Involving the private sector in rural water services: lessons from Sangara Village, Tanzania – WaterAid
Original article on WASHmatters by WaterAid
“Two of the greatest challenges to rural water services – inextricably connected – are sustainability and financing. Priya Sippy, Emma Williams and Severine Allute describe how WaterAid Tanzania worked with local government and private partners to successfully pilot technology, a management model and a financing scheme to overcome these challenges in Manyara region.
In Tanzania, access to water in rural areas is around 65%. The target of the Water Sector Development Programme (WSDP II), through the Ministry of Water and Irrigation, is 85% coverage by 2021. The target date is not far off, and rural water services are facing several key challenges that are slowing down progress.
Sustainability and financing are major challenges
One of the main challenges facing the sector is sustainability. Data from the Ministry of Water and Irrigation show that around 35% of water points in rural areas no longer work. Money is therefore being invested in repairing schemes instead of in extending the water systems. And, while the water points are not working, communities are forced to rely on unsafe sources of water, often several kilometres away. Another challenge to achieving the WSDP II targets, connected to this, is resourcing – there is a big funding gap for water projects.
Piloting new technologies, management models and financing schemes
WaterAid Tanzania has been working to pilot new technologies, management models and financing schemes to answer some of the sector’s challenges. In 2018, we began a partnership with Habitat for Humanity, eWATERpay LTD, Babati District Council and Unit Trust of Tanzania Microfinance Institution (UTT-MFI), to implement a project in Sangara Village, Babati, Manyara region. The project aimed to improve access to clean water, through piloting an alternative financing model, working in collaboration with the private sector. The project also used several other innovations which support the financing model and ensure the water services will be sustainable.
The key innovations included:
• The solar pumping system
• Prepaid meters via eWATERpay Ltd
• A loan model to the village via microfinance company UTT
Before, 2,000 people shared six pumps
Before the project, water coverage in Sangara Village was less than 20%, significantly below the national average of 85%. Around 2,000 people shared six hand pumps, which pumped water from a shallow well. These water points were part of a WaterAid Tanzania project from more than 15 years ago. Community members would travel long distances (up to 5km) across this sprawling, hilly village to fetch water, only to often find large queues. Collecting water could take up to three hours, leaving little time for people to carry out their responsibilities in farming or at home.
Community members used the water at the hand pumps for free, which meant there was little money to keep the system working, and no money to increase the number of water points.
Solar pumping, payment meters and microfinance loans
Our project constructed a new borehole in the village, 120 metres deep. From the borehole, the water is pumped via solar technology to a 100,000 litre water tank. Solar technology is a more cost-effective technology than diesel pumping systems, because it needs very little maintenance and has a life span of around 50 years. The water from the tank flows to six new water points in the village via a gravity system.
Each of the six water points has the eWATER pre-paid meter, which charges community members 30 tshs per 20 litre bucket. The system guarantees the security of the water users’ fees, because it goes into an online bank account owned by the Community Owned Water Supply Organisation (COWSO).
As an innovative way of funding the project, the community agreed to receive some of the funding from Habitat for Humanity as a loan, facilitated by microfinance institution UTT-MFI. We engaged UTT-MFI and influenced them to join this project and understand the business opportunities for investing in water services. The cost of the infrastructure is 210,000,000 tshs, of which 50% is a grant and 50% is a loan from UTT-MFI. The loan model is built on a revolving fund mechanism, whereby the revenue collected by paying users will be re-invested in the same community until full coverage is achieved.
The schemes improved daily lives, attitudes and sustainability
While improved access to water has first and foremost improved the lives of the community members, a key achievement for the project has been changing attitudes towards paying for water, and piloting the loan scheme. We are now planning to connect the old WaterAid project to the new one, by upgrading all the existing handpumps, where water was previously taken for free, to the prepaid system. This will increase the money available for maintaining and extending the system.
One of the main lessons that has come out of our project is the importance of community engagement. When communities are used to getting water for free it takes a lot of engagement to change attitudes, but without the community on board the project can’t succeed.
Although the initial response was negative, after supporting the community to understand why paying for water was important, and where the money would be going, mindsets began to change. The village leadership worked closely with the community members to decide on a price for water that people could afford.
The project brought together partners from different sectors to test a model to improve the sustainability of rural water services, showing that the private sector can be a key player in supporting government to provide these services. It has demonstrated that, when properly engaged, communities are happy to pay for water, and that the payment model can enable increased sustainability and reach.
We are continuing to work with Babati District Council to encourage them to look for different funding options for water schemes. And we are looking to extend the water network to Sangara Juu, an area in the village not yet reached.”