Triggering, Implementing, Sustaining Urban water sector reforms SUWASA, Kampala 2015 Roland Werchota 1

7 Sector Challenges in Africa (Sub-Sahel)  Insufficient information and monitoring to set realistic goals and give directions 2  Rapid urbanization/poverty especially in low income areas  W+S insufficient priority on national and global level  Voice of underserved not heard  Insufficient performance of Service Providers – professionals do not have sufficient autonomy and oversight  Chronical underinvestment since decades  Informal service delivery - no potential to ensure rights for consumers

Degrading services - Entry Points for Reform? What can we learn from Reforms: Empirical evidence 3

7 Crucial Dimensions for Reforms / Devel. Sector Reforms Enabling Framework 1.1 Orientation Enabling Framework 1.2 Architecture 2 Providers performance 3 Regulation Regulatory tools 4 Increasing Fund mobilization 5 Development Partners Dialogue 6 Information and Monitoring Any entry point / trigger possible (mostly restructuring of providers) but gradually simultaneous progress in all dimensions needed 4

1.1 Orientation Political Will for Change and Continuity 7 Sector Principles as guiding path for sustaining reforms 1. Separation WRM / WSS, 2. Separation urban / rural, 3. Cost recovery through bills – ring fencing, 4. Focus on low-income areas, 5. Same minimum rights for all - formalization, 6. Autonomy for SI especially providers, 7. Professional planning and financing mechanism 1.2 Architecture Coherent Framework policy and legislation Stable and lean institutional Framework - No change for sake of change but sufficient checks and balances Minimization of conflict of interest – possible reason to adjust framework 5

2 Provider performance Commercialization = Professionalism, Autonomy - Decision making, recruitment, financing / budgeting Economy of scale No small scale providers in towns Progress low-income areas - underserved Nationwide standards / enforcement Regular tariff setting by Professionals Consumer protection and voice Monitoring of utility performance / reporting to public 3 Regulatory tools 6

Planning and financing model long term, related to policy goals Ring-fencing of sector income Professionalization of asset development 4 Fund mobilization Selling business case - increase donor funding / self financing Alignment and harmonization - aid effectiveness Dialogue platforms focused on monitoring outputs 5 Development Partners Data base for underserved low-income areas Data reliability, use and updating 6 Data / Information 7

Empirical Evidence of Success Statistic, Documents, Experts 1.1 Orientation 7-sector principles = high sector performance 1.2 Architecture lean / less costly = good sector performance 2 Provider performance Strong correlation between access to water and performance - measured by collection efficiency, cost recovery, staff efficiency, water production (BF average/8y 94%,163%, 4.4) and (K 83%, 125%, 6.6) – higher for providers which have reached higher service levels High success - same minimum standards for all on services / action on consumer voice as well as frequent tariff reviews 3 Regulatory tools 8

Establish credit worthiness, constant flow of funds and generate support for good governance and sustainability 5 Development Partners Making the case with detailed planning and financing plan = high fund mobilization (no correlation with access, e.g. with shift from kiosks to hh connections e.g. BF) 4 Investments High cost recovery + High self financing (BF average over 8 years 40%, Kenya 7% over 4 years) leads to high funding level BF: 160USD/year/capita served (av.8y) K: 54USD/year/capita served (av.8y) 6 Data / Information Going public with reliable information to gain confidence / support among consumer and politicians on reform 9

7 Conclusions Any entry point / trigger is possible Progress in all dimensions is needed Use 7 sector principles as guide for sector and politicians Including underserved (high access) means including the poor Gradual / stable performance increase and avoid fluctuations for sustainability Making the case for the sector with planning and financing plan and solid information Support from development partners helps to maintain reforms (good governance and funding) 10