A shortfall of finance is hampering progress on SDGs. Yet available public funds, for water in sanitation in particular, often fail to be used effectively, or do not reach those most in need. Mismanagement, inefficiencies, and corruption are contributing to the situation. In this Integrity Talk, organised with Sanitation and Water for All, partners discussed ways to increase participation and integrity, as means to use public funds more effectively.
This is an edited summary of the main discussion points of Integrity Talk 8 on Participation and water and sanitation sector finance, which took place online on September 19, 2023. See other Integrity Talk summaries here.
With special guests: Meghna Abraham, Executive Director of the Center for Economic and Social Rights (CESR) ; Bubala Muyovwe, Coordinator of the Zambia NGO WASH Forum; Alejandro Calvache, Coordinator at The Nature Conservancy (TNC). Moderated by Mary Galvin, Research Coordinator at the Water Integrity Network (WIN).
Key Takeaways
There are contested agendas and narratives on financing and the availability of public funding. People are struggling to find answers to whether the public sector can provide and meet the finance gap and what role other actors can and should play, on whose terms and with who benefitting. These are debates that relate to voice, power, capture, and ultimately integrity.
There is no doubt that there are financing challenges and these impact service providers acutely in many regions, as in Zambia. There is not one solution however. It’s important to consider challenges in context, along with issues related to international donor funding, international financial flows, and debt burden.
Water and sanitation sector actors are building successful and important alliances to hold authorities and funders to account (as shown by the cross-sector advocacy work of the NGO WASH Forum in Zambia) and to address financing needs at local level (as shown by the impact of multi-actor Water Funds Latin America).
Session Overview
Mary Galvin (WIN) explained that this session was linked to WIN’s forthcoming launch of its flagship report, the Water Integrity Global Outlook on ensuring integrity in financing water and sanitation, with a focus on one aspect of the puzzle: participation and integrity in public sector finance.
Meghna Abraham (CESR) framed the session by highligting the need for a human rights perspective on financing the sector, which puts an emphasis on the responsibilities of States. (See recording)
Bubala Muyovwe (NGO WASH Forum) shared information about NGO WASH Forum’s work to hold the Zambian government accountable on its budget promises to the water and sanitation sectors. (See recording)
Alejandro Calvache (TNC) presented Water Funds, local collective action platforms to mobilise resources for catchment protection measures. (See recording)
Finally, speakers answered questions from participants and noted their takeaways from the session.
Discussion
What do you consider the main challenges for financing in the WASH sector?
Meghna Abraham:
The human rights framework allows us to focus on the basic right to water and highlight the intersections of different discriminations people face when it comes to water and sanitation, which have deep historical context. It also sheds light on WASH’s relationship with other issues of unequal access, for example in education or health. The framework puts emphasis on the responsibilities of States to provide access and also on obligations for international assistance and cooperation.
Here we arrive at the problem of finance. The current narrative on WASH financing is one of scarcity, by which there is a funding gap because there isn’t enough money in the public sector for progress on SDGs. Private money is proposed as the solution to the funding gap, which leads to an emphasis on creating incentives for private investment, on making investments profitable for the private sector, and on creating new asset classes for infrastructure and nature itself. This leads to financialisation.
The key question we must ask is whether this is a good model. We tend to focus on developing or calling for safeguards, like due diligence standards or participation, instead of looking at the model itself. Are we actually addressing the problems and huge inequalities that are inherently built into the model? Who is setting the terms of the discussion? It’s important to acknowledge that a lot of countries are being forced into this position because of a very vicious debt and austerity cycle, in itself imposed by international actors.
[Water and sanitation] requires a lot of investment, in infrastructure, in addressing inequalities, which cannot be driven by a profit logic but by the logic coming from human rights. It is a state obligation. These are public goods and we require investment whether or not it is profitable in the end.
- Meghna Abraham, Executive Director, Center for Economic and Social Rights (CESR)
If you look at the SDG agenda, there really is a massive financing gap. The money we anticipated as necessary is not on the table, not from ODA and not from other sources. But there isn’t enough focus on how to free up public resources and address weaknesses in tax rules or look at profit sharing methods, all neglected ways to raise revenue. There is one narrative, that obscures alternative solutions. This should be questioned.
We want the conditions internationally and domestically that make public financing both available but also accountable to people in terms of how it's being spent.
- Meghna Abraham, Executive Director, Center for Economic and Social Rights (CESR)
How has civil society participation improved the use of public funds for water and sanitation in Zambia?
Bubala Muyovwe:
The NGO WASH Forum in Zambia is a network of 40 international and local NGOs and community-based organisations advocating for improved financing and equitable, sustainable service delivery. We also work to strengthen civil society capacity and participation in these spaces.
Zambia is landlocked. It has a population of almost 20 million people. About 72% of the population has access to water and 54% has access to sanitation, but these overall figures hide big inequities between rural and urban areas.
The big issues we see in terms of public finance for water and sanitation are:
a general decrease in budget allocation despite commitments to progressively increase investment
much higher per capita spending for people living in urban areas compared to people living in rural areas, and
poor budget execution, with only 37% of promised budget actually disbursed to the water and sanitation sectors.
These issues combine with inadequate or dilapidated infrastructure, challenges in informal settlements, high non-revenue water levels, high energy costs that impact utility finances, a huge debt stock, and climate change. Historically Zambia has been donor dependent but sources have claimed that even donors are not fulfilling their complete pledges for contributions. This means institutions and services providers are squeezed for resources, there is a financing gap.
The NGO WASH Forum built alliances with other networks focusing on gender issues or poverty alleviation, education, or social protection. This ensured that even when we were not in the room, there was always someone speaking WASH. We engaged with political parties and members of Parliament. We reviewed and highlighted gaps in manifestos. We also began dialogues with the ministries – Finance, National Planning, Water – highlighting human rights obligations, the need to focus on the needs of rural populations as well as women and girls, and discussing the big issue of debt.
As a result, water, sanitation, and hygiene has much more visibility, including from the highest offices in the land. New avenues have been opened to use resources from local funds (The Constituency Development Fund in particular). Some of the submissions we made to various committees were adopted. Importantly, the water sector received 94.1% of its national budget allocation, a huge improvement. A large number of MPs have now expressed willingness to set up a WASH parliamentary caucus and we have also seen improvements for accountability, in the planning and reporting mechanisms.
We’re able to ask questions on why progress is slow, why targets haven’t been met. And the government representatives share some of the challenges they face, whether it’s with procurement processes that slow down getting services to people or something else.
- Bubala Muyovwe, Coordinator of the Zambia NGO WASH Forum
We have struggled a little to directly discuss corruption issues in the sector. There have been studies and the auditor general did a report on the performance of water utilities which raised a number governance issues. What we have done is respond to parliamentarians and make proposals. We do want to go a step further and assess willingness of service providers to adopt some of the recommendations of the auditor general.
How has The Nature Conservancy approached financing of water programmes in Latin America?
Alejandro Calvache:
The main premise of our work, is that everything we do, everything we promote as a human activity has consequences on our water flows, in terms of quantity but also in terms of quality. This is not just one problem, it’s a collective one which needs to rely on everyone for a solution, from homes, to citizens, to companies, to governments. It is not enough to have good dams, good treatment plants. It is also important for nature to be able to recover and provide water over the long term.
To support this, our proposal is collective action platforms which we call Water Funds. A Water Fund has a board that provides guidance on Water Fund interventions, priorities and funding. There’s a jointly defined strategic plan of interventions with the protection of the watershed as main goal. It’s a flexible model. Each Water Fund can involve different players but it’s always multi-stakeholder and most often involves both the public and private sector.
How the Water Funds finance their interventions varies. Some funding commitments are from external donors. The Inter-American Developmebt Bank has provided significant funding in some regions for example. The private sector also makes commitments in certain Funds, and in some contexts, funding is primarily from the public sector. The financing does not change the governance models or the decision making process.
In the Water Funds, there is a long term relationship, based on strategic plans, which are based on science and agreements between the stakeholders to reach a common goal.
- Alejandro Calvache, Coordinator at The Nature Conservancy (TNC)
There are three critical elements to our interventions. First our Water Funds are meant to be operational for the very long term, at least 20-30 years. Second, the collective action concept is key. These platforms are meant to be formed not only by public sector stakeholders but also corporate ones, but especially with civil society, local communities, local organisations, local authorities. The third element is science. We need to make sure we have science robust enough to develop a best approach in conservation or in any activity we deploy in the watershed.
What are other ways to make better use of public funds? We know that corruption drains funds and preventing corruption can free up resources. Participants in the chat are also suggesting ICT, especially for reducing non-revenue water, or indigenous approaches to water management and WASH. What are your views?
Alejandro Calvache: Many activities led by indigenous communities for conservation, or fisheries, or water management are better and more cost effective than plans brought in from the outside. And respecting culture and promoting local ways of conservation is not only important for sustainability but also for local participation. Working at the local level is key.
Bubala Muyovwe: I am curious as to what we really mean by indigenous WASH. Some traditions work, and we shouldn’t interfere with them. We can’t copy-paste everywhere. But others are not so clear cut. Using ash to wash hands is a traditional practice but it’s also a practice that stems from people not being able to afford soap. Constructing sanitation facilities with local materials is another example that has advantages and disadvantages.
Meghna Abraham: It is key that we do look at empowering communities to be able to protect and continue practices that are important to them. Sometimes we have to acknowledge there are also tensions, maybe on gender, maybe on health or other aspects. We do have to consider the price tag. We also need to build better alliances, with groups working on agriculture and food sovereignty, with groups working on health, because the issues are linked.
In terms of corruption, it is a bit convenient to use corruption as a scapegoating exercise for developing countries but there is corruption everywhere. We need to broaden our reference framework. The issue of state capture is indeed also key to the debate and we need to critically examine who dictates the agenda.
Recording
Part 1
Meghna Abraham, CESR, framing the discussion on availability of public funding for water and sanitation and possible solutions to a funding gap.
Part 2
Bubala Muyovwe, NGO WASH Forum, discussing her work holding the Zambia government to account on its WASH budget promises.
Part 3
Alejandro Calvache, TNC, presenting Water Funds, local multi-stakeholder action platforms for water protection
Part 4
Discussion and Takeaways from Integrity Talk 8 on water and sanitation sector finance