situational analysis of the water sector in tanzania · 2.3 sector-wide approach to planning 9 2.4...

UNITED REPUBLIC OF TANZANIA

MINISTRY OF WATER

Situational Analysis of the Water Sector in Tanzania

Final Report September 06th, 2006

Joint Sector Working Group on Water

Situational Analysis of the Water Sector in Tanzania September 2006

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TABLE OF CONTENTS

Acronyms and Abbreviations II

Executive Summary III

1 INTRODUCTION 1

2. FRAMEWORK FOR PLANNING IN THE WATER SECTOR 2

2.1 Background 2

2.2 Planning and budgeting for water and sanitation 4

2.3 Sector-wide approach to planning 9

2.4 Key issues and areas for priority action 9

3. FINANCING THE WATER SECTOR 12

3.1 Background 12

3.2 Funding of the water and sanitation sector 12

3.3 Financing needs 17

3.4 Key issues and areas for priority action 19

4. PERFORMANCE REVIEW 21

4.1 Background 21

4.2 Current situation 21

4.3 Constraints 26

4.4 Recommendations 27

5. KEY ISSUES AND AREAS FOR PRIORITY ACTION 31


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Acronyms and Abbreviations AfDB - African Development Bank BWO - Basin Water Office CBOs - Community Based Organisation COWSOs DHS DPs

- - -

Community Owned Water Supply and Sanitation Organisation Demographic and Health Surveys Development Partners

DPG - Development Partners Group DPP - Department of Policy and Planning DWSTs - District Water and Sanitation Teams EWURA - Energy and Water Utilities Regulatory Authority GoT HBS

- -

Government of Tanzania Household Budget Survey

HP IMIS ILFS

- - -

Hand Pump Integrated Management Information System Integrated Labour Force Survey

i .o. t. - In order to JAS - Joint Assistance Strategy JWSR - Joint Water Sector Review LFA - Logical Framework Approach/Analysis LGAs - Local Government Authorities M&E - Monitoring and Evaluation MDA - Ministries, Departments and Agencies MDGs - Millennium Development Goals MTEF - Medium-Term Expenditure Framework MIS MoEVT

- -

Management Information System Ministry of Education and Vocational Training

MoF MoH

- -

Ministry of Finance Ministry of Health

MoW - Ministry of Water NAWAPO - National Water Policy NGO - Non-Governmental Organisation NRWSSP - National Rural Water Supply and Sanitation Programme NSGRP - National Strategy for Growth and Reduction of Poverty (MKUKUTA) NWSDS - National Water Sector Development Strategy O&M - Operation and Maintenance OC - Other Charges PE - Personal Emolument PER - Public Expenditure Review PMS - Poverty Monitoring System PRS - Poverty Reduction Strategy PS - Permanent Secretary RWSS - Rural Water Supply and Sanitation RWSSI - Rural Water Supply and Sanitation Initiative SWAP - Sector-Wide Approach to Planning TSPs - Technical Service Providers TWG - Technical Working Group URT - United Republic of Tanzania UWSAs - Urban Water and Sewerage Authorities UWSS - Urban Water Supply and Sanitation WATSAN - Water and Sanitation WB - World Bank WRM - Water Resources Management WSSP - Water Supply and Sanitation Programme WSDP - Water Sector Development Programme WSDS - Water and sanitation sector Development Strategy WSWG - Water and sanitation sector Working Group


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Executive Summary Tanzania is currently undergoing major political, social and economic reforms with the main goal of addressing its widespread poverty and promoting economic growth. Water supply and sanitation is seen as one essential tool in the effort to reduce poverty. Therefore, the National Strategy for Growth and Reduction of Poverty (MKUKUTA) commits Tanzania to achieving the Millennium Development Goals (MDGs) for access to safe water, sanitation and a sustainable environment. In order to provide the necessary foundation for contributing to the reduction of poverty, major reforms in the water sector are currently underway includ-ing decentralization of service provision, full cost recovery and an increasing role for the pri-vate sector.

The targets defined in the MKUKUTA, the National Water Policy (NAWAPO) and the Na-tional Water Sector Development Strategy (NWSDS) call for increasing the proportion of the rural population with access to clean and safe water from 53% in 2003 to 65% in 2010. They also call for increased access to clean and safe water or the urban population to rise from 73% in 2003 to 90% by 2010. Access to improved sewerage facilities is targeted as rising from 17% in 2003 to 30% in 2010 in respective urban areas and sanitation coverage is tar-geted to rise from 90% in 2003 to 95% by 2015.

Based on the new strategic orientation in the water and sanitation sector as set out in the NWSDS, the Government has engaged in the process of establishing a new development partnership for the sector. This includes the establishment of a Sector Wide Approach to Planning (SWAP) and the introduction of an effective sector dialogue as well as joint sector reviews in order to strengthen policy choices, improve budgeting, improve resource utilization and mobilization, and enhance performance. The objective of this situation analysis is to pro-vide baseline information for the first Joint Water Sector Review (JWSR) to be held in Sep-tember 2006. It provides an overview over sector progress to date with respect to sector planning frameworks, sector financing and sector performance monitoring.

Adequate sector planning frameworks are needed for translating the overall development goals and the specific sector goals into priority interventions and activities. The planning processes in the water sector follow the general planning and budgeting cycle in Tanzania. National policies and strategies set the stage for the National Water Policy (NAWAPO) and the National Water Sector Development Strategy (NWSDS) and provide overall targets for the water sector. For the planning process, sector and sub-sector planning involving a num-ber of different stakeholders need to be matched with financing from different sources. A high degree of articulation between these different planning frameworks is required to ensure effi-cient allocations of the available funds to the sector priorities and to prevent overlapping roles of and inadequate co-ordination among the various agencies involved in the water sec-tor.

The analysis of the framework for planning in the water sector has highlighted the critical issues for planning in the water sector that will require attention in the future. The overall planning process involves different stakeholders and the flow of information between the lo-cal and the national level has to be considered dysfunctional. Planning for water-related ac-tivities is not fully integrated resulting in the overall planning being based on limited informa-tion. Furthermore, the planning for water and sanitation is currently made on the basis of im-perfect information with regard to available funding and complementary activities.

It is essential for the water and sanitation sector to improve the planning basis through better co-ordination and communication as well as better data. One area for priority action is to im-prove the flow and analysis of information in the sector on water-related activities, in particu-lar between LGAs and UWSAs and the MoW. A second priority is to take forward the initia-tive undertaken by the MoF to improve reliability of data on external funding.

This would also facilitate the strengthening of the consistency between medium term plan-ning and recent sector initiatives. The challenges for the water sector require a forward-looking planning and budgeting to address the core issues. However, the current MTEF pre-pared by the MoW is not yet fully oriented towards taking up the existing challenges, partly


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due to the imperfect planning basis. Important elements are to harmonize the planning for priority interventions set out in the Water Sector Development Programme with the MTEF and to link the planning process to sector performance monitoring (input-output-outcome).

The current situation of planning for water and sanitation hampers efficient priority setting and resource allocations. The new strategic orientation in the water sector proposes the adoption of a more effective institutional framework for the provision of water and sanitation services to rural and urban people and for the management of water resources. A Sector-Wide Approach to Planning has been introduced to provide the overall framework for the different planning processes and to ensure efficient allocations of the available funds to the sector priorities and to prevent overlapping roles of and inadequate co-ordination among the various agencies involved in the water sector.

The recent initiatives for strengthening the co-ordination between different planning proc-esses in the context of the SWAP need to be taken seriously to improve the situation. With the new approach for the water sector embedded in the Water Sector Development Pro-gramme the context for coherent planning in the sector have improved markedly. However, it is essential that the core components of the new framework be implemented over the next years. This concerns primarily the improvement of the flow of information and the assumption of the new roles and responsibilities by the respective stakeholders. The association of the different stakeholders in the context of the sector dialogue will contribute to improving the planning process.

The MKUKUTA and MDG targets for the water sector will only be achieved under the condi-tion that sufficient financing for the sector is available and that the available resources are allocated efficiently to the different priority interventions. Sector financing is analysed with regard to the overall resource envelope, the resource requirements for reaching the targets and the split between allocations for different sub-sectors. Different sources of financing for the water sector are included in the analysis, taking into account both public and private funding as well a domestic and external resources.

Several important issues arise from the analysis of the financing for the water sector. In gen-eral, sector funding has increased considerably over the last years, mainly from domestic resources. However, a clear picture of the resource flow to the water and sanitation sector is not available. This concerns primarily the resource flows to Local Government Authorities.

The urgent need for getting a clear picture on resource flows in the water sector has already been stated by other studies. A comprehensive overview over resources allocations for water and sanitation from the different relevant funding sources is essential to inform the MoW for its strategic planning for the sector, to improve the planning basis for the other stakeholders in the sector, in particular the LGAs, the UWSAs and the BWOs and to provide a basis for the sector dialogue. It is therefore suggested to establish a data base for the sector in rela-tion with the sector performance monitoring that will reflect the overall trends in resource al-locations for the sector. In addition, it is also recommended that a broad based public expen-diture review in combination with very specific studies are carried out to fill the information gaps on sector funding, in particular with regard to the funding generated internally by the sector (UWSA revenues, private funding for water and sanitation, village water funds).

A second key issue coming out of the analysis of the sector financing is the funding for rural water supply. The share of funding for rural water supply within the MoW budget has de-clined (Vote 49) despite top priority given to the improvement of rural water supply services in the respective policy documents.

A last issue is related to the funding for the water sector. The strategic orientation in the wa-ter sector reflects the decentralization policy outlined in the Local Government Reform and LGA allocations for water have already been restructured. However, an adequate resource transfer to the local level yet needs to happen. It is therefore suggested that the MoW puts efforts into ensuring that funding for rural water supply is directly allocated at the LGA.

The recent estimates of resource requirements to meet the MDG and MKUKUTA targets


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elaborated in the context of the Water Sector Development Programme show funding gap. However, potential financing sources have already been identified and commitments for funding are reflecting the challenges for the sector. However, the adequacy of available fund-ing is not the most important issue for the water sector in Tanzania with regard to achieving the MKUKUTA and MDG targets. Absorption capacity is a much more important limiting fac-tor that needs to be addressed through improving project preparation. Strengthening the ca-pacity of all relevant stakeholders for planning and implementing the interventions in the wa-ter sector is essential and has been included as a core component in the Water Sector De-velopment Programme.

In order to provide the basis for tracking progress on a sector-wide level, a sector perform-ance monitoring system sector is to be introduced at the first JWSR. The performance monitoring framework comprises key indicators for assessing progress in the sub-sectors, including input indicators to measure the resources flowing to the sector, output indicators quantifying the investments financed from the resources and outcome indicators capturing the changes in the water sector. Existing reporting and performance monitoring systems for the water sector are analysed with regard to their link to the MKUKUTA and MDG targets and outcome indicators. Taking into account the availability of data, a set of simple, but rele-vant indicators is proposed for the sector performance monitoring.

The chapter on the status of performance monitoring for water and sanitation has given an overview of the overall development targets related to the sector as well as the specific per-formance indicators currently used in the three sub-sectors.

The framework proposed in the report needs to be further developed into an operational Management Information System (MIS) for tracking sector performance. The MIS will confirm definitions, data capture, methodologies and reporting systems and arrangements.

Derived from these key issues, three areas for priority action were highlighted and recom-mendations for specific undertakings formulated. It is recommended that the sector develops and adopts standard definitions that will be used routinely in the sector evaluation. Secondly the strengthening of data gathering and analysis capacity is essential for building an ade-quate performance monitoring. The focus of such capacity building should be on strengthen-ing the data gathering capacity, the quality of survey information, statistical tracking capaci-ties, the capacity to transform statistical analysis into effective recommendations for policy, planning and resource allocation and the monitoring (of the monitoring) mechanisms.

A third area for priority action is the definition of core output indicators. A set of output indica-tors was suggested in order to track sector progress throughout the years to come. These output indicators would evaluate the sector better than the current ones and do not demand new or extra resources (funds, HR or time etc.) in order to be carried out.


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1 INTRODUCTION The aim of this situation analysis is to provide baseline information for first Joint Water Sector Review (JWSR) which will take place in September 2006. The purpose of the first JWSR is to establish a common basis for future performance monitoring and priority setting in the water sector based on a mechanism of continuous partnership dialogue between the Government of Tanzania (GoT) and development partners (DPs). The first JWSR is expected to produce

� Performance assessment procedures, which takes into account requirements of MKUKUTA cluster targets and indicators and MDG targets.

� Agreed mechanisms for sector co-ordination and dialogue between GoT and DPs as well as for the involvement of other stakeholders.

� Priorities for policy, development and investment for the FY 2007/2006

The joint sector review is an integral part of the new development partnership for the water sector. Based on the National Water Sector Policy and the National Water Sector Develop-ment Strategy (NWSDS) and as a central component of the new strategic orientation in the water and sanitation sector, the Government has engaged in the process of establishing a new partnership with the Development Partners. This includes the establishment of a Sector Wide Approach to Planning (SWAp) with an effective sector dialogue as a core element. In order to strengthen policy choices, improve budgeting, improve resource utilization and mobi-lisation, and enhance performance, the sector dialogue requires ongoing dialogue mecha-nisms such as sector working groups and annual events such as the joint sector reviews. Three thematic issues have been identified for the situation analysis as core areas for priori-tized action in the context of the new strategic orientation for the water sector.

Adequate sector planning frameworks are needed for translating the overall development goals and the specific sector goals into priority interventions and activities. Sector and sub-sector planning involves a number of different stakeholders and needs to be matched with financing from different sources. A high degree of articulation between the different planning frameworks is required to ensure efficient allocations of the available funds to the sector pri-orities and to prevent overlapping roles of and inadequate co-ordination among the various agencies involved in the water sector.

The MKUKUTA and MDG targets for the water sector will only be achieved under the condi-tion that sufficient financing for the sector is available and that the available resources are allocated efficiently to the different priority interventions. Sector financing is analysed with regard to the overall resource envelope, the resource requirements for reaching the targets and the split between allocations for different sub-sectors. Different sources of financing for the water sector are included in the analysis, taking into account both public and private funding as well a domestic and external resources.

In order to provide the basis for tracking progress on a sector-wide level, a sector perform-ance monitoring system is to be introduced at the first JWSR. The performance monitoring framework comprises key indicators for assessing progress in the sub-sectors. Existing re-porting and performance monitoring systems for the water sector are analysed with regard to their link to the MKUKUTA and MDG targets and outcome indicators. Taking into account the availability of data, a set of simple, but relevant indicators is proposed for the sector perform-ance monitoring.

On the basis of the above analysis, the report identifies key areas for change and makes recommendations for future action to be discussed at the first JWSR. A draft report was pre-sented to the Task Force on July 14, 2006 and the comments received are taken into ac-count in this document. In view of the broad audience for the JWSR, the document proposes a non-technical approach to the situation analysis and derives the findings and recommenda-tions from the relevant background information.


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2. FRAMEWORK FOR PLANNING IN THE WATER SECTOR

2.1 Background

The general framework for the development in Tanzania is set out in two core policy docu-ments:

• The Development Vision 2025 as an overall vision for the long-term social and eco-nomic development goals and

• The National Strategy for Growth and Reduction of Poverty (NSGRP – MKUKUTA) identifying key areas for poverty reduction.

Tanzania’s Vision 2025 has the key objective of alleviating poverty by 2025. For each prior-ity sector, it provides complementary strategies that focus on poverty alleviation. The target of the Development Vision 2025 for water and sanitation sector is universal access to safe water by 2025. This will be achieved through involvement of the private sector, empowering local government and communities, and promotion of broad based grass root participation in mobilisation of resources, knowledge and experiences, with a view to stimulating initiatives at all levels of the society.

The Tanzanian National Strategy for Growth and Reduction of Poverty (MKUKUTA 2005-2010) identifies three clusters for poverty reduction: (I) Growth and Reduction of Income Poverty, (II) Quality of Life and Social well-being and (III) Governance and Accountability. Increased access to clean affordable and safe water and sanitation was identified as one of the priority poverty reduction strategies. The MKUKUTA calls for measures to expand and maintain existing protected-water sources, to properly maintain sanitation facilities and to ensure facilities at public institutions are adequate and meet Government guidelines.

In line with the time frame for the five-year MKUKUTA, operational targets for the water, sani-tation and waste management have been defined for the year 2010:

• increased proportion of rural population that has access to clean and safe water from 53% in the year 2003 to 65% by the year 2009/10 within 30 minutes of time spent on collection of water;

• increased urban population with access to clean and safe water from 73% in 2003 to 90% by the year 2009/10;

• increased access to improved sewerage facilities from 17% in 2003 to 30% in 2010 in respective urban areas;

• 95% of people with access to basic sanitation by 2010;

• reduced water related environmental pollution levels from 20% in 2003 to 10% in 2010;

• reduce households living in slums without adequate basic essential utilities;

• 100% of schools to have adequate sanitary facilities by 2010; and

• Reduce cholera out-breaks by half by 2010. The overall objective of the Local Government Reform Policy (1998) is to improve service delivery by making local authorities more democratic and autonomous within the framework established by the central government. The policy identifies the provision and facilitation of water services as an important responsibility of local government. Together with the two core policy documents Vision 2025 and MKUKUTA, the Local Government Reform Policy defines the strategic framework against which the orientation of the water sector development is de-fined and the priority interventions are being planned.

The current policy framework for the sector is set out in the National Water Policy (NAWAPO 2002). It is oriented towards reaching the MDGs for water and sanitation in Tan-zania and incorporates the overall development goals set out by the Vision 2025 and the MKUKUTA. It also incorporates the principles of decentralisation of service delivery set out in the Local Government Policy. The NAWAPO advocates a new approach for developing a


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comprehensive framework in the water sector:

• for promoting the optimal, sustainable and equitable development and use of water resources

• for improving health and alleviate poverty of the rural population through improved access to adequate and safe water and

• for achieving sustainable, effective and efficient development and management of Urban Water Supply and Sewerage (UWSS) services.

National Development Vision 2025

Poverty Reduction Strategy Paper (2000)

Local Government Reform Policy Paper (1998) Public Service Reform Programme (2000)

Rural Development Policy (2003)

National Strategy for Growth and Reduction of PovertyMKUKUTA 2005-2010 (2005)

National Water Policy (NAWAPO, 2002)

National Water Sector Development Strategy 2005-2015 (2006)

National Rural Water Supply and Sanitation Programme (2006)Urban Water Supply and Sewerage Programme (2006)

Water Resources Management Programme (2006)

Water Sector Develoment Programme (2006)

The National Water Sector Development Strategy (NWSDS) sets out how the National Water Policy, 2002, will be implemented to achieve the targets set out in the core policy documents. The NWSDS provides the basis for carrying out the reforms to spell out the comprehensive and innovative framework provided by the policy. The strategy proposes new institutional frameworks for Water Resources Management and Water Supply and Sanitation.


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Together, the Policy and the Strategy for the water sector provide the strategic background for the planning and budgeting of interventions in the sector.

2.2 Planning and budgeting for water and sanitation

The planning and budgeting cycle in the water sector is an integral part of the overall budget process in Tanzania. The budget process describes the annual budget cycle events and activities. It follows the Medium Term Expenditure Framework (MTEF) approach with expen-diture planning for a medium term period of three years. The MTEF serves as strategic policy and expenditure framework for the allocation of resources to priorities and for providing the link of national policies and objectives to the budgeting process.

At the central government level, the most important step is the formulation of the Budget Guidelines. These Guidelines set the ceilings for allocations to sectors and their related mi-nistries, departments and agencies (MDAs) as well as the resources to be made available to the local governments. The ceilings are fixed for the three years for the MTEF period. They are broken down into personal emoluments including the basic salaries and fixed allowances (PE), other charges (OC) and development expenditure. In essence, these guidelines consti-tute the main tool of the government to express the strategic decisions on expenditure alloca-tions over the medium term period covered by the MTEF. In the last years, the Budget Guidelines have been informed by the priority interventions for poverty reduction defined by the Poverty Reduction Strategy and the MKUKUTA.

The NAWAPO and the NWSDS set out the new roles and responsibilities of various stake-holders in the water and sanitation sector. With regard to planning and budgeting for the wa-ter sector, the new institutional framework assigns specific functions to each of the core stakeholders. The Ministry of Water (MoW) has the ultimate responsibility for the develop-ment of the water sector and the management of water resources. The MoW is responsible for the planning and budgeting process for the core water-related budget component. How-ever, planning and budgeting in the water sector is not fully captured by the budget of the MoW (Vote 49), but also involves other budget votes as well as private funding.

On the basis of the Budget Guidelines, the MoW prepares its budget proposal (Vote 49) for the coming three years following the MTEF format. This includes a budget performance re-view covering actual performance of revenue, expenditure and physical work done for the previous fiscal year. Performance of the current year to-date is also being assessed. The preparation of the annual budget estimates and estimates for the following two years of the MTEF includes revenue, recurrent and development expenditure. This process involves the setting of objectives and targets, the definition of activities, the identification of inputs and their prices and the costing for them for each year of the MTEF period. The yearly MTEF documents for the water sector provide the framework for allocating resources to the priori-ties identified in the NAWAPO, NWSDS as well as WSDP.

At the Ministry of Water, the preparation of the draft budget proposals takes place at all levels of management, coordinated by a budget committee within the MoW with the Perma-nent Secretary as chairperson. The preparation of the budget proposals is built on the inter-nal planning process of the MoW consolidating the priority interventions identified by the cur-rent three sub-sectors (rural water supply and sanitation, urban water supply, sewerage and sanitation and water resources management). The coordination lies with the Department for Policy and Planning (DPP) of the MoW.

In the past, the planning and the consolidation process was not set within a coherent and transparent planning framework for the sector that linked the policy priorities to the resource allocations. The budget proposals for the development expenditure were primarily inspired by the different sub-sector projects under preparation and under implementation in cooperation with the Development Partners (DPs). The stated policy priorities played only a minor part in the planning process. This is partly due to one central limitation of the planning process at the MoW itself, which is the insufficient information on the link between the resource alloca-tions (financial input) and the respective physical realisations (output) that contribute to


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reaching the sector targets.

A second constraint for the planning process is the imperfect planning basis with regard to the resource projections. The flow of information on external resources between the MoW, the Ministry of Finance (MoF) and the Development Partners (DPs) is not sufficiently aligned to the MTEF planning framework. As a result, the projected external resources for the outer MTEF years deviate strongly from the realistic development of the resource availability. The MoF together with the DPs is currently introducing a modification of the communication proc-ess regarding future commitments to address these shortcomings in the projections.

At sub-sector level, planning processes include the identification of activities and projects and their prioritization in line with the available resources. The elaboration of the sub-sector plans and the respective expenditure planning by the MoW is based on consultations with relevant stakeholders, such as the Local Government Authorities (LGAs) for the rural water supply, the Urban Water Supply and Sanitation Authorities (UWSAs) for the urban water supply and the Basin Water Offices (BWO) for water resources management. However, cur-rently the planning process at the MoW only takes into account those activities at local level that are submitted by the respective stakeholders (LGAs, UWSAs, BWOs) to the MoW for funding. Additional water and sanitation related interventions that are reflected in the local budgets and business plans do not automatically come to the attention of the MoW and are therefore not integrated in the overall planning for the water and sanitation sector. The same applies to direct interventions by NGOs and DPs that are not reflected in the budget, neither at local nor at national level.

The estimations of resource requirements for the budget proposals are based on the re-sults of costing exercises. Several costing have been undertaken over the last years by the MoW in order to determine the investment and financing needs for improving the water sup-ply and sanitation situation in rural and urban areas and for meeting the MDGs for water and sanitation in Tanzania. They include the MKUKUTA costing undertaken by the Ministry of Water for assessing the needs and costs of implementing MKUKUTA interventions and for attaining the water and sanitation related MDGs by 2015 as well as the most recent costing in the context of the consolidated Water Sector Development Programme (WSDP). These costing provide a reference for resource estimation for the water and sanitation sector and have been used for the preparation of the FY 2006/07 budget proposals.

Based on the Budget Guidelines issued by the Ministry of Finance (MoF), the MoW prepares the budget proposals according to the process described above. After negotiations between the MoW and the MoF, the sector budget is finalized and presented to Parliament during the budget discussions.

Local Government Planning for Water and Sanitation

Different central and local government departments and organisations have mandates to be involved in the provision of these services. In particular, local government, be it at the city, municipal, town, district, or township authority level, has varying levels of responsibility for providing services. Within the policy framework for decentralisation, the mandate to provide basic services, including water supply and sanitation has been devolved to the lowest administrative level. The roles and responsibilities of the decision-making authority and con-trol of resources for the delivery of basic services have been transferred to the District Coun-cils in the first instance, and in the second instance from the District Councils to lower level government administration or to other suitable, institutional agents, including community based organization, NGOs, and private sector.

The Local Government Authorities are responsible for their own planning and budgeting process based on their budgetary allocations contained in the Budget Guidelines (PMO-RALG Vote 56 and Regional Votes). These include ceilings for discretionary recurrent and development expenditure, but also earmarked allocations for specific sectors, such as the Water Block Grant. However, part of the water-related expenditure at local level is also fi-nanced by allocations from the MoW budget based on funding requests submitted by the Local Government Authorities to the MoW.


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The planning for water-related activities at local government level is seriously hampered by the fact that allocations for water sector expenditure at local level are derived from different sources. Budgeting with limited overview over resource availability leads to inefficient use of limited financial resource for the water sector.

Figure 2-2

Planning and Budgeting Cycle for the Water Sector

Planning for Urban Water Supply, Sewerage and Sanitation Under current legislation, the MoW has designated and declared 19 Urban Water Supply and Sewerage Authorities (UWSAs) in the areas of municipal councils throughout the country, and for town councils where these are also regional centres. All these UWSAs are currently accountable to, and monitored by, MoW. The respective local authority has representation on the Board. The UWSAs have been established as “autonomous” bodies and are responsible for preparing their business plans and budgets. Where the organisations are still reliant on the Government for part of their costs, annual budgets are subject to endorsement by MoW.

A fundamental problem for the planning for the urban areas is that the UWSAs do not yet fully exercise their autonomy. Although their Strategic Plans give direction towards full cost recovery, most UWSAs depend on donor aid or grants from MoW for major refurbishments. The strategy for achieving the goals in the urban sector is to develop the existing UWSAs into Water Supply and Sanitation Authorities (WSSAs) that are financially autonomous and commercially viable. In essence, the focus of the strategy is the commercialisation of the urban water authorities so that they are capable of efficient and cost-effective provision of services. A second component of the ongoing reforms in the sector that will impact on the planning framework is the establishment of the Energy and Water Utilities Regulatory Authority (EWURA) with responsibility for regulation of water and sewerage services. How-ever, the respective sector legislation is yet to be approved and the regulatory role for the commercially operated WSSAs to be assumed by EWURA.

Votes 43, 44, 58 69

Vote 49 Vote 49 Vote 49

Vote 56

Budget proposal based Budget proposal based on NAWAPO priorities on sector costing

Ministry of Finance

Ministry of Water

Local Government

Budget Guidelines /

MTEF

Budget Proposal /

MTEF

UWSAs BWO

Rural Water Supply

Urban Water Supply

Water Resources Management

Vote 49

MKUKUTA Targets

Submission of Funding Requests

Submission of Funding Requests

PMO-RALG MAFSC, MITM, MEM, MNRT


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The planning and budgeting for urban water service provision is currently based on different funding sources, including allocations from the MoW, the UWSAs own resources and exter-nal funding.

Box 2-1

Who is planning for the water sector?

Ministry of Water (MoW)

In the new institutional framework, the overall responsibility for planning and budgeting in the water sector lies with the Ministry of Water. The MoW new functions comprise the policy and strategy devel-opment as well as the coordination of the planning and the securing of the funding for projects of na-tional importance. With regard to the water resources management, the MoW will ensure the sectoral coordination as well as the policy development and financing. The elaboration of the budget proposals for Vote 49 lies with the MoW; however the overall responsibility of the MoW for the sector implies that water-related components of other budget votes (Vote 56 for PMO-RALG as well as regional votes) need to be determined in consultation with the MoW.

Water Supply and Sanitation Authorities (WSSA)

The future Water Supply and Sanitation Authorities (WSSA) own, manage and develop water supply and sewerage infrastructure. They are responsible for preparing business plans to provide water sup-ply and sewerage services including the capital investment plans. The functions of the WSSAs com-prise also the securing of financing for capital investments.

Community Owned Water Supply Organisations (COWSO)

The COWSOs own and manage water supply infrastructure and are responsible for their operation and maintenance.

Local Government Authorities (LGA)

With regard to planning and budgeting for water sector activities, the municipal and district councils are responsible for co-ordinating the physical planning with the WSSAs and for co-ordinating the WSSAs budgets within Council Budgets.

Ministry of Finance

The Ministry of Finance (MoF) is responsible for overall planning and budgeting in the context of the budget process and MTEF implementing a Multi-Annual Financial Expenditure Framework (MTEF).

PMO-RALG

The Prime Minister’s Office – Regional Administration and Local Government (PMO-RALG) will be involved in co-ordinating the planning of projects from local government authorities and their budgets. Vote 56.

Water Resources Management

With regard to water resources management (WRM), the MoW holds overall responsibility for water resources management. However, a number of other departments and agencies also manage water resources according to their own mandates and needs, their own legislative provisions. With regard to efficient water use, the Ministry of Energy and Minerals (power generation), the Ministry of Agriculture and Food Security (irrigation) and the Ministry of In-dustry and Trade (industrial water use) are concerned. The Department of Forestry in the Ministry of Natural Resources and Tourism is involved in the protection of water sources. As a consequence of the involvement of different government divisions or agencies, water re-sources management is faced with the challenge of parallel and partly overlapping planning and budgeting processes – similar to the two other sub-sectors.

With the new strategic orientation given by the NAWAPO and the NWSDS, the institutional framework for water resources management will be streamlined to meet the challenges of effective integrated water resources planning and management, and the roles and responsi-bilities of the different stakeholders will be clearly defined so as to ensure their participation. With the role of the MoW changing to that of co-ordination, policy and guideline formulation, and regulation, new institutions have already been created, including the Basin Water Offices (BWO). The BWO will be financially and administratively autonomous, and financed from water user charges. They are responsible for co-ordinating and approving basin WRM plan-ning and budgets.


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Planning for Sanitation

The Ministry of Health and Social Welfare (MoH&SW) has an overall responsibility for pro-tecting public health through ensuring the provision of adequate sanitation and hygiene edu-cation by the local authorities. Promotion, planning and skills development for sanitation and hygiene within the community fall within the responsibility of the respective local govern-ments, however the initiative for on-site sanitation as well as the funding for the on-site infra-structure has to be provided by the households themselves. In urban areas, the cost of house connections to the sewerage system and additional tariffs often result in a reluctance of households and commercial establishments regarding connection.

Therefore, planning and budgeting for sanitation and sewerage involves different stake-holders, including private households, local government authorities as well as central gov-ernment and the UWSAs, adding to the complexity of the planning framework.

Inclusiveness and Consistency of Planning for Water and Sanitation

The institutional framework for the entire sector is at present complex due to disparate pieces of legislation, overlapping roles and responsibilities and inadequate co-ordination. This is also valid for the sector planning framework involving a number of different institutions. The new strategic orientation in the water sector proposes the adoption of a more effective institu-tional framework for the provision of water and sanitation services to rural and urban people and for the management of water resources. Roles and responsibilities of different players have already been redefined. However, the implementation of the decentralisation process requires time and the transformation of the roles and functions of the Ministry of Water has not been finalised.

Box 2-2

Consistency of Planning: Sector Priorities and MTEF

The priority activities for the water sector included in the budget proposal for the Financial Year 2006/2007 were identified by the Ministry of Water based on the existing policy and strategy docu-ments. The priority intervention areas will be implemented through three categories of development programmes, Urban Water and Sewerage Programme, Rural Water Supply Programme and Re-search, Training and Planning Programme. Within these programmes, the Ministry of Water is plan-ning to concentrate on the following priority activities which hare consistent with sector orientation:

• Policy: Review, formulate and disseminate policies, strategies and regulations

• Sector Performance Monitoring: Implementation of streamlined routine information systems to promote monitoring of quality of social services/ensure production of robust data on access, use and outcomes. Data desegregation by gender, age, income status, location, to inform equity indi-cators.

• Water Supply: Improve Access to affordable and reliable water and sanitation facilities – rural and urban - and construct more water charcos and dams, Increase access to mechanization and use of appropriate technologies

• Sewerage and Solid Waste Management: Expansion, rehabilitation and construction of urban sewerage systems and garbage collection

• Water Resources Management: Improved land management and adoption of water conservation technologies, implementation of national plans to halt desertification and land degradation; Water quality surveillance and maintenance or protected water sources

• Good Governance: Promote use of ICT and e-government, implement specific actions for en-forcement of NACSAP and apply proper Estate Management, Provision of Goods, Services and Rental Expenses annually, Development of HIV/AIDS work place programmes

Currently, sector planning involves different players at different levels and articulation and coordination between the different planning processes is not fully ensured. Due to these par-allel planning processes at national and local level, the inclusiveness of the planning for the water sector is limited. It is difficult for the Ministry of Water to get an overall picture of the planning for water-related activities which impacts negatively on their overall responsibility for the provision of water and sanitation services and the management of water resources.


9

The planning and budgeting for the water and sanitation sector at the MoW is linked to the strategic orientation and policy documents for the sector. The MTEF documents elaborated annually by the MoW provide the reasoning for the resource allocation based on the strategic sector orientation spelled out in the policy. In general terms, the sector planning can be seen as consistent with the overall policy documents as well as the sector specific ones. How-ever, currently the internal planning and budgeting process of the MoW is not oriented by a specific coherent planning framework translating the policy priorities into interventions and activities.

2.3 Sector-wide approach to planning

Over the last years, the water sector was characterized by the disparate, overlapping and parallel planning processes described above, involving different stakeholders and using dif-ferent funding sources. In order to establish a coherent and adequate sector planning framework for translating the overall development goals and the specific sector goals into priority interventions and activities the Government has adopted a Sector-wide Approach to Planning (SWAp). The SWAp is based on community-demand orientation, decentralised management through local governments and dedicated water user entities or authorities, combined with central government facilitation and delivery of services by the private sector. The SWAp is in direct response to the new strategic orientation for the water sector set out in the NAWAPO. The NWSDS provides a coherent, holistic and integrated strategy for the wa-ter sector in order to implement the directives of NAWAPO in the context of the SWAp.

June 2003 marked the start of a three-year transition period for establishing the SWAp. It was intended to: (i) lay the foundations for a SWAp; (ii) prepare the necessary investment plan; (iii) build service delivery and water resources management capacity at all levels; and (iv) establish the necessary regulatory framework for sustained delivery of water supply ser-vices country-wide.

The SWAp brings together the three sub-sectors—rural water supply, urban water supply and sewerage, and water resources management—under one comprehensive investment regime. Separate sub-sector investment programmes have been prepared: the National Ru-ral Water Supply and Sanitation Programme; (ii) the Urban Water Supply and Sanitation Programme and (iii) the Water Resources Management Programme. The programmes com-prise infrastructure investments as well as strengthening the general administration of the Ministry of Water and capacity building for other stakeholders. A Water Sector Development Programme (WSDP) has been prepared.

The Water Sector Development Programme will enable both the Ministry of Water and the Developing Partners supporting the sector to agree on a set of priority interventions for the water sector and to assess implementation against the planning set out by the WSDP. The documents will facilitate the articulation between the different planning frameworks and con-tribute to efficient allocations of the available funds to the sector priorities.

With regard to external resources commitments by development partners, an initiative by the MoF currently modifies the process by which donor commitments and pledges are reflected in the MTEFs. Currently, the projections for the outer years of the MTEF do not sufficiently reflect the resources available for the sector, given that only firm commitments are being taken into account. With the new approach also planned allocations will be reflected improv-ing the basis for the planning and budgeting in the water sector.

2.4 Key issues and areas for priority action

Streamlining the different planning processes in the water sector, ensuring articulation be-tween them and assigning clear responsibilities for specific planning functions to the different stakeholders in the water sector has been a challenge for the water sector over the last years. With the new strategic orientation for the sector and the recent initiatives of establish-ing one coherent planning and investment document for the water sector, major limitations for the planning will be addressed.


10

However, some issues still remain critical for planning in the water sector and will require attention in the future. Two key issues come out of the analysis of the planning and budget-ing processes for the water and sanitation sector, namely the dysfunctional planning frame-work and the imperfect planning basis. Recommendations and areas for priority action are derived from the key issues.

Dysfunctional planning process The responsibility for planning and for providing water supply and sanitation services and for managing the water resources lies with different stakeholders. Overall responsibility rests with the Ministry of Water, however local governments are also strongly involved in the provi-sion of these services as are the different providers and user associations.

Especially at LGA level, planning for water-related interventions is a challenge due to a vari-ety of funding sources and no clear overview over available resources. But also the overall sector development planning by the MoW is hampered by the dysfunctional processes. Planning for water-related activities takes place at different levels and is not fully integrated resulting in the overall planning being based on limited information. In particular, the informa-tion flow on water-related activities between the Local Government Authorities and the MoW is not functional. Therefore, the MoW has not sufficiently taken into account the planning at local level in the overall sector planning. The current situation with regard to the planning hampers efficient priority setting and resource allocations.

The recent initiatives for strengthening the co-ordination between different planning proc-esses in the context of the SWAP need to be taken seriously to improve the situation. With the new approach for the water sector embedded in the Water Sector Development Pro-gramme the context for coherent planning in the sector have improved markedly. However, it is essential that the core components of the new framework be implemented over the next years. This concerns primarily the improvement of the flow of information and the assumption of the new roles and responsibilities by the respective stakeholders. The association of the different stakeholders in the context of the sector dialogue will contribute to improving the planning process.

Imperfect planning basis Currently, the planning for water and sanitation is made on the basis of imperfect information with regard to available funding and complementary activities. As discussed before, the planning processes between different players in the water sector are not fully integrated and carry the risk of inefficient resource allocation. In addition, information on sector financing is not fully consistent, i.e. identification of constraints and subsequent resource allocation can be misleading. A third issue that was identified in the analysis is the fact that the DPs com-mitments for water not necessarily in line with planning and budgeting process. The inclu-siveness of MTEF projections on which the planning for the water sector is based, is there-fore questionable. In general, the Ministry of Water does not have complete overview over funds available to water sector.

The challenges for the Water Sector require a forward-looking planning and budgeting to address tackle core issues. The planning for future interventions in the water sector is to a large extent reflected in the new Water Sector Development Programme. However, the cur-rent MTEF prepared by the MoW is not yet fully oriented towards taking up the existing chal-lenges, partly due to the imperfect planning basis.

It is essential for the water and sanitation sector to improve the planning basis through better co-ordination and communication as well as better data. One area for priority action is to im-prove the flow and analysis of information in the sector on water-related activities, in particu-lar between LGAs and UWSAs and the MoW. A second priority is to take forward the initia-tive undertaken by the MoF to improve reliability of data on external funding.

Even if planning and budgeting for the water sector shall and will not be fully integrated given the involvement of different players, an overview of resource flows (ex-post analysis of ex-penditure) to the water sector is essential for ensuring an efficient allocation of funds and the consistency of sector interventions with policy priorities. This would also facilitate the


11

strengthening of the consistency between medium term planning and recent sector initia-tives. Important elements are to harmonize the planning for priority interventions set out in the Water Sector Development Programme with the MTEF and to link the planning process to sector performance monitoring (input-output-outcome).


12

3. FINANCING THE WATER SECTOR

3.1 Background

A number of issues have to be considered regarding the financing of the water and sanitation sector. The core questions arising are related to the amount of resources available (sector funding), the amount of financing required (sector costing) and the resulting funding gap. Further issues are related to the structure of sector funding (rural-urban-water resources) in view of the respective needs (coverage rates, MDG targets) and the situation of internally generated sector funding (UWSA revenues and private funding for water and sanitation).

The recognition of the water sector as one of the priorities for poverty reduction has trans-lated itself into an increase in public funding for the water sector since FY 2001/02. Total domestic resources budgeted for the Ministry of Water (MoW) as a whole increased from an average of 1.5 percent of the total allocations to ministries, departments and agencies (MDAs) to 2,8% in FY 2004/05 and to 3,6% in FY 2005/06 with further increases to 4,0% for FY 2008/09 projected in the MTEF.

In addition to the public funding allocated for the budget of the Ministry of Water (Vote 49), resources from other MDAs budgets as well as external funding and private sector funding contribute to the financing of water-related interventions.

3.2 Funding of the water and sanitation sector

The considerable increase in resources for the water sector becomes evident when analyz-ing the total budgetary allocations for water in detail, including ministry recurrent and devel-opment, allocations to local government authorities for recurrent as well as development ex-penditure (see figure 3-2). Excluding livestock components, the budget for the Ministry of Water has increased from 20 billion Tsh in FY 2001/02 to 170 billion in FY 2006/07. The most pronounced increase can be observed from FY 2003/04 to FY 2004/05 with a doubling of allocations. The projections set out in the Medium Term Expenditure Framework (MTEF) show a further increase of budgetary allocations, based mainly on domestic resource alloca-tions. Foreign contributions are currently projected to decline considerably in 2007/08 and 2008/09, but will be revised with updated donor projections.

3-1: Budgetary Allocations to the Water Sector

(Budgetary Allocations from Domestic Revenue)

0

500

1.000

1.500

2.000

2.500

3.000

3.500

FY 01/02 FY 02/03 FY 03/04 FY 04/05 FY 05/06 FY 06/07 FY 07/08 FY 08/09

Tsh billion0,0%

0,5%

1,0%

1,5%

2,0%

2,5%

3,0%

3,5%

4,0%

4,5%

% share

Total Allocations to MinistriesTotal Allocations to MoW MoW Share of Total Ministry Allocations


13

Public allocation for the water and sanitation sector includes the development and the recur-rent budget. The latter is subdivided between personal emolument and other charges. It is financed by domestic revenue and external resources.

3-2: Budget Allocations for the Water Sector(Votes 49 (MoW) and Other Budgets (Vote 56 and Regional Votes))

0

20.000

40.000

60.000

80.000

100.000

120.000

140.000

160.000

180.000

200.000

FY 01/02 FY 02/03 FY 03/04 FY 04/05 FY 05/06 FY 06/07 FY 07/08 FY 08/09

TSh Million

Other Development Budget Allocations

Other Recurrent Budget Allocations

MoW Foreign Development Budget (excl.

Livestock)

MoW Local Development Budget (excl.

Livestock)

MoW Recurrent Budget (excl. Livestock)

The considerable increases in funding for the water sector are partly due to more allocations directed to water as one of the priority sectors defined in the PRSP/MKUKUTA and to the funding made available from domestic resources for the Lake Victoria – Shinyanga / Kahama Water Supply Project. No reliable information is available, but several documents indicate that over the last years a larger share of donor funding has been registered on budget con-tributing to the overall increase in resource allocation.

The domestic resource allocations have seen significant increases over the last years, both for recurrent as well as for development expenditure. The increase in the share of recur-rent expenditures to 70% by 2008/09 in the overall budget envelope can also be observed for the MoW.

The local development financing in the water sector has been markedly increased from its relatively low level in FY 2003/04 (3,1 TSh billion) to TSh 30 billion in FY 2004/05 and TSh 70 billion in FY 2005/06. This can be mainly attributed to the funding for the Lake Victo-ria – Shinyanga / Kahama Water Supply, which is to be wholly funded by the GoT own do-mestic sources. The total allocations to the projects amount to TSh 225 billion and accounted for between 80% and 90% of the total local water development budget over the last years, leaving insufficient resources for allocations to other development projects.

Fiscal Year / TSh million FY 04/05 FY 05/06 FY 06/07 FY 07/08

Local Development Budget 30.453 68.728 77.865 106.409

Rural Development 1.335 3.314 16.650 17.549

Urban Development 28.385 63.602 56.120 81.879

of which for Lake Victoria-Shinyanga 28.100 63.000 52.201 80.600


14

The small nominal increase in local development financing to the sector from FY 2005/06 to FY 2006/07 does not keep pace with current inflation (4,4%) and does not reflect the in-creased domestic revenue efforts or debt relief (HIPC and MDRI > 400 bn Tsh).

Comparing the estimates for local development expenditure contained in the current MTEF with the resource availability projections provided by the Budget Guidelines, it is interesting to note the marked deviations. MoW planning for local development expenditure in FY 2007/08 amounts to TSh 106 billion (with TSh 80 billion for the completion of the Lake Victoria Shinyanga project), whereas resource projections are indicated at TSh 83 billion. For the later MTEF year (FY 2008/09) however, MoW planning remains markedly below the re-sources projection leading to questions on the reflections of the current core sector docu-ments (investments included in the Water Sector Development Programme) in the MTEF planning.

Most water development projects are however relying on donor funding. There are two main channels that donors use to fund the water sector development initiatives in Tanzania apart from budget support, one is through the national budget with targeted projects and the other is direct funding to a donor’s area of choice. Direct funding to specific donor’s area of choice is now highly discouraged by the Government of Tanzania (GoT), though not prohib-ited. There is an understanding between the GoT and some donors these days regarding project support. More donors are now willing to contribute their funds through budget support system than it used to be in the past, giving the GoT much flexibilities in funding its priorities.

Apart from the public funding for the water sector included in the MoW budget (Vote 49), other public sector funds have to be taken into account when assessing the overall sector allocations. On the national level, allocations from the Ministry of Health and the Ministry of Education must also be partially considered. In particular, allocations for construction of sani-tation infrastructure in health facilities and primary schools as well as for hygiene education must be taken into account. Additionally, local government allocate resources for water and sanitation. It is difficult to establish the total level of funding to the water sector in Tanzania given that funding is provided from different sources and that the information on allocations and expenditure is not communicated sufficiently.

Budget Execution

With regard to budget execution, the available information is not very consistent. A low level of budget execution was an important concern for the water sector in the FY 2000/01, FY 2002/03 and FY 2004/05. Actual releases against the approved budget were reported as low as 6,5% and 36,3%.

The budget performance review in the current MoW MTEF document (FY 2006/07 – FY 2008/09) states that for the FY 2004/05 only 44% out of the total local development budget was released and spent. For the FY 2005/06, the budget execution rate was reported to be even lower, with only 34.16% of total development allocations from both local and for-eign components having been released by mid April 2006. Reasons given for the slowness of project implementation and the low budget execution rate are given as problems of not releasing or late releasing of counterpart funds for the co-funded projects, slowness of pro-curement procedures and fragmented project funding.

According to the Quarterly Budget Execution Reports issued by the MoF however, budget execution for the last three fiscal years was averaging 90% both for local and foreign re-sources. These discrepancies in the different data sources add to the lack of transparency regarding the financing of the water and sanitation sector.

Sector Allocations Rural – Urban – Water Resources Management

To reach the targets for water and sanitation will require an important improvement in service provision, in particular for the rural population. The MKUKUTA targets call for increasing the proportion of rural population that has access to clean and safe water from 53% in the year 2003 to 65% by the year 2009/10.


15

However, the urban bias in the allocation of funds for water development activities persists. The disparity is in both domestic and foreign sources. With regard to the domestic resources, they are partly explained by the high share of development allocations for the Lake Victoria-Shinyanga project (80% - 90% of local development allocations) between 2003/04 and 2007/08.

Although it is understood that the level of infrastructure development in the urban areas natu-rally requires relatively more expensive investment than in the rural areas, the continuing disparity does not appear appropriate. The increase of funding for rural water supply from other sources such as the direct allocations to Local Government Authorities (Vote 56 and regional votes) does only partly compensate for the declining share of rural allocations.

3-3: Budget Allocations for Rural and Urban Water

Supply (Ministry of Water Vote 49)

0

20.000

40.000

60.000

80.000

100.000

120.000

FY 03/04 FY 04/05 FY 05/06 FY 06/07 FY 07/08 FY 08/09

TS

h m

illi

on

0%

10%

20%

30%

40%

50%

60%

70%

80%

MoW Total Rural Budget MoW Total Urban Budget

Share of Allocations for Rural Share of Allocations for Urban

It is interesting to note that both sub-sectors have seen a reduction in donor-dependency over the last three fiscal years that will persist also in the coming years. It is especially pro-nounced for the urban water supply, where the local resource allocation for the Lake Victoria-Shinyanga project account for up to 70% of total urban development budget allocations.

Funds Allocated to Local Government Authorities

Allocations for LGA water sector recurrent and development expenditure are accounted for under different votes. Based on submission from the Local Government Authorities, alloca-tions for other charges (OC) as well as for development expenditure are taken into account by the MoW budget (Vote 49). With regard to the OC, it concerns mainly minor repairs of existing systems, whereas the allocations for development expenditure cover the interven-tions of ongoing rural water supply programmes.

However, LGAs are also responsible for their own planning and budgeting process based on their budgetary allocations contained in the Budget Guidelines (PMO-RALG Vote 56 and Regional Votes). These include ceilings for discretionary recurrent and development expen-diture, but also earmarked allocations for specific sectors, such as the Water Block Grant.

Furthermore, information on the total level of donor and NGO funding to the water sector in the LGAs is not known with certainty, especially for the funds that go directly to operating areas with no information communicated to the central Government. As described in the chapter on the sector planning framework, the dysfunctional planning processes and the un-satisfactory flow of information between the LGAs and the MoW make it difficult to get a clear overall picture on resource allocations both at central as well as at local level.


16

Figure 3-4

Funding Sources for LGA

LGAs

Vote 49

• Recurrent PE

• Recurrent OC

• Development L

• Development F

Vote 56

• Recurrent PE

• Recurrent OC

• Development L

• Development F

Formula-Based Allocations for

Recurrent Expenditure

-> Water Block Grant (PE/OC)

Discretionary Development

Funding through LGCDG/LGDG

-> LGCDG/LGDG

Needs / Submission-Based

Allocations to LGAs for OC

-> included in Ministry OC

Ongoing Projects Development

Funding (Local+Foreign)

-> included in Ministry Dev

Σ ?

LGAs

Vote 49

• Recurrent PE

• Recurrent OC

• Development L

• Development F

Vote 56

• Recurrent PE

• Recurrent OC

• Development L

• Development F

Formula-Based Allocations for

Recurrent Expenditure

-> Water Block Grant (PE/OC)

Discretionary Development

Funding through LGCDG/LGDG

-> LGCDG/LGDG

Needs / Submission-Based

Allocations to LGAs for OC

-> included in Ministry OC

Ongoing Projects Development

Funding (Local+Foreign)

-> included in Ministry Dev

Σ ?

Due to the different funding sources, the LGAs face a complex funding situation which ren-ders the planning and budgeting for water sector expenditure very difficult. However, this also leads to problems in providing an overview over funding for water and sanitation at local level in the context of this situation analysis. So far, consolidated LGAs MTEF are not avail-able to provide information on local level planning for water-related activities. Figure 3-5 pro-vides some insight into resource allocations for LGAs based on the information contained in the MoW budget (vote 49) as well as the PMO-RALG budget (vote 56).

3-5: LGA Allocations for Water and Sanitation

MoW Budget (Vote 49) and PMO-RALG Budget (Vote 56)

0

5.000

10.000

15.000

20.000

25.000

30.000

35.000

FY 03/04 FY 04/05 FY 05/06 FY 06/07

TS

h m

illio

n

Vote 49: Rural OC Vote 49: Rural Dev Local

Vote 49: Rural Dev Foreign Vote 56: Water Block Grants

Vote 56: LGCDG


17

Private Sources

In addition to public funding, private sources are highly relevant for financing the water and sanitation sector. They include user fees as well as contributions to the village water funds and household investment as a second sub-category. User fees are collected by UWSAs in regional headquarters, in district headquarters and small towns, by water service providers (Companies, Groups, Trustees, Associations, etc.) and water basin boards.

No data are currently available on the contributions to the village water funds, given that only the balance of the water funds being recorded. The lack of data concerns also household investments, including one-time expenditures in on-site sanitation facilities and household connections.

3.3 Financing needs

The resource requirements for attaining the water and sanitation related MDGs by 2015 have been estimated by several studies over the last years. The most recent costings were under-taken by the Ministry of Water for assessing the needs and costs of implementing MKUKUTA interventions (MKUKUTA costing) and in the context of the Water Sector Development Pro-gramme (WSDP).

The Water Sector Development Programme (WSDP) is oriented towards the goals for water and sanitation stated in the Vision 2025. The WSDP consolidates three separate sub-sector programmes: the Water Resources Management Programme (WRMP), the National Rural Water Supply and Sanitation Programme (NRWSSP) and the Urban Water and Sewerage Programme (UWSSP). Furthermore, the WSDP includes strengthening of the general ad-ministration of MoW as well as strengthening of three Executive Agencies (Drilling and Dam Construction Agency (DDCA), Water Resources Institute (WRI) and Maji Central Stores (MCS)) to effectively support the implementation of the WSDP.

The total cost of the urban, rural and water resources management components of the Water Sector Development Programme is estimated at TZS 3,614,700 million (USD 2,891.76 mil-lion), to be invested over the 2005 – 2025 timeframe. In addition, strengthening of MoW cost is estimated at TZS 17,200 million (USD 13.76 million) while strengthening Executive Agen-cies is estimated at TZS 38,500 million (USD 30.83 million).

The cost of the WRM component is estimated for the 2005 – 2025 period at TZS 333,370 million (USD 266.70 million). Of this, about 80% will be invested in basin-level activities, while the remainder is allocated to national and cross-sectoral activities by MoW.

The NRWSS component covers the 2005/06 – 2024/25 period, addressing the timeframe encompassed by Development Vision 2025. During this period, overall investment require-ments to achieve the above objectives in rural water supply coverage are estimated at TZS 2,216,440 million (USD 1,773.15 million).

The Urban Water and Sewerage component calls for investments for the construction of physical works for individual UWSAs as well as investments for capacity building projects designed to strengthen the capacity of MoW and the UWSAs to operate, maintain and de-velop the urban water supply and sewerage systems. The Urban Water Supply and Sewer-age (UWSS) investment requirements to 2020/21 total TZS 1,064,900 million (USD 851.92 million).

Meeting the resource requirements

When comparing the available resources for the water sector with the resource requirements estimated by the WSDP costing, a considerable financing gap becomes visible. The pro-jected available funding for the water and sanitation sector from Vote 49 amounts to about TSh 550 billion for the period FY 2005/06 to FY 2008/09. The resource requirement esti-mated in the WSDP costing for the MKUKUTA period (2005-2010) amount to TSh 955 billion and exceed the projected available resources even if the longer period is taken into account


18

(see figures 3-6-1 and 3-6-2)

0

100.000

200.000

300.000

400.000

500.000

600.000

TS

h m

illi

on

FY 05/06 FY 06/07 FY 07/08 FY 08/09 Cummulative

3-6-1: MTEF Projections of Water Sector Funding

MoW Total Rural Budget MoW Total Urban Budget MoW Total Budget

Mo

W

WR

M

NR

WS

S

UW

SS

Ex

. A

g.

20

05

-20

10

20

11

-20

15

0

100.000

200.000

300.000

400.000

500.000

600.000

TS

h m

illi

on

3-6-2: WSDP Costing for MKUKUTA and MDG

Box 3-1

WSDP: Funding Sources

Estimates for the three programme components (WRMP, NRWSSP, UWSSP) over the 2005-2025 period indicate that a total of TZS 1,324,630 million (USD 1,059.71 million), which will be available from sources within Tanzania. These include government central budget allocations, rural, small towns and urban community contributions, water resource revenues, and NGO and donor funds, among others. Thus, to conduct the activities envisaged under the WSDP, external financing in the order of TZS 2,290,070 million (USD 1,832.0 million) will be required over the 2005 – 2025 period, excluding external financing required for strengthening the MoW general administration and Executive Agencies, which will require an additional USD 41.29 million.

In this context, the WRM investment plan suggests that water use revenues will grow from about TZS 661.0 million (USD 0.53 million) per annum in 2006 to approximately TZS 12,500 million (USD 10.00 million) per annum over a 10-year period. Government allocations to the WRM sector, estimated at TZS 2,740 million (USD 2.19 million) in 2006 are projected to grow to TZS 4,020 million (USD 3.22 million) by 2010. Beyond this, periodic government allocations are assumed to be sufficient to meet the financing gap between water resource management costs and anticipated revenues. Thus the requirement for government allocations shall decrease beginning in 2016 as revenues increase over time. These assumptions result in external financing requirements of TZS 72,430 million (USD 57.94 million) over the 2005-2015 period.

Government allocations for RWSS in 2005, 2006 and 2007 are assumed to grow from TZS 2,460 mil-lion (USD 1.97 million) in 2005 to TZS 7,800 million (USD 6.24 million) by 2007. Beyond this period government allocations are assumed to increase at 5% per annum. Rural communities are expected to contribute 5% to capital costs of the NRWSSP, totalling TZS 83,400 million (USD 66.72 million) each over the period.

Other funding for RWSS from NGOs and external donors are estimated for this same period at TZS 21,252 million (USD 17.00 million) in 2005 to TZS 22,640 million (USD 18.11 million) by 2007. Be-yond this period, donor funds are assumed to increase at 5% per annum. These assumptions result in an estimated TZS 927,900 million (USD 742.32 million) in available resources over the timeframe of the NRWSSP, or approximately 58% of the estimated total cost. Given this, the financing gap between available resources and estimated NRWSSP costs is estimated at TZS 1,288,540 million (USD 1,030.83 million) over the programme timeframe.

With regard to the Urban Water and Sewerage component, resources identified as likely to be avail-able for capital projects were estimated at approximately TZS 135,820 million (USD 108.65 million) over the 2005 – 2020 period, or approximately 18% of programme costs. Necessary financing for ur-ban water supply and sewerage improvements is therefore estimated at TZS 929,080 million (USD 743.30 million) over the programme timeframe.

However, in order to determine the resulting financing gap, not only the currently available MTEF, but also information on additional external resources and additional domestic revenue


19

as well as other potential sources of funding has to be taken into account.

Based on recent indications regarding external resources pledged for the water sector, it becomes clear that the external resource flow will be considerable higher than reflected in the projections of the MTEF document. This is in line with the commitment of the develop-ment partners to reach the MDGs as well as the MKUKUTA targets.

Secondly, Tanzania has stronger and better governance than other countries in sub-Saharan Africa so that additional funds can be expected to be efficiently spent. Finally, aid for Africa is currently in the focus of public attention in donor countries and high on the international agenda so that overall increases are possible or even likely.

However, the most important sources for financing the funding gap are the domestic re-sources. The increased domestic revenue efforts and the debt relief (HIPC and MDRI > 400 bn Tsh) provide an opportunity for increasing domestic resource allocations for the water sector in order to meet the MDG targets. The assessment of the prospective funding situa-tion included in the WSDP is given in box 3-1.

3.4 Key issues and areas for priority action

Several important issues arise from the analysis of the financing for the water sector. In gen-eral, sector funding has increased considerably over the last years, mainly from domestic resources. However, a clear picture of the resource flow to the water and sanitation sector is not available. This concerns primarily the resource flows to Local Government Authorities.

Generally, the analysis of resource flows to the water sector is very difficult due to several factors. Various funding sources and therefore various sources of information on resource flows to the water sector make it nearly impossible to get a clear overview for the Ministry of Water as well as other stakeholders. The access to the data is difficult given the number of different players involved. But also inconsistencies in the data, such as regarding the budget execution data reported by the Ministry of Finance in the budget execution reports and by the Ministry of Water in the MTEF documents, as well as different aggregation levels prevent a transparent information base. Furthermore, the reflection of funding for water in different budget votes carries the risk of overlapping or double accounting for water and sanitation expenditures.

The urgent need for getting a clear picture on resource flows in the water sector has already been stated in the Public Expenditure Reviews (PERs) carried out in the FY 2002/03 to FY 2004/05. This recommendation can only be reiterated by his situation analysis. A compre-hensive overview over resources allocations for water and sanitation from the different rele-vant funding sources is essential to inform the MoW for its strategic planning for the sector, to improve the planning basis for the other stakeholders in the sector, in particular the LGAs, the UWSAs and the BWOs and to provide a basis for the sector dialogue. The last aspect is particularly important in view of the new strategic orientation of the sector. The new devel-opment partnership need to be built on a sector dialogue with regard to sector priorities, re-source allocations to policy priorities and constraints for the sector.

It is therefore suggested to establish a data base for the sector in relation with the sector performance monitoring that will reflect the overall trends in resource allocations for the sec-tor. In addition, it is also recommended that a broad based public expenditure review in com-bination with very specific studies are carried out to fill the information gaps on sector fund-ing, in particular with regard to the funding generated internally by the sector (UWSA reve-nues, private funding for water and sanitation, village water funds).

A second key issue coming out of the analysis of the sector financing is the funding for rural water supply. The share of funding for rural water supply within the MoW budget has de-clined (Vote 49) despite top priority given to the improvement of rural water supply services in the respective policy documents.

A last issue is related to the funding for the water sector. The data shows that the allocations have increased markedly over the last years. It is however essential to highlight the fact that


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a considerable share of the domestic resources have been allocated to one project will reach completion within the next two years. The sustainability of the increased level of the water resources has to bee ensured even for the future.

The strategic orientation in the water sector reflects the decentralization policy outlined in the Local Government Reform and LGA allocations for water have already been restructured. However, an adequate resource transfer to the local level yet needs to happen. It is therefore suggested that the MoW puts efforts into ensuring that funding for rural water supply is di-rectly allocated at the LGA such as set out in the recent Aide-Memoire with the ADB and the LGCDG system.

The recent estimates of resource requirements to meet the MDG and MKUKUTA targets elaborated in the context of the Water Sector Development Programme show funding gap. However, potential financing sources have already been identified and commitments for funding are reflecting the challenges for the sector. However, the adequacy of available fund-ing is not the most important issue for the water sector in Tanzania with regard to achieving the MKUKUTA and MDG targets. Absorption capacity is a much more important limiting fac-tor that needs to be addressed through improving project preparation. Strengthening the ca-pacity of all relevant stakeholders for planning and implementing the interventions in the wa-ter sector is essential and has been included as a core component in the Water Sector De-velopment Programme.


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4. PERFORMANCE REVIEW

4.1 Background

Performance of any entity be it government, NGO or charity organization must be measured against well-structured output or outcome indicators. Indicators do provide valuable insights into the functioning of a utility or sector as well as drawing causality from inputs. In addition, reporting the annual indicators provide an opportunity to demonstrate progress towards meeting the set goals. The community and government are demanding increased account-ability by water utilities together with increased levels of service and efficiency. In order to achieve these, the regulators have to identify key elements that need to be measured in or-der to know if the water supply, sewerage and sanitation services delivered are efficient and sustainable.

The Water Resources Management (WRM) Division has the task of integrating management of the water supply, sewerage and storm water services within a whole of catchments’ stra-tegic framework in line with water management plans. The Rural and Urban Water Supply Divisions are responsible for distributing and managing water supply systems in rural and urban areas respectively.

Monitoring of water supply, sewerage and to a lesser extent sanitation has evolved recently. Parallel to this, the water and sanitation sector has committed itself to the Millennium Devel-opment Goals (MDGs) and to monitoring progress toward achieving them. The Urban Water Supply and Sewerage Division has developed five categories for monitoring performance with about forty detailed parameters. Rural Water Supply has developed six while WRM Divi-sion has five monitoring categories.

The challenge here is how to use these proposed indicators to track sector development pro-gress with lack of or inadequate data. Data usually emanates from MoW routine (monthly, annual or periodic) reports. These reports are frequent and fairly standard but need corrobo-ration from other independent sources of information. The other sources would include, NBS-CENSUS, DHS, HBS or and ILFS which are periodically carried. These sources are usually fairly accurate and therefore reliable. Faced with this predicament the sector has to strive to derive simple, robust and reliable indicators that are measurable and achievable within the resources available to the sector.

Energy and Water Utilities Regulatory Authority (EWURA) will monitor the performance of all commercially managed water utilities. These will include all urban (small or regional head-quarters) and other water utilities managed commercially. The Government having abdicated from the role of a provider will continue to monitor community owned water supply organiza-tions (COWSO’s).

This chapter will look at the performance indicators as currently used in the water and sanita-tion sector, analyse their applicability and recommend the way forward.

4.2 Current situation

4.2.1 General

It is to be stated outright that the sector has previously developed output indicators to meas-ure itself on regular basis. It is also noted that each sub-sector (UWSS, RWSS and WRM) has developed independently and at different rates, and as such is at different levels of per-formance evaluation. The most developed being UWSS followed by the RWSS division.

4.2.2 Water and Sanitation Sector in General

MKUKUTA Cluster Targets

In order to track progress of the sector it is worthwhile to gauge the sector against the MKU-KUTA targets. The water and sanitation sector performance targets are as elaborated in sec-


22

tion 2 of this report. This is then to highlight how the sector is geared towards meeting both the MKUKUTA and the MDGs targets.

As of May 2006, the agreed MKUKUTA Cluster and Goal have four main outcome indicators in meeting goal 3 of MKUKUTA Cluster 2 relevant to the water and sanitation sector. Goal 3 is aiming at increased access to clean, affordable and safe water, sanitation, decent shelter and a safe and sustainable environment (Box 4.1 below).

Box 4.1: MKUKUTA Cluster 2 goal 3

Indicator Source of Information/Data and Frequency

(1) Proportion of population with access to piped or pro-tected water as their main drinking water source (30 min-go, collect, return to be taken into consideration)

MoW/NBS – DHS/HBS/ILFS/Census done periodically

(2) Percentage of household with basic sanitation facilities NBS-DHS/HBS/Census – periodi-cally

(3) Percentage of schools having adequate sanitation facili-ties (as per policy)

MoEVT – IMIS on Annual basis

(4) Number of reported cholera cases MoH on Annual basis

Source: MKUKUTA Indicators, May 2006

Most of the data and information in Box 4.1 above come from NBS-Census, DHS and HBS surveys which are done periodically. Some of the information will emanate from MoW, MoH and other official but routine sources. Usually the surveys and census give accurate data but they are only periodically done. For an example Census comes only once in ten years in Tanzania while the household surveys are called upon from time to time as inter-censual data sources. The data from Mow, MoH and other agencies are routine and collected more often but of doubtful accuracy but they can be combined easily into composite and useable sources of information. The challenge is therefore collection of useful data and archiving the data for sector and other needs as they arise. It can be agued about the accuracy of the data but by and large let the data be collected using the same parameters and improve on the accuracy with time.

Definitions

The consultant is recommending the following definitions to be used throughout this assign-ment:

� ‘Coverage” whether water supply or sanitation or water supply is an output indicator e.g. number of connections to sewerage system or to a water supply system. This is what MoW ‘purchases” with the resources (usually funds) from MoF.

� ‘Access” on the hand is an Outcome indicator influenced by the sector but also by other related sectors such as MoH, MoEVT as well as MoAFS to mention the key players. Examples would be percentage households with access to improved water supply or sanitation. Box 4.2 below shows accessing for both water supply and sani-tation. As urban sector responsibilities frequently encompass rural environments, these definitions apply equally to both rural and urban settings. This is the ideal case the government should strive to achieve at the end.

Looking forward, it will be important to specifically define the standard of latrines one is “ac-cessing”, as this will help in the process of measuring sector performance. At present, the sector has mandate of the sewerage in Urban Centres (Regional Headquarters) and not in small towns and or rural areas per se. As the basic sanitation mandate largely falls under the MoH rather than in MoW. While the MoH has basic sanitation responsibilities it is important to establish a mechanism for the two ministries to cooperate on planning, funding, implemen-tation, and monitoring. This is very critical especially in getting accurate data to help in sec-tor development and equitable utilisation of resources.


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Box 4.2: Definition of Access

The following technologies are included in the assessment as representing “improved” water supply and sanitation

Water Supply Sanitation

- Household connection - Public stand pipe - Borehole - Protected dug well - Protected spring - Rainwater collection

- Connection to a public sewerage - Connection to septic system - Pour-flush latrine - Simple pit latrine - Ventilated improved pit (VIP) latrine

The below listed technology options are considered “not improved”

Water Supply Sanitation

- Unprotected well - Unprotected spring - Vendors – provided water - Bottled water - Tanker truck – provided water

- Service or bucket latrines (where excreta are manually removed) - Public latrines - Latrines with open pits

Source: www.wssinf.org/en/welcome.html

Outputs are supposedly directly influenced by the inputs introduced as interventions. In this case funds from Ministry of Finance (MoF) or Development Partners (DPs) secured by MoW will have outputs like number of water points built or number of households with connection to sewerage system. It must be noted that at present there is no direct relationship between inputs and outputs as the inputs (funds) may go into rehabilitation rather than expansions. As such the number of connections to improved water sewerage could remain the same even after a certain amount of funds has been inputted into the sector.

4.2.3 Rural Water supply and Sanitation

The Division has had three performance indicators as follows:

� Number of villages with water committees,

� Number of villages with water funds and

� Percentage of rural water supply service coverage. (Note that coverage was defined as a household within four hundred meters to a water source).

MoW decided not to include time factor, because it is expected to be too difficult to acquire reliable data on time spent to fetch water. Issues of sanitation (as this was not among the sector’s mandate) as well as the quality of the source were not considered. Box 4.3 below gives a summary of the coverage (based on the above criteria) for the last five years.

Box 4.3 – Coverage for the Last Five Years

Year 2001 2002 2003 2004 2005

% Coverage 49.80 52.80 53.00 53.50 53.74

As of 2005 there were 10,678 villages with water committees and by the same time there were 9,990 villages with water funds. It is debatable however, how much funds are available and how the funds are expended.

MoW has proposed 6 performance indicators to replace the previous three. These are inter-alia.

1. Percentage of people with access to improved water sources

2. Percentage of improved water sources that is functional


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3. Percentage of people with access to improved sanitation

4. Percentage of water samples taken at the point of water collection that comply with national standards

5. Percentage of water points with actively functioning water and sanitation committees.

6. Percentage of water and sanitation committees with women holding key positions.

Indicator No.1 can only be useful if tallied with the definition “access” as indicated in Box 4.2 above. “Access” must also be in line with MKUKUTA Cluster 2 Goal 3 as given in Box 4.1 above. Indicator No.3 has also to be qualified by the definition in Box 4.2 on improved sanita-tion. Indicators 5 and 6 can be considered tools in the management of water supply and sani-tation in order to meet the MKUKUTA as well as the MDGs targets. Four output indicators are proposed to cover tracking of progress within the sub-sector as follows:

1. Number of water points built

2. Percentage of functionability

3. Number of people sensitised and trained on sanitation

4. Number of latrines constructed at household level

The four indicators are meant to monitor the whole sector (NGOs, MoW, CBOs, etc) and not the MoW. Indeed the six proposed indicators by the sub-sector can be used by the MoW as a checking system within the Ministry itself.

4.2.4 Urban Water Supply and Sewerage (UWSS)

The Department has five categories of indicators that have been developed over time and are used to access individual UWSAs. These parameters are indeed in the MoU between UWSAs and UWSS department, which is valid up to 2008. It is gratifying to see that data and information is regularly collected on the weekly flash and the monthly reports. More or less the same is reported in the annual consolidated reports. All in all, the Department has experience and expertise to carry out the exercise now and in future. Box 4.4 depicts per-formance of various UWSAs versus the MKUKUTA targets. Accuracy of the data from the UWSAs is good but there is still room for improvement.

Furthermore, the department is proposing fewer and more effective indicators to be used in performance reviews in the future (see section 4.4 of this report). The proposed indicators will be imbedded in a user-friendly software which all UWSAs will have to apply. Reports so generated will then be posted electronically and simultaneously to MoW and Energy and Water Utilities Regulatory Authority (EWURA) for monitoring and regulatory purposes.

Some decline in coverage in of the indicators is due to increased population being served in 2005 than that of 2002 financial year. It is also a fact that category A is congested with 8 towns/cities now than it was three years ago when four towns qualified into this category. In some cases, there have been actual extension of pipelines and sewerage system but cover-age is either declining or stagnant for the aforementioned reasons .The following output indi-cators are recommended as sector wide tools of assessment

(i) No of HH connections to water supply system

(ii) No of public water points (kiosks)

(iii) No of HH connection to sewerage


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Box 4.4 Performance of UWSAs Versus the Set Targets

NSRGP Operational Target by 2010 (from 2005)

Average coverage for Category A UWSAs

(% of population covered)

Average coverage for Category B UWSAs


Average coverage for Category C UWSAs


2002/03 2003/04 2004/05 2002/03 2003/04 2004/05 2002/03 2003/04 2004/05

1. Increased % of urban popu-lation with access to clean and safe water from 73% in 2003 to 90%

81.62 85.35 84.4 71.5 75.8 77.2 66.7 66.1 69.6

2. Increased access to im-proved sewerage facilities from 17% in 2003 to 30% in 2010 in respective urban areas.

10.2 9.3 8.4 2.5 2.5 3.25 0 0 0

3. 100% of schools to have adequate sanitary facilities by 2010

Very little has been done

0 0 0 0 0 0

4. Reduced water related environmental pollution levels from 20% in 2003 to 10% in 2010

• Environmental degra-dation of some water sources noted

• Encroachment of water sources

5. Reduction in harmful indus-trial and agricultural effluents

Very little has been done

4.2.5 Water Resources Management (WRM)

The sub-sector has the responsibility to manage water resources in a sustainable manner. It is the sector which will feed accurate data and information to the other sub-sectors for sus-tainable abstractions taking cognize of environmental flow requirements as well as self-purification capabilities of different rivers and lakes. It is therefore important that the perform-ance indicators be those which can give appropriate data to other departments and ministries as well as NGOs etc.

The sub-sector never had any performance indicators per se. The sub-sector has developed five indicators as follows:

1. Number of river and Lake basin Water Offices established and operational

2. Level of environmental protection and conservation of key rivers, lakes, wetlands and groundwater activities.

3. Level of knowledge of available and potential surface and groundwater resources and their utilization

4. Number of operational River and Lake Basin IWRM plans

5. Increased access to water resources

The following five practical and easily measurable indicators for sector-wide evaluation and monitoring are therefore recommended

1. Hydrometric network established

2. Percentage of stations functionality.

3. % of land with water resources (WR) inventory available

4. % of land with utilisation regulations established

5. Percentage of rivers, lakes, wetlands and ground water with environmental protection and conservation


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The outcome indicators are then

(i) Water (m3/capita) of acceptable quality available

(ii) Environmental protection and conservation of key rivers, lakes, wetlands and ground water implemented

4.3 Constraints

As indicated at the outset of this chapter, the different sub-sector have developed or evolved separately. As a result their levels of performance evaluation and monitoring are at various degrees in conformity with targets of the sector in general. This notion can be considered a hindrance to sector development in meeting the MKUKUTA and the MDGs targets.

Lack of accurate data and information at the required time can be a developmental problem. For an example there are no accurate data on functional water supply schemes in the rural areas.

It complicates matters that on-site sanitation (basic sanitation) in Urban Centres (regional headquarters or small towns) and peri-urban areas is not currently within the mandate of the UWSAs, which are technically more informed and capable of carrying out these responsibili-ties.

Hydrometric networks have fallen into states of disrepair making it difficult if not impossible to equitably allocate water resources in the country.

There is not a database about onsite sanitation (which is the preferred, affordable and used option) situation in the country especially in urban centres.

Definitions of “output and outcome indicators”, “access”, “coverage” as well as “standards” are not sharply agreed upon and therefore difficult for assessors to define exactly what is the sector performance?

The major weakness in performance monitoring is low capacity in data gathering. It is there-fore proposed to strengthen capacities at country level. The focus of such capacity building should be on strengthening:

1. Data gathering capacity,

2. Quality of survey information,

3. Statistical tracking capacities,

4. Statistical analysis capacities,

5. Capacity to transform statistical analysis into effective recommendations for policy, planning and resource allocation,

6. Monitoring (of the monitoring) mechanisms.

The following is a good example for crosscutting issues that may hinder sector development if they are not nabbed in the bud early enough.

� NAWAPO (2002) Section 3.3 states that safeguarding health through safe disposal of excreta and solid waste and adequate safe water shall be encouraged.

� NAWAPO (2002) Section 4.7 among others states that emphasis will be placed on in-tegrated water supply and sanitation services and hygiene education

� National Health Policy (1990) states that MoH will promote construction of latrines and their use encourage safe basic hygiene practices


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4.4 Recommendations

4.4.1 Standardisation of definitions

It is recommended that the sector develop and adopt standard definitions that will be used routinely in the sector evaluation. As an example let us look at access to improved sanita-tion. Technologies commonly used for sanitation purposes include: (i) central sewerage sys-tems (ii) connection to septic systems (iii) pour-flush latrines (iv) Ventilated Improved Pit (VIP) latrine (v) simple pit latrines, which is by far the most common technology as shown in Table 1 below:

Table 4.1 Sanitation Service Levels (UNICEF?)

Population Groupings Access to Sanitation by Type of Tech-nology 200- 2,000 2,000-5,000 5,000-50,000 50,000–

500,000 500,000 - plus

- Connected to public sewer 0% 0% 0% 10% 6.1%

- Connected to septic system 1.8% 4.7% 7% 16% 23%

- Pour-flush latrine 1.2% 6.1% 9.7% 21% 28.2%

- Simple pit latrine 91.2% 86.1% 81.8% 47% 35.4%

- Ventilated improved pit latrine 3.1% 3% 1.4% 5% 6.5%

Other 2.7% 0.1% 0.1% 1% 0.8%

TOTAL 100% 100% 100% 100% 100%

People in unplanned settlements - - - 46% 70%

It could be important to impress on the type and standard of a simple pit latrine (which is the most reachable option for most of the people). It could easily be said as follows: "a simple wooden or concrete slab installed over a pit of 2 m or more in depth. This support should stand on a sufficiently waterproof edge of the pit to avoid surface water (run-off and grey wa-ter) entering and destroying the facility. The pit should be lined in case of unstable soil where there is a risk of walls collapsing. However, in the case of lining openings have to be pro-vided in the walls to allow infiltration of liquid in the soil.” Excreta fall directly into the pit through a drop hole or a seat. This type of latrine is a simple pit covered by a slab with a drop hole. A superstructure is necessary to provide privacy and protection. It would be a good strategy to go for toilet modes that are affordable for each level of the society. In this case there will be several designs implemented rather than only one type for the whole country.

4.4.2 Strengthening of data gathering and analysis capacity

The focus of such capacity building should be on strengthening:

� Data gathering capacity,

� Quality of survey information,

� Statistical tracking capacities,

� Capacity to transform statistical analysis into effective recommendations for policy, planning and resource allocation and

� Monitoring (of the monitoring) mechanisms

4.4.3 Output indicators

In order to track sector progress throughout the years to come, the following 8 output indica-tors are suggested. These outputs would evaluate the sector better than the current ones and those suggested by the different sub-sectors. The reasons were expounded above. These output indicators do not demand new or extra resources (funds, HR or time etc.) in order to be carried out. These indicators (output and outcome) will help the sector to evaluate its progress towards meeting the MKUKUTA and MDGs targets.


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Box 4.5 Output and Outcome Indicators for Water (and Sanitation) Sub-sectors

Output indicator Measured by Baseline data Outcome indicator Measured by Baseline

Rural

Water Supply

• Number of water points built

MoW

Currently not re-ported

Water Supply

• % of functional water points

PMORALG Moni-toring system

Water point map-ping surveys

• % Household using im-proved sources for drinking water

NBS - Periodically by survey Census, HBS, DHS

42% - 2002 Census

Sanitation • No of people sensitized and trained on sanitation

• No of latrines constructed at household level

LGAs & MoH annual health reports

Currently not re-ported?

• % HH using improved sanitation


89% - 2002 Census

Urban

Water Supply

• No. of connections to HH

• No of public water points (kiosks)

UWSAs monthly and annual re-ports

UWASA annual reports

• % Household using im-proved sources for drinking water


85% - 2002 Census (Dar 91%) (Other urban 84%)

Sewerage • No HH with connections to sewerage

UWSAs

UWASA annual reports

Sanitation • No of people sensitized and trained on sanitation

• No of latrines constructed at household levels

LGAs and MoH annual health reports

Currently not re-ported?

• % HH using improved sanitation


??% - 2002 Census (Dar 98%) (Other urban 94%)

WRM

Water Re-sources Man-agement

• Hydrometric network established.

• % functional monitoring stations

• % of land with WR inven-tory available

• % of land with utilisation regulations established

MoW - BWO Hydrological year book

MoW annual and quarterly reports

• Inventory and status of available and potential WR & utilization established by 2010

• Water (m3/capita) of ac-ceptable quality available

MoW, DHS, NBS-Census

?

Schools

Schools Sani-tation

• Number of sanitation facilities built in schools

LGA & MoEVT annual reports

Current annual reports

% of schools with adequate sanitation facilities

MoEVT/IMIS? On annual basis

?


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Box 4.5 above gives a summary of recommended output and outcome indicators that are measurable, achievable and verifiable within the means available in the sector. The eighth indi-cator is specifically aiming at schools sanitation. This would help not only in having healthier school children and pupils but also to foster the notion of having and properly using sanitation facilities by the young generation. This approach has a big possibility of being replicated by the wider community as children grow up to adulthood.

The above recommended indicators are now put in a matrix on how they are going to be used to evaluate against the development goals i.e. MKUKUTA 2010, MDGS 2015 and VISION 2025.

Box 4.6 Sector performance against development goals

PREVIOUS INDICA-TORS

DEPARTMENTAL PROPOSED INDICA-

TORS

SUGGESTED INDICATORS MKUKUTA GOALS 2010

MDGS 2015 VISION 2025

RWSS

Number of villages with water commit-tees,

Percentage of people with access to improved water sources

Number of water points built

65 percent of population with access to water by 2010

To half the population without water by 2015

Universal access to potable water

Number of villages with water funds

Percentage of improved water sources that are functional

% of functional water points

Percentage of rural water supply ser-vice coverage.

Percentage of people with access to improved sanita-tion

No of people sensitized and trained on sanita-tion

90 percent of population with improved sani-tation by 2010

To half the population without sani-tation by 2015

Universal access to improved sanitation

Percentage of water samples taken at the point of water collection that comply with national standards

No of latrines con-structed at household levels

Percentage of water points with actively functioning water and sanita-tion committees

Percentage of water and sanita-tion committees with women hold-ing key positions

UWSS

Increased % of urban population with access to clean and safe water from 73% in 2003 to 90%

Same

No. of connections to HH No of public water points (kiosks)

90 percent of population with access to safe water

To half the population without water by 2015

Universal access to potable water

Increased access to improved sew-erage facilities from 17% in 2003 to 30% in 2010 in respective urban areas.

No HH with connec-tions to sewerage No of people sensitized and trained on sanita-tion No of latrines con-structed at HH levels

To half the population without sanitation by 2015

Universal access to sewerage facility


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Box 4.6 Sector performance against development goals

PREVIOUS INDICA-TORS

DEPARTMENTAL PROPOSED INDICA-

TORS

SUGGESTED INDICATORS MKUKUTA GOALS 2010

MDGS 2015 VISION 2025

Reduced water related environ-mental pollution levels from 20% in 2003 to 10% in 2010

Reduction in harm-ful industrial and agricultural efflu-ents

WRM

Number of river and lake Basin Water Offices (BWO) established and operational

% of land with WR inventory available

Level of environ-mental protection and conservation of key rivers, lakes, wetlands and groundwater activi-ties.

% of land with utilisa-tion regulations estab-lished

Systems of standards and permits, monitor-ing discharges and enforcement of pollution control imple-mented in all basins

Level of knowledge of available and potential surface and groundwater resources and their utilization

Hydrometric network established

Inventory and status of avail-able and poten-tial water re-sources and their utilisation established by 2010.

System of effective and sustainable water resources utilisation and allocation in operation

Water (m3/capita) of acceptable quality available

SCHOOLS

100% of schools to have adequate sanitary facilities by 2010

Number of sanitation facilities built in schools

100% schools should have adequate sani-tary facilities


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5. KEY ISSUES AND AREAS FOR PRIORITY ACTION The analysis of the three thematic issues of the sector planning framework, the sector financing and the performance review has highlighted the respective key issues and areas for priority ac-tion. It is not surprising that the key issues are highly interrelated and concern primarily the qual-ity and consistency of the planning – funding - performance monitoring cycle. The lack of a sim-ple but adequate performance monitoring system for the overall sector development has a negative impact on the planning and makes the allocations of resources to priority interventions more difficult.

Sector planning framework

The analysis of the framework for planning in the water sector has highlighted the critical issues for planning in the water sector that will require attention in the future. The overall planning process involves different stakeholders and the flow of information between the local and the national level has to be considered dysfunctional. Planning for water-related activities is not fully integrated resulting in the overall planning being based on limited information. Furthermore, the planning for water and sanitation is currently made on the basis of imperfect information with regard to available funding and complementary activities.

It is essential for the water and sanitation sector to improve the planning basis through better co-ordination and communication as well as better data. One area for priority action is to im-prove the flow and analysis of information in the sector on water-related activities, in particular between LGAs and UWSAs and the MoW. A second priority is to take forward the initiative un-dertaken by the MoF to improve reliability of data on external funding.

This would also facilitate the strengthening of the consistency between medium term planning and recent sector initiatives. The challenges for the water sector require a forward-looking plan-ning and budgeting to address the core issues. However, the current MTEF prepared by the MoW is not yet fully oriented towards taking up the existing challenges, partly due to the imper-fect planning basis. Important elements are to harmonize the planning for priority interventions set out in the Water Sector Development Programme with the MTEF and to link the planning process to sector performance monitoring (input-output-outcome).

The current situation of planning for water and sanitation hampers efficient priority setting and resource allocations. The recent initiatives for strengthening the co-ordination between different planning processes in the context of the SWAP need to be taken seriously to improve the situa-tion. With the new approach for the water sector embedded in the Water Sector Development Programme the context for coherent planning in the sector have improved markedly. However, it is essential that the core components of the new framework be implemented over the next years. This concerns primarily the improvement of the flow of information and the assumption of the new roles and responsibilities by the respective stakeholders. The association of the differ-ent stakeholders in the context of the sector dialogue will contribute to improving the planning process.

Sector Financing

Several important issues arise from the analysis of the financing for the water sector. In general, sector funding has increased considerably over the last years, mainly from domestic resources. However, a clear picture of the resource flow to the water and sanitation sector is not available. This concerns primarily the resource flows to Local Government Authorities.

The urgent need for getting a clear picture on resource flows in the water sector has already been stated by other studies. A comprehensive overview over resources allocations for water and sanitation from the different relevant funding sources is essential to inform the MoW for its strategic planning for the sector, to improve the planning basis for the other stakeholders in the sector, in particular the LGAs, the UWSAs and the BWOs and to provide a basis for the sector dialogue. It is therefore suggested to establish a data base for the sector in relation with the sector performance monitoring that will reflect the overall trends in resource allocations for the


32

sector. In addition, it is also recommended that a broad based public expenditure review in combination with very specific studies are carried out to fill the information gaps on sector fund-ing, in particular with regard to the funding generated internally by the sector (UWSA revenues, private funding for water and sanitation, village water funds).

A second key issue coming out of the analysis of the sector financing is the funding for rural water supply. The share of funding for rural water supply within the MoW budget has declined (Vote 49) despite top priority given to the improvement of rural water supply services in the re-spective policy documents.

A last issue is related to the funding for the water sector. The strategic orientation in the water sector reflects the decentralization policy outlined in the Local Government Reform and LGA allocations for water have already been restructured. However, an adequate resource transfer to the local level yet needs to happen. It is therefore suggested that the MoW puts efforts into ensuring that funding for rural water supply is directly allocated at the LGA such as set out in the recent Aide-Memoire with the ADB and the LGCDG system.

The recent estimates of resource requirements to meet the MDG and MKUKUTA targets elabo-rated in the context of the Water Sector Development Programme show funding gap. However, potential financing sources have already been identified and commitments for funding are re-flecting the challenges for the sector. However, the adequacy of available funding is not the most important issue for the water sector in Tanzania with regard to achieving the MKUKUTA and MDG targets. Absorption capacity is a much more important limiting factor that needs to be addressed through improving project preparation. Strengthening the capacity of all relevant stakeholders for planning and implementing the interventions in the water sector is essential and has been included as a core component in the Water Sector Development Programme.

Performance review

The chapter on the status of performance monitoring for water and sanitation has given an overview of the overall development targets related to the sector as well as the specific per-formance indicators currently used in the three sub-sectors.

The lack of agreed definitions of “indicators”, “access”, “coverage” as well as “standards” and the lack of accurate data and information at the required time was identified as a key issue for the performance monitoring. The low capacity in data gathering was identified as a major weak-ness in performance monitoring.

Derived from these key issues, three areas for priority action were highlighted and recommen-dations for specific undertakings formulated. It is recommended that the sector develops and adopts standard definitions that will be used routinely in the sector evaluation. Secondly the strengthening of data gathering and analysis capacity is essential for building an adequate per-formance monitoring. The focus of such capacity building should be on strengthening the data gathering capacity, the quality of survey information, statistical tracking capacities, the capacity to transform statistical analysis into effective recommendations for policy, planning and resource allocation and the monitoring (of the monitoring) mechanisms.

A third area for priority action is the definition of core output indicators. A set of output indicators was suggested in order to track sector progress throughout the years to come. These output indicators would evaluate the sector better than the current ones and do not demand new or extra resources (funds, HR or time etc.) in order to be carried out.

situational analysis of the water sector in tanzania · 2.3 sector-wide approach to planning 9 2.4...

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