Sustainable finance for universal rural water services

Achieving the global goal of universal water services in rural Africa requires new and sustainable financial models. Oxford University and partners convened a special session at World Water Week 2015 in Stockholm, to present new evidence and debate emerging approaches being tested across rural Africa.

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Operation and maintenance costs for waterpoints in rural Africa are estimated at around USD 1 billion per year, according to new cross-country evidence (Foster). Mobile money platforms provide a promising but largely untested approach to improve rural water cost recovery (Nique). Public and private sector initiatives in rural Rwanda and Kenya illustrate emerging impacts and wider implications for Africa (Sano, Mikkelsen, Hope) with UNICEF supporting many initiatives across the region.

The session on 25 August saw Oxford University collaborating with partners from UNICEF (East and Southern Africa Regional Office), the Government of Kenya Water Services Regulatory Board (WASREB), Rwanda’s national Water and Sanitation Corporation (WASAC), Grundfos and GSMA (mobile industry).

The following conclusions were drawn:

  1. Water service regulation and financial support in Africa largely focusses on urban piped services with insufficient attention and support to promoting sustainable models in rural areas.
  2. The legacy of uncoordinated investments in rural areas has wasted significant resources with competing infrastructure cannabilising sources.
  3. The non-functionality rate of millions of rural handpumps is twice as high without revenue collection.
  4. Communities struggle with low probability, high cost repair costs often leading to use of more distant, dirty and often expensive water sources.
  5. There are affordability concerns for vulnerable groups. Interventions must leave no one behind through a universal service delivery approach.

 
Next steps identified include:

  1. Institutional investments to promote coordination and regulation of existing and future infrastructure assets and financial models.
  2. Information systems that provide timely and reliable operational and financial data to inform more robust institutional design and performance.
  3. Understand the potential of private sector engagement in testing new models at scale in partnership with government and civil society.
  4. Generate evidence of novel financial instruments that optimise rural water sustainability blending user payments (tariffs), donor contributions (transfers) and government (taxes).

 

Presentations

Why financial sustainability matters – evidence from Africa
Tim Foster, Oxford University
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Mobile water payment systems
Michael Nique, GSMA
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Financial sustainability of rural water wupply
James Sano, Water and Sanitation Corporation (WASAC), Rwanda
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Public private partnerships for sustainable rural water supply
Rasoul Mikkelsen, Grundfos Ltd.
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Financial sustainability for universal rural water services
Rob Hope, Oxford University
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