- Markets, finance and governance
- Cities (planning, implementation, and management processes)
- Various thematic discussions (time bound) - 5
- Urban Sanitation Finance - From Macro to Micro Level (June/July 2015, Thematic Discussion 2)
- Theme 3 of TD 2: City level sustainable cost recovery
- City level sustainable full cost recovery - How to ensure finances for services for the entire city and entire sanitation chain?
City level sustainable full cost recovery - How to ensure finances for services for the entire city and entire sanitation chain?
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- jonpar
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- As part of the Engineering team, my role at IMC is to lead on the delivery of projects requiring specific expertise on urban sanitation (including excreta/waste/wastewater/stormwater management) focusing on technical, institutional and financial aspects in project design and implementation.
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"Financing sanitation"
www.ideasforindia.in/article.aspx?article_id=370
and
"14th Finance Commission: A trust-based approach towards local government"
www.ideasforindia.in/article.aspx?article_id=1443
Principal Consultant – Water and Sanitation
IMC Worldwide Ltd, Redhill, United Kingdom
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- Improving life and livelihood through decentralized wastewater management
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This last May I had the opportunity of leading a study tour of septage management programs in the Philippines for USAID, which included some folks from their Washington, DC office as well as invited guests from government and development organizations from the Philippines and Indonesia. In addition to Dumaguete City (a favorite of septage tourists these days), we went to see the Baliwag system, a highly mechanized, private sector-run collection and treatment program, and the Bayawan system in southern Negros utilizing passive technology. In analyzing the financials of these programs, it seems that there is ever increasing support for tariffs around the $1 US dollar per month per family for small to medium sized programs of 5,000 to 25,000 households to achieve full cost recovery. For a small community of 5,000 homes, this works to $60,000 per year, which is certainly enough to cover the debt service (principal and interest) on a loan for a couple of trucks, the installation of a basic treatment system, and operations expenses.
In the Philippines, it works out to a little less than one peso per day per adult. It also makes for a catchy promotions program: “Would you pay a peso a day for improved sanitation in your community?” Most people can afford a peso per day; even poor people living on $50 to $100 a month. The real question is would they pay? As with anything, the answer is that they would if they believe the benefit to be real and of value greater than the cost. Which leads to the basic theme of this posting: people (anywhere) generally won’t do anything unless they are sufficiently motivated to do so. Motivations can include the threat of regulatory enforcement actions or fines, but enforcement programs are often ineffective. In this case, an old adage comes to mind: “you tend to get more with honey than you do with vinegar”. For septage management, positive incentives can be much more powerful and can help us achieve this holy grail of full cost recovery. Positive incentives can and should be built into every aspect of septage management programs, and in my opinion, this concept can apply to other water and sanitation programs as well.
I was disappointed to see on this last study tour that my friends in Dumaguete City are back-sliding. What was once billed as the first scheduled desludging program in the Philippines has now slid back into a call-for-service delivery model. When the group visited Project 7 of Maynilad Water, a septage management program in Metro Manila, we learned that only about 30% of the households avail of the service when the trucks are working in the community. And stories continue to abound from all over the region of how all too frequently, septage loads are diverted to the nearest storm drain or open field when the treatment plant is perceived as being too far away. Let’s look at how incentives can and should be used to address these issues:
1. How can you ensure the septage load makes it to the treatment plant or the transfer station? Eliminate payment-at-the-door in favor of payment only for loads delivered to the plant. This new paradigm of billing lends itself perfectly to scheduled desludging, where tariffs are collected periodically and payments to service providers made on a monthly basis for loads delivered. Money being the most powerful motivator, truck drivers will be sure the load is not diverted if their pay depends upon it arriving at the facility.
2. How do you get more people to avail of the service when the truck is working on the block? What about giving a small discount for people that comply, and charge a slightly higher rate for those that don’t? Or adopt a practice from the Marikina City playbook where those families that comply are awarded with a window sticker proclaiming their support of the community goals. Those that don’t comply have to endure the shame of non-compliance, and in many cultures, shame avoidance is a most powerful motivator.
3. On our study tour, we were fortunate to be able to observe the actual septic tank desludging operations in one community, and were shocked to see the workers trying to desludge a septic tank through a 4 inch cleanout when there was a perfectly good manhole (access port) right next to it! One of our participants, an engineer from the US requested that the manholes be opened up for inspection after the “desludging”, and as expected, the “desludgers” succeeded in evacuating all of the liquids from the tank, but unfortunately, most of the solids were left behind. And this from a seasoned desludging team with 5 years of experience! How can we incentivize workers to do the job right and remove the solids as well as the liquids? In an increasing number of septage management programs, the septage biosolids are mixed with shredded municipal solid waste or other bulking agents to create a compost product useful for some agricultural purposes. Imagine a composting program where the septage truck drivers were offered a share of the sales of compost produced. Once they were informed of the importance of the septage solids in the composting process, you can be assured that they would do a better job in collecting the solids.
These are just 3 examples on how positive incentives can be utilized to improve the long term sustainability of septage management programs. At least for septage management, these programs can be cost recoverable, but as the development professionals tasked with designing sustainable programs, we are only limited by our own lack of imagination and creativity on addressing these and other difficult problems to enhance the sustainability of these programs for long term sanitation improvement and full cost recovery.
Dave Robbins
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You need to login to reply- jonpar
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- As part of the Engineering team, my role at IMC is to lead on the delivery of projects requiring specific expertise on urban sanitation (including excreta/waste/wastewater/stormwater management) focusing on technical, institutional and financial aspects in project design and implementation.
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This is an absolutely fundamental issue and I am really pleased Mughal raised it... there is no easy answer as, in many situations, we are facing a few generations of distrust that has built up between civil society and municipal authorities/publicly owned utilities. Political interference and corrupt practices in service extensions and in tariff setting is commonplace and the quality of service is poor... if this is what you have grown up with, then why would you envisage that there could be anything different? and, although you might express a "willingness-to-pay" would this willingness be upheld when you received a bill and you'd not actually observed any appreciable change. Wouldn't you complain and quite possibly object to paying? I would.
I think this is the same with expectations of the quality of the environment. There seems to be a total disconnect between the aspirational and unrealistically high standards for environmental protection that are required for any treatment facility that is in place and the prevailing environment which is highly contaminated because there is no treatment at all. I think we need to encourage a serious look at this "is the glass half empty or half full" situation and promote the concept that any improvement is a good one. This is particularly important in my opinion because we could reduce pollution loads going into the environment massively with some crude and cheap treatment technologies. But because the moment anyone try to do anything to improve the situation, there is the expectation that it must reach national standards, which is a total disincentive to do anything in the first place. It's not surprising that the status quo prevails and the majority of waste streams from sanitation systems (wastewater, septage and faecal sludge) are not treated...
I think the only way forward is for services to improve first and people to get used to the reality that things can be different from the norm that they are accustomed too.. and then, and only then can tariffs to be increased. The idea that tariffs can be increased before there is any confidence/trust from civil society (aka "customers") in the service provider being able to meet their expectations (aka demand in economic terms), is in most contexts unrealistic and I presume that this is the situation in Sindh.
The implication of this discourse is that there is a need not only for national and local Governments to be "brave" in making the capital investment for improving sanitation because it is good for health, the environment and the economy ... but also there is probably a need for some of this investment to "stretch" to subsidizing O+M for some period of time, to get to the stage where it is realistic to ask society to pay for these services. But if this is the case, , the question is how long, and how much...?
I'd be interested to hear the responses from others on this as it does raise some fairly significant questions about WASH sector theory vs the reality of the socio-political environment.
best regards, Jonathan
Principal Consultant – Water and Sanitation
IMC Worldwide Ltd, Redhill, United Kingdom
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- Sanitation as a business
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I will also be interested in the response seeing that I have experienced first hand what you mentioned, that is, failure for people to pay even when you agreed prior on the quantity and price! I even sent the operator to take sludge to one client's premise after avoiding us for 4 months! It is was terrible. This is one of the reasons I am venturing into pay per use public toilets because money is paid upfront...
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You need to login to replyIn the rural areas of Sindh province (Pakistan), the funds for the operation and maintenance (O&M) of the sanitation facilities (typically, sewerage system and improvised sewage treatment plants), are provided for by collecting from each household a small amount every month, for the sanitation services rendered. While there are problems (e.g. people refuse to pay; blames for the poor service) in collecting revenues, the amount collected is not enough to meet the O&M costs.
On the other hand, there are issues of “transparency” and “sanitation integrity.” Moving on, even if some amount is made available by the municipal government to the towns, the amount becomes the victim of non-transparency and non-integrity.
Microfinance has picked up in Pakistan, but it is not yet popular for use in sanitation sector in the rural areas. In dispersed settlements, the people do not pay, in some cases, for emptying the pits, for being too poor to afford the expenses. This creates unhygienic conditions.
It is quite obvious that to keep the sanitation facilities going, you need adequate funds each month. In my project of aerated lagoons wastewater treatment plant, 1982, Karachi, we used to sell treated effluent for gardening of greenbelts; and the dried sludge as soil conditioner. This generated some amount to meet the O&M cost of the plant. But, this approach is not going to work in the rural areas of Sindh.
With that background, my question is: when you are “cornered” from all sides – people refusing to pay; issues of transparency and integrity – how can the sanitation facilities be made sustainable?
F H Mughal
Karachi, Pakistan
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You need to login to reply- jonpar
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- As part of the Engineering team, my role at IMC is to lead on the delivery of projects requiring specific expertise on urban sanitation (including excreta/waste/wastewater/stormwater management) focusing on technical, institutional and financial aspects in project design and implementation.
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I am in overall agreement with what you present. If we accept that in many contexts there is a need for external financing to pay for capital investment and if for example this was to come from central (or provincial government) as a grant that was came from general taxation, then I am not sure that this constitutes full recovery as such - but it does mean that all costs are covered. But perhaps this is just a question of semantics/use of terminology that I perceive a little differently.
I certainly agree that we need to look at the full life-cycle costs and for sustainable financing mechanisms (one of the Sanitation 21 principles www.iwa-network.org/filemanager-uploads/...n-21_22_09_14-LR.pdf) and to do this there is a need for revenue coming from various sources at various times.
I think that although the financial return from waste recovery may be hyped in so far as I have doubts how far up the sanitation chain the returns go (my gut feeling is that if it can cover treatment O+M costs then it is worth doing. So, I also agree that with the sentiment that it doesn’t matter too much if the financial returns from reuse/‘trade’ are small, if they are still additive to the overall financial balance.
The answers are of course specific to the context and, as you mentioned earlier, the type of system that is installed can affect both CAPEX and OPEX. So, I think it is imperative to be using financial tools to identify the most cost-effective sanitation solutions on the basis of life-cycle analysis, taking into account all costs incurred and revenues generated over the total lifespan of an investment (see p.28 of San21 which refers briefly to the development and application of a financial model in Dhaka by WSUP. More information here : www.wsup.com/resource/financial-analysis...-lessons-from-dhaka/
Some of you may already be aware that David has developed the "Interactive Septage Management Toolkit" with a spreadsheet to support the analysis of finances for septage management. You can download from David's site at : watsanexp.ning.com
Hopefully we can get David Robbins to contribute to this discussion because he is also mentioned in the posting from Elisabeth.
After this e-conference, I'd be keen for the Working Group on Finance and Economics to bring these various tools together and where possible make them available for practitioners to download and use in earnest. I'd also be keen for university lecturers to utilise these tools as part of the lecturing programmes so that engineers graduate with a better ability to do financial costings to complement their engineering designs. Speaking from experience, this is one area where I felt very poorly equipped - especially in the early stages of my consulting.
So, the more we can provide the tools for engineers to be apply in practice to be able to compare different proposed sanitation options and to present the full costs to stakeholders in a way that they understand the financial implications, the better.
best regards, Jonathan
p.s. can we not extend this discussion for another week to give more people a chance to contribute.
Principal Consultant – Water and Sanitation
IMC Worldwide Ltd, Redhill, United Kingdom
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- Sanitation as a business
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To the point, I think in a way, sustainable full cost recovery can be attained through private sector involvement as usually local authorities do not have the incentive or motivation an ambitious disciplined private entity would have. Take a look at mist local governments outsourcing O&M after things start getting out of hand and deserted by those they were meant for (public toilets).
I believe I have a sustainable business model after a little over a year in trying out several products that have once been named on this forum (susana) both in Uganda and South Sudan. I have worked with the Sato pan and the gulper but due to a difference in mindset and direction often dictated by NGOs dying to impress funders rather than create opportunities for other entrepreneurs, I sat down and came up with something.
It is in concept mode, has been approved and works with per pay use along with other revenue points that would create long term establishment and create a franchise model from sanitation something not often heard of. I think much as we have such discussions and for which usually sectors like IT (I have some tech backing) present like youth grants, hackathons and all, we need to have a global outreach on regarding sanitation.
2015 was set as the year for achieving MDGs but how our we genuinely doing. I will speak for sub Sahara Africa cause that's where I am from. Almost every month there is a company here calling for applications for grants for different tech products, is sanitation only trusted to be achieved by graduates, doctors and et al? NGOs invest highly in behavioral change, how about sustainable projects that may have community involvement in terms of usage and payment can't that be coupled with both sensitization on behavior and at the same time celebrate sanitation?
If we are creating future leaders that never look at the opportunity sanitation as a business can provide, then we are simply creating a funnel through which funds return to donors and that's the bitter truth. Find me 20 successful entrepreneurs relating to sanitation in each African country; very difficult! While IT is well funded and supported, at least from what I see in Uganda, Kenya and Rwanda, proposals submitted on sanitation are blocked with 'we don't receive unsolicited emails.'
At this point I may stand alone regarding my sustainable ideas concepts or yet-to-be financed sustainable projects but the truth is we need a paradigm shift if we are to achieve desirable change.
Apologies for being on and off at the same time regarding this comment.
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You need to login to reply- kevintayler
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- I am a water and sanitation engineer, also interested in general urban housing issues. In recent years, I have worked on FSM for various organizations
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First, on the four 'T's, it is important to look at the existing situation and the constraints on change. In most of the countries I have worked in, the tariff for sanitation services (read wastewater collection and disposal) is typically around 10% of the water tariff - far below the level required to get anything approaching full cost recovery, even for operational costs.
The situation with regard to septic tank and leach pit emptying services is rather different in that people are willing to pay to have their pits and tanks emptied. As suggested in earlier posts, it is possible to cover operating costs (and perhaps some capital costs) from tank/pit emptying charges. One point to note here is that for this to happen, the service provider (normally Local Government) must be engaged in sludge collection and transport - this is where there is potential revenue. Numerous studies show that people are much less willing to pay for treatment to protect the environment so a model with independent private sector collection and transport operators delivering to publicly owned treatment facilities will not be financially viable. Sale of treated materials - sludge and wastewater - is unlikely to cover more than a fraction of operating costs. (There are studies on this but I would have to search for them).
Sale of mater
Municipalities normally have limited ability to collect taxes - the taxes that they can collect rarely provide anything more than a fraction of their expenses so they are dependent on transfers from higher levels of government. Their ability to change this situation is limited because decisions on taxation are not made at the municipal level. Similarly, few municipalities have the freedom to borrow money directly - the situation varies from country to country and is also dependent on the size of the municipality but I think that it will often be a risky option for smaller municipalities, regardless of whether they are allowed to borrow.
The experience in the Philippines and Indonesia is interesting. One point to make here is that regular desludging of tanks and pits is often promoted on the basis that it removes or greatly reduces the risk of groundwater pollution. While the risk may be reduced, it will not be eliminated since the reduction in pathogen levels through a septic tank is only of the order of 1 log. My experience in Indonesia are aware of the health risks associated with drinking shallow groundwater and say that they either boil it or use water from other sources for drinking.
Turning to Elisabeth's surprise that so many tanks and pits in Indonesia are inaccessible. There are, I think, two reasons for this. The first is that people perceive, often correctly, that pits (they are mainly pits rather than septic tanks) will go for years with needing emptying. The reason for this is probably that the hydraulic loading is fairly low although there is some evidence from work done by WSP that the subsoil can eventually become blocked, necessitating more frequent emptying. The second point is that when we investigated building standards and responsibilities for enforcing them, we found that no-one in Government believed that enforcing national standards relating to on-site sanitation was their responsibility. Most pits are built by local builders, who work to their own rules of thumb and produce facilities that do last for a long time.
The challenge with financing regular emptying is that it requires a step change in expenditure and availability of vacuum trucks. Many municipalities will face a chicken and egg situation in which they are unsure whether increased expenditure down the line will be sufficient to pay the capital costs of the additional vacuum tankers and perhaps treatment facilities to move the increased amount of septage generated by regular emptying. ONe question here is whether there need to be changes in institutional arrangements to allow this to happen. USAID is gathering information on 'pilot' projects involving regular emptying in both the Philippines and Indonesia so it will be interesting to see what the results are. My view is that it might be best to focus efforts to introduce regular scheduled emptying on areas within towns and cities where the available information shows that there is already a relatively high demand for on-call pit and tank emptying.
One last point on building codes - I think that there is a tendency for these to be developed without sufficient reference to what people are already doing on the ground. Clearly, there are issues with current 'informal' practices but there are also lessons to be learnt from them and I would like to see a greater focus on existing practices, what works and what does not work so well, when developing building codes. If the codes are too far from what people know and can afford, they will surely ignore them.
Independent water and sanitation consultant
Horsham
UK
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You need to login to reply- Elisabeth
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I only have a hardcopy so I took photos of the article and attach them below (I have embedded them in the post but also attached them below for downloading; if anyone has the pdf file, perhaps they can provide that).
The concept is about a city-wide desludging programme. I quote from the paper:
Unlike the "call-for-service" desludging model, scheduled desludging provides street by street septic tank, cesspool and pit toilet emptying services on a regular basis. Services are less expensive and programme efficiency and economics of scale decrease transportation and collection costs.
With their rapid technical assessment using Akvo FLOW they found that:
- 4.75 years would be a suitable desludging frequency
- "37% of septic tanks and cesspools are located underneath buildings and are not equipped with any access ports, indicating that a concrete boring machine will be required to install proper access ports to enable desludging of these tanks." (!!!) (how can that be?? What kind of building codes are (not) enforced there? Is the expectation when they build the houses that the spetic tanks never have to be emptied?)
Regards,
Elisabeth
Freelance consultant on environmental and climate projects
Located in Ulm, Germany
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You need to login to reply- KumiAbeysuriya
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- Independent sustainable development researcher with a passion to enable developing countries and communities to ‘leap frog’ to the leading edge of sustainable urban sanitation services.
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First, thank you Jonathan for your post, and I would like to encourage more of you to share your views and experiences before this topic and thematic discussion closes at the end of this week.
In this post, I will respond to Jonathan and also link with some issues raised in the earlier discussions that relate to city level sanitation financing.
Jonathan, regarding examples of faecal sludge management (FSM) initiatives that achieve full cost recovery through tariffs and ‘trade’, there are several cities in the Philippines – I understand that Dumaguete City had a payback period of 5 years to recover capital investment including depreciation. Please see the attached paper by David Robbins et al for more details. But you are correct about the insignificance of the revenues from sale of recovered resources (the ‘trade’ component).
I would also argue that FSM based on urban septic tanks may not be a complete sanitation solution if the pathogens from the effluent are not adequately managed – so this may be ‘full cost recovery’ of only a part of the sanitation service chain.
In relation to your question about attaining full cost recovery, we recognise that dominant ideas about how sanitation should be financed have changed over time. As you noted in your earlier post (#13840) public funds were invested in many industrialised countries – reflective of the dominant view at the time about the role of governments in supporting economic development. With the rise of ‘market economics’ since the 1980s, the idea that users should pay the full costs through tariffs came to dominate.
I think the main ‘take home message’ from this thematic discussion is that views about how sanitation should be financed are changing again, in favour of ‘sustainable full cost recovery’ made of ‘building blocks in the sanitation financing equation”, to quote Sophie. That is, cost recovery through a combination of public financing (taxes), tariffs from service users, transfers from overseas development aid (ODA) and/or other socially motivated/charitable entities (and potential ‘trade’ of waste-derived products: the 4Ts)! From this perspective, it also doesn’t matter too much if the financial returns from reuse/‘trade’ are small, if they are still additive to the equation
![:) :)](/media/kunena/emoticons/smile.png)
Even if a city level service provider could plan for ‘sustainable full cost recovery’ over the service lifetime, the timing of the revenues will generally not coincide with when the bills have to be paid, as highlighted by Antoinette (a point also made by Sowmya in #13991). Accessing the large upfront finance is a particular challenge.
Instruments such as commercial loans and bonds have been mentioned by a few, as sources of repayable finance that could bring in new players to the sector.
Financial market players will lend the required funds only if they are assured that the borrower is creditworthy, and will have sufficient and reliable revenues to repay. City level sanitation service providers such as local governments typically have particular constraints in this regard.
Do you have any experiences or thoughts about how city-level sanitation service providers can overcome such challenges? Combining the 4Ts in innovative ways (that suit the context) may address these constraints – do you know of any examples?
Kind regards,
Kumi
Independent Consultant
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You need to login to reply- jonpar
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- As part of the Engineering team, my role at IMC is to lead on the delivery of projects requiring specific expertise on urban sanitation (including excreta/waste/wastewater/stormwater management) focusing on technical, institutional and financial aspects in project design and implementation.
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Kumi - you mention that we are starting to hear of cases where full costs can be recovered from tariffs and ‘trade’ of waste-derived products. When you say "full" costs, I presume you are referring to the investment as well as O+M and rehabilitation (capital investment) costs. I'd be interested to hear more about these examples. Please give more information.
I am all in favour of reuse for environmental/ecological and associated economic benefit. I can also see that there is potential for financial returns (revenue) from sale of the recovered resource if the waste is processed into a product for which there is demand within the local market. But, I still ask myself how much how much evidence we have to make the case that reuse is such a strong driver for the capital investment in the first place. As part of the FAME project, SANDEC did a considerable amount of research on this (see www.eawag.ch/en/department/sandec/projec...nagement-enterprises) and although they demonstrated the economic value and the potential for revenue generation (especially for energy - more than soil conditioner), the results in my opinion didn't provide a strong enough case that reuse can contribute towards the repayment of a loan. I'd be willing to accept the evident if it exists, but for the time being I see the financial return from reuse more as a means to pay for the cost of treatment.
And...., given the socio-political / macro-economic context in many countries in the South, how much can we really expect users to pay for the massive investment that is required to complete the sanitation chain for faecal sludge/septage/wastewater collection, storage, transportation, and treatment. If we look at the current situation with respect to water tariffs, there is frequently a situation in which there is insufficient cost recovery from tariffs due to a combination of political interference and/or a lack of willingness to pay for municipal services due to corruption (real or perceived) and a poor performance of service providers/utilities.
So, I still have questions about what steps we need to go through to break the 'viscous cycle' before we can attain a situation in which citizens have both the capacity and are willing to pay for full cost recovery for sanitation services or the full chain AND the life cycle. In many low-income countries, I envisage that there is a long road ahead to go before this is a realistic proposition and therefore there remains a need to national governments to make a commitment in sanitation and provide grants to municipalities for the capital investments and for these investments to be written off without the expectation that users or reuse / resource recovery will pay back the capital.
But, although there may be the enlightened national political will (e.g. India) to fix the problem and throw large sums of money at municipalities with the expectation that the'll sort it out, this is all easier said than done. As far as I see it it, there is no easy solution to this as it boils down to a combination of national and sub-national/local politicians working together with an agreed/collective policy - supported by technicians (the likes of you and me) who can provide pragmatic and evidence-based analysis.
As we all know politicians make the most irrational decisions and, in most cases aspire to sewerage (end of problem?) we really need to think about our "elevator pitch" (en.wikipedia.org/wiki/Elevator_pitch) and how we can communicate with non-technical people. So - let's hear more about the experience from Baliwag in the Philippines and how this might be used as the basis to encourage other politicians to invest in sanitation in a sensible way.
One of the things that I find interesting and exciting about working for an organisation such as as Oxfam - and I believe SNV is similar - is the fact these organisations have a much wider mandate than WASH. The solution that is technically the "best" is not necessarily the one that is accepted and therefore I think we need to consider how we can play a role in communicating/influencing those who are outside our immediate technical dimension to overcome these political challenges - and it is frequently financial/economic ($$$$$$$$$) arguments/evidence that will win them over.
best regards,
Jonathan
Principal Consultant – Water and Sanitation
IMC Worldwide Ltd, Redhill, United Kingdom
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You need to login to reply- KumiAbeysuriya
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- Independent sustainable development researcher with a passion to enable developing countries and communities to ‘leap frog’ to the leading edge of sustainable urban sanitation services.
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While the key financing concepts shown in Antoinette’s attachment are not specific to any particular technology, finding the right balance between lifecycle costs and revenues greatly depends on the technology chosen – how costly (and affordable) it is, how easy to capture and reuse the resources, and most importantly, how effective it is in delivering the public health and environmental outcomes…
Onsite sanitation is widely discussed as a key (affordable) option for urban areas in developing countries. As Sophie mentions in her opening post, many national policies give responsibility to the site owners (households or business) to finance/invest in their onsite sanitation. Some contributors to the discussion have confirmed this widely accepted view and practice that onsite sanitation should be funded entirely by tariffs (paid by service users). While there are many different technologies that can operate at the onsite scale, septic tanks and pits are the most common, and as Hanns-André (#13933) noted, it is common that ‘regular (unlined) pit latrines and the soakpits of septic tank systems are polluting the ground water’ that could be used for drinking water. In urban areas the negative impact of leaky pits/tanks placed close to each other can be very significant.
In such cities, is the basic sanitation outcome of protecting human health, water resources and the environment being delivered? If the answer is NO, how can models for investment in onsite sanitation be improved to provide more effective sanitation outcomes?
There is a lot of momentum building around local governments enabling faecal sludge management (FSM) as a service for onsite systems (sometimes delivered by private sector players), and we are starting to hear of cases where full costs can be recovered from tariffs and ‘trade’ of waste-derived products. While important, FSM initiatives attend to only a part of the sanitation service chain and do not prevent the impacts of leaky pits and tanks.
Are there ways to blend more Ts – taxes, transfers and ‘trade’, in addition to tariffs, so onsite sanitation systems in cities and towns can ensure public health outcomes from safeguarding water resources or preventing their contamination? It would be great to hear stories of financing onsite sanitation that is achieves good outcomes over the long term.
Independent Consultant
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- Cities (planning, implementation, and management processes)
- Various thematic discussions (time bound) - 5
- Urban Sanitation Finance - From Macro to Micro Level (June/July 2015, Thematic Discussion 2)
- Theme 3 of TD 2: City level sustainable cost recovery
- City level sustainable full cost recovery - How to ensure finances for services for the entire city and entire sanitation chain?