improving water operator finances through better practices – experiences from east africa

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33 WATER21 •  FEBRUARY 2011 The Fast Track Cap aci ty Buildin g pro gra mme impl emented by the National Water and Sewerage Cor por ation (NWSC) in Uganda under UN-HABITAT’s ‘Wa ter for Afr ican Cities’ pro gra mme demonstra tes that an integr ated pr ogramme of tr aini ng and capaci ty buildi ng, combined with inv est ments in phy sical infr astructure, offers the best hope of impr oving ins titu tion al cap aci ties to reduce non-revenue water, impr ov e service delivery and increase the sust ainabilit y of  inv estments in the long-t erm. GRAHAM ALABASTER discusses the programme’s succes s in v e towns in Kenya and T anza nia. CAPACITY BUILDING I t is only in recent years that countries in sub-Sah aran Africa have started to emerge from the highly centralised water sectors supported by donor agencies, which have focused primarily on the main urban centres.This has left the infrastructure in many small towns neglected due to a lack of investment in rehabilita- tion and a lack of technical and managerial capacity within the organisations responsible for managing the assets.This has led to high rates of leakage and rev enue losses, which have undermined the nancial status of most small town operators. At the same time , the Millenn ium Development Goals (MDGs) hav e focused resources on increasing service cov erage, with far less attention paid towards the ensuring the sustainability of these services or improving the operation and maintenance (O&M) of existing assets.This results in the situation shown i n Figure 1, which shows the difference between the theoretical values of access to improved water facilities (measured as coverage as reported by theWorld Health Organisation (WHO) / UNICEF  Joint Monitoring Program) and the actual access,taking into account the inadequacies of supply based upon data from ve small towns in Kenya. This situation invariably reduces customer’ s willingness to pay , which has knock-on consequences on utilities’ rev enue and undermines institutional capacities to sustain the services.An evaluation undertaken by the W orld Bank’ s Independent Evaluation Group in 2009 concluded that most municipal development projects – including those with water supply components – paid little attention to O&M, leading to negative project results and signicantly increasing the risk to development outcomes 1 .It is therefore clearly apparent that there is an imperative need to focus on the O&M require- ments of water and sanitation infra- structure in order to improve service delivery on a sustainable basis. The UN-Habitat capacity building programme on utility management A good example of an initiative that has been designed to systematically address the problems described above is the UN-HABITAT’s Capacity Building Programme on Utility Management.The programme was carried out between June 2007 and August 2008 in the ve towns of the LakeVictoria RegionWater and Sanitation (LVWATSAN) Initiative: Muleba and Bukoba inTanzania and Kisii, Gusii and Homa Bay in Kenya. The overall objective was to support the nancial and operational sustainability of the capital investments provided under the LVWATSAN Figur e 1: Acc ess to waterin Kenya n towns Impr ovi ng water op erator n ances thro ug h better pr actices  experiences from East Africa An ofci al recei ves wat er pip es forthe LVWSAN initiat ive in Homa Bay , Kenya . Credit: UN-HABITAT .

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8/12/2019 Improving Water Operator Finances Through Better Practices – Experiences From East Africa

http://slidepdf.com/reader/full/improving-water-operator-finances-through-better-practices-experiences 1/333WATER21 •   FEBRUARY 2011

The Fast Track Capacity Building programme

implemented by the National Water and Sewerage

Corporation (NWSC) in Uganda under UN-HABITAT’s

‘Water for African Cities’ programme demonstrates that

an integrated programme of training and capacity

building, combined with investments in physical

infrastructure, offers the best hope of improving

institutional capacities to reduce non-revenue water,

improve service delivery and increase the sustainability of investments in the long-term. GRAHAM ALABASTER discusses

the programme’s success in five towns in Kenya

and Tanzania.

CAPACITY BUILDING

It is only in recent years thatcountries in sub-Saharan Africa

have started to emerge from thehighly centralised water sectorssupported by donor agencies,which have focused primarily onthe main urban centres.This hasleft the infrastructure in manysmall towns neglected due to alack of investment in rehabilita-tion and a lack of technical andmanagerial capacity within theorganisations responsible formanaging the assets.This has

led to high rates of leakage andrevenue losses, which haveundermined the financial status of most small town operators.

At the same time, the MillenniumDevelopment Goals (MDGs) have

focused resources on increasing servicecoverage, with far less attention paidtowards the ensuring the sustainabilityof these services or improving theoperation and maintenance (O&M)of existing assets.This results in thesituation shown in Figure 1, whichshows the difference between thetheoretical values of access to improvedwater facilities (measured as coverageas reported by theWorld HealthOrganisation (WHO) / UNICEF Joint Monitoring Program) andthe actual access,taking into account

the inadequacies of supply based upondata from five small towns in Kenya.

This situation invariably reducescustomer’s willingness to pay, whichhas knock-on consequences onutilities’ revenue and undermines

institutional capacities to sustain theservices.An evaluation undertaken bythe World Bank’s IndependentEvaluation Group in 2009 concludedthat most municipal developmentprojects – including those with water supply components – paid littleattention to O&M, leading to negativeproject results and significantlyincreasing the risk to developmentoutcomes1.It is therefore clearlyapparent that there is an imperativeneed to focus on the O&M require-ments of water and sanitation infra-

structure in order to improve servicedelivery on a sustainable basis.

The UN-Habitat capacity buildingprogramme on utility managementA good example of an initiative thathas been designed to systematicallyaddress the problems described above isthe UN-HABITAT’s CapacityBuilding Programme on UtilityManagement.The programme wascarried out between June 2007 andAugust 2008 in the five towns of theLakeVictoria RegionWater andSanitation (LVWATSAN) Initiative:Muleba and Bukoba inTanzania andKisii, Gusii and Homa Bay in Kenya.

The overall objective was tosupport the financial and operationalsustainability of the capital investmentsprovided under the LVWATSAN

Figure 1:

Access to water in

Kenyan towns

Improving water operator finances through better

practices – experiences from East Africa 

An official receives

water pipes forthe

LVWSAN initiative in

HomaBay, Kenya.

Credit: UN-HABITAT.

8/12/2019 Improving Water Operator Finances Through Better Practices – Experiences From East Africa

http://slidepdf.com/reader/full/improving-water-operator-finances-through-better-practices-experiences 2/3

8/12/2019 Improving Water Operator Finances Through Better Practices – Experiences From East Africa

http://slidepdf.com/reader/full/improving-water-operator-finances-through-better-practices-experiences 3/335WATER21 •   FEBRUARY 2011

complaints and the actions taken.The aim was to improve thehandling of customer complaintsand provision of feed back to

the customers.

Key achievements and outcomesAs a result of the capacity buildingactivities described above, the utilitieswere observed to develop a stronger feeling of ownership and a better understanding of the need to work as ateam to overcome key constraintsaffecting the performance of theorganisation. Divisions betweenmanagement and staff were observedto decrease with the staff showinggreater support for managementdecisions.This has also led to internal

staff reorganization, improved manage-ment structures and a markedimprovement in the ambience of boththe offices and installations,which hasimproved their corporate image.

All the utilities have improvedtheir documentation and reportingcapabilities.With the monitoringand evaluation reporting templatesdeveloped during the execution of theprogramme,data and information iscaptured on a regular basis.Throughthe reporting templates,the utilitiescan now track their performance over time and produce comprehensive

monthly and quarterly reports.Table 2 summarizes the key out-

comes in two of the utilities:GusiiWater and Sanitation Company(GWASCO) in Kisii, Kenya andBukobaWater and SewerageAuthor ity(BUWASA) in Tanzania.

Pilot areas were block mapped ineach of the towns which has enabledthe utilities to easily identify their customers in these zones and toincrease the efficiency of metering. For example, BUWASA increased meter-ing efficiency from an average of 58%before the PIP to 95% in the periodof nine months after the introductionof the PIP in September 2007.Thenew computer billing system has nowbeen installed in all the towns andcustomized to suit each utility’scircumstances.This has enabled

computerized generation of billsthat can easily be referenced to thecustomer data base and integratedwith the block mapping.

GWASCO managed to reduceNRW from 62% before theprogramme to 41% in the period of nine months after the introduction of the PIP in September 2007.Theseimprovements were as a result of implementation of better monitoringcombined with an improved responseto leaks and bursts.Examples of revenue collection improvements for BUWASA are shown in Figure 2.Improvements were noted in revenuecollection in all the towns, although insome cases the targets set for eachquarter in the PIP were not achieved.

Institutionalization of improvedoperational and management practicesThe reductions in NRW can beattributed to both the infrastructuredevelopments and hardwarecomponents provided by UN-HABITAT combined with the skillsacquired by the staff acquired duringthe FastTrack Capacity Buildingprogramme.The results that have beenachieved demonstrate that an integrat-ed programme of training and capacitybuilding combined with investments inphysical infrastructure offers the best

hope of improving institutionalcapacities in the long-term.

The key to achieving the institu-tionalization of O&M practices is toensure that there is a demand withinthe organization from all levels instaff from the director down to thetechnicians, who are responsible for 

actually implementing changes inO&M practices.These changes needto be enshrined in the organization’sstrategic and policy and business

plans.As well as changes in operationalchanges from a technical perspective,there is a need for specific toolsthat enable managers to makedecisions related to operation andmaintenance practices.

Training programmes must berelevant and ‘hands on’ and should besupported by assistance in systemsdevelopment.The training provided byNWSC has been immensely beneficialto the utilities participating in theprogramme.However, the quality of the existing staff needs to be strength-ened further through tailor-made

training programmes.These mayinclude asset management tools,standard operating procedures and / or performance monitoring indicators.UN-HABITAT is aiming to collabo-rate with IWA,WHO and theNational Institute of Public Heath in Japan under the umbrella of theOperation and Maintenance Network(see box) to meet these capacitybuilding needs.

ReferencesNWSC (2008) Fast Track Capacity Building 

Programme For Utilities. Final Project Report 

(September 2008).LakeVictoriaWater and 

Sanitation Initiative,NWSC External Services,

Uganda

Note1 World Bank (2009) ImprovingMunicipal Management for Cities toSucceed:An IEG Special Study.Independent Evaluation Group,Knowledge Programs and EvaluationCapacity Development (IEGKE),Washington DC.

Table 2: Key outcomesof the capacity building in two ofthe participating utilities

Performance indicator GWASCO BUWASA

Sept 2007 June 2008 Sept 2007 June 2008

(Before PIP) (Before PIP)

Water produced (m3 /d) - 2778 - 5695

Unaccounted for water (NRW) 62% 41% 59% 51%

Revenue c ollection ( USD) 12,773 21,133 24,923 48,369

O& Mexpenditures (USD per month) 27,917 22,423 31,032 50,869

Working r atio ( expenditure / revenues) 2.2 1.06 1.25 1.05

Number of metered connections 696 1,676 2,720 5,220

Metering efficiency (%) 15% 29% 58% 90%

Figure 2:

Vicious cycle

of poor service

delivery

exacerbated bypoor O&M

Figure 3:

Revenue collection

trends for BUWASA

(July 2007 –

June2008)

     %

    o     f     (    p    o     t    e    n     t     i    a     l

     )    r    e    v    e    n    u    e    c    o     l     l    e    c     t    e     d

About theauthor

Graham Alabasteris Chiefof Section I oftheWaterSanitation and InfrastructureBranch in theHuman SettlementsFinancingDivision of theUnited NationsHuman Settlements Programme UN-Habitat, Nairobi, Kenya.Email: [email protected]