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Final SWAP report Kenya
Ministry of Water and Irrigation
Water Sector Working Group
STUDY FOR THE ESTABLISHMENT OF A SECTOR-WIDE APPROACH TO PLANNING (SWAP) IN THE WATER AND SANITATION SECTOR IN KENYA
FINAL REPORT
MTEF Activities
July
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
April
May
June
Water Sector Activities
Ministerial Strategic Plan
Revise and update ministerial strategic plans
Line ministries
Review and comment on Annual SP Update and MWI Strategic
Plan
WSWG
Ministerial Public Expenditure Review
Develop Public Expenditure Review (PER) work plan, TORs and
timetable for Ministries’ PER
Treasury/ MOPND
Launch sector working groups and initiate preparation of MPERs
Treasury
Develop Budget Outlook Paper
Treasury/ Macro Working
Group
Value for Money Studies
MWI
Prepare DP requirements/ input to Joint Annual Review
WSTG
Information/ discussion of the budget outlook paper, Plan for Joint
Annual Review and MPER Process
WSWG
Stakeholder workshop on budget outlook paper
Treasury
Input from WSBs, WRMA, NIB, MWI Divisions and other sector
institutions to the annual budget process
Submission of district input on Irrigation to ministry headquarters
Line ministries
Finalise budget outlook paper and present to Cabinet
Treasury
Joint Annual Review contributing to the Ministerial Public
Expenditure Review
Finalise MPERs
Line ministries
Review and comment on the MPER
WSWG
Budget Preparation
Issue MTEF guidelines together with budget outlook paper
Treasury
Issue revised budget circular
Treasury
Finalise review of sectoral priorities and submit sector report to treasury
Treasury/ MOPND
Coordinate DP commitments to next FY budgets
WSTG
Outline Commitment from DPs on contributions to next years
sector plan and budget
Submission of revised estimates
Line ministries
Stakeholder Consultations on Budget and Plans
Plan for the Water Sector Stakeholder Workshop
WSWG
Water Sector Stakeholder Workshop as input to Sector Hearings
on Physical Infrastructure Sector
Hold Sector Hearings
Treasury/MOPND
Revised Budget Estimates
Finalise revised estimates
Treasury
Prepare budget strategy paper
Treasury – Macro working
group
Stakeholder consultations on BSP
Treasury
Submit BSP to Cabinet for approval
Treasury
Consultative Group Meeting
Prepare DP input to WSWG/ Consultative Group Meeting
WSTG
Prepare for water sector input to Consultative Group Meeting
WSWG
Consultative Group Meeting
Treasury
Final Budget Preparation and Approval
Circulate to Ministries approved BSP
Treasury
Firm Commitment from DPs on the contributions to next years
sector plan and budget
Submission of itemised budget
Line ministries
Review and finalise the itemised budget
Treasury
Submission of budget estimates to Cabinet
Ministry of Finance
Printing of estimates
Treasury
Presentation of budget to Parliament
Minister for Finance
Up-date SIP and Annual Plans
Sub-sector Strategic Planning Working Group Meetings to provide
input to water sector strategic plan
Define DP requirements for Technical Reviews
WSTG
CAAC review of Catchment Management Strategies and input to
water sector strategic plan
Prepare for Technical Reviews
WSWG
Technical Review contributing to water sector strategic plan and
SIP update
Annual up-date of SIP:
1. detailed annual plan for next FY,
2. outline medium term plan
3. adjustment in strategic inv. plan
Frame Consultants Ltd
May 2006
This report is the complete report - a summary volume of less than 20 pages is available – a CD ROM with an electronic version of the available documents summarised in the annotated bibliography of annex E is also available from the SWAP secretariat MWI or Frame Consultants Ltd.
The report authors are Eric Buhl-Nielsen (team leader), Jens Vad, Francis Kimani, John Nguri and Naomi Ngeno
PEMCONSULT a/s
WILDERS PLADS, BYGN. J, 2 SAL
DK-1403 KØBENHAVN K
TEL.: +45 32 952626
FAX.: +45 32 952646
www.pemconsult.com
Frame Consultants Ltd
Loita House, 3rd Floor Loita Street
P.O.BOX 58624 – 002000 Nairobi
Tel: 213755, 251505
Fax: 213990
Executive summary
The objective of this study is to assist the Ministry of Water and Irrigation (MWI) and its partners to prepare a Sector Wide Approach to Planning (SWAP) for the water sector. The specific objectives are: i) compile all the necessary background information; ii) gather relevant experience from SWAPs in other sectors and countries; iii) outline a SWAP framework and, iv) present a roadmap for the preparation and establishment of a water sector SWAP.
1.Framework
Ten key principles have emerged to guide the development of the SWAP based on an analysis of how best to realise a number of opportunities and addressing key challenges and risks:
· SWAP and the reforms potentially complement and reinforce each other;
· SWAP presents a mechanism for better inter-sectoral coordination;
· SWAP can lead to reduction of transaction costs and a more efficient sector;
· SWAP can mobilise more resources;
· SWAP can improve the MWI Financial Management Systems (FMS) and flow of funding;
· SWAP should reinforce decentralised rather than centralised planning;
· SWAP should simplify rather than complicate reforms;
· SWAP should enhance rather than reduce NGO and private sector involvement in the sector;
· SWAP should increase government capacity rather than overwhelm it;
· SWAP should be flexible enough to recognise when project modalities have advantages.
Based on these principles a framework composed of 8 crucial elements is presented which sit within policy, planning and funding frameworks as shown in Table 1.
Table 1: Core elements of the SWAP framework
Framework
Core elements
Policy framework
1. Definition of the national sector framework (what to align to)
2. Partnership principles (common donor policies on how to align)
Planning framework
3. Sector Investment Plan –SIP (tool for prioritisation)
4. Sector Information System – performance monitoring
5. Coordination – both inter-sectoral and with external partners
Funding framework
6. Channels of funding (ladder of options – project, basket, budget support)
7. Financial management (transparency, accountability, value for money)
8. Resource mobilisation (using SWAP to increase funding)
Most of the actions implied by this framework are already part of the ongoing reforms and normal processes of sector management. Thus the role of a SWAP roadmap will not be to build a separate series of plans and actions but instead to support, strengthen and consolidate the present reform roadmap and “fill in pot holes” where the SWAP process has a comparative advantage. The comparative advantage of SWAP will derive from. i) breathing new life into processes that have stalled; ii) increasing the leverage arising from improved harmonization and alignment of external efforts and, iii) using the SWAP as a presentation and communication tool to harness the efforts and cooperation of actors in other sectors. This role of SWAP is also a reflection that the reform secretariat is winding down as the transition tasks are over and that the main focus now will be on longer term improvements and maintenance of sector performance – thus the SWAP will mainstream and take over the longer term requirements of the reforms.
A number of pre-requisites are needed as minimum steps before a SWAP can be meaningfully launched. After launching there will be a number of benchmarks to be attained (and maintained) over the years before a SWAP can be said to be fully operational. In addition, each particular funding modality will itself have a series of “Funding Modality Pre-requisites” which are to be developed, defined and updated in the partnership principles.
Table 2: SWAP pre-requisites and benchmarks
Framework
Pre-requisite (pre launch)
Benchmarks (sub sequent to launch of SWAP)
Policy
1. Government leadership
2. MOF involvement
3. Partnership Principals signed
4. MWI staff transfer
1. NSF completed (irrigation & sanitation)
2. Transferred staff trained and effective in new duties
Planning
5. Interim SIP
6. Annual sector review
3. SIP updated
4. SIS – performance review undertaken, results acceptable
5. Annual Sector Review undertaken
6. WSBs, WRMA, WSRB, WSTF and WAB fully operational and in control of their own budgets and staff
Funding
7. Funding Modalities Pre-requisites defined
8. Review of FMS systems
9. Anti corruption, enforcement, accountability
7. Tracking results acceptable
8. Value for money acceptable
9. Audits acceptable
10. Funding levels increased at a rate that will see target met
Note: indicators are given in the main report under chapter 6: SWAP framework
Each of these pre-requisites and benchmarks have a number of indicators and means of verification which are elaborated on in the main report.
The pre-requisites for adopting a particular funding modality will be of a financial, technical and managerial nature. Financially, the pre-requisites will aim at determining when the fiduciary risks are at an acceptable level i.e. the same or lower than project or basket modalities. Technically, the pre-requisites will aim at determining when the technical capacity is in place such that correct investment and technical decisions are taken in the use of capital and recurrent funds e.g. that a database system is selected and used in a technically correct way. Managerially, the pre-requisites will aim at determining when the organisation is well managed such that funds are only directed towards strategically correct purposes and in a cost effective manner.
The funding modality pre-requisites should as far as possible be absolute values that either trigger or don’t trigger a move to another funding modality. In practice, the conditions which they aim to measure are often subjective and require judgment and have to not only be attained but also maintained. Thus the pre-requisites need to be periodically confirmed by spot checking. There will often be uncertainty about their attainment, in such cases, it is often constructive to give the benefit of doubt and then put in place safeguards. The design of the safeguards will essentially be determined by the nature of the uncertainty or the particular areas of weakness. The tendency of allowing the presence of uncertainties to slow down the progress towards budget support can also be minimised by demanding that the burden of proof is on the argument for why budget support should not be given.
A key principle has been to select funding modality pre-requisites that are already part of the sector activities and normal management instruments and do not require special studies or interventions. Those pre-requisites which do not fall into this category are marked with an * in table 3.
Water resources developments are considered to fall under the area or sector that uses the infrastructure, so if for water supply it will be a Water Services Board (WSB), for irrigation it will be the National Irrigation Board (NIB), for hydropower the Ministry of Energy etc. The pre-requisites are separated into those that relate to: investment funding; support to recurrent budget and, technical assistance.
The funding modality pre-requisites related to investment funding are shown in Table 3.
Table 3: Investment related funding modality pre-requisites
Investments and related promotion
Relevant Institution
Funding modality Pre-requisite
From project to Basket (project pooling)
From either project or basket to Targeted budget support
RWSS
WSTF
The WSTF is in essence a basket already.
1. SIP adherence
2. Annual workplan/budget
3. Sector Information System (SIS) – performance measurement of RWSS sector
4. Audit of WSTF (financial& procurement)
5. Timely financial reporting
6. Tracking study
7. Value for Money (sustainability focus)
UWSS
WSBs, WSPs
1. Analysis to demonstrate validity of retaining project type modality due to size, complexity of investment and capacity of the WSB.*
2. Transaction costs can be reduced by pooling
The 7 pre-requisites above plus
8. Capacity analysis (for larger investments)*
Irrigation
Regional Development Authorities (RDAs), NIB, MWI
Assistance will be in the form of projects until the irrigation sector reforms are in place
The funding modality pre-requisites for recurrent expenditure (salaries, allowances, travel, equipment, office running, consumables, routine training, outsourcing of specialist tasks) is shown in Table 4.
Table 4: Recurrent expenditure related funding modality pre-requisites
Recurrent expenditure
Institutions
Funding modality Pre-requisite
From project to Basket (project pooling)
From either project or basket to Targeted budget support
Water and sanitation related
WSBs, WRMA, WSRB, WSTF, MWI, WSPs, MWI
1. Analysis to demonstrate validity of retaining project type modality due to size, complexity of investment and capacity of the WSB.*
2. Transaction costs can be reduced by pooling
1. Annual workplan and budget approved
2. Audit (both financial and procurement)
MOH, RDA,NIB
To be defined once reforms in place
Sanitation and Hygiene promotion (not linked to investments)
MOH
The funding modality pre-requisites will be defined under the emerging Health SWAP
The funding modality pre-requisites for capacity building (technical assistance and the costs associated such as workshops – provided it is beyond the normal routine training that will be required by the organisation in perpetuity) is shown in Table 5:
Table 5: Capacity building funding modality pre-requisites
Capacity Building
Institutions
Funding modality Pre-requisite
From project to Basket (project pooling)
From either project or basket to Targeted budget support* (TBS)
Water and sanitation related
WSBs, WRMA, WSRB, WSTF, MWI, WSPs, MWI
1. Analysis shows that value can be added by in-kind delivery of TA
2. Transaction costs can be reduced by pooling
1. Annual workplan and budget approved
2. Audit (both financial and procurement)
3. Procurement capacity for local TA
4. Procurement capacity for international/ regional TA
MOH, RDA,NIB
To be defined once reforms in place
Sanitation and Hygiene promotion
MOH
The funding modality pre-requisites will be defined under the emerging Health SWAP
As mentioned earlier, safeguards can be used in order to allow a softening of the pre-requisites and thus advance the progression towards budget support. .It is however, very important that the safeguards are designed to avoid the introduction of parallel systems of financial control and technical and/or managerial decision making. Otherwise the safeguards risk to undermine the very purpose of targeted budget support which is to direct all efforts at reinforcing national systems from within.
2.Roadmap
The SWAP roadmap is not a new programme separate from the reform process, but rather a process that can add to consolidation of the reforms and highlight aspects of the reform that are especially important for an operational SWAP. The roadmap below presents a number of ‘potholes’ – these are aspects of the reform process that need particular attention in order to make the SWAP operational. These are shown as red stars on the activity charts within the policy, planning and funding frameworks. An important part of the funding framework is that the links between MWI and the MoF are intensified and consolidated.
Table 6: Policy framework road map
Road Map for SWAP Establishment
Policy Framework
Milestones
Jan-June
2006
July-Dec
2006
Jan-June
2007
July-Dec
2007
Jan-June
2008
July-Dec
2008
Jan-June
2009
July-Dec
2009
Definition of the national sector framework
Kenya Joint Assistance Strategy
KJAS agreed
Irrigation Policy and Strategy Development
Process
Approved Policy and
Strategy
Stakeholder hearings and final approval of NWSS
Strategy
Approved NWSS Strategy
Stakeholder hearings and final approval of NWRM
Strategy
Approved NWRM Strategy
Inter-ministerial agreement on sanitation MWI/
MoH/ MoEST/ MoLG
Agreement signed
MWI Transition Plan - Head Office Reorganisation
MWI Head Office
Reorganised
MWI Transfer Plan - WSP establishment
WSP handing over
completed
Operationalising the WAB
WAB operational
Partnership principles
Partnership Principles discussed, amended and
agreed
Partnership Principles signed
by GOK and all WS DPs
On-going support programmes screened for
complience to the Partnership Principles
Screening completed
Partnership Principles revised as needed to
incorporate changes in the sector framework
Partnership Principles signed
by GOK and all WS DPs
HRM and HRD activities like clear functions and job-
descriptions for new units/ staff in MWI that do not
duplicate/ overlap with sector institutions
Irrigation sub-sector reform
process important for SWAP to
cover the entire water sector
Monitoring of WSP hand over and
capacity buillding process and
allocation of resources when
needed
Agreement on Partnership
Principles important for DP
harmonisation
Coordination with Health
Sector SWAP Process
Table 7: Planning framework roadmap
Road Map for SWAP Establishment
Planning Framework
Milestones
Jan-June
2006
July-Dec
2006
Jan-June
2007
July-Dec
2007
Jan-June
2008
July-Dec
2008
Jan-June
2009
July-Dec
2009
Sector Investment Plan –SIP (tool for prioritisation)
Development of Interim Sector Investment Plan
Interim SIP Completed
based on Business Plans
Sector Investment Plan Project
Version 1 SIP Completed
and updated annually
WSB, WSRB, WRMA and WSTF Business Plans
(5-year)
Business Plans developed
and used for annual planning
WRMA Catchment Management Strategies
CMS used as tool for
regional IWRM planning
Sector Information System – performance monitoring
Sector Information System Project
MPER based on systematic
data flow
Design and operationalisation of data collection
and Inf. Man. Systems in WSBs, WSRB, WRMA
and WSTF
Data Collection systems
operational
MWI overall Information System Operational
Information Management
System operational
Performance monitoring systems WSP =>WSB
=>WSRB =>MWI, WRMA =>MWI, WSTF => MWI
operational
Performance Monitoring
System operational
Coordination – intersectoral / with external partners
WSWG participation inclusive (Key Line ministries,
ALGAK, Nat. Council of NGOs)
WSWG meetings attended
by all key stakeholders
Operationalise Sub-Sector Strategic WGs ( WS,
Sanitation, WRM, Irrigation)
SWG active in revision of
MWI Strategic Plan
CAACs effective in regional water sector
coordination
CAACs active in
coordination of annual
planning at regional level
Capacity Building of MWI Unit Responsible for
Planning and M&E
Planning and M&E Unit
handling Sector
Planning/SWAP effectively
A common plan to contribute to is a pre-requisite for
SWAP - an iSIP needed to fill the time gap until SIP
can be ready
Funding needed for SIP - especially
establishment of baseline data
Coordination with MoPNDF/ Bureau of Statistics
needed for establishment of generally accepted
Performance Monitoring Framework
Capacity in MWI Planning, Policy M&E
important for functioning of SWAP
Sub-sector coordination providing input to
MWI strategic plan and implementation
strategies
Table 8 Funding framework road map
Road Map for SWAP Establishment
Financial Framework
Milestones
Jan-June
2006
July-Dec
2006
Jan-June
2007
July-Dec
2007
Jan-June
2008
July-Dec
2008
Jan-June
2009
July-Dec
2009
Channels of funding (ladder of options – project, basket, BS)
MWI Budget Structure revised to fit new
institutional set-up
Budget structure clearly identify
budget holders
MOF FMS Reforms and MWI Financial
Management and Procurement Improvements
FMS operational and producing
accurate reports
FMS in WSB, WSRB, WRMA and WSTF
operational
FMS operational and producing
accurate reports
Financial management (transparency, accountability, Vfm)
Capacity Building of MWI and sector institutions in
Financial Management and Procurement
Transparent and accountable
Fin. Man. and Procurement
Audit procedures agreed in general for the sector
Audits implemented timely and
increasingly less remarks
Annual Value for Money studies implemented in
general for the water sector
Good quality and timely VFM
studies and VFM improving
Resource mobilisation (using SWAP to increase funding)
Increasing funding to Water Sector to reach MDGs
Funding level according to SIP
Rational budget structure important for transparent
and accountable financial monitoring - possibly too
late to adjust for next FY
Improvement in MWI FMS and fund release a
pre-requisite for DP budget support and
improved sector performance
Implementation of new FMS should be evaluated to
ensure fulfilment of DP requirements
Staff trained in anti-coruption and
transparency to improve administration and
raise DP confidence
3.Action plan
A general plan for the activities in the sector that will support the development of a SWAP over the next six months is shown below in relation to the Policy Framework, the Planning Framework, the Financial Framework and some general activities in support of SWAP.
SWAP Action Plan - Policy Framework
Responsibility
Apr-06
May-06
Jun-06
Jul-06
Aug-06
Sep-06
Oct-06
Nov-06
Dec-06
Definition of the national sector framework
Programme for reforms in the Irrigation sub-sector
PS MWI
Coordination with MOH on the development of the
Health Sector and the Water Sector SWAPs
WSWG
HRM and HRD activities in the new MWI head
office structures
MWI
Close monitoring of progress in the WSP
development and capacity building process
WSRB
Partnership principles
Negotiations on acceptable formulation of the
Partnership Principles
WSWG/ WSTG
Screening of complience in existing support
programmes to the Partnership Principles
WSWG/ WSTG
SWAP Action Plan - Planning Framework
Responsibility
Apr-06
May-06
Jun-06
Jul-06
Aug-06
Sep-06
Oct-06
Nov-06
Dec-06
Sector Investment Plan –SIP (tool for prioritisation)
Development of Interim SIP based on the Business
Plans for the sector institutions
MWI
Agree on funding for the SIP Project
WSWG/ WSTG
Sector Information System – performance monitoring
Fast track the SIS Project and coordinate with
MoPND/ Bureau of Statistics
PS MWI/ SIS
Project
Management
Coordination – intersectoral / with external partners
Invite relevant key stakeholders to the WSWG
meetings
WSWG
Operationalise Sub-Sector Strategic WGs (Rural
WS and Sanitation, Urban WSS, WRM, Irrigation)
WSWG
Mobilise funding and implement Capacity building
for MWI Planning, M&E Unit
WSWG/ WSTG
SWAP Action Plan - Financial Framework
Responsibility
Apr-06
May-06
Jun-06
Jul-06
Aug-06
Sep-06
Oct-06
Nov-06
Dec-06
Channels of funding (ladder of options – project, basket, BS)
MWI Budget Structure revised to fit new
institutional set-up
PS MWI/ Chief
Accountant
Prioritise MWI Financial Management and
Procurement Improvements
PS MWI
Prioritise FMS in WSB, WSRB, WRMA and WSTF
KWSP/ CEOs
Financial management (transparency, accountability, Vfm)
Ensure adequate funding and implement FMS
Capacity Building of MWI and sector institutions
WSTG/ WSWG
Increase the scope of Audits done under KWSP/
WSRP to cover the sector more generally
WSTG/ WSWG
Design concurrent Value for Money studies for the
different sub-sectors
WSTG/ WSWG
Resource mobilisation (using SWAP to increase funding)
Prepare General Information on the water sector
SWAP and consolidation of the reforms
MWI
SWAP Action Plan - General activities
Responsibility
Apr-06
May-06
Jun-06
Jul-06
Aug-06
Sep-06
Oct-06
Nov-06
Dec-06
Discuss SWAP Final Report and decide on follow-
up on recommendation and proposed action plan
WSWG/ SWAP
Committee
Recruit SWAP Support Consultant and implement
support programme (TOR Annex K)
SWAP Committee/
WSTG
Follow-up on the progress on the pre-requisites and
milestones
WSWG/ SWAP
Committee
Screening of ongoing programmes in complience
with Partnership Principles
WSTG/ Consultant
Revise or amend existing programmes in line with
outcome of screening
WSTG
Planning and implementation of joint Annual
Review covering the entire water sector
WSWG/ KWSP
Launch of Water Sector SWAP
SWAP Committee
The following specific activities are recommended to be carried out to ensure that the pre-requisites for launching a Water Sector SWAP towards the end of 2006 are achieved:
Action
Responsibility
Timeframe
1. The WSWG and the SWAP Committee will use the draft final SWAP Report to discuss in detail the action plan and the road map and assign in detail the responsibilities for implementation. The Consultant will facilitate a short workshop with WSWG members for assessment of the action plan.
WSWG
April 2006
2. A draft TOR for support to the SWAP process in Annex K should be finalised and the SWAP Committee procure a consultant to undertake the support tasks
SWAP Committee
April 2006
3. The SWAP framework and road map contain prerequisites for moving towards a SWAP and the SWAP Committee should monitor the fulfilment of these and report to the WSWG on a regular basis.
SWAP Committee
Monthly
4. The reforms in irrigation and land reclamation are important to develop a consistent sector reform framework – a programme for designing and implementing these and identification of funding is important steps to move towards a SWAP.
PS MWI
Ongoing
5. Adopt and operationalise the National Environmental, Sanitation and Hygiene Policy
MoH
September 2006
6. Discussions will have to take place in the WSTG and the WSWG on the draft PPs and these amended to form a realistic compromise between the ideal and the possible in the present context.
WSWG
WSTG
May – June 2006
7. The ongoing programmes should be screened to identify how and where these do not comply with the PPs – this can guide the partners in the design of new programmes and amendment of ongoing programmes
WSWG/
Consultant for independent screening
July – August
8. Elaboration of the sub sector and sector wide information systems
December 2006
9. The design of the interim SIP needs to be taken into account in the work that is ongoing in developing Business Plans in the sector institutions
SIP Project
July – September
10. Agreement on the structure/design of the SIP and identification of the funding for the SIP Project must be done soonest to avoid further delays.
WSWG
April 2006
11. The sub-sector working groups should be constituted in July to assist MWI in the annual revision of the strategic plan
WSWG
June 2006
12. The MWI head office reorganisation is highest priority for improving the overall sector performance – capacity building of the Planning Policy and M&E unit as anchor for the SWAP is important to operationalise the SWAP
PS MWI
July 2006
13. The FMS activities must include priority given by MWI PS and the CEOs to financial management, independent evaluation of the new FMS in the institutions and training in transparency/ anti-corruption to key sector stakeholders. The key for implementing the SWAP and mowing towards budget support is that confidence building is needed towards the DPs in the adequacy of the sector financial management systems.
PS MWI
CEOs
Consultants for FMS Review and training
May – August 2006
14. Audits for different DP activities should be coordinated and to the degree possible combined in a common audit set-up
15. Value for money studies should be carried out to contribute to the Joint Annual Water Sector Review and the Public Expenditure Review – initially the VFM could target specific sub-sectors e.g. the RWSS/ WSTF to gain experience – in later years combined VFM studies can be carried out for the different projects and programmes.
MWI Director Water
VFM Consultants
July 2006
16. The joint KWSP/WSPR reviews should be conducted just before the broader Joint Annual Water Sector Review that should include all main sector stakeholders – this should be done for the first time in October – November 2006 to lead up to the launching of the SWAP
PS MWI/ KWSP
August – October 2006
17. The sector should take advantage of the launching of the SWAP to communicate the water sector programmes and achievements to the wider public – this can potentially contribute to better coordination of sector activities and increased attention to the sector programme from politicians.
PS/ Unit responsible for communication in MWI
August – October 2006
18. The launching of the SWAP on a stakeholder workshop towards the end of 2006 to create awareness about the aspirations in the sector – not that the SWAP will be effective from that date.
PS MWI
October – November 2006
4.Methodology and process for the SWAP Study
The development of the SWAP framework, roadmap and action plan has been led by the SWAP committee established by the MWI and through active involvement of other structures has encompassed a broad partnership of sector actors. The committee was supported by a team of Kenyan and international consultants who undertook more than 100 interviews and constructed an annotated bibliography of some 200 relevant reports, studies and strategies developed in the Kenya water sector, other sectors such as health and education as well as relevant international experience on establishing SWAPs. This work was complimented by the development of case studies for the water sector SWAPs in Uganda, Tanzania and Zambia.
Continuous reporting such as an inception report, an interim report and frequent meetings with the SWAP committee, senior staff of MWI and others in the sector ensured that Kenyan leadership was retained throughout the process. A half day stakeholder workshop with more than 40 participants was held on 28th March to discuss the issues raised and comment on the presentation by MWI of an outline framework and roadmap and the presentation by Ministry of Health (MOH) of the related SWAP activities in the health sector as well as a presentation by the Ministry of Finance (MOF) of the linkage between the water SWAP and the Medium Term Expenditure Framework (MTEF) budget process. This workshop endorsed the overall framework and ensured that a number of valuable additions and corrections were made to the framework and roadmap and included in this report.
The main report provides:
· A full list of abbreviations
· A glossary of definitions of key terminology
· The context of the study (chapter 1)
· An assessment of the demand for a SWAP in Kenya (chapter 2)
· A detailed analysis of the requirements for a SWAP (chapter 3)
· Presentation of the experiences of SWAP in Kenya and elsewhere (chapter 4)
· A detailed risk analysis for establishing a SWAP in the water sector (chapter 5)
· The detailed SWAP framework (chapter 6)
· The detailed roadmap (chapter 7)
· The TOR for the study (annex A)
· The stakeholder workshop proceedings (Annex B)
· Summary of findings from interviews (Annex C)
· List of stakeholders consulted (Annex D)
· Annotated bibliography of the water sector in Kenya (Annex E)
· Detailed information on other SWAPs in Kenya and elsewhere (Annex F)
· Current donor programmes in the water sector in Kenya (Annex G)
· Medium Term Expenditure framework calendar in Kenya (Annex H)
· Draft Partnership Principles (Annex I)
· Outline for the first Annual Sector Review (Annex J)
· Draft TOR for support for the launching of the SWAP (Annex K)
Table of Content
iExecutive summary
ixTable of Content
xList of Abbreviations
xiiTerminology
11.Introduction
32. Demand Assessment
32.1 The Present Situation and Institutional Set-up
122.2Sector Coordination
152.3Harmonisation and Alignment
182.4 Major current stakeholders
272.5 Advantages and potential for a SWAP in the Kenyan WSS
302.6 Essential structural, institutional and procedural prerequisites for a SWAP
312.7 SWAP Contribution to Reaching the MDGs
333. Requirements for a Water Sector SWAP
333.1 SWAP Requirements
343.2Components of a SWAP
364. Experiences in establishment of SWAPs
364.1 SWAPs Experiences in other sectors in Kenya
434.2 Water Sector SWAP Experiences in Neighbouring Countries
525.Risk Analysis
556. SWAP Framework
556.1SWAP principles
556.2Framework
586.3Pre-requisites and milestones
586.3.1Rationale and measurement of pre-requisites prior to launch of the SWAP
606.3.2Rationale and measurement of the SWAP benchmarks after launch of the SWAP
606.4Funding Modality Pre-requisites
647. Roadmap and Action Plan
647.1Roadmap for Policy Framework
667.2Roadmap for Planning Framework
687.3Roadmap for Financial Framework
697.4Action Plan
1Annex ATerms of Reference
7Annex BWorkshop Proceedings
28Annex CDraft Summary Findings Matrixes
48Annex DInitial List of Stakeholders for consultations
56Annex EDocument Review
76Annex FLessons Learned in other SWAPs
106Annex GList of Current Donor Supported Programmes
112Annex HMTEF Calendar
114Annex IDraft Partnership Principles
121Annex JDraft Outline of Annual Sector Review
127Annex KDraft TOR for Support to SWAP Process
List of Abbreviations
ADA
Austrian Development Agency
AFD
Agence Française de Développement
AfDB
African Development Bank
ALGAK
Association of Local Government Authorities of Kenya
AMREF
African Medical Relief Foundation
ASAL
Arid and semi arid lands
BADEA
Arab Development bank
BTC
Belgian Technical Cooperation
CAAC
Catchment Area Advisory Committees
CBO
Community Based Organisations
CEO
Chief Executive Officer
CIFA
Country Integrated Fiduciary Assessment
Danida
Danish International Development Assistance
DCG
Development Counsellors Group
DP
Development Partner (Cooperation Partner, Donor, Financier)
DFID
Department for International Development – United Kingdom
ERS
Economic Recovery Strategy
EU
European Union
FMA
Financial Management Agent
FMS
Financial Management System
FY
Financial Year
GJLOS
Governance, Justice, Law and Order Sector
GoK
Government of Kenya
GTZ
German Technical Cooperation
HAC
Harmonisation, Alignment and Coordination Group
HIP
Harmonization in Practice (in Zambia)
HIV/AIDS
Human Immune Deficiency Virus / Acquired Immune Deficiency Syndrome
HRD
Human Resource Development
HRM
Human Resource Management
IDD
Irrigation and Drainage Department (in MWI)
IFAD
International Fund for Agricultural Development
IPAR
Institute for Policy Analysis and Research
IP-ERS
Investment Program for the Economic Recovery Strategy for Wealth and Employment Creation
IRC
International Water and Sanitation Centre
IWRM
Integrated Water Resources Management
IWUA
Irrigation Water User Associations
JFA
Joint Financing Agreement
JICA
Japan International Cooperation Agency
JICC
Joint Inter-agency Coordinating Committee (in the Health Sector)
JPR
Joint Programme Review
JTR
Joint Technical Review
KEPSA
Kenya Private Sector Alliance
KESSP
Kenya Education Sector Support Programme
KEWI
Kenya Water Institute
KFW
German Financial Cooperation
KIPPRA
Research Institutions such as Kenya Institute for Public Policy Research and Analysis
KJAS
Kenya Joint Assistance Strategy
KWSP
Kenya Water and Sanitation Programme
LGA
Local Government Authority
M&E
Monitoring and Evaluation
MDGs
Millennium Development Goals
MoA
Ministry of Agriculture
MoE
Ministry of Energy
MoEARC
Ministry of East African and Regional Cooperation
MoENR
Ministry of Environment and Natural Resources
MoEST
Ministry of Education, Science and Technology
MoF
Ministry of Finance
MoH
Ministry of Health
MoLFD
Ministry of Livestock and Fisheries Development
MoLG
Ministry of Local Government
MoPND
Ministry of Planning and National Development
MoRDA
Ministry of Regional Development Authorities
MoTI
Ministry of Trade and Industry
MPER
Ministerial Public Expenditure Review
MTEF
Medium Term Expenditure Framework
MWI
Ministry of Water and Irrigation
NCCK
National Council of Churches
NCNGO
National Council of NGOs
NEMA
National Environmental Management Agency
NESC
National Economic and Social Council
NETWAS
Network for Water & Sanitation International
NGO
Non-Governmental Organisation
NHSSP
National Health Sector Strategic Plan
NIB
National Irrigation Board
NSF
National Sector Framework
NWCPC
National Water Conservation and Pipeline Corporation
O&M
Operation and Maintenance
OP
Office of the President
PEMAAP
Public Expenditure Management Assessment and Action Plan
PER
Public Expenditure Review
PRS
Poverty Reduction Strategy
PS
Permanent Secretary
RDA
Regional Development Authority
RWSS
Rural water supply and sanitation
SAGA
Semi-Autonomous Government Agency
Sida
Swedish International Development Assistance
SIP
Sector investment plan
SIS
Sector Information System
SWAP
Sector-Wide Approach to Planning
TBS
Targeted Budget Support
TOR
Terms of Reference
UN-HABITAT
United Nations Centre for Human Settlements
UNICEF
United Nations Children’s Fund
UWSS
Urban Water Supply and Sanitation
W&S
Water and Sanitation
WAB
Water Appeal Board
WB
World Bank
WRM
Water Resources management
WRMA
Water Resources Management Authority
WRUA
Water Resource User Associations
WSB
Water Service Board
WSPCC
Water and Sanitation Programme Coordination Committee
WSP
Water Service Providers
WSP-AF
Water and Sanitation Programme – Africa
WSPPFC
Water and Sanitation Programme Procurement and Finance Sub-Committee
WSRB
Water Services Regulatory Board
WSRP
Water Sector Reform Programme
WSRS
Water Sector Reform Secretariat
WSS
Water Supply and Sanitation
WSTF
Water Services Trust Fund
WSTG
Water Sector Technical Group
WSWG
Water Sector Working Group
Terminology
Alignment: actions between donors and governments that aim to increase national ownership of development processes. Alignment stands for donors providing assistance that accords with and supports partner government national and sector development strategies and relies on partner government systems and procedures – e.g. national public financial management systems, monitoring and evaluation systems and procurement policies – to manage the aid implementation process.
Harmonisation: increased coordination between, and the streamlining of, aid agencies such that transaction costs are reduced for partner governments. This includes sharing of information, working towards the simplification of procedures, reducing the number of donor missions and creating common arrangements for designing, managing and implementing aid.
On-budget: that project funds appear in the sector budget at the ministry but are not channelled through the government system.
Ownership: actions taken at the national/ sector level by the government – legitimised by parliamentarians and citizens – that assists progress towards development and poverty reduction. In order for ownership to result in enhanced aid effectiveness the necessary institutional reforms and capacity building must be successfully completed.
SWAP - Sector Wide Approach to Planning: pooling of resources to support a single sector policy and expenditure programme, under Government leadership, adopting common approaches across the sector and progressing towards relying on Government procedures to disburse and account for funds.
Project funding modality: Implementation administered outside the national institutions with its own financial management and procurement modalities normally prescribed by the financier.
Basket Funding: Two or more Development Partners agree to implement programmes with harmonised modalities for administration and financial management often aligned to but not integrated into the government procedures.
Targeted Budget Support: Funding earmarked for specific activities or institutions through the Treasury financial management system. Normally the funding for targeted budget support would be administered by treasury as part of the normal government financial management system. A modified form of administering the Targeted Budget Support would be to initially channel funds trough a Special Account in Ministry of Finance to the implementing agencies e.g. Water Service Boards to allow for easy tracing of the flow of funds.
Budget Support: General budget support is provided as financial input to the government’s budget without earmarking the support to specific activities. The administration of the funding relies completely on the government’s financial management and procurement systems.
1.Introduction
This Draft Final Report for the Study for the Establishment of a Sector-Wide Approach to Planning (SWAP) in the Water and Sanitation Sector in Kenya presents the Demand assessment, the SWAP requirements, the SWAP experiences from other sectors in Kenya where SWAPs have been introduced and from the water sectors in Tanzania, Zambia and Uganda. The report also describes the framework, structures and procedures that are need for a SWAP in the water sector in Kenya and the roadmap and action plan for the establishment of the SWAP.
The results presented in this report are based on literature review and interview with close to 100 stakeholders in the water sector in Kenya as well as study of documents and interview with stakeholders in the Education Sector, Health Sector and the Justice Sector in Kenya and the water sectors in Tanzania, Zambia and Uganda. The background to the study and the methodology and work plan for the assignment are described in the Terms of Reference (TOR) (Annex A) and in the Inception Report, dated February 2006.
The objectives of the present study assisting the Ministry of Water and Irrigation (MWI) in the development of a SWAP in the Kenyan Water and Sanitation (W&S) Sector are to:
(i) Avail all information and documents necessary for the preparation and establishment of a SWAP;
(ii) Gather relevant experience from SWAP processes in other sectors in Kenya and in the W&S sectors in the East African region and assess and validate these for the benefit of a Kenyan W&S SWAP;
(iii) Outline and design the necessary structural and procedural steps for the sector including all relevant stakeholders for the establishment of a SWAP;
(iv) Prepare a detailed road map for the preparation, establishment and consolidation of a Kenyan W&S SWAP.
Chapter 2 of this Report contains the findings related to Demand Assessment (Task 1); Chapter 3 presents the requirements for a SWAP (Task 2) and Chapter 4 presents the experiences with establishment of SWAPs in three sectors in Kenya and in the water sectors in three neighbouring countries (Task 3).
Chapter 5 presents a risk analysis of the process of establishing a SWAP, Chapter 6 describes the structures and procedures that are proposed to operationalise the water sector SWAP and Chapter 7 describes the road map and action plan for the establishment of the SWAP.
The TOR for the study is attached as Annex A. Annex B contains the proceedings from the stakeholder workshop on the 28th of March 2006 and Annex C contains a summary of the findings in a matrix format. Annex D contains the current list of stakeholders that have been consulted during the study. The documents that have been reviewed as part of the study are listed in Annex E together with brief synopsis describing the content and relevance of the document in relation to the SWAP. All these documents are available on a Compact Disk distributed to the stakeholders on the 28th March Workshop. Annex F contains the detailed information on the lessons learned from SWAPs in the Governance, Justice, Law and Order Sector (GJLOS), the Health Sector and the Education Sector in Kenya and the water sectors in Zambia, Tanzania and Uganda.
A list of the current donor supported programmes in the water sector is enclosed as Annex G. Annex H contains detailed information on the current annual calendar used by Ministry of Finance (MoF) in the preparation of budgets according to the 3-year Medium Term Expenditure Framework (MTEF).
A first draft of Partnership Principles based on the format used in the Education Sector is enclosed in Annex I. Annex J presents a draft outline for planning of the annual sector review and finally Annex K described a draft TOR that can be used by the SWAP Steering Committee to engage Consultants to support the process until the planned launch of the SWAP in October – November 2006.
2. Demand Assessment
2.1 The Present Situation and Institutional Set-up
The overall resource allocation and financial planning in the W&S sector in Kenya takes place through the budgeting process steered by the MoF. In the planning and budgeting set-up, the W&S sector is regarded as a sub-sector of the ‘Physical Infrastructure Sector’. The achievements of the W&S sub-sector as well as the plans for the next 3 years are described in an annual ‘Physical Infrastructure Sector MTEF Report’, based on the Ministerial Public Expenditure Review (MPER) Report, prepared by MWI in November – December each year. The current report dated February 2006 covers the period 2006/07 to 2008/09. The report provides an overview over the Government of Kenya (GoK) and on-budget donor funding to the sector.
The Ministry of Planning and National Development (MoPND) together with the MoF provides guidance to the planning and budgeting process and sets the ceilings for sector spending. The ceilings cover the GoK budgets including the on-budget donor support.
The institutional set-up in the water sector is illustrated on Figure 2-A. This diagram has been used during the reform process to describe the institutional responsibilities – irrigation is not included as this sub-sector was not part of the water sector reforms.
Figure 2-A: Institutional Set-up in the Water Sector
Ministry of Water and Irrigation (MWI)
In the new institutional set-up the MWI is responsible for development of legislation, policy formulation, sector coordination and guidance, and monitoring and evaluation. The process of operationalising the reforms is led by the MWI and in particular by the Water Sector Reform Secretariat (WSRS) within the ministry. The MWI has 3 Directorates: Water (overseeing water resources management and water service provision), Irrigation (Irrigation and Drainage Department (IDD) developing and implementing smallholder irrigation and National Irrigation Board (NIB) for large schemes) and Land Reclamation (land reclamation, water and irrigation activities especially in the Arid and Semi-arid Lands (ASAL) Areas).
The MWI is presently undergoing a transformation process to implement the reforms and revise the organisational set-up and the staffing levels to correspond to the new institutional set-up in the water sector. The transformation includes changes to staffing of MWI and a Human Resource Management Strategy and plan for Capacity Building has been prepared by the ministry. The MWI organisational restructuring process is lead by an inter-ministerial team headed by the Permanent Secretary Public Sector Reform and is expected to be completed before the end of June 2006.
Water Appeal Board
The Water Appeal Board (WAB) will arbitrate in water related disputes and conflicts. The Chairman was appointed in early 2005, however the board is not yet operational as decision on membership has been delayed and is only now ready for submission to Attorney General for approval.
Water Resources Management
The organisational structures related to water resources management and the roles and responsibilities are:
Figure 2-B Map of WRMA Catchment areas
Water Resources Management Authority (WRMA)
· Management, protection and conservation of water resources;
· Allocation, apportionment, assessment and monitoring of water resources;
· Issuance of water permits;
· Water rights and enforcement of permit conditions;
· Catchment and water quality management;
· Coordination of the Integrated Water Resources Management (IWRM) Plan.
Catchments Area Advisory Committees (CAACs) in each of 6 river basins:
· Advising WRMA on water resources issues at catchment level.
Water Resource Users Associations (WRUAs) at local level:
· Involvement in decision making process to identify and register water user;
· Collaboration in water allocation and catchments management;
· Assisting in water monitoring and information gathering;
· Conflict resolution and co-operative management of water resources.
The national office for WRMA was established during the 2004/05 Financial Year (FY). All 6 regional offices have been established this FY with office space, furniture, transport, e-mail etc. with staff seconded from MWI. The CAACs were gazetted in September 2005, have all been inaugurated and have had 1-2 meetings and made tours of the catchment areas. There are some practical issues to be resolved to clarify their role as an advisory body vis-à-vis the role of the WRMA regional and sub-regional offices. 6 Sub-regional offices have been established, each covering sub-catchments, typically 3 – 4 districts. Approximately 10 more are in various stages of establishment and by the end of the year there will be 15 - 20 operational. The final target according to the operational plan is 25 sub-regional offices. A number of WRUAs are active and perform the water resource management duties at the lowest level.
The main sources of funding for water resources management are the GoK recurrent and capital budgets (Kshs 500 – 600 million for the 2005/06 FY) and the contribution from the Kenya Water and Sanitation Programme (KWSP) for water resources management (Kshs 272 million for the 2005/06 FY). In addition World Bank (WB) funded Water Resources Management (WRM) activities as part of a Natural Resource Management project are in the last stages of formulation with appraisal planned for April 2006. The project will be implemented under the Presidents Office, jointly by the WRMA and the Ministry of Environment and Natural Resources (MoENR). The project will focus on WRM in western Kenya and in the upper Tana Catchments and include funding for implementation of dams and water harvesting structures.
Water and Sanitation Service Provision
The organisational structures related to provision of water and sanitation services and their roles and responsibilities are:
Water Service Board
Districts
Km2
Population (1999)
Athi WSB
6
40,130
5,617,000
Tana WSB
13
52,777
5,032,000
Coast WSB
7
82,816
2,487,000
Rift Valley WSB
8
113,771
2,999,000
Lake Victoria North WSB
11
16,977
5,135,000
Lake Victoria South WSB
16
20,340
5,730,000
Ewaso Nyiro WSB
9
244,864
1,703,000
Total
70
571,675
28,703,000
Water Services Regulatory Board (WSRB):
· Regulation and monitoring of Water Services Boards;
· Issuance of licenses to Water Services Boards;
· Setting standards for provision of water services;
· Developing guidelines for water tariffs.
Figure 2-C Map of WSB Areas
WSTF Funds Received and Expenditures
-
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
160,000,000
GOKSidaDanida
Kshs
Funding
Expenditures
Water Services Boards (WSBs):
· Responsible for efficient and economical provision of water services;
·
Irrigation Area
0
20,000
40,000
60,000
80,000
100,000
120,000
Developed
Area 1985
Developed
Area 1998
Developed
Area 2003
Under
Production
2003
Ha
Private Schemes
National Schemes
Smallholder Schemes
Developing water facilities;
· Applying regulations on water services and tariffs;
·
Does the SWAP Framework adequately address the Priority Issue
Opportunities and
Challenges for SWAP
Water
Public
Sector
Other
Public
Sector
Develop
ment
Partners
NGO
Private
Sector
Water
Public
Sector
Other
Public
Sector
Develop
ment
Partners
NGO
Private
Sector
Highly
Likely
Highly Un-
likelyTotal
1 Complements reforms1231440100
33134
2 Better coordination113951050
28634
3 Reduce transaction costs93523092
191433
4 Mobilise more resources123940056
281139
5 Improve FMS102832161
231033
6 Decentralise planning834440100
191433
7 Simplify reforms172341140
26632
8 NGO involvement103643080
231134
9 Government capacity921233121
26733
10 Include projects1014141103
161834
Total Votes
108257434215591324198339
SummaryHighly LikelyHighly Un-likely
Procuring and leasing water and sewerage facilities;
· Contracting Water Service Providers (WSPs).
Water Service Providers (WSPs):
·
Estimated General WS
Funding
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2005/06
2006/07
2007/08
Mill Kshs
KWSP
DED
GTZ
GOK
Estimated WRM
Funding
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2005/06
2006/07
2007/08
WB
KWSP
GOK
Estimated WSS Funding
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2005/06
2006/07
2007/08
UWSS WB
UWSS UN-
HABITAT
UWSS
KFW
UWSS
AFD
UWSS
ADA
RWSS
UNICEF
RWSS
KWSP
RWSS
JICA
RWSS
ADA
WSS GOK
Provision of water and sewerage services.
MWI Budget
(GOK + on-budget donor funding)
0
2,000
4,000
6,000
8,000
10,000
12,000
2005/062006/072007/08
Mill Kshs
KEWI
IRR
NWCPC
WSS
WRM
WS
Total MWI Budget 2005/06
(
Proportions in Million Kshs)
GOK,
4,136
Donor
on-
budget,
3,028
All 7 WSBs are established and in different stages of operationalising their functions and fulfilling their mandate. The Athi WSB was established first and therefore further than the other WSBs in implementation of the transfer process and establishing WSPs for the water systems.
A transfer plan is in progress transferring the responsibility for management of the previously MWI operated water systems to WSPs and the ownership of assets to the WSBs. The transfer also include providing a framework for WSBs to make arrangements for water facilities owned by Local Government Authorities (LGAs) as well as facilities owned by Non-Governmental Organisations (NGOs), Community Based Organisations (CBOs) and community self-help groups. The transfer process is ongoing and the target for the WSBs to enter into WSP agreements for all the existing schemes is end of June 2006.
GOK Development Budget
Actual vs Budget
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
2001/02
2002/03
2003/04
Mill Kshs
actual
budget
GOK Recurrent Budget
Actual vs Budget
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
2001/02
2002/03
2003/04
Total Water Sector Funding
Communities/
Households
7%
Local
Authorities
Budget
17%
Off-budget
Donor funding/
NGOs
19%
Internal
generation by
WSPs
19%
GOK Budget
incl. on-budget
donors
38%
The new institutional set-up for W&S service provision implies that users of a rural scheme will form a trust that will be the WSP and employ the operational staff. GoK will continue to pay salaries for 3 years to the operators that have previously been employed by GoK to assist the WSPs to get established. From 1st of July the revenue will no longer be paid to treasury but remain with the WSP and training in financial management for the WSPs is ongoing. The assets of the GoK owned schemes will be transferred to the WSB who will lease them to the WSPs. Compilation of assets registers is presently ongoing. The community owned schemes will continue to be owned by the users who will operate as a WSP under their own arrangement.
Water Services Trust Fund (WSTF):
· Financing provision of water and sanitation to disadvantaged groups.
The WSTF is established and operational. The current funding that has been provided for the WSTF and the expenditures to February 2006 are shown on Figure 2-D. 47 projects have received funding from the WSTF.
The National Water Conservation and Pipeline Corporation (NWCPC)
The functions of the NWCPC are defined in the Water Act 2002.
Does SWAP Framework adequately address
the Priority Areas?
0
5
10
15
20
25
30
35
40
45
Complements reforms
1
Better coordination
2
Reduce transaction costs
3
Mobilise more resources
4
Improve FMS
5
Decentralise planning
6
Simplify reforms
7
NGO involvement
8
Government capacity
9
Include projects
10
Issue:
No of Votes
Highly Un-likely
Highly Likely
The NWCPC is not expected in the future to operate water systems, except in emergency situations as defined by the WSRB. The NWCPC will continue to develop and manage assets for provision of bulk water supply and other works as directed by the Minister. Presently the NWCPC is mostly constructing dams and pans for water harvesting and drilling of boreholes funded directly by the GoK development budget. From the 2006/07 FY the funding for NWCPC construction activities is expected to come from the development budgets for the respective WSBs. This will ensure that the structures undertaken by the NWCPC are included in the planning of the WSBs. Memorandum of Understanding between the NWCPC and the WSBs have been established to guide the coordination between the institutions.
According to NWCPC, the organisation has the ability to provide prompt action when required e.g. in the current case of drought by avoiding the sometimes tedious tendering procedures. Another reason for using NWCPC as an official GoK contractor is to control prices for construction of water facilities. All construction work by the WSBs should be coordinated with the NWCPC like dam construction, development of new and rehabilitation and expansion of the existing W&S facilities. NWCPC is only expected to undertake major engineering projects like dams and major water pipelines and flood control measures while small projects like boreholes should be done by the WSBs when they have the required capacity.
There seems to be different opinions on the role of NWCPC in the sector. In the new water sector institutions the view is that NWCPC should purely be a contractor and not involved in design and planning. However, NWCPC is of the opinion that it has capacity for planning and design in addition to construction and that this should be utilised. NWCPC might have useful capacity for meeting the requirements of the WSBs and WSPs in management and operations. These capacities should be made available to the WSBs and WSPs in an open, transparent and competitive process in order to ensure the WSPs and WSBs could fulfil their roles and responsibilities as early as possible with maximum competence and therefore make the entire reform more credible.
The NWCPC is not getting support from Development Partners (DPs) – possibly due to uncertainty concerning the role of NWCPC in the new sector framework. There is also a need to clarify the role in relation to multi-purpose facilities e.g. dams for hydropower between the Ministry of Energy which develops dams for hydropower, the MWI and the Regional Development Authorities (RDAs) under the Ministry of Regional Development Authorities (MoRDA).
Kenya Water Institute (KEWI)
KEWI trains existing government staff and new students however the majority are government employees and employees of the various WSBs. The curriculum is on the whole water cycle from source to supply in the water services and irrigation sector as well as water conservation. KEWI also carry out research as a recently developed department within the institute. The main courses and qualifications obtained are:
a) Higher Diploma in water engineering
b) Diploma in Water Engineering (Modular)
c) Certificate in Water Engineering (Modular)
d) Certificate in Water & Wastewater Laboratory Technology
e) Operators and Allied Personnel Courses
f) Short Courses
Currently KEWI has partnership with Arche (an NGO through French embassy and International Fund for Agricultural Development (IFAD)) and German Technical Cooperation (GTZ).
Irrigation and Drainage
The National Irrigation Board (NIB) was established in 1966 with a mandate to develop and manage 9 national irrigation settlement schemes in specified gazetted areas. NIB took over the management and operation of the Mwea, Hola and Perkerra schemes and later developed the Ahero, West Kano, Bunyala and Bura schemes and expanded the Mwea and Hola schemes. NIB budget comes from GoK/MWI (approx. Kshs 100 million) and from BADEA (approx Kshs 80 Million).
The Small Scale Irrigation Unit was created in the Ministry of Agriculture in 1977 to coordinate the development of small-scale irrigation schemes. The unit was upgraded and renamed the Irrigation and Drainage Branch in 1978, and is now the Irrigation and Drainage Department (IDD) in the MWI, with the main objective of promoting the development of smallholder (farmer-managed) irrigation and drainage schemes. Smallholder schemes are classified into two categories i) Schemes where the irrigation structures are operated and maintained by Water Undertakers e.g. NGOs and ii) Schemes where the Irrigation Water User Associations (IWUA) have full responsibility for water supply, distribution and the accompanying operation and maintenance (O&M) activities. There are 3000 smallholder schemes operated by IWUAs under the guidance and support from IDD. IDD gets finance from GoK and Donors (Japan International Cooperation Agency (JICA) and German Financial Cooperation (KFW)) for development of new irrigation projects. The workplan for this year include 7 projects in 5 districts. IDD has engineers in 61 districts that design new projects after application from the farmers and assist IWUAs in implementation and operation and maintenance (O&M).
Regional Development Authorities (RDAs) were formed from 1980, and given broad mandates for regional development that included irrigation. The RDAs started by developing institutional commercial farms and later also community based irrigation schemes. Examples of RDA schemes are Yala Swamp by Lake Basin Development Authority, Sigor by Kerio Valley Development Authority, Kibwezi and Tana Delta by Tana and Athi River Development Authority. RDAs must generate revenue from their investments so the schemes are not handed over to NIB.
Figure 2-E Irrigated Areas
Water Public Sector
Highly
Likely
84%
Highly
Un-likely
16%
Other Public Sector
Highly
Likely
83%
Highly
Un-likely
17%
Development Partners
Highly
Likely
56%
Highly
Un-likely
44%
NGO
Private Sector
Highly
Likely
72%
Highly
Un-likely
28%
The development of private commercial irrigation schemes started in the 1960s in sugarcane, coffee and pineapple estates and in the late 1980s for production of fruits, vegetables, cut flowers and other high- value crops mainly for export. Most private schemes are found around Naivasha, Athi River, Nanyuki, Nairobi and in several parts of Central Province.
The development of private, national and small holder schemes are shown in Figure 2-E
Opportunities and Challenges
for SWAP
Water
Public
Sector
Other
Public
Sector
Develop
ment
Partners
NGO
Private
Sector
1 Complements reforms
5
0
7
1
2 Better coordination
12
3
11
4
3 Reduce transaction costs
6
0
8
1
4 Mobilise more resources
9
2
3
2
5 Improve FMS
8
0
6
0
6 Decentralise planning
10
5
8
4
7 Simplify reforms
13
4
4
1
8 NGO involvement
1
1
4
5
9 Government capacity
1
5
9
2
10 Include projects
5
1
5
0
Total Votes
70
21
65
20
Priority
Problem areas in the Irrigation sub-sector have been identified as
· Absence of clear coordination among the many actors leading to poor planning and haphazard interventions.
· Development of expensive and unsustainable irrigation and drainage schemes;
· Conflicts among public sector actors e.g. between NIB and some RDAs in resource mobilisation and operational areas,
· Conflicts between IDD and some RDAs in approaches to smallholder scheme development;
· Lack of adequate coordination and regulation leading to conflicts among beneficiaries sharing irrigation water or river systems.
Some institutional confusion appears in the WRM and Irrigation sector. Clearance of roles and responsibilities also to the extent of termination of institutions is required. The existence of state-owned and private irrigation schemes as well as WRM programmes does not mean that each sub-sector requires its own institutional structure with overlapping functions and responsibilities.
The current involvement of many public sector actors leads to a thin spread of human and financial resources and has resulted in duplication of efforts and slow pace of development. In the effort to improve the draft policy it is proposed that government will:
· Create a regulatory body to set targets, standards and guidelines for irrigation and drainage research and development and another body to be responsible for irrigation and drainage development and research under the ministry responsible for irrigation and drainage;
· Continue being responsible for policy formulation and its implementation through the ministry responsible for irrigation and drainage; and
· Promote the formation of Water Users Associations in the irrigation and drainage schemes and empower them.
MTEF Activities
July
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
April
May
June
Water Sector Activities
Review and comment on Annual SP Update and MWI Strategic
Plan
WSWG
Prepare DP requirements/ input to Joint Annual Review
WSTG
Information/ discussion of the budget outlook paper, Plan for Joint
Annual Review and MPER Process
WSWG
Review and comment on the MPER
WSWG
Coordinate DP commitments to next FY budgets
WSTG
Plan for the Water Sector Stakeholder Workshop
WSWG
Prepare DP input to WSWG/ Consultative Group Meeting
WSTG
Prepare for water sector input to Consultative Group Meeting
WSWG
Define DP requirements for Technical Reviews
WSTG
Prepare for Technical Reviews
WSWG
The draft policy on irrigation and drainage from March 2004 has not been addressed by cabinet yet. The aim will be to harmonise the NIB act and develop a new act covering all irrigation activities, as the activities under the IDD are not covered by an act. There is a need to reassess the draft policy since it is not taking the water sector reforms into account as the IDD was in the Ministry of Agriculture (MoA) when the policy formulation started. The institutional set-up is not well aligned with the principles of the water sector reforms, e.g. separation of service provision from regulation. The process is ongoing and the IDD has budgeted for continuation of the policy and strategy development process in the 2006-07 FY.
MTEF Activities
July
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
April
May
June
Water Sector Activities
Revise and update ministerial strategic plans
Line ministries
Value for Money Studies
MWI
Input from WSBs, WRMA, NIB, MWI Divisions and other sector
institutions to the annual budget process
Submission of district input on Irrigation to ministry headquarters
Line ministries
Joint Annual Review contributing to the Ministerial Public
Expenditure Review
Finalise MPERs
Line ministries
Outline Commitment from DPs on contributions to next years
sector plan and budget
Submission of revised estimates
Line ministries
Water Sector Stakeholder Workshop as input to Sector Hearings
on Physical Infrastructure Sector
Hold Sector Hearings
Treasury/MOPND
Consultative Group Meeting
Treasury
Firm Commitment from DPs on the contributions to next years
sector plan and budget
Submission of itemised budget
Line ministries
Sub-sector Strategic Planning Working Group Meetings to provide
input to water sector strategic plan
CAAC review of Catchment Management Strategies and input to
water sector strategic plan
Technical Review contributing to water sector strategic plan and
SIP update
Annual up-date of SIP:
1. detailed annual plan for next FY,
2. outline medium term plan
3. adjustment in strategic inv. plan
Water Sector Funding
The current sources of funding for W&S service provision are:
· GoK capital and recurrent budgets
· DP funding on budget
· DP funding off budget
· Loan funding
· NGO funding
· Private investments
· User payment of tariffs and connection fees
The current levels of GoK and on-budget donor funding are illustrated in Figure 2-F based on the MWI MPER Report 2005 and approximate sub-division in sub-sectors/ institutions like NWCPC and KEWI. The proportion of GoK to on-budget donor funding is shown on Figure 2-G indicating that GoK provide approximately 60% of the budget.
The effectiveness of the GoK budgeting and financial management processes can be illustrated by actual expenditure versus budgets as shown in Figure 2-H. The development budget is generally only utilised 60% - 75% while the recurrent budget has been both over and under spent. The inefficiencies in financial management is according to MoF deficiencies in line ministries in submission of accurate returns and according to MWI delays is allocation of funding to line ministries e.g. funding made available in the last month of the FY.
Figure 2-H Expenditures vs Budgets
Information on the total funding to the water sector in Kenya is not readily available, especially the funding provided through NGO projects is not easily accessible. The map below in Figure 2-I illustrates the activities by different NGOs in the water sector, especially in relation to drought affected districts.
Figure 2-I Map indicating W&S activities of organisations in drought affected districts
The Water and Sanitation Programme – Africa (WSP-AF) undertook a study of sector finance and resource flows for water supply in Kenya in 2003/04 that provides valuable insight into the overall distribution of funding to the sector. Although the study did not include irrigation, the overall proportion of funding between various sources as illustrated in Figure 2-J can probably be used as a good indicator for the general funding distribution in the water sector. It indicates that the GoK and on-budget donor funding only represents 38% of the total funding in the W&S sector based on 2000/01 expenditures.
An interesting aspect in relation to the new institutional set-up in the sector is that local authority budgets in 200/01 contributed 17% of the total W&S sector budget – this part will in the future need to be replaced by improved revenue generation by WSPs to cover previous subsidies by LGAs for service provision.
Figure 2-K presents an attempt to show a picture of the GoK/donor funding to the W&S sector. The amounts are based on the MTEF paper for the GoK funding and the information that has been collected from sector stakeholders and the Project Matrix developed by the Water Sector Technical Group (WSTG). The figures are only indicative as annual expenditures for some of the donor funding have been based on the limited information available.
Figure 2-K Estimated Water Sector Funding
It appears from Figure 2-K that the WB, Agence Française de Développement (AFD) and KFW together with the GoK are the main funding agencies in the sector in terms of amount of funding. The KWSP with the funding from Swedish International Development Assistance (Sida) and Danish International Development Assistance (Danida) is also contributing substantially across the different sub-sectors with a programmatic approach that includes investments as well as institutional development.
2.2Sector Coordination
National Level Coordination
A number of regular coordination meetings takes place within the top management of the GoK some of which in relation to the water sector are:
· Monthly meetings of the Permanent Secretaries (PSs) chaired by the Head of the Civil Service;
· Kenya Food Security Committee with monthly meetings between PSs and senior staff of relevant ministries related to food security;
· Committee on Agriculture and Natural Resources with monthly meetings between PSs from ministries related to agriculture and natural resources;
· East Africa/ Lake Victoria Infrastructure Committee with quarterly meetings between PSs from countries bordering the Lake Victoria;
· Lake Victoria Environmental Management Programme meetings;
· Nile Basin Commission with regular bi-monthly meetings between countries in the Nile Basin;
· National Economic and Social Council (NESC).
Within the Physical Infrastructure Sector, coordination takes place in the Sector Working Group as part of the MTEF budgeting process. The Physical Infrastructure Sector does not include key line ministries linked to water such as MoA and MoLFD, MoEST and MoH and is therefore not very effective in the coordination between MWI and the water related ministries.
The overall coordination in the water sector between the GoK and DPs take place in the ‘Water Sector Working Group’ (WSWG) that has membership from the water sector institutions, other ministries with links to the water sector and the DPs active in the sector. The WSWG meetings are chaired by the PS of MWI and the group meets regularly on a bi-monthly basis.
Members of the Water Sector Working Group (WSWG)
MWI and Water Sector Institutions
Development Partners
MWI Principal Secretary (Chairman)
Agence Française de Développement (AFD)
MWI Director Water
German Financial Cooperation (KFW)
MWI Deputy Director
German Technical Cooperation (GTZ)
MWI Head of Water Sector Reform Secretariat
Swedish International Dev. Assistance (Sida)
CEO of WSRB
Danish International Dev. Assistance (Danida)
CEO of WSTF
World Bank (WB)
CEOs for the 7 WSBs
Water and Sanitation Programme - Africa (WSP-AF)
CEO of WRMA
United Nations Children’s Fund (UNICEF)
CEO of NWCPC
Netherlands Development Assistance
CEO of National Irrigation Board
Japan International Cooperation Agency (JICA)
Ministries related to the water sector
Department for International Development (DFID)
Ministry of Environment and Natural Resources
German Agro Action
Ministry of Livestock and Fisheries Development
Ministry of Health
Members of the Water and Sanitation Technical Group (WSTG)
Agence Française de Développement (AFD) Present Co-chair
German Financial Cooperation (KFW) Present Co-chair
German Technical Cooperation (GTZ)
French Embassy
Austrian Development Agency
Swedish International Dev. Assistance (Sida)
Danish International Dev. Assistance (Danida)
World Bank (WB)
Water and Sanitation Programme - Africa (WSP-AF)
United Nations Children’s Fund (UNICEF)
United Nations Centre for Human Settlements (UN-HABITAT)
Netherlands Development Assistance
Japan International Cooperation Agency (JICA)
Department for International Development – United Kingdom (DFID)
Coordination between the DPs also takes place through meetings in the Water and Sanitation Technical Group (WSTG) that is a forum of the DPs active in the water sector that meets every 2 months in between the WSWG meetings to discuss issues and share information on activities in the W&S sector. The WSTG and WSWG meetings are purposely alternating so that the frequency is regular and high. Coordination in the sanitation sub-sector between national and international stakeholders is not developed and needs to be improved.
The WSWG and WSTG are part of an overall coordination system in the foreign aid structure for Kenya consisting of the HAC-Group which assists the Development Counsellors Group (DCG). These are all working on the preparation and implementation of a Kenya Joint Assistance Strategy (KJAS) which should help focussing foreign and national aid to enhance implementation of the ERS. The water sector is represented in the coordination fora and the sector’s role can be enhanced through the establishment and consolidation of a SWAP.
Joint funding with GoK is provided to the water sector from Sida and Danida through the KWSP. Coordination of funding through GTZ is documented in Joint Financing Agreements (JFAs) and similar agreements between the KWSP and UNICEF for the funding to RWSS from the Netherlands Government are in the process of being established.
The JFAs are interesting for the establishment of the SWAP for the water sector as the purpose and aims are very much related to the SWAP process. The JFAs aim at:
· facilitating the implementation of reforms and development activities in the water sector by promoting harmonisation and enhanced coordination of internal and external resources.
· increasing openness and transparency by promoting a common format for information sharing, dialogue and consultation between sector institutions, other stakeholders and DPs and thereby contribute to the introduction of a SWAP and eventually MTEF-based budget support to the sector.
The consultative process agreed in the JFA includes annual Joint Programme Reviews (JPRs) to review programme progress and performance in the previous financial year in relation to long-term sector indicators and specific targets and outputs according to Annual Work Plan for the previous financial year. The JPRs also review the progress for the current financial year and the Forward Work Plan and budget and strategic issues for the forth-coming financial year. The JPRs provide an opportunity to assess and approve/ reject proposed modifications to the agreed programme and for discussing strategic sector issues with sector stakeholders.
Joint Technical Reviews (JTRs) are held 6 months after the JPR to review progress with regard to the agreed upon annual workplan for the current financial year, and follow up on the issues agreed upon at the JPR. The JTR will review the preparations of the forward workplan. Quarterly review meetings provide for consultations and adjustments regarding current matters between the JPRs and the JTRs.
The coordination arrangements include establishment of a ‘Water and Sanitation Programme Coordination Committee’ (WSPCC); and a ‘Water and Sanitation Programme Procurement and Finance Sub-Committee’ (WSPPFC). The mandate of the WSPCC includes assessment of reports and work plans/ budgets and recommendations for subsequent decisions by GoK and DPs. The WSPPFC shall monitor financial and progress reporting; foresee problem related to the financial control of expenditure and suggesting solutions; propose and supervise common reporting and auditing systems; monitor tracking and value for money studies; review and advise on procurement procedures. The WSPCC is intended to be a forum for coordination in general in the sector between the WSBs, WRMA and MWI and has so far been an effective tool for the coordination of the KWSP activities. The WSPPFC has not yet been effective mainly due to issues of appointing the membership.
Outside the KWSP activities, the coordination between MWI and DPs related to WSS service provision takes place through the WSWG.
Coordination between the stakeholders involved in irrigation and drainage activities is not well developed. At the government level overall coordination between the IDD and NIB takes place as the Director of Irrigation is a board member of NIB, however at the more practical level there is limited coordination in planning of infrastructure development as the two institutions implement their own projects and there is no forum for coordination between different DPs. The DPs tend to have their own priorities e.g. JICA will presently only fund projects in Central and Southern Kenya. The coordination with the NWCPC for planning of projects only takes place through the information that is shared through the budgeting process in MWI. There are also NGOs active in the irrigation sector but there is no information in IDD or coordination of the NGO activities with the IDD activities. IDD get information on NGO activities through field visits and newspapers.
When RDAs plan new schemes the IDD is invited through a inter-ministerial committee for appraisal of the scheme. Coordination is important at an earlier stage in the planning to utilise information and previous studies. It has happened that a RDA undertakes studies in the same area that has earlier been done by the NWCPC or the IDD and visa versa.
In the agricultural sector there is not yet a process of developing a SWAP, however, there are programmes which improve sector coordination such as the ‘Strategy for Re-fertilization of Agriculture’ between MoA and Ministry of Livestock and Fisheries Development (MoLFD), the ‘National Agriculture and Livestock Programme’ defining how the two ministries of Agriculture and Livestock can deliver services efficiently and the ‘Kenya Agricultural Productivity Programme’ aiming at enhancing agriculture productivity in the greater agricultural sector. These programmes do however not seem to include MWI as a main partner.
Coordination takes place between different ministries via the budgeting proces