources. Attached is a copy cf their comments.

3. Finally, I sieze this opportunity to thank your Division for preparingthis memo which has highlighted the problems facing the prority areaof water supply and sanitation in Nigeria.

4. The Memo is eccepted with the amendments a5 per the attacheddooueent.

5. Finally, the idea of a rehabilitation Project being prepared along thelines indicated in the report is accaptable.

Engr. N.0.e poolaPermanent Secretary

- 26 - ANNEX IPage 2 of 2

WAT WPLY Atp6NSA;O

SECTF N80RAN_g

VIEWS OF THE E -CO4IXTrEE tN WATE SUPPLY AN 9ANITATION

ILtFN flTH JJNE 1984

1. SECTOR RGNATIS N AND REAT1MIRt8: RECOMEATION

(i) Accepted

(ii) Accepted

(iii) Accepted

(iv) A nttion wide sArvey must be undertaken to identify sanitation

problems before recommendation an be made for future directions

and policy on sanitation sub-sector for Nigeria.

2. SECTaL INVESTMENT PROOUIJEa RECMENDATIONS

(i) At the Federal level , some involvement and influence must be

exercised over 13vels of services targets, invustment stretegy,

State budget all,,cetions of sector investmaent; and in preparstion

of proposls for externeal financing the Federal Government must

reconider its posltion with a review to reinstating direct grant

for public water supply.

(1i) Accapted.

(iii) Accepted.

3. PERFORMANCE CF STATE WATER UTILITY: RECCWENJDATIONS

Ci) Accepted

(ii) Acoepted

(iii) Accepted

4. BAW('S LENDING STRATEGYi FECOItENIATIONS

(i) Beouase of the reeds manifested in this eeport for sector

co-ordination tIe Bank should give strong support to a project

which is presently under disoussion with the Federel Government to

pursue the foreg'oing objectives. Funds would be neoded for

substantial tecalnical assistance (Projects preparation, manpower

treinino end acrmunting systems) funds for special studies (such as

rural water and sanitation) end funds to help states meet the

rehebilitation needs of existing water supply feciltties.

As much as possible indegenous consultants and local resources

should be utiliascd.

- 27 - ANNEX 2-1Page 1 of 3


WATER SUPPLY AND SANITATION SECTOR

Sector Background

Introduction

1. These notes provide a background to the water supply and sanitationsector in Nigeria.

Geography and Climate

2. Nigeria is located between latitudes 4°N and 13°N, and has a landarea of 924,000 km2 and an estimated population of 87.6 million (1983). Thecountry opens on to the Bight of Benin in the Gulf of Guinea over a coastline800 km long, over half of which is taken by the Niger Delta. In the north-east, the frontier runs through Lake Chad. The entire country rises steadilyfrom the coast towards the northern border, where the altitude is in the orderof 400m. The mean maximum temperature is about 30.6°C in the coastal belt andabout 34.4°C in the north. Maximum temperatures are highest from February toApril in the south, and from March to June in the north. The mean minimumtemperature is about 22.20C over most of southern Nigeria, but falls to 18.9°Cin the north. The southern half of the country has from 1 to 1.5m of rain peryear, and more in the south-east. The drier regions, along the northernboarder, have O.5m of rain per year.

Water Resources

3. Groundwater plays an important role in the life of Nigeria. The mainaquifers occur in the fracture and weathered zones of the crystalline andmetamorphic basement. The entire country is made up of the Pre-Cambrianformations of the "basement complex", which outcrop over half of its totalarea. Although the country is humid, there are large areas where there issufficient surface water to meet local needs. This is particularly true ofthe northern provinces and of the Benue and Niger valleys at some distancefrom the rivers and their major tributaries. Most of the wells have been sunkinto the basement formations. Most of the boreholes are in the Chad basin.In the Borno region, some of the boreholes are artesian. The depth at whichthe water lies is from 120m to 400m. In the southern part of the countrysurface water resources are generally abundant below the confluence of theNiger and Benue Rivers.


Population

4. Nigeria, with a 1984 population of over 90 million is the mostpopulous nation in Africa. The last census which serves as a basis of allpopulation estimates and forecasts dates back to 1963. There are an estimated24 million people living in some 1,000 towns with a population over 20,000including the federal capital at Lagos with a population estimated to be6 million in 1983. In contrast to an estimated annual national populationgrowth rate of 2.5%, the urban polulation increased at an annual rate of about7% between 1970 and 1975, with existing large centers continuing to grow, andmany previously small centers rapidly doubling and tripling their size since1975. More recent estimates (1983) put the countrywide population growth rateat nearly 3.5%. The creation of a federal system of 12 states following thecivil war and the 1976 addition of 7 new states has stimulated the dispersionof urban population into the new state capitals as well as to secondarycenters within states. The rapid growth of urban employment opportunitiesthroughout Nigeria, resulting from 1970-76 and 1979-81 periods of high oilrevenues and massive public expenditures, has led to high urban income levelsrelative to returns to agriculture and induced large-scale migration to townsof all sizes. The present recession in Nigeria has curtailed income growthand caused certain sectors of industry and government to retrench staff.

Environment

5. The rapid growth of the urban population however, was not accompaniedby a commensurate increase in the provision of urban services. Many Nigeriantowns have vast slum areas, unconnected to existing infrastructure networks ofpiped water, storm-water drainage, sewage disposal, roads or transportation.Urban areas generally have highly inadequate service systems. Not one townhas a modern or central sewerage system; yet under the Third Development Plan,this subsector was allocated only 1.3% of the total public sector capitalexpenditure program for 1975-80, whereas the allocation to water supply was2.8%. Inappropriate methods of sclid waste disposal are prevalent; domesticrefuse clutters the streets because of irregular collection and disposal andflooding often occurs after storms because of inadequate or clogged stormdrainage systems. While some urban master plans have been prepared, the focusof these plans has often left major gaps in dealing with the near-term pro-blems of managing and improving the immediate urban environment and therelated services of infrastructure.

Health Conditions

6. Data collected from State Ministries of Health indicate that malariais the most predominant disease affecting the population of Nigeria. Reportedincidence varies from approximately 400 per 100,000 population (Kano) to justunder 4000 per 100,000 (Benue). Even with such high incidences reported,there is severe under-reporting of malaria as well as of other diseases.


Parasitological studies in a number of clinics in Oyo State have shown that46.2% of infants harboured malaria parasites in 1969. The corresponding ratefor children aged 1-4 years was 56.2% and the adult rate was 40.3%. The samerates are reported to be continuing. Malaria incidence tends to be higher inthe south and south-east than in the north where rainfall is relatively lightand the dry season lasts from five to seven months.

7. Diseases, which are prevalent where drinking water supply and sanita-tion conditions are unsatisfactory, are endemic throughout the country, andrank second in importance nationally; diarrhoea, dysentry, gastro-enteritis,infectious hepatitis, hookworm and other parasitic infestations all have highincidences in the reported range of 200 to 650 per 100,000 population. Thesemaladies are chronically under-reported, particularly in rural areas. Out-breaks of cholera are frequent but are usually quite rapidly contained. Otherdiseases vary in their incidence and their relative importance from region toregion.

8. Reduction and control of much of the prevalent communicable diseasein Nigeria will depend on the provision of safe water supplies and sanitationfacilities for the disposal of human exereta. Provision of physical facili-ties alone will rarely be enough, however, and health education on the properuse of safe water and sanitation is essential if maximum health benefits areto be obtained. The introduction of improved sanitation practices presentsparticular difficulties because the need for sanitation is not perceived bythe people, especially those in rural areas. Cultural habits are also aconstraint. Sanitation is, however, essential if intestinal parasites, thediarrhoeas and schistosomiasis are to be controlled. Human behavior andlifetime habits are difficult to change, and state authorities must be con-vinced that their responsibilities do not end with the mere provision of pumpsand pipes, taps and toilets.


FEDERAL FEPUBLIC OF NIGERIA


Rural Water Supply and Community Participation

1. In order that rural water supply programs can run effectively andtheir performance evaluated, it would be useful to have, wherever located, adistinct Rural Water Unit (RWU). The RWU relationship with LGAs and throughLGAs to the communities is considered to be of growing importance as Govern-ment places greater reliance on the LGAs. The RWU should be able to providesiting and design advice, work supervision and necessary non-local materialsto LGAs. It should also be a sour3e of grant/soft loan funds to LGAs as wellas being able to run promotion and training programs for LGA and communityoperatives, advise on levels of service and appropriate design, and provide arepair shop and operations and maintenance referral and support services.Planning and programming would be a joint RWU and LGA function. The LGAs,with appropriate support from State water utilities, would organize communitywater associations, community or LGA labor input and a routine maintenanceservice.

2. If the funding of water agency activities was split between urban andrural, and sufficient funds made available to support the RWU, then the loca-tion question is less crucial. Water agencies have been concerned more withtheir urban programs and have not in many cases formed distinct RWUs. Milita-ting against water agencies as the best location is that they have littlerecord of significant interest in rural water supply, scant organization orknowledge to handle complex social and inter-sectoral problems and are notexperienced in setting up a supporting service rather than acting as theexclusive executive implementing agency. The IADP does provide a frameworkfor sub-state integrated rural development which, where it exists, runs effi-ciently although there are organizational problems in dovetailing with theexisting Governmental structure. In a number of states, consideration isbeing given to the implications of making IADP a State-wide program; althoughthis would need to be reconciled with the recent setting up of RBRDAs in allstates except Lagos state. However, this organizational solution to thelocation of a State RWU will only be immediately available to a few states; inothers IADP can be applied only to selected areas. Another solution would beto locate the RWU in MLG; this would be particularly applicable where the MLGwas strengthened by other means and it was also decided to have the MLG as thereporting Ministry for State water agencies. Probably the best solution, evenwhere there was no State-wide IADP, is to locate the RWU in the Ministry ofAgriculture (MOA) as the MOA has close contacts with rural communities throughits extension offices and can make the necessary links of domestic watersupplies with cattle watering and small scale irrigation or communal kitchengardens.


3. The third rural water supply issue is the need to increase efficiencyand reduce the influence of local politics on rural borehole programming.Many communities have managed to have boreholes drilled, not on hydrogeolo-gical grounds that improved perennial shallow well supplies were not feasible,but to improve their level of service without extra charge to them. Politi-cians were able to influence borehole programs of State water agencies so thatnow greater reliance is being placed on the RBRDAs to undertaken boreholeprograms. Rigs are brought by water agencies, Ministries of Agriculture andIADP managements, Ministries of Community Development and RBRDAs. The mostsensible arrangement would be for a central drilling rig unit to be formed andrun in each state by a triumvirate of officials from the State and FederalAuthorities--the Chairman being the General Manager of the RBRDA or LocalOffice of the FMAWRRD with the Permanent Secretaries from Water (or LocalGovernment) and Agriculture as members. The program for this Central Unitwould be decided within the Five-Year Plan and confirmed annually. Alldrilling rigs in the State (apart from those owned by private contractors)would be owned by the Central Unit and would be operated by teams employed byit, work being carried out on repayment basis from the commissioning agency.

4. The funding of rural water capital program can be partly by the RuralWater Unit (RWU) and partly by LGAs. It is recommended that a sizeable partof the Fourth Plan capital grants for rural water supplies be allocated to arevolving fund to be administered by RWUs. The RWU can make soft loans toLGAs to pay for rural water systems. The LGA should pass on the debt servicecost to their community water associations.

5. The nature of the state institutions for water supply is such thatthe involvement of the people in participatory project planning and imple-mentation is virtually impossible. Projects are usually large, urban-based,centrally planned and built by contractors. The involvement of a communityand its members in the planning, selection from alternatives, and operation ofa water supply system, as done by UNICEF in Imo state, would require adimension of management that is entirely foreign to the water corporationtechnocrats.

6. This is true to a lesser degree with rural water supply agencies,some of which have self-help components to their water programs. The mostcommendable efforts in community participation are made by units of Governmentwith titles such as "Community Development" or "Rural Development". Some ofthese have programs which permit the community to select the type of improve-ment required and to be involved in all aspects of project management, fromplanning through operation and maintenance. Government input in theseprojects is limited to technical/professional assistance plus a grant to covera portion of the cost. Semi-skilled and unskilled labor is provided by thebeneficiaries.


7. In Oyo State, 72 rural water projects were implemented under theaegis of the Department of Community Development in Fiscal Year 1979-80.Programs of this nature are invariably more consistent with Decade 1/approaches than are the programs of the State water supply agencies. Thus itappears logical that increased rescurces need to be made available toCommunity Development departments in order to support water supply andsanitation projects. There is a paradox, however, in that communities do notalways perceive safe water supply and sanitation to be priority needs. Theentire conceptual and practical framework of the community developmentapproach would be destroyed if comnLunity development officers became promotersof water supply and sanitation--se2ecting priorities is and must be acommunity responsibility. The soltLtion to the paradox rests largely with thehealth education units who must supply the health and other informationnecessary to raise peoples' desires and priorities for improved water supplyand sanitation. If this can be done successfully, then increased supportearmarked specifically for water supply and sanitation development should bechannelled into the sector through the Community Development Department.

1/ International Drinking Water Supply and Sanitation Decade1980-1990.

- 33 - ANNEX 2-3



Sanitation Services

1. Support to LGAs for sanitation services could best be providedthrough the Chief Public Health Superintendents of State Health ManagementBoards, which are the executive wings of the State Ministries of Health res-ponsible for policy, planning and budgetary control. A short-term objectiveshould be to eliminate night soil conservancy systems through the implementa-tion of programs to convert pail systems to alternative on-site disposalsystems supplemented where necessary, in high density areas by public comfortstations. Financial support to individual households would be required,probably in the form of construction materials, including standard toiletbowls, with labor being provided or paid for by the beneficiaries. Recurrentfunding from public sources would in future be limited to the cost ofattendents and the provision of light and water to communal facilities,although it is possible that even these costs could be shared by the usersprovided they were made fully aware of the likely commitment prior to con-struction, this being one of the principal reasons behind the less-than-satis-factory usage of comfort stations provided in Ibadan.

2. The provision of the plant (trailers, tractors and mechanicalshovels) necessary to establish a sound basis for the operation of solid wastecollection and disposal systems is seen as an area for State support con-sidering the poor financial situation of the Local Authorities. To containoperating costs by avoiding door-to-door collection service, it would benecessary to recruit public cooperation in depositing household refuse inconveniently located reception trailers through public information campaignsconducted by the LGAs in association with the Health Management Boards.

3. As the provision of a properly run solid waste collection and dis-posal system is of importance for both public health and aesthetic reasons,continuing support to meet the cost of operating the system from State sourceswould be required. Such support would be directed through the State Ministryof Health to supplement LGA funds for at least an initial period of some yearsuntil overall costs can be properly defined, through operational experience,and steps taken to introduce local taxes for their recovery. The alternativewould be to form a State parastatal agency for the provision of all sanitationservices with powers to recover costs from the beneficiaries. However thiscould be seen as an erosion of Local Authority responsibility which may not bepolitically acceptable in the light of the greater recognition given to theseAuthorities in the Fourth Plan, although often undermined at the State level.


FEDERAL ItEPUBLIC OF NIGERIA


Health Education

1. * Ministries of Health recognize the role that health education canplay in the prevention of ill-health and have established health educationunits, or sections, usually within a Division of Preventive Medicine. Unfor-tunately, staffing problems are chronic and in the States for which studieswere undertaken, the health education units have numerous vacancies--inseveral, fewer than half of the established posts are filled. Many of thevacant posts are for health educators or for skilled artisans such as artists,photographers and printers. Operation budgets are also very low but, in lightof the staff shortages, it is unlikely that major increases in budget alloca-tions could be usefully absorbed.

2. The staff situation is paradoxical when one considers that theAfrican Regional Health Education Center is located at the University ofIbadan in Oyo State. This excellent center produces well-trained healtheducators, but its output so far seems to have had little impact on thestaffing of State health education. units. Nor does it appear to have hadsignificant impact on the staffing of schools for the training of sanitariansand other health-related personnel.

3. The most common health education approaches seen in Nigeria are thosethat depend on posters, brochures and films. To a lesser extent the media areused, normally for special occasicns such as World Health Day or when a signi-ficant outbreak of, for example, cholera poses a threat of epidemic. Commu-nity-based health education does not seem to occupy much of the time of thehealth educators. Shortages of staff and shortages of transport are offeredas the major reason for this. Yet, discussions with health educators reveal astated--indeed strongly stated--belief in the essentiality of dialogue withpeople at the village or community level if health education is to be effec-tive.

4. Health education seems tc be practiced in Nigeria as a separateprogram of the Ministry of Health, unrelated to other health programs. Theexception noted above--World Health Day and epidemic conditions--seems to bethe only exception. Health education units do not generally consider thattheir work should be supportive of the State Water Supply Corporation althougha portion of the health education is directed to water supply and the need forsafe water. There is little or nco coordination between the suppliers of waterand the suppliers of health education. Thus, any advantage that might begained by concentrating education on water supply at a location where newsupplies are being installed is lcst. Mechanisms are being developed in theAnambra Water and Sanitation project to achieve coordination between the WaterCorporation and the health educatcrs.


5. Some States have, within their schools' curriculum, programs ofhealth education. Insofar as water and sanitation is concerned, the impact ofsuch education is slight, because many if not most of the schools lack watersupply and sanitation facilities. Thus the pupils are unable to practice whatthe teachers preach. The school curriculum outlines seen (Kano and AnambraStates) appear adequate but officials in both the Ministry of Education andthe Ministry of Health felt that health education was not always welltaught. Teachers lack teaching aids and, in many cases, do not have healtheducation within their teachers' training program.

6 Several actions are required to improve health education inNigeria. Adequate staff and budget are obvious and fundamental needs.Equally important is the design and implementation of State health educationprograms, so that the resources are utilized in a way that the greatestpossible health benefits can be obtained. This will require full cooperationand collaboration with other Ministries and with other departments within theMinistry of Health. In particular it will be necessary to:

(a) improve the quality of the health education curricula and teaching inthe schools. Every effort should be made to ensure that schools haveadequate and well-maintained water supply and sanitation facilities;

(b) improve collaboration and cooperation with State water supply cor-porations to ensure that continuing information on the health bene-fits of safe water supply is transmitted to the population served bypublic water supply systems;

(c) improve collaboration with Sanitation Units in the Ministry of Healthand/or the Ministry of Public Works and strengthen health educationdelivery supportive of sanitary excreta and waste disposal; and

(d) expand the flow of health information to the public, in an effort togenerate an increased public demand for safe water supply andimproved sanitation facilities, especially in rural areas wheredevelopment is supported by Community Development departments andsimilar agencies of Government.



Estimates of Water Supply Investments required to meet

Alternative Service Levels

Note: Population in millions, Prices in millions (N 1983 constant prices)

1978 1985 1990 1995 2000

*Total Population 82.8 103.3 121.7 143.5 169.1

**Urban Population % 20 25 30 33 35

No. 16.6 25.8 36.5 47.4 59.2

**Rural Population % 80 75 70 67 65

No. 66.2 77.5 85.2 96.1 109.9

**Urban Population served % 50 60 75 85 95

No. 8.3 15.5 27.4 40.3 56.2

**Rural Population served % 20 30 50 70 90

No. 13.2 23.3 42.6 67.3 98.9

Investments to serve Incremental Urban Population at forecast coverage levels(see Page 2)

Population to be served 7.2 19.1 32.0 47.9

Low service at N43 per capita (Nm) 310 821 1376 2060

Medium service at N81 per capita (Nm) 583 1547 2592 3880

High service at N142 per capita (Nm) 1022 2712 4544 6802

Cumulative Investments to serve incremental Rural Population at forecast coveragelevels (see Page 3)

Population to be served 10.10 29.4 54.1 85.7

Investments at N34 per capita (Nm) 343 1000 1839 2914

Total Water Supply Investments (N million)

Low service level 653 1821 3215 4974

Medium service level 926 2547 4431 6794

High service level 1365 3712 6385 9716

*Source: Federal Office of Statistics, and updatedin light of most recentIBRD estimates.

**Source: Rapid Assessment and Sector Planning Studies - figures averaged androunded and modified by Bank estimates.


Notes on Basis of Determining Urban Investment Costs

Per Capita Costs (N)

A SuraceWatrSppleLow Service Med. Service High ServiceA. Surface Water Supplies at 50 lcd at 70 lcd at 130 lcd

(i) Treatment at N85 per M3 per day 4.3 6.0 11.1

(ii) Av.Pumping at N57 per M3 perday 2.8 4.0 7.4

(iii) Intake & transmission at N170per M3 per day 8.5 11.9 22.1

(iv) Storage at N284 per M3(12 hours allowed) 7.1 9.9 18.5

(v) Distribution at N28 per meter 16.8 (0.6 M) 42.0 (1.5 M) 64.4 (2.3 M)

(vi) Connections N99 each (at 6persons per house N16.5 percapita) 1.7 (10%) 5.0 (30%) 14.9 (90%)

(viii) Standposts N284 each (at 500persons per standpostNO.6 per capita) 0.5 (90%) 0.4 (70%) 0.1 (10%)

T 0 T A L 41.70 79.2 138.5

B. Borehole Supplies

(i) Borehole c/w transmission andtreatment N0.34 million per800 M3 per day 21.3 29.8 55.3

(ii) Storage (as before) 7.1 9.9 18.5

(iii) Distribution (as before) 16.8 42.0 64.4

(iv) Connections and standposts(as before) 2.2 5.4 15.0

T O T A L 47.4 87.1 153.2

C. Overall Development Costs based on:

75% Use of surface sources 31.3 59.4 103.9

25% Use of groundwater sources 11.9 21.8 38.3

T 0 T A L (rounded) 43.0 81.0 142.0


Notes on Basis of Determining Rural Investment Costs

Per Capita Costs (N)

A. Piped systems providing low stamdard of service(see urban investment figures) 41.7

B. Shallow wells complete N14,000 serving 500 people 28.0

C. Borehole complete with tank and battery of standposts(say 6) N92,000 to serve 3001) people 30.7

Assume Overall development will be evenly distributed over each type ofabove supply to give average cost of N34 per capita.

- 39 -

ANNEX 3-2


EXTRACTS FROM WORLD DEVELOPMENT REPORT 1983 1/

A. Box 11.1 Institutional development in industrialized countries

In the industrializ.d worid, little more across the countrv-anc did s r, so cart tur.' onwvard, it w;as also active in edu-

than a century separates the tolerably ef- by creating state ertterpnses that for a cating the labor force and ir influencing

fective bureaucracies of today from. tLme dominated siich industries as ship- working cond,ticns through child labor

administrations in which ccrruption and building, railroads, mining. and arma- laws and safety standards. The cther side

-icompetence were the rule rather than ments. In the United States the basis of of the comn, ot course, was the w.r:y the

the excepticn. No countrn made prog- modern adrmnistraton was laid in the state used its povwer, especa31iv in the

ress in tie same way, but ceitain features nineteenth centurv and tI-en expanded early stages of Lndustnalization. tc sup-

stand ou: Firs:% most of the large leaps during the 1930s as p.irt of the New Deal press trade unions.

in administrative reform (which were political response to the Depression. The growth of the pubbc sector has

often ollocwed by peneds of consolida- Second. administratve 3exeloprnent produced its ovwn problem- unequal ac-

tion) enjoyed strong political sponsor- also had immediately practical concerns. cess to services provided by the state,

ship. In Britain the Northcote-Trevelvan It was prompted by the growth of na- rising adminms richve costs 1anO often di-

reforms, which est2blihed the essence tional economies and tie rapid devel- minishing etiectiveness), and thegrowth

of a merit-based, nenpolitical bureau- opin-nt of markets. lust 3s it was in de- oi self-serxing bureaucracies ailied to po-

cracy, were part of the w ide-ranging po- veloping countnes- The siate under:-ok htical elites. These weaknesses are par-

litical changes between 1832 and 1884 that the essential tasks for economic dee! alieled in some respects in the pnvate

cornsolidated middle-class ascendancy opment-organizinS trf-astructure; sector. a, large corporations are seen by

over the aristocracv. in Japan the leaders standardizing currencies, weights, and many to be less adaptabie or the face of

of the Meiji Restoration after 1868 wished measures; strengthenig commnerda, lawzsi: cnanpr.g technological and competitive

to build a modermizing administration and so on. From the late nineteenth cen- conditions.

B. Box 11.2 Corruption

All societies have corropt features in the sessive preoccupation. Public officials w-ll on speciHic actions by govenrnment. Many

sense that some pv' iic money is illicitly do nothing without bribes, and rany governments from timne to time have in-

diverted for private gain. The particular people are unproductivelv employed in itated anticorruption drives However,

circumstances cf de eloping countries- secunng their favors or buying their si- such eiforts tend to be shortlived and

rapid social and econormic change. strong lence. Corruption can thus become an nrefective. since they ofteni concentrate

kinship ties, new ;nstitutions. overlap- utstitution's raison d'etre. rather than a on punitive measures and even closer-

ping and ;ometirnes contlicting views miror aspect of its activities. In extreme but stiil unworkable-controls. instead

about proper jpublic beha tor-may be cases, such as in countries which are ma- of designing interventions so as to min-

peculiarly conducv e to corruption. lor exporters of illegai drugs, admninis- irnize the opportunities or incentives tor

Corruption takes pl3ce in transactions tration mn entire regions and arms of gov- corruption. For examnple, corruption can

between private ir-iviL-uals or firms and ernment rnay become perverted by be limited by avoid'ing admninistratively

pabl;c officials. thus, it is the misuse of corruption. created scarcities (as some centrallv

public funds and the tailure of public * Corruption tends to tavor those with planned economies are doing by effec-

trust tn2t :s ot raiticular ccncern Cor- economic or institutonal power. tiveh sanctioning a "second econromy');

ruptinn seriously undiermines the eftec- * Some corruption is on such a scale by reducing contrcs on international

tiveriess oi gove-nment. that it has major ecoriomic conse- trade and pa-rnents; and by- improving

* Cver time corrurntion tends to cor- quences: it may stimulate the ilegal ex- the incentives and accountabili't of of-

rode popular onrtidence in public insth- port of capital or result in large Frotects ficia!s in the areas *Fhee regulations or

tutions. Th:s makes it ha-de. to raise the being aw arded to contractors (otten nui- adrr,inisurarle discreton re-na:n. Cor-

st.ndards ot pubibc service. deflects pub- tirnatonal conpanies) according to the size ruption is usually beter tcught by a com-

lic debate assay trom ecoromic perfor- of their bnbes rather than the qualitY of buianon of te%ser, better-paid officials

manc to-xard thFs sincle issue, ard in their pertor-nance. controlling only what realiv needs to be

extreme cases proGmts ior at least pro- The eradication of corruption as a tea- land can effectnelv be, -:untrelied in the

vcldes a justificattcn toro violent changes ture of public life depends on the gradual fuU light of public scrutiny, than by oc-

in govemment. creation oi a politicai and pubiic curnrate casional anticrrupi-n 'campaigns

* 'Rent-seeking" can become an oh- tavonng imparnal institutions, as well as

1/ The World Bank (July 1983) Published by O-:tord Uriiversity Press.

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