tapping the private sector in wastewater and sanitation
TRANSCRIPT
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Engaging Private Sector for Green Growth in the Lake Victoria Basin (EPSGG)
Institutional Assessment Study
Synthesis Report
Tapping the Private Sector in Wastewater and Sanitation Management in Lake Victoria Basin: Assessment and Recommendations of Institutional
Arrangements
The World Bank May 2020
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Contents Abbreviations and Acronyms ................................................................................................................ 4
Acknowledgements ............................................................................................................................... 5
Executive Summary .............................................................................................................................. 6
1. Introduction ................................................................................................................................. 10
2. Rationale, Barriers, and Context of PSP in Wastewater and Sanitation Management .......... 13
2.1 Benefits of and Need for PSP................................................................................................... 13
2.2 Barriers and Requirements to Support PSP ........................................................................... 16
2.3 PSP in Wastewater and Sanitation Management in LVB ....................................................... 18
3. Situation Analysis of Institutional Assessment for PSP in Wastewater and Sanitation
Management in LVB ............................................................................................................................ 22
3.1 Regional Summary .................................................................................................................... 22
Policy Frameworks ....................................................................................................................... 22
Sector Regulations....................................................................................................................... 23
Regional Standards ..................................................................................................................... 23
Organizational Setup ................................................................................................................... 24
3.2 Country Summaries .................................................................................................................. 26
Burundi ......................................................................................................................................... 26
Kenya ............................................................................................................................................ 28
Rwanda ........................................................................................................................................ 30
Tanzania ....................................................................................................................................... 31
Uganda ......................................................................................................................................... 33
4. Gap Analysis and Areas for Improvement for Enabling PSP .................................................... 35
4.1 Weak Policy Frameworks ......................................................................................................... 35
4.2 Complicated Regulations and Standard Frameworks ............................................................ 36
4.3 Ineffective Organizational Setup ............................................................................................. 37
4.4 Inadequate Financing .............................................................................................................. 39
5. Recommendations ....................................................................................................................... 41
5.1 Improved Policy and Regulatory Frameworks ........................................................................ 41
5.2 Stronger Organization Setups .................................................................................................. 42
5.3 Enhanced Financing Capacity .................................................................................................. 43
5.4 Clearer Public-Private Partnerships (PPPs) ............................................................................. 45
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6. Concluding Remarks .................................................................................................................... 47
7. References ................................................................................................................................... 49
Annexes ............................................................................................................................................... 55
Annex 1. List of Supplementary Technical Background Reports ................................................. 55
Annex 2. LVB Institutional Roles and Responsibilities in the Wastewater and Sanitation Sector,
Extended .......................................................................................................................................... 56
Annex 3. Organizational Setups in the LVB Countries’ Wastewater and Sanitation sector ....... 62
Annex 4. In-depth Analysis of Policies and Regulatory Frameworks in the LVB ........................ 67
List of Boxes & Tables
Box 1: Definitions and Terminologies in the Report ........................................................................ 11
Box 2: Burundi’s Private Sector Challenges ...................................................................................... 21
Box 3: County Case Study of Kisumu ................................................................................................ 30
Box 4: PPP Policy Gaps in Kenya ....................................................................................................... 36
Box 5: Doing Business in Uganda ...................................................................................................... 38
Box 6: Kenya’s Creditworthy Assessment of Utilities ....................................................................... 45
Table 1: PPP Model Structures used in Wastewater Management ................................................. 15
Table 2: Specific Commercialization Efforts in the LVB ................................................................... 18
Table 3: Organizations for Private Sector Engagement in the LVB ................................................ 20
Table 4: Burundi’s Institutional Framework for Wastewater and Sanitation Sector...................... 27
Table 5: Kenya’s Institutional Framework for Wastewater and Sanitation Sector ........................ 29
Table 6: Rwanda’s Institutional Framework for Wastewater and Sanitation Sector ..................... 31
Table 7: Tanzania’s Institutional Framework for Wastewater and Sanitation Sector ................... 32
Table 8: Uganda’s Institutional Framework for Wastewater and Sanitation Sector ...................... 34
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Abbreviations and Acronyms
BOD Biochemical Oxygen Demand
CBO Community-based organization
COD Chemical Oxygen Demand
DGREA DG-Water Resources & Sanitation
EAC East Africa Community
EASC East African Standards Committee
EIA Environmental Impact Assessment
ENR Environment and Natural Resources
EPSGG Engaging the Private Sector for Green Growth in the Lake Victoria Basin Project
FS Fecal Sludge
GDP Gross Domestic Product
GRI Global Reporting Initiative
ISO International Organization for Standardization
KEBS Kenya Bureau of Standards procedures
KPI Key Performance Indicator
KSH Kenyan Shillings
LGAs Local Government Authorities
LVB Lake Victoria Basin
LVBC Lake Victoria Basin Commission
LVEMP Lake Victoria Environment Management Project
MSME Micro, small-to-medium-sized enterprise
NDF Nordic Development Fund
NDP National Development Plan
NEMA National Environment Management Authority
NEMC National Environmental Management Council
NGO Non-governmental organization
NSB National standard body
NRW Non-revenue water
NWSC National Water and Sewerage Corporation
ODF Open defecation free
PPIAF Public-Private Infrastructure Advisory Facility
PPP Public-Private-Partnership
PSP Private Sector Participation
RECP Resource Efficiency & Cleaner Production
SQMT Standardization, Quality Assurance, Metrology and Testing
USD United States Dollar
WASREB Water Services Regulatory Board
WSS Water and Sanitation Sub-sector
WSTF Water Sector Trust Fund
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Acknowledgements
This report is an output of an institutional assessment study in the World Bank project “Engaging
Private Sector for Green Growth in the Lake Victoria Basin Project (EPSGG-LVB)”. It was prepared
by a World Bank team led by Jian Xie (Sr. Environmental Specialist) and comprising Kimberly
Worsham (Consultant), Nicholas Zmijewski (Environmental Specialist), Simon Thuo (Consultant),
Kenneth Musabe (Consultant), and Svilena Bochukova (Consultant).
The team gratefully acknowledges David Auerbach, Alex Manyasi, Harriet Kimani, Ruthie
Rosenberg, Nicola Greene, and Emanuel Owako of Sanergy for their support to the Kenya study,
Pascaline Wanjiku Ndungu of the World Bank Nairobi Office for her review of the Kenya study
report, and Alexander Danilenko and Harriet Nattabi of the World Bank Kampala Office for their
support to the Ugandan study.
The EPSGG Project was funded by the Nordic Development Fund (NDF) and executed through
the World Bank. The project has benefited from the general guidance of Iain Shuker, Practice
Manager in Environment, Natural Resources and Blue Economy (ENB) Global Practice at the World
Bank, and Ali Said Matano, Executive Secretary of the Lake Victoria Basin Commission.
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Executive Summary
Lake Victoria Basin’s Regional Importance & Development Context
Lake Victoria and its watershed (known as the Lake Victoria Basin or LVB) is a transboundary
natural asset of global importance. As the world’s second-largest lake, Lake Victoria has a surface
area of about 68,800 km2 with an average depth of 40 meters. The LVB is shared among five
countries: Tanzania (44%), Kenya (22%), Uganda (16%), Rwanda (11%), and Burundi (7%).
Lake Victoria has significant commercial fishing, waterway transportation, hydropower
generation, and great potential for tourism activities, however LVB’s ecosystems have undergone
substantial environmental degradation over the last 40 years. Much of the pollution comes from
the Basin’s rapid urbanization and growth in population, many of whom do not have access to
sewered sanitation, and industrialization along the lake shore that discharges wastewater
effluents into Lake Victoria. Increases in the discharge of industrial and residential waste reaching
the Lake contributes to the challenges of eutrophication, widespread water hyacinth that impedes
transportation and fishery, and poor water quality which is now often a human health hazard.
These challenges have highlighted the importance of sanitation and wastewater management in
the LVB.
Need for Private Sector in Wastewater and Sanitation Management
While wastewater and sanitation management in the LVB are generally the responsibility of
government-led institutions, efficiency and cost allocations within the sector can be improved by
encouraging private enterprises to participate through investments and service management. The
private sector’s participation can be vital to government efforts in managing the Basin by (1)
increasing the amount of clean drinking water and safely-managed sanitation for Basin
communities; (2) increasing wastewater and sanitation management services through the
construction and production of facilities; and, (3) managing effluent discharge effectively and
improving the Basin’s overall water quality. However, the current specifics surrounding
institutional arrangements – whether institutional, legal or policy frameworks – are not adequate
for enabling private sector participation (PSP) and must be improved. To make this happen, it’s
necessary to first assess the institutional arrangements, and their gaps, in supporting PSP in the
LVB.
Objective & Methodology
The report’s overall objective is to review the LVB’s institutional arrangements, identify and
analyze any gaps, and propose recommendations for promoting PSP in wastewater and sanitation
management across the Basin such as through public-private partnerships (PPPs). The study’s
methodology included several different components: primary research on sanitation policies;
secondary research using reports on wastewater and sanitation management both globally and
within the region; and interviews with employees from sanitation-focused organizations in
different countries – particularly in Kenya and Uganda. The report synthesizes the analytical
findings and recommendations of the study’s institutional assessments on supporting PSP in
wastewater and sanitation management within the LVB.
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PSP Rationale and Barriers in Wastewater and Sanitation Management
PSP is a vital component to improving wastewater and sanitation management in the LVB.
Engaging the private sector can improve the management of effluent discharges from industrial
practices and recover the ecological integrity and overall health of Lake Victoria. The private
sector can be a key to increasing households’ ability to have their waste safely managed and
treated, as well as ensuring that drinking water quality is safely maintained. The main benefits of
involving private actors include: (1) improved access to commercial financing, (2) more cost-
effective solutions, (3) faster expansion of services, and (4) technical expertise and higher
flexibility in tailoring services to the specific needs of different communities. In many developing
countries, PSP in sanitation and wastewater management has been scarce because of the barriers
from institutional arrangements, lack of incentive mechanism to offset investment costs to
financial viability that private investors face which hinders their participation. Institutional
arrangements can have limited regulations, policies, unclear sector standards, and organizational
setups that do not clearly guide how businesses can approach work, making PSP difficult.
Additionally, a favorable investment climate –regarding budgeting, tariffs, and financing in
particular – requires a set of established rules and processes to allow reasonable confidence in
the sector. Utilities need to be creditworthy and generate sufficient revenue to repay commercial
loans and demonstrate reliability in public sector roles to support PSP in the wastewater and
sanitation sector and must also have constant and dedicated public funding.
Current PSP Situation in LVB’s Wastewater and Sanitation Management
The provision of WSS services in LVB countries has been gradually privatized while ownership is
retained by public institutions, starting with the big cities and municipalities. That said, there is
an increasing trend of small-scale independent provider who obtain licenses to supplement
services from the formal utilities. The private sector industries in these countries are in varying
levels of development - from Burundi's embryonic private sector to the well-developed industry
sector in Kenya - that contribute significantly to each country’s gross domestic product (GDP).
Within the LVB, two regional private sector organizations have engaged in PSP conversations;
each country has an additional two other national organizations that promote private sector
interests. Unfortunately, PSP in WSS in the region is underdeveloped and in need of attention. In
Kenya, of the 88 utilities only two are privately run; in Uganda, private sector involvement in
wastewater treatment is minimal, most is around fecal sludge collection and transport, which is
mostly in Kampala and has limited policies and regulations. On the other hand, privately-owned
industries in the LVB create additional challenges for regional WSS management, particularly
around managing wastewater with industrial effluent discharge, which has compromised Lake
Victoria’s water quality.
Regional Assessment of Policies and Regulations
The sector has numerous policies and regulations that provide a welcoming environment for
attracting private sector investment in the areas of waste management and sanitation treatment
infrastructure. Key legislation governing the sub-sector in all the Basin countries consists of
broader mandates of environmental law and specific WSS sub-sector legislation. All but Burundi
have explicit policies about guidelines and protocols for using PPPs to support PSP. The region’s
regulation policies and regulatory bodies indicate how they set and manage water and sanitation
tariff structures for consumers around water and sanitation services. The East African Community
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(EAC) introduced East African Standards (EAS) to have a harmonized approach for dealing with
common water resources, these were developed jointly by the national standard bodies (NSBs)
of each EAC Member State. Countries also have their own separate standards and parameters for
municipal effluent discharge and water quality. In addition to other national standards, other
voluntary international standards operate in the region outside of effluent discharge.
Regional Assessment of Organizational Setup
At the regional level, the EAC and its regional committees and institutions (e.g., LVBC and Lake
Victoria Fisheries Organization) facilitate cross-country coordination in managing transboundary
issues including the environmental management of Lake Victoria. For each LVB country,
institutional frameworks provided for ENR and sanitation in the WSS sector are shared among a
large group of different ministries and several government agencies, whose responsibilities
overlap. Most government agencies responsible for WSS in LVB countries are at the national level,
though a few countries also have roles decentralized to agencies or representatives at more local
levels of government, such as in districts and communes. Financing water and sanitation services
are usually the responsibility of the Ministry of Finance or the National Treasury in each country.
Provision of services is mostly the responsibilities of the district and local regions, with some
support and participation from national agencies.
Summary of Gaps in the Region’s Institutional Arrangements
The institutional arrangements in the region, as well as each LVB country, illustrated gaps on
which to expound. PSP in wastewater and sanitation management across the Basin would likely
improve if the responsible ministries and WSS agencies in the LVB countries clearly understood
which areas need improvement. The gaps exist across the region, though some countries have
more room for improvement than others for each one. The main gaps discussed in this report
include governments having (1) weak policy frameworks that should provide important direction
for the sector, (2) confusing and overlapping regulations and standards frameworks for the
private sector to follow, (3) unclear organizational setups for the private sector to navigate, and
(4) inadequate financing for improving and maintaining waste management.
Key Recommendations
To strengthen the institutional arrangements for promoting private sector participation in
wastewater and sanitation management, the study provides policy recommendations in the
following four areas:
Improved Policy and Regulatory Frameworks
Countries should improve policy and harmonize regulatory frameworks. LVB countries can
improve these frameworks in a way that more easily enables the private sector to participate in
the WSS sector and liaise with governments. Such improvements include:
• Harmonizing regional policies and regulatory frameworks;
• Simplifying and better coordinating PPP policies;
• Implementing consistent standards and regulations across the region; and,
• Introducing standards for onsite sanitation services.
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Stronger Organizational Setups
Countries need to implement stronger organizational setups within each country’s government.
By streamlining government roles and responsibilities and developing capacity development
opportunities, LVB countries can be better equipped to work with the private sector on wastewater
and sanitation management. Strengthening the organizational setup would require:
• Clarifying and implementing government roles across different levels;
• Increasing capacity at the local level for the public and private sectors; and,
• Creating central, dedicated regulatory bodies for WSS and strengthening their capacity for
enforcement.
Enhanced Financing Capacity
Government institutions need to enhance the sector’s financial capacity. Financing opportunities
in LVB countries exist in the provision of potable water, garbage and refuse disposal facilities,
and waste treatment facilities. Enhancing financial capacity in the LVB would include:
• Increasing the public budget allocations to sanitation and wastewater management;
• Providing clarity for what public funding is able to support;
• Implementing Project Development Facilitation Funds nationally and regionally;
• Requiring lead agencies in each country to design and lead bankable projects;
• Assessing creditworthiness of current WSS actors; and,
• Improving government tariff structures to increase private sector incentives.
Clearer Public-Private Partnerships (PPPs)
The LVB countries and region need to implement clearer PPPs through guidelines and
communication. Implementing PPP arrangements across the LVB would help facilitate more PPPs
in the provision of wastewater and sanitation management services. LVB countries should
consider making navigation of PPP as simple and clear as possible, while reducing the burden on
public servants. Better implementation of PPPs includes:
• Developing simple guidelines for PPP setup;
• Developing PPP risk mitigation mechanisms;
• Increasing PPP communication and building awareness of them; and,
• Clearly understanding the challenges of PPPs for the WSS sector and the government
requirements to successfully run a PPP.
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1. Introduction
Lake Victoria and its Basin are a transboundary natural asset of global importance. As the world’s
second-largest lake, Lake Victoria has a surface area of about 68,800 km2 with an average depth
of 40 meters. The Lake is located in the upstream part of the Nile River and its basin is shared
among five countries: Tanzania (44%), Kenya (22%), Uganda (16%), Rwanda (11%), and
Burundi (7%). The Lake Victoria Basin (LVB) and its tributaries are the main sources of drinking,
domestic, industrial, and irrigation water to rural and urban areas across country boundaries. The
Basin has an estimated total population of some 45 million people, and is facing rapid population
growth. While the majority of the Basin’s population lives in rural villages and small towns, several
major urban centers share Lake Victoria’s natural resources.
Lake Victoria has significant commercial fishing, waterway transportation, hydropower
generation, and great potential for tourism activities. Fish production is estimated at one million
metric tons per annum (LVFO, 2011), and income generated from fishing provides food security
and supports the livelihoods of more than three million people (World Bank, 2009). The Lake and
its upper reach water systems are also a vital source of hydropower energy, providing
approximately 70% of Uganda’s power while Rwanda and Burundi have significant hydropower
potential in the Basin’s upper catchments.
LVB’s ecosystems have undergone substantial environmental degradation over the last 40 years.
Much of the pollution comes from the Basin’s rapid population growth and urbanization and
industrialization along the lake shore without commensurate investment in sanitation service
provision. The region’s high levels of poverty result in many having poorly-managed sanitation
facilities, and while some of the urban areas on the Basin have constructed sewer systems, a
large majority of the population relies on onsite sanitation solutions. Industrial development has
also picked up speed, with an increased number of entities discharging untreated wastewater and
solid waste into the lake and catchments. Increases in the discharge of industrial and residential
waste reaching the Lake contributes to the challenges of eutrophication, widespread water
hyacinth, and poor water quality, and the Lake is now often a human health hazard. Addressing
these challenges requires sustained local and national commitment in all countries, jointly
undertaken and coordinated at the regional level; the LVB countries recognize this need through
the collaborative work by the East African Community (EAC) through its regional institution Lake
Victoria Basin Commission (LVBC), to address environmental degradation in the Lake (Kayombo
& Jorgensen, 2006; Lake Victoria Basin Commission, 2019).
While wastewater and sanitation management are generally the responsibility of government
agencies or government-led institutions in the LVB, the efficiency and cost allocations within the
sector can be improved by encouraging the participation by private enterprises through
investments and service management. The private sector can provide vital participation with
government efforts in managing the Basin, such as (1) increasing coverage of clean drinking
water and safely-managed sanitation for Basin communities; (2) increasing services available for
wastewater and sanitation management through construction and production of facilities; and,
(3) managing effluent discharge effectively and improving the Basin’s overall water quality. The
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LVB’s governments are interested in and committed to promoting private sector participation
(PSP) for wastewater and sanitation management. However, the current situation of institutional
arrangements – institutional, legal, and policy frameworks – are inadequate for enabling PSP and
require improvement.
The report’s overall objective is to review the LVB’s institutional arrangements, analyze the gaps,
and propose recommendations for promoting PSP in wastewater and sanitation management
across the Basin such as public-private partnerships (PPPs). The study focuses on wastewater
management and sanitation under the Water Supply and Sanitation (WSS) sub-sector and the
Environment and Natural Resources (ENR) sub-sector.
The study’s methodology included several different components. Firstly, the study leveraged
primary research on sanitation policies, as well as secondary research using reports on
wastewater and sanitation management globally and within the region. Then, interviews were
conducted with government officials and staff from sanitation-focused organizations in different
countries – particularly in Kenya and Uganda. Case studies were separately completed for Kenya
and Uganda, and a rapid regional overview was developed based on previous interviews and
research. The study finally analyzed all produced case materials to synthesize the regional
institutional arrangements through thematic analysis, comparing themes identified in country
frameworks and setups horizontally to recognize regional gaps and solutions.
Based on three background study reports done for the institutional assessment at the regional
level and for Kenya and Uganda, respectively, this report was to synthesize their analytical
findings and recommendations for supporting PSP in wastewater and sanitation management
within the LVB. The three background study reports are listed in Annex 1. The definitions and
terminologies adopted in this report are provided in Box 1 below.
Box 1: Definitions and Terminologies in the Report
Institutional Framework: The arrangements and structure of different organizations (both
governmental and non-governmental) in place to manage the WSS and ENR sectors - with
different and specific roles and responsibilities to manage the sector's requirements - through a
country or region's existing policies and legislations (SSWM, 2020).
Private sector participation (PSP): This includes a wide spectrum of legal arrangements in
which private enterprises are involved in the provision of wastewater and sanitation services that
are otherwise supposed to be provided by government agencies. PPPs are a form of PSP and
have different forms, including Service contract; Management contract; Lease; Build-operate-
transfer (BOT); and, Concession and Divestiture.
Sanitation Management: Aspects covered are the containment, collection, transportation, and
treatment of fecal sludge from pit latrines, septic tanks, or other onsite sanitation systems. Solid
waste management is partly covered, only if it relates directly to sanitation and not trash.
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Wastewater Management: Includes the collection, transportation, treatment, and disposal of
domestic wastewater/sewerage.
The report consists of the following chapters: After the introductory chapter, Chapter 2 provides
a rationale of PSP in the LVB’s wastewater and sanitation management, its current barriers, and
the current situation in the Basin; Chapter 3 presents an institutional assessment of the sector’s
enabling environment for supporting the private sector in the LVB; Chapter 4 highlights the
analyzed gap areas for improvement for enabling PSP in the region; and, Chapter 5 shares
recommendations to address the gap analysis in the previous chapter. Chapter 6 concludes the
report with a discussion on the next steps for the LVB countries in the EAC and limitations of this
report. The report is further supplemented with relevant References and Annexes.
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2. Rationale, Barriers, and Context of PSP in Wastewater and
Sanitation Management
PSP is not an all-encompassing solution for improving sanitation coverage; in many situations,
the public sector is better suited to allocate resources to lower income constituents who may
otherwise not be the most commercially attractive customer segment for businesses. However,
through collaboration with government, PSP can have many benefits and accelerate wastewater
and sanitation progress that the public sector alone may struggle to make. This chapter will review
these benefits, as well as requirements the public sector must address to foster PSP, and the
current PSP situation in the Basin for wastewater and sanitation management.
2.1 Benefits of and Need for PSP PSP is a vital component to improving wastewater and sanitation management in the Basin. While
governments in the LVB generally lead wastewater and sanitation management, efficiency, cost-
recovery, and financing in the sector may benefit from encouraging PSP through investments and
service management. Engaging the private sector can improve management of effluent
discharges from industrial practices and recover the ecological integrity and overall health of Lake
Victoria. The private sector can also be a key to increasing households’ ability to have their waste
safely managed and treated, as well as ensure drinking water quality is safely maintained. This
section will explain four of the main benefits of involving private actors in sanitation service
provision: (1) improved access to commercial financing, (2) more cost-effective solutions, (3)
faster expansion of services than government initiatives on their own, and (4) technical expertise
and higher flexibility to tailor services to the specific needs of different communities.
The first benefit of PSP in sanitation and wastewater is its ability to attract increased commercial
financing in this space. One of the biggest limiting factors to expanding sanitation coverage is
limited access to funding. Government budgets from taxes and grants from development donors
are spread thin between many competing priorities, thus significantly limiting the amount that
can be dedicated to sanitation and wastewater management. It has become evident that public
funding alone may not deliver successful and less polluting enterprises. PSP tends to increase
profitability and improve the creditworthiness perception of a sector, thus helping to attract more
private funding. Additionally, PSP can help increase coverage quickly and cost-efficiency and can
help attract commercial financing in the sanitation space, which would be a valuable addition to
government budgets dedicated to this sector. There is strong evidence that by involving private
firms, the sector’s ability to attract commercial financing increases substantially (OECD, 2011).
Private actors are effective at achieving efficiency gains and controlling costs to maximize returns,
which makes the sector more financially sustainable by derisking investment. This increases
creditworthiness and strengthens the sanitation sector’s ability to obtain commercial financing in
the form of debt finance (e.g., loans from commercial banks, bonds issued through capital
markets, project finance) and equity finance (from private firms, capital markets, or private equity
funds) (World Bank Group & UNICEF, 2017).
A second benefit of promoting PSP is that it can offer cost-effective solutions, most often by
reducing current levels of waste in the sector. For example, operational inefficiencies such as poor
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revenue collection and distribution losses in water (often called NRW, non-revenue water)
increase operating costs for water utilities. The Africa Infrastructure Country Diagnostic estimated
that in Sub-Saharan Africa, inefficiencies amounted to approximately 0.5% of gross domestic
product (GDP), or USD 2.9 billion a year (OECD, 2011). Private sector actors tend to focus on
revenue collection and reducing waste to improve operational efficiency and maximize profits.
Therefore, PSP would cut costs and maximize the impact of the resources available to the
sanitation sector. Governments can benefit through PSP such as privatizing utilities through
performance-based contracts focused on cost reduction, extending services to the underserved,
and infrastructure maintenance. Governments will need to address concerns pertaining to private
utilities exploiting pricing incentives by regulating private utility tariffs charged for service
provision. In this way, PSP can be a tool to decrease service costs so that coverage can be
extended to those currently lacking access to safe sanitation while ensuring financial viability for
utilities.
Third, PSP can help expand waste and sanitation services faster than the government on its own.
By hiring private businesses to provide sanitation services, coverage can scale up faster than if
only the public sector were involved. Additionally, because private firms have fewer approval
processes than the public sector, they can be quicker in the implementation of services. However,
it is important to note that PSP is most beneficial if the regional governments are involved in the
strategic coordination of efforts in the space. For example, the public sector should be closely
involved in prioritizing the areas of highest need for the expansion of coverage, in offering
licensing and technical assistance, and in setting up appropriate regulatory guidelines to ensure
the safe and fair provision of services.
Fourth, private firms in the sanitation sector possess the commercial incentive and technical
expertise better suited to tailor sanitation and wastewater services to the specific needs of
communities in the Basin. By being closer to their customers and not having to provide services
on a national scale, businesses have the flexibility to customize their offerings to the local needs
of the areas they are serving. Local knowledge, along with their technical knowledge, creates
more room for innovation, which often allows private sector actors to expand coverage in cheaper
or more efficient ways. Therefore, the public sector can work closely with private actors in
providing tailored solutions to those in need. By instituting regulation on what constitutes safe
sanitation practices, the government can ensure that the private sector remains compliant with
basic guidelines, while still having room to innovate and customize services to specific community
needs.
The global water and sanitation sector has used PPPs as a key way to support PSP and reap the
benefits of having the private sector involved in provision of WSS services while ensuring sector
standards are met for effluent discharge. PPPs work on the premise that the private sector’s
involvement can result in greater value for money through the private sector’s superior ability to
improve service provision efficiency by delivering projects on time and at cost, with enhancements
in quality and coverage, as well as some transfer of risk. PPPs can also be an effective way to
encourage PSP in sanitation, while also making sure that firms are acting per government
priorities and guidelines. PPPs also help overcome the perceived risk of investing in the
wastewater and sanitation sector and shows the private sector that profitability and corporate
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social and environmental responsibilities are aligned and are not mutually exclusive. PPPs have
proved to be an important tool in improving utility performance, leveraging finance, and
stimulating a much-needed sense of competition and accountability in the otherwise monopolistic
water and sanitation sector.
Many countries around the world use PPPs as one way to develop infrastructure projects under
the assumptions stated above. There are many different structures for PPPs that have been used
for wastewater and sanitation management, with different ownership structures between public
and private sector partners, as well as different objectives and financing mechanisms that can
accommodate different regional contexts. PPPs in Africa’s water sector date back to 1959, with
the implementation of the Côte d’Ivoire urban water average - a successful operation that
continues to provide water to over seven million people today. Examples of PPP models previously
used in wastewater in other regions are included in Table 1 below.
Table 1: PPP Model Structures used in Wastewater Management
Some PPP models listed in the table above include service contract; management contract; lease;
build-operate-transfer (BOT); concession; and, divestiture. The types listed in the table above is
not exhaustive of all types of PPPs available. Many of the models explicitly shift the commercial
risk from the public sector to private and release the government from the burden of daily
managing service provision and expanding networks. The models have a wide spectrum of legal
arrangements in which private enterprises are involved in the provision of wastewater and
sanitation services that are otherwise supposed to be provided by government agencies. Most of
the models have stipulated that the government maintains ownership over assets, while the
private sector is responsible for the operations and maintenance; the other responsibilities, such
as capital investment and commercial risk ownership, are split between public and private sectors,
depending on the structure of the PPP. They have focused on the private sector taking
responsibility of the management and operations of the full wastewater or sanitation system,
though some models can also specify the scope on a particular aspect of management, such as
PPP Option Asset
ownership
Operations
and
maintenance
Capital
investment
Commercial
risk
Scope of
contract
Duration
Service
contract
Public Public and
private
Public Public Meter reading,
collection of bills,
leak repairs etc.
1-2 years
Management
contract
Public Private Public Public Full system 3-5 years
Lease Public Private Public Shared Full system 8-15 years
Build-
operate-
transfer
(BOT)
Private
Private Private Private Bulk supply,
wastewater
treatment plants
20-30 years
Concession Public/Private Private Private Private Full system 25-30 years
Divestiture Private Private Private Private Full system Indefinite
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repairing leaks and collecting service bills. The tenor of PPPs can vary from only a year or two, to
indefinite timeframes, depending on the model used. There is flexibility with the structure of PPP
models for different contexts, which helps support PSP in countries, regions, and sectors with
different contexts and situations.
2.2 Barriers and Requirements to Support PSP It is important to note that the private sector cannot participate without a favorable business
environment. In many developing countries, PSP in sanitation and wastewater management has
been scarce because of the barriers from the institutional arrangements to financial viability the
private investors are facing which hinder private participation. There are several requirements for
institutional reform and strengthening in order to promote PSP on a larger scale in wastewater
and sanitation management in the region.
Institutional arrangements can have limited regulations, policies, unclear sector standards, and
organizational setup that do not clearly guide how businesses can approach work, making PSP
difficult. Thus, the environment for doing business in the sector can be limited, which further
challenges the private sector from feeling incentivized to participate in waste management. To
encourage PSP, the public sector needs to provide strong and clear institutional arrangements for
the private sector to navigate. Institutional frameworks make it clear for PSPs to engage in PPP
contracts with the government and comply with industry standards and requirements. There also
needs to be county governments with robust municipal governments that have specific
departments to take over key sanitation functions, such as subcontracting private sector actors
to provide sanitation services, to improve clarity about key public stakeholders.
An institutional arrangement particularly important to the private sector for navigating the waste
management sector and finding ways to participate is the public sector’s role of regulation and
tracking of sector practices. Governments need to guarantee the accountability of various
business stakeholders and to ensure the effective implementation of regulations and contractual
provisions; this can happen through enforcement of service standards and contractual obligations.
A regulatory body specifically dedicated to creating guidelines for sanitation provision and
monitoring services could contribute to a supportive environment for the private sector to engage
in sectors like that of wastewater and sanitation. This can be accomplished in two ways: (1) by
expanding current regulation mandates to include sanitation and wastewater management, or
(2) by creating a new regulatory body focused on sanitation and wastewater management. Both
options are viable.
The government needs to actively engage with micro, small, and medium-sized enterprises
(MSMEs), which are mostly privately owned. Government engagement with MSMEs already
working in water and sanitation will help supplement formal utilities in the WSS sector. Not
working with MSMEs can result in failures to address MSME and informal private sector needs as
well prohibit their participation in the WSS and ENR sector, which can lead to lost potential in
realizing the full benefits of the sector engaging the private sector. Some governments pass policy
papers, laws, and funds to facilitate small enterprise development. However, governments need
to ensure their scale, commitment, and coordination in supporting MSMEs is adequate and that
MSME representation in policy and regulatory reforms in existing policies is clear and sufficient to
17
be well executed. There are low levels of public awareness about the government’s organizational
setup, sector standards, non-compliance repercussions, and incentives for PSP in the region,
especially by MSMEs. Lack of communication has contributed to poor participation by the private
sector.
A favorable investment climate – in particular, budgeting, tariffs, and financing – is conducive to
and encourages private funding under optimal conditions for the public sector. Private investment
requires a set of established rules and processes to allow reasonable confidence and should
complement budgets from governments and donor organizations and help close the gap of
resources needed to expand sanitation coverage. To support increased private sector finance,
utilities need to be creditworthy and generate sufficient revenue to be able to repay commercial
loans and demonstrate reliability. Additionally, public sector roles in the wastewater and sanitation
sector to support PSP must have a constant source of dedicated public funding – whether if it’s
from taxes collected by local or national government entities or customer revenue. This shows
the private sector that wastewater and sanitation management has government support and is
not solely reliant on private funding for its function. To clarify for the private sector where
dedicated public funding is going, PPP contracts should detail the mechanics of what WSS costs
will be supported by public funding and what the private sector is obliged to cover.
In many places, PSP in sanitation and wastewater management is insufficient yet to attract
adequate level of private investment partially because government efforts fell short in supporting
private participation. Government entities are often unable to provide sufficient financing for
wastewater and sanitation management, which makes interested private actors less secure about
engaging in sector opportunities; banks see the sector as risky and unable to generate sufficient
financial returns, and sector creditworthiness has remained largely unaddressed. Smaller water
and sanitation service providers generally cannot understand or have the staff to manage
commercial lending processes to become creditworthy and have limited collateral to use in
securing loans because the government often owns the service providing assets, further hindering
private financing in the sector (Advani, 2015). Lastly, larger private entities can be discouraged
in engaging in the sector because of foreign currency risks. Currency fluctuations are considered
a key threat to PPP projects, particularly with international private sector actors, as it increases
the risk of a project’s viability. This is caused by currency mismatch brought about by loans and
their repayment being in foreign currency (typically USD or EUR) while project revenues and
government revenues/taxes being in local currency. Depreciation of the local currency against
the foreign currency over the life of a PPP project can lead to termination of the contract. This
has cost implications for both the public and private sectors.
Lastly, evidence has shown that PPPs are not necessarily run better than public firms (Leighland
2018). Research shows that PPPs tend to be more effective in middle-income rather than in low-
income countries because less-developed nations need more capacity building and technical
assistance(ibid.). Besides, many projects may not be suitable for implementation under PPP
arrangements, and others might not enable the adequate transfer of risk resulting in fiscal
commitments and contingent liabilities for the government. Evidence from 65 PPPs in developing
countries has shown that they have limited potential to bring on commercial financing, except in
the most developed nations (Marin 2009). In lower and middle-income countries, PPPs still had
18
to rely on the government, international donors, or tariff financing (ibid.). The lack of PPP success
in the developing world can discourage the private sector from engaging with governments for
future projects; low-income countries need to make sure that they put in sufficient resources to
develop government capacity and funding that will boost confidence in the private sector to
explore PPP opportunities.
2.3 PSP in Wastewater and Sanitation Management in LVB The provision of WSS services in the LVB countries has been gradually commercialized, starting
with the big cities and municipalities – some remain public entities while others are in the process
of privatizing. Examples of the region’s efforts to commercialize utilities can be seen in Table 2
below.
Table 2: Specific Commercialization Efforts in the LVB
Country Privatization Efforts
Burundi REGIDESO, Burundi’s state owned water and electricity utility company, since the
1930s, aims to increase people’s access to water in urban and peri-urban areas
and improve the quality and reliability of water services in the Bujumbura city and
other smaller urban centers.
Kenya Some of these services have already been commercialized, with the Nairobi Water
and Sewerage Company currently providing water and sanitation management
services in Nairobi. It plans to expand its operations to other cities in the country.
Rwanda The Water and Sanitation Corporation (WASAC) has increased water provision to
many parts of the country.
Tanzania While a public entity, the National Water and Sewerage Corporation is in the
process of improving its commercial services.
Uganda The National Water and Sewerage Corporation conducted trials with contracted
private management of operations in Kampala and Jinja and is in the process of
identifying the forms of private-sector involvement. NWSC is improving internal
commercial management through Internally-Delegated Area Management
Contracts.
LVB countries have private sector industries in varying levels of development - from Burundi's
embryonic private sector to the well-developed industry sector in Kenya - that contribute
significantly to each countries' gross domestic product (GDP). Most of the countries have large,
thriving MSME industries ranging from thousands to millions of firms that employ a significant
amount of people. In the region, the private sector can work in the wastewater and sanitation
management sector by focusing on the construction of sanitation facilities and managing public
toilets, such as in Uganda, as well as the collection and transport of fecal sludge (FS) and the
management and operations of public sanitation utilities.
In Kenya, the private sector is well developed and large by sub-Saharan African and regional
standards. The private sector is worryingly dualistic in nature there, comprised of a productive
formal sector of big businesses, underpinned by a massive, poorly understood informal sector,
with estimates pegging MSME contribution to GDP to as much as 25%. Similarly, in Tanzania,
19
large informal economic activities are controlled by MSMEs, with an estimated 3 million MSMEs
which contribute to 27% of overall GDP. The private sector in Uganda is dominated by MSMEs
comprising approximately 1,100,000 enterprises and employing approximately 2.5 million people
equivalent to 90% of total non-farm private sector workers. Of the 123,000 firms operating in
Rwanda, the grand majority are MSMEs, with around 84% of formal sector employment coming
from MSMEs. While some countries have a growing formal private sector, many of LVB countries'
MSME industries remain largely informal.
Unfortunately, PSP in WSS in the region is underdeveloped and in need of attention. According
to Kenya’s Water and Sanitation Regulatory Board (WASREB), only two of the 88 utilities in Kenya
are privately run, though they are well-run; these private utilities score high across all KPIs set
by WASREB, with similar performance to the top ten public sector utilities (WASREB, 2019). In
Uganda, private sector involvement in wastewater treatment is minimal - only one FS treatment
plant is managed by a private operator. All sewer networks and sewage treatment plants are
managed by the public-owned National Water and Sanitation Corporation (NWSC), and the private
sector is only involved with the construction of sanitation facilities and public toilet management.
Most of Uganda’s private sector involvement in the sector is around FS collection and
transportation, which is mostly in Kampala and has limited implemented policies and regulations
in place for oversight.
Within the LVB, two regional private sector organizations have engaged in PSP conversations;
each country has an additional two other national organizations that promote private sector
interests (see Table 3 below). The East African Manufacturers Association (EAMA), in particular,
champions the cause for regional private sector organizations in the Basin across sectors. Also,
collective private sector organizations and associations are championing the cause for
manufacturers in each country. Per the EAC Consultative Dialogue Framework, these private
sector interest groups maintain a dialogue with the EAC1 Partners States and civil society
organizations (CSOs) in the area with an annual forum convened by the EAC Secretary-General.
1 Comprising of the 5 Lake Victoria Basin countries plus South Sudan.
20
Table 3: Organizations for Private Sector Engagement in the LVB
Burundi Kenya Rwanda Tanzania Uganda
Regional
Private
Sector
Councils
• The East Africa Manufacturers Association (EAMA)
• East African Business Council (EABC)
Organizations
promoting
Private
Sector
Interests
• Chambre
de
Commerce
et
D’Industrie
du Burundi
(CFCIB)
• Association
des
Industriels
du Burundi
(AIB)
• Kenya Private
Sector
Alliance
(KEPSA);
• Kenya
Association of
Manufacturers
(KAM)
• Private Sector
Federation
(PSF);
• Rwanda
Manufacturers
Association
(RMA)
• Tanzania
Private Sector
Foundation
(TPSF);
• Confederation
of Tanzania
Industries
(CTI)
• Private Sector
Foundation
Uganda
(PSFU);
• Uganda
Manufacturers
Association
(UMA)
Increasing PSP also means that the LVB needs to manage industrial practices to protect the water
resources that remain key to the area’s economy. Privately-owned industries in the LVB
unfortunately create additional challenges for regional WSS management, particularly in
managing wastewater with industrial effluent discharge, which has compromised Lake Victoria’s
water quality. In Burundi, municipalities and industries are the country’s main effluent discharge
sources, and Kenya's growing industries have not adopted clean production technology nor
adequate environment monitoring and standard practices, creating additional challenges for
water and sanitation efforts to protect ENR. The private sector is not incentivized to comply with
effluent discharge regulations because their monitoring often remains unclear and active
enforcement remains insufficient to encourage industries to improve their practices.
21
Box 2: Burundi’s Private Sector Challenges
Burundi’s private sector is at an emergent stage, with 3,000 mostly small- or medium-sized
registered businesses, employing 37,000 people in 2012. Private investment’s share of GDP was
13% in 2010. Access to funding and political instability were identified as the main problems to
private sector investment.
A 2019 Resource Efficiency & Cleaner Production (RECP) study listed 36 industries and MSMEs in
Burundi’s LVB region (Lake Victoria Basin Commission, 2019). Of those, ten were surveyed, with
only 20% of the surveyed MSMEs meeting wastewater effluent standards. Municipalities and
industries are the primary sources of effluent charges, some of which are discharged directly into
the upstream river system of Lake Victoria.
What’s more, Burundi has weak institutions to monitor effluent discharge by the private sector;
Burundi does not monitor key water quality parameters such as pH, ions concentration, or heavy
metals presence, mostly focusing on essential water quality tests like color and odor, which
creates challenges to enforce improved industrial practices in effluents discharge by the private
sector.
This review of PSP in the LVB’s wastewater and sanitation management highlights the need for it
to be further developed and supported by public entities. To improve the private sector’s work in
the Basin regarding WSS and ENR protection, it is important to assess the current institutional
frameworks in their effectiveness to support PSP across the region and within each of the Basin’s
countries. The next Chapter will address this need and analyze the region’s resulting gaps.
22
3. Situation Analysis of Institutional Assessment for PSP in
Wastewater and Sanitation Management in LVB
The institutional arrangements analyzed below will include the policy frameworks, regulations,
standards, and organizational setup for PSP in wastewater and sanitation management across
the region. First, a regional summary will assess the region’s institutions collectively, followed by
elaboration on each country’s specific situation analysis.
3.1 Regional Summary Assessing the region’s collective institutional arrangements is important to understand the similar
frameworks and setups that exist across the five countries along the LVB. In this section, we will
summarize the region’s policies, regulations, standards, and institutional frameworks.
Policy Frameworks
The region’s member states have, over recent years, developed institutional arrangements at the
regional and national levels to implement WSS and ENR projects. The sector has numerous
policies and regulations that provide an enabling environment to attract private sector investment
in the areas of waste management and sanitation treatment infrastructure. To start, each of the
five countries’ constitutions generally specifies protection of ENRs. Key legislation governing the
sub-sector in all the Basin’s countries consists of broader mandates of environmental law and
specific WSS sub-sector legislation.
Sustainable management in Lake Victoria is highlighted in the national development strategies of
each LVB country, which identifies environmental degradation as a threat to national
development. They have incorporated the important role of ENR management in health
improvements, poverty reduction, and sustainable economic growth. All of the LVB’s five countries
have a Growth Agenda (i.e., National Vision) for developing the country and attaining a higher
quality of life for its people, most including language for universal access to water supply and
sanitation (i.e., WSS, in attaining SDG6).
Additionally, all countries' policies in the region revolve around their vision for the future highlight
the importance of water resources and improved WASH services to create healthy, clean,
sustainable, and economically-growing nations. To formalize the institutional framework of the
sector, each of the Basin’s countries has a National Policy on Water and Sanitation - the oldest is
Uganda’s (1999) and newest is from Kenya (2017). In these frameworks, each country mandates
a key ministry in management, policy formulation, and strategic planning in the WSS, but with
the assistance of other Ministries and national institutions.
All but Burundi in the Basin have explicit policies about guidelines and protocols for using PPPs to
support PSP. Although not directly related to wastewater and sanitation management, the PPP
legislation in all four cases is significant in the general guidelines it provides for PPPs. Perhaps
influencing the overall effectiveness of the implementation of the policy and legislation is the
nascent private sector in the region.
23
Sector Regulations
As previously discussed in Chapter 2, the private sector needs performance regulations to follow
in their operations, particularly on ENR via effluent discharges and tackling environmental
impacts. Historically, as demonstrated by Kenya, reviews of environmental law have resulted into
umbrella legislation to form single authorities as a coordinating and regulating agency. Where
regulations are not comprehensive enough for a particular service provision project, international
best practices dictate that internationally-accepted standards are followed at the Environmental
Impact Assessment (EIA) and implementation stage. EIAs are a key requirement for project
development in each country.
The most basic, essential effluent discharge international standards available for governments to
adopt are from the World Health Organization (WHO) guidelines, which stipulates that the
threshold for Biochemical Oxygen Demand (BOD) for five days at 20C discharge into waterways
is 50mg/l and Chemical Oxygen Demand (COD) discharge is 200mg/l. The WHO does not detail
the parameters for effluent discharge into public sewers.
Regulation policies and regulatory bodies in the region also indicate how they set and manage
consumer water and sanitation tariff structures for water and sanitation services. Tariffs in some
countries are considered politically charged, which can challenge enforcing tariff levels that will
cover operational costs. Tariff setting policies and regulations are important for the private sector
to understand their potential revenue streams, should they become waste management providers
in the region.
Regional Standards
The region has created its own set of standards to be used by each country. The EAC
Standardization, Quality Assurance, Metrology, and Testing (SQMT) Act (2006) provided for
regional cooperation in the areas of standards, metrology, conformity assessment, accreditation,
and technical regulations. The SQMT Act was to facilitate industrial development and trade, as
well as protect societal and environmental health and safety within the community. The SQMT
Act also provided for the development of East African Standards (EAS). The EAS was introduced
to have a harmonized approach for dealing with common water resources and was developed
jointly by each country’s national standard bodies (NSBs) of the EAC Member States per the
procedures approved and maintained by a committee. This standard prescribes maximum
permissible limits and test methods for industrial and municipal effluents discharged into public
sewers and water bodies. It is in use in all the LVB countries and prescribes maximum permissible
limits for BOD for five days at 20C discharge into public sewers and discharge into water bodies
as 500 mg/l and 30 mg/l respectively. According to the EAS, the maximum permissible limits for
COD discharge into public sewers and discharge into water bodies are given as 1000 mg/l and 60
mg/l, respectively. The standards mandate the nation-states, among others, to develop and
publish standards in line with internationally recognized procedures and give effect to the
decisions and recommendations of the Council and the East African Standards Committee (EASC)
concerning EAS (East African Legislative Authority, 2006).
Countries also have their own separate standards and parameters for municipal effluent discharge
and water quality. Additional to other national standards, there are other voluntary international
24
standards operational in the region outside of effluent discharge. Countries have adopted
international standards to supplement their national standards in different ways. The main
international standards used by LVB countries are below.
• International Standards Organization (ISO): The ISO has standards that each country’s
NSBs can use to undertake product certification and issues quality marks for locally produced
commodities. ISO standards include two particularly useful parameters2 for service delivery
to consumers and end-users as well as infrastructural management of water and wastewater
utilities and can be adapted by countries where relevant standards are lacking.
• Global Reporting Initiative (GRI): Under the GRI, organizations, and companies publish
Sustainability Reports covering the economic, environmental, and social impacts caused by
their everyday activities. The Reports are based on GRI Standards, which include two
specifically about water quality and effluents. Participating organizations from the LVB,
including large size companies by number, are as follows: 37 in Kenya, one in Rwanda, three
in Tanzania, and ten in Uganda. No private sector actors in Burundi currently follows GRI
Standards (GRI, 2019).
• United Nations (UN) Global Compact: The UN Global Compact is a principle-based
framework for businesses, stating ten principles in the areas of human rights, labor, the
environment, and anti-corruption. Under the Global Compact, companies are brought together
with UN agencies, labor groups, and civil society. Some MSMEs and non-governmental
organizations (NGOs) in each country voluntarily participate in the guidelines from the Global
Compact related to wastewater and sanitation, which include complements the UN’s
Sustainable Development Goals (SDGs) for the private sector specifically. SDG6 specifically
pertains to clean water and sanitation, and, as it relates to wastewater and sanitation, two of
the ten Principles apply to the businesses in the UN Global Compact. These include Principle
7, where businesses should support a precautionary approach to environmental challenges.;
and Principle 8, where businesses should undertake initiatives to promote greater
environmental responsibility (UN Global Compact, 2019).
Organizational Setup
At the regional level, the EAC and its regional committees and institutions (e.g., LVBC and Lake
Victoria Fisheries Organization) facilitate cross-country coordination in managing transboundary
issues including environmental management of the Lake Victoria. LVBC as one of these regional
institutions specifically coordinates between LVB countries. The LVBC also develops regional
planning and technology dissemination efforts for key regional ENR issues, such as the Basin’s
water quality, sanitation management, aquatic weed control, and erosion control. The LVBC
Secretariat reports to the Sectoral Council of Ministers for the Basin and provides policy guidance
on all regional matters. The LVB Coordination Committee submits reports and recommendations
to the Sectoral Council of Ministers on the Protocol’s implementation, and supports the decisions
of the Council of Ministers. Additionally, LVB countries have developed institutional arrangements
at regional and national level to implement regional projects, such as ENR collaborations.
2 ISO 24510:2007 & ISO 24511:2007
25
For all LVB countries, institutional frameworks provided for ENR and sanitation in the WSS sector
are shared among a large group of different ministries and several government agencies. Some
ministries and various levels of government – national to local – overlap in responsibilities,
predominantly ministries focused on health, the environment, as well as water and sanitation (the
Annex includes detailed lists of ministries involved and their roles). The overlap in mandates
between various entities presents a challenge to PSP, as it is time-consuming for the private
sector to engage in negotiations of contracts and long-term partnerships with the government.
Most of the LVB countries’ government agencies responsible for WSS are at the national level,
though a few countries also have roles decentralized to agencies or representatives at more local
levels of government, such as in districts and communes. National ministry responsibilities have
some common division of roles - in Kenya, Tanzania, and Uganda, ministries responsible for the
regulation of water and sanitation are not the same as those who provide leadership in
policymaking and implementation.
In each country, national regulation responsibilities are diffused across many different
government agencies, often including ministries for health, the environment, local government,
and water services. EIAs in each country are managed by authorities in charge of regulations;
these EIA-regulating institutions are OBPE (Burundi), NEMA (Kenya), REMA (Rwanda), NEMC
(Tanzania), and NEMA (Uganda). These authorities have general EIA regulations based on key
main environmental legislation in each county, and in the case of Kenya, Tanzania, and Uganda,
the Authorities have developed specific sector regulations. Kenya and Rwanda have set up
autonomous water regulatory agencies to monitor utility performance and service delivery –
WASREB and RURA, respectively.
Financing water and sanitation services are usually the responsibility of the Ministry of Finance or
the National Treasury in each country, with consulting from the Water Ministry. Some countries
have additional finance support: Rwanda's Development Board is responsible for facilitating
investments, which is especially driven by the private sector; Tanzania's district-level Water
Supply and Sanitation Authorities (WSSAs) are responsible for design and planning for
investments for rural water and sewerage infrastructure; and, Kenya's Water Sector Trust Fund
(WSTF) provides financing projects dedicated to providing water and sanitation services to low-
income populations.
Provision of services is mostly the responsibilities of the district and local regions, with some
support and participation from national agencies. The largest utilities in the Basin are run by
publicly-owned companies and are located in three urban areas, which will be further detailed in
the country summaries below. Many of the countries have NGOs such as the private sector and
community-based organizations providing direct water and sanitation services at the district and
local levels, which requires lose coordination with other line ministries. Most countries indicate
that the private sector is partly or entirely responsible for providing services, production, or both.
26
3.2 Country Summaries After having summarized the region’s institutional arrangements, it is crucial to also understand
the unique arrangements of each country within the Basin. In this section, each of the five
countries in the Basin will has their policies, regulations, standards, and institutional frameworks
assessed.
Burundi
Burundi’s main policy frameworks that address PSP in the wastewater sanitation sector are the
Burundi Vision 2025 and The National Water Policy from 2009. Burundi’s Vision 2025 expresses
the desire for realization of economic and social evolutions for Burundi. Throughout the vision
document, Burundi wishes to achieve comprehensive and sustainable ENR management and
development in a manner that water resources play a central role in Burundi’s social and economic
development process. The National Water Policy’s overall objective is to guarantee water needs
to users through a harmonious and sustainable development of national water resources. Other
relevant frameworks constitute good management of natural resources and environmental
protection, as well as mandating that drinking water should meet international quality standards.
Being a country in a post-conflict transition phase after many years of civil strife, Burundi does
not have explicit policies about guidelines and protocols for using PPPs to support PSP.
Burundi’s standards are considered the most basic out of the region, adopting the WHO standards
for the control of industrial and municipal effluent discharge. Very recently, the government
adopted the EAC effluent quality standards, the problem remains on the implementation of such
standards due to financial and other constraints.
In Burundi, about twelve different national ministries and agencies have roles and responsibilities
related to the wastewater and sanitation sector. Details are listed in Table 4 below (detailed
version available in Annex 2).
27
Table 4: Burundi’s Institutional Framework for Wastewater and Sanitation Sector
Institution
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Environment, Agriculture and Livestock (MINEAE) ✓ ✓
Ministry of Public Health and AIDS control ✓
Ministry of Hydraulics, Energy and Mines ✓
Ministry of Commerce, Industry, Posts and Tourism ✓
Ministry of the Interior ✓
Ministry of Finance, Budget and Economic Development Cooperation. ✓
DG-AHAMR ✓
Burundian Office for the Protection of the Environment (OBPE) ✓
Geographic Institute of Burundi (IGEBU) ✓
DG-Water Resources & Sanitation (DGREA); ✓ ✓
Municipal Technical Services Board (SETEMU) ✓
Water and Electric Authority (REGIDESO) ✓
Pro
vin
ce
DGEREA (Directorate General for the Environment, Water Resources and Sanitation ✓
CPEA ✓
DGEAE (Direction Generale de l’Environnement, de l’Agriculture et de l’Elevage) ✓
Communal Water Authorities (RCEs) ✓
Com
mune
Direction Communale de l’Environnement, de l’ agriculture et de l’elevage ✓
AHR ✓
Local Authorities
✓
(?)
Communal Water Authorities (RCEs) ✓
Developing and implementing sector policies at the national level are the responsibility of The
Ministry of Environment, Agriculture and Livestock (MINAEA) through the DG-Water Resources
and Sanitation (DRREA) and Ministry of Public Health and AIDs Control; no lower-level institutions
have policy roles in the local areas. Nationally, the Ministry of Finance, Budget and Economic
Development Corporation is the sole agency responsible for financing.
Regulation responsibilities are shared across five national institutions, including: MINAEA and
DGREA; the newly-formed Burundian Office for the Protection of the Environment (OBPE) under
the MINAEA to ensure compliance around environmental protection; the Ministry of Commerce,
Industry, Posts and Tourism, which houses the supervisory agency called the Burundian Bureau
of Standardization and Quality Control (BBN); and, the Geographic Institute of Burundi (IGEBU),
mandated to collect hydro-climatic and GIS data about water resources in the country.
Provision of services is diffused across national, provincial, and communal levels of government
and non-governmental institutions. National institutions include DG-Rural Hydraulic Infrastructure
and Basic Sanitation Agency (DG-AHAMR) under the Ministry of Hydraulic, Energy and Mines; and
the Municipal Technical Services Board (SETEMU) of the City of Bujumbura under the Ministry of
the Interior. DGREA, AHAMR, Local Authorities and Communal Water Authorities (RCEs) are
mandated to offer service provision at the provincial and commune levels. The role of the private
sector in wastewater and sanitation management in Burundi is unclear, as they are not referred
to in the country’s institutional framework.
28
Kenya
Kenya’s policy and legal framework in the sector are guided by Kenya Vision 2030 and the Kenya
Environmental and Sanitation Hygiene Policy (KESHP) 2016-2030. Kenya Vision 2030 sets the
goal of universal access to safe water and sanitation in the country. It proposes strategies for
achieving this objective, such as increasing community sanitation, improving the planning of
informal urban settlements, and encouraging public-private partnerships in the building and
management of sewage infrastructure. KESHP was launched in 2016 to create broad guidelines
for both state and non-state actors in their efforts to achieve universal access to water and
sanitation. It aspires to make Kenya open defecation free (ODF) by 2030 and to increase public
funding of sanitation from its current level of 0.2% of Kenya’s GDP to 0.5% in 2020 and 0.9% in
2030. The policy includes provisions for improving urban sanitation facilities and ensuring safe
waste disposal and management through low-cost technologies in slum and peri-urban areas.
Most relevant to this report, KESHP also seeks to encourage PSP, especially as it relates to
providing lower cost, market-based solutions for lower income households. It mentions the
potential of establishing subsidies to achieve this goal, recognizing the possibility of “market-
compatible financing options including new types of cash transfers and social subsidies to enable
households in the lower wealth quintiles to purchase through the market, while maintaining
incentives for others who can afford to purchase on their own” (Kenyan Ministry of Health, 2016).
KESHP has been an effective step towards promoting PSP because it allowed private sector actors
to engage with different government stakeholders on sanitation matters across the value chain.
By recognizing the importance of the private sector and the need for innovative sanitation delivery
options, it has created the space for private firms to begin offering sanitation services. While it is
too early to see a tangible increase in PSP resulting from this policy, KESHP has been effective in
setting up sanitation matters in Kenya in the absence of a national act. The policy has been useful
to counties such as Nakuru and Kisumu in helping them create local level sanitation acts and
policies.
Kenya's other laws include language that seeks to encourage PSP, especially as it relates to
market-based solutions for lower-income households and using subsidies to achieve this goal, as
well as guidelines on how to manage PPPs for these initiatives.
Kenya has two vital standards for regulating effluent discharges and associated guidelines, which
are categorized depending on whether the effluent is discharged directly into a water body or a
public sewer. These are standards for regulating effluents discharged into surface waters and
effluent discharged into the public sewer, in accordance with the KEBS procedures.
Kenya has been undergoing a devolution of government, which is when “executive, legislative
and fiscal powers are assigned at both national and county levels, established as distinct and
inter-dependent entities through the Constitution and operationalized through national legislation,
conducting their relations on the basis of consultation and cooperation” (Boulenouar et al, 2018).
The 2010 Constitution specifically outlined this two-fold separation of powers between the
national level and the 47 county governments. Counties are now responsible for wastewater and
sanitation service provision, but implementation is still in transition.
29
After devolution, Kenya’s national government is primarily in charge of setting general policies
and regulation on wastewater and sanitation, while county governments are more focused on
implementation, service provision, and monitoring. While each county is domesticating national
sanitation policies to its local context, there are some structural commonalities. Planning and
service delivery across most Kenyan counties involve a coordination between their local
Departments of Health, Water, and the Environment. All counties also intend to decentralize
sanitation functions to municipalities or other lower level entities such as community or village
units. However, there is variability in the extent to which these sub-county level entities have
been established and in the capacity they have to provide services. Kenya’s institutional
framework can be viewed in Table 5 below.
Table 5: Kenya’s Institutional Framework for Wastewater and Sanitation Sector
Institution
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Water & Sanitation ✓
Ministry of Health ✓
Ministry of Environment & Forestry ✓
Ministry of Education ✓
National Environmental Management Authority (NEMA) ✓
Water Services Regulatory Board (WASREB) ✓
Water Works Development Agencies (WWDAs)
(previously Water Service Boards (WSBs))
✓
National Treasury ✓
Water Sector Trust Fund (WSTF) ✓
Kenya Water Institute (KEWI) ✓
County
County Departments of Health & Sanitation ✓ ✓ ✓
County Assembly ✓
Water Service Providers (WSPs) ✓
County Department of Finance ✓
Private sector ✓ ✓
Notable national institutions mandated to regulate the sector include NEMA, WASREB, and Water
Works Development Agencies (WWDAs); the County Departments uphold regulations at the local
level. Budgeting and finance are managed by the National Treasury, the state corporation WSTF,
and County Departments of Finance at the local level.
In Kenya there are eight regional Water Service Boards responsible for the development and
rehabilitation of water and sewerage facilities and for investment planning and implementation in
their service areas. The Lake Victoria South Water and Sewerage Board (LVSWSB) appointed
Kisumu Water and Sewerage Company (KIWASCO), a publicly-owned company, to supply water
within the jurisdiction of Kisumu. Most of the water used in Kisumu is extracted from Lake Victoria.
More information about Kisumu’s institutional framework can be found below in Box 3.
30
Box 3: County Case Study of Kisumu
Kisumu County in Kenya has a limited institutional framework for managing wastewater and
sanitation, which is a challenge that is representative of almost the entire nation (except for
Nakuru County, which has domesticated most national policies). Although there is a County
Assembly and a Department of Health and Sanitation in Kisumu, the process of establishing local
authorities below the county level, such as municipalities, is still ongoing. This means that there
is no separation of functions between the county and lower-level municipal governments yet,
which is an important step in delegating the provision of services. Kisumu has a city government,
but there is no formal coordination between the municipality and the county. Technically, the
county should be supervising the city government in planning and service delivery, yet that
collaboration has been almost inexistent due to limited resources. For example, even though the
county Public Health Department has an interest in sanitation management and has made itself
available to private actors such as WSUP to discuss various initiatives, it has no budget to
implement them. Clarification of municipal and county-level roles, as well as the allocation of
resources to sanitation-related municipal departments, would simplify private sector participation
in the space as it would delineate who should be contracting private actors and working with
them on implementation and monitoring.
Additionally, the process of decentralizing responsibilities has caused counties confusion about
the national government’s role, since there have also been changes in their functions. For
example, in matters of onsite sanitation, counties used to work closely with the Ministry of Public
Health. However, primary responsibility at the national level for onsite sanitation has now shifted
to the Ministry of Water and Sanitation. In Kisumu County, this shift has confused new role
allocations and has therefore led to no material changes in organizational structure or
implementation at the local level. There should be more clarification of national ministries’ roles
as they assume their new responsibilities.
Rwanda
Rwanda’s key relevant policy frameworks include Rwanda’s Vision 2020 and the Private Sector
Development Strategy 2013-2018 (Republic of Rwanda, 2012). Vision 2020 identifies that
infrastructural development is a key pillar to achieving the country’s development goals, in
particular ensuring that by 2020 all Rwandans have access to clean water, and the rural and
urban areas have sufficient sewerage and disposal systems. The Private Sector Development
Strategy aimed at addressing the small but growing private sector in the country by developing
an innovative and competitive environment that fosters private sector and includes language on
how to manage institutional arrangements for potential PPPs. Other key policies focus on
increasing sustainable and affordable WSS coverage, especially in rural areas, and ENR
management.
Rwanda has adopted WHO wastewater and sanitation standards, like Burundi, but has also opted
to enforce water quality industrial and domestic discharge tolerance standards from EAS, the US
Environmental Protection Agency (EPA), and nationally-adjusted ISO adoptions for tolerance
limits of discharged industrial and domestic wastewater.
31
Rwanda’s institutional framework is highlighted in Table 6 below (detailed version available in
Annex 2).
Table 6: Rwanda’s Institutional Framework for Wastewater and Sanitation Sector
Institution
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Environment (MINIRENA) ✓ ✓
Ministry of Health (MINISANTE) ✓ ✓
Ministry of Local Government (MINALOC) ✓ ✓
Ministry of Education (MINEDUC) ✓
Ministry of Finance, Planning and Economic Development (MINECOFIN) ✓ ✓
Energy, Water and Sanitation Authority (EWSA) ✓ ✓
Rwanda Environment Management Authority (REMA) ✓
Rwanda Utilities Regulatory Agency (RURA) ✓
Rwanda Bureau of Standards (RBS) ✓
Rwanda Natural Resources Authority (RNRA) ✓ (?)
Rwanda Development Board (RDB) ✓
Private Sector ✓
Dis
tric
t /
Loca
l
Districts ✓
Private Sector ✓
EWSA representation ✓
REMA Representation ✓
RURA Representation ✓
RBS Representation ✓
User Communities ✓
In Rwanda, implementing policies for the sector are led by three national institutions – Ministry
of Environment (MINIRENA), Ministry of Health (MINISANTE), and Ministry of Local Government
(MINALOC) – as well as district governments. Regulations are shared by the same ministries
managing policies, as well as at least three other national ministries (Rwanda Environment
Management Authority – REMA, Rwanda Utilities Regulatory Agency – RURA, and Rwanda Bureau
of Standards – RBS); district representatives from these ministries support regulation efforts at
the local level. The Ministry of Finance, Planning, and Economic Development (MINECOFIN) and
Rwanda Development Board (RDB) are responsible for mobilizing and allocating financial resource
to the sector.
National ministries responsible for the provision of WSS services include the Ministry of Education
(MINEDUC) at schools; MINECOFIN; and, Energy, Water and Sanitation Authority (EWSA), which
is responsible for WSS services in major towns and urban centers. The private sector is involved
in service provision and the national and district levels. User communities also participate in
service provision at the District level.
Tanzania
Tanzania’s relevant policy frameworks include Vision 2025, the National Water Sector
Development Strategy 2006-2015, and National PPP Policy from 2009 (Tanzanian Planning
Commission, n.d.). The Development Vision aims to transfer Tanzania from a least-developing to
32
a middle-income country, and WSS is seen as an essential avenue to reduce poverty nationally.
The National Water Sector Development Strategy clarifies roles for the sector, and the National
PPP Policy aims to create and manage an enabling environment to guide different stakeholders
in PPPs. Other relevant frameworks address ENR management and different PPP aspects related
to processes and procurements.
Tanzania’s NEMC regulates standards based on three tiers of effluent discharge categories:
compulsory compliance, voluntary compliance for certification processes and environmental
performance compliance, and testing methods compliance to assess effluent discharge samples.
Existing compulsory standards related to effluents are specifically:
• TZS 860 (2005): Municipal and industrial wastewaters – General Tolerance Limits for Municipal
and Industrial Wastewaters.
• TZS 344 (1989): Tolerance Limits for Industrial Effluents discharged into inland surface water
– Tanning industry.
• TZS 343 (1989): Tolerance limits for industrial effluents discharged into surface waters –
Phosphate Fertilizer Industry.
• TZS 846 (2005): Tolerance limits of emissions discharged to the air by Cement factories.
• TZS 789 (2003): Drinking (potable) water – Specification.
Other stipulated compulsory standards which may have relevance to effluents include limits for
occupational exposure to ionizing radiation. Voluntary compliance are also a requirement for
certification processes and use in evaluating environmental performance compliance. Lastly,
testing methods compliance specifically detail standard sampling procedures, testing frequency,
and preservation.
Table 7: Tanzania’s Institutional Framework for Wastewater and Sanitation Sector
Institution
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Water and Irrigation (MoW) ✓
Ministry of Health, Community Development, Gender, Elderly and Children (MoHCDGEC) ✓
The Prime Minister’s Office - Regional Administration and Local Government (PMO-RALG) ✓ ✓
Ministry of Finance (MoF) ✓
National Water Board
National Environmental Management Council (NEMC) ✓ ✓
Energy and Water Utilities Regulatory Authority (EWURA) ✓
Dis
tric
t /
Loca
l
Local Government Authorities (LGAs i.e. City, Municipal, Towns and District Councils)
*Basin, catchment and sub-catchment committees also included here! ✓
Water Supply and Sanitation Authorities (WSSAs) ✓ ✓
Community Owned Water Supply Organizations (COWSOs); WUAs? ✓
Services providers (public, private, NGOs, CBOs, WCAs) ✓
33
As seen in Table 7 above, national institutions implement Tanzania’s sector-related policies. The
national governments managing policies include The Ministry of Water and Irrigation (MoW);
Ministry of Health, Community Development, Gender, Elderly and Children (MoHCDGEC); National
Environmental Management Council (NEMC); and, the Prime Minister’s Office for Regional
Administration and Local Government (PMO-RALG). Regulations are managed at the national level
by NEMC, PMO-RALG, and the Energy and Water Utilities Regulatory Authority (EWURA); at the
district-level, the Local Government Authorities are responsible for regulating municipal utilities.
The Ministry of Finance works with the district-level WSSAs on budgeting and financing sector-
related work. The private sector can be contracted by WSSAs to provide services to consumers.
On the Basin, the Mwanza Urban Water and Sewerage Authority (MWAUWASA) is a Government
agency of Tanzania, established for the provision of water and sewerage management services
in the city of Mwanza. Lake Victoria is the major source of the piped water scheme, which serves
about 84% (500,000 people) of the Mwanza city and Kisesa township populations.
Other relevant utilities in the Basin are the Bukoba Water Supply and Sanitation (BUWASA)
Authority and the Musoma Urban Water and Sewerage Authority (MUWASA). BUWASA serves
around 53,000 people in Bukoba, which are about 61% of the total population. Almost 60% of
water supplied to the town comes from Lake Victoria. MUWASA is responsible for the overall
operation and management of water supply and sanitation services in the Musoma Municipality.
It draws water from three Lake Victoria intakes and serves around 90,000 people.
Uganda
The Uganda Constitution advocates for a clean and healthy environment and empowers central
government, local governments, and the communities/municipalities to ensure that every citizen
in Uganda has access to a clean and healthy environment. Relevant policy frameworks in Uganda
include Vision 2040, and the National Development Plan (NDPII). Vision 2040 seeks to transform
Uganda from a peasant society to a modern prosperous country within 30 years. This will involve
changing from a predominantly low income to a competitive upper middle country within 30
years. NDPII is the second in a series of six five-year plans aimed at achieving the Uganda Vision
2040. The goal of this plan is to propel the country towards middle income status by 2020 through
strengthening the country’s competitiveness for sustainable wealth creation, employment and
inclusive growth. Other relevant policies emphasize decentralization of roles in water and
sanitation, as well as focus on ENR protection and effluent discharge.
Uganda's other policies specifically focus on operating an enabling environment for more PPPs to
support economic development. They also include guidelines for implementing PPPs with local
governments and agencies. Although not directly related to the wastewater and sanitation, the
PPP legislation in all four relevant countries is significant in the general guidelines it provides for
public-private partnerships.
Uganda has centralized regulatory responsibilities in the government with NEMA, which manages
regulations nationally and locally. The Uganda Bureau of Standards established the effluent
standards in Uganda and implemented by the NEMA. Among the most important parameters used
in Uganda are lead and its compounds, mercury, cadmium, arsenic, nickel, copper, cobalt,
34
aluminum, zinc, and barium. Total suspended solids (TSS), pH, BOD, COD, Kjeldahl nitrogen, and
Total phosphorus are also critical parameters in monitoring and control of effluents quality
discharged into water bodies and public sewers in the country.
In Uganda, many of the ministries have roles and responsibilities for the sector across the national
and regional levels of the country. Table 8 below details the institutional framework of the
country.
Table 8: Uganda’s Institutional Framework for Wastewater and Sanitation Sector
Institution
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Water and Environment (MWE) ✓ ✓ ✓
Ministry of Health (MoH) ✓
Ministry of Education and Sports (MoES) ✓
Ministry of Finance, Planning and Economic Development (MFPED) ✓
National Water & Sewerage Corporation ✓
National Environment Management Authority ✓
Regio
nal
MWE ✓
MFPED ✓
NEMA ✓
Private sector ✓
Dis
tric
t /
Loca
l
District / Local Governments (DLGs) ✓
NEMA ✓
Community Based Organizations (CBOs) ✓
The MoH develops relevant policies at the national level with the Ministry of Water and
Environment (MWE). MWE manages policies at both the level and regional levels. Regulations are
the sole responsibility of NEMA across the different levels of government. Budgeting and finance
is managed by MWE, the Ministry of Finance, Planning and Economic Development (MFPED) at
the national level and coordinates with the district local governments – the PPP unit in Uganda is
also housed under MFPED.
At the national level, the National Water & Sewerage Corporation (NWSC) is responsible for
service provision in coordination with MWE and the Ministry of Education and Sports (MoES);
community-based organizations also provide services at the local level. NWSC is the primary
supplier of water and sanitation services in Uganda, withdrawing water from Lake Victoria. It is
owned by the Government of Uganda. NWSC increased its coverage almost ten-fold, from 27 to
253 towns since June 2013, with major operations in all urban municipalities and cities of Uganda.
The private sector’s role is primarily around the design and construction of wastewater and
sanitation management facilities, as well as the operation and maintenance services for the
facilities.
35
4. Gap Analysis and Areas for Improvement for Enabling PSP
The assessment of the institutional arrangements in the region, as well as each of the LVB’s
countries, illustrated gaps on which to expound. PSP in wastewater and sanitation management
across the Basin would likely improve if the LVB countries understood clearly where are some
areas for improvement. The gaps exist across the region, though some countries have more area
for improvement than others for each gap; countries’ specific gaps in each analysis will be
highlighted in each section below. The main gaps discussed in this chapter include governments
having (1) weak policy frameworks providing important direction for the sector, (2) confusing
regulations and standards frameworks to the private sector to follow, (3) unclear organizational
setups for the private sector to navigate, and (4) inadequate financing for improving and
maintaining waste management.
4.1 Weak Policy Frameworks
Policy frameworks in the region are old, outdated, and/or insufficient to provide PSP support in
the region. While different countries have different policy frameworks, they all are in need of
updating and strengthening to be more relevant to PSP in wastewater and sanitation
management. For example, policies in Rwanda are for the most part correctly stated, however
there are many areas of improvements for budgetary allocations and specific institutional
structures in place for undertaking the pollution assessment mandates. Meanwhile in Uganda,
there are diverse policies that require complex national multi-stakeholder cooperation for
implementation, which means that policies are not effectively implemented or operational at local
levels of government and communities.
Many of the LVB countries have several PPP-related policies and guidelines that can cause
confusion and opaqueness about how PPPs are facilitated and managed in the government.
Setting up contracts, guidelines, and monitoring is a burdensome process given current policies,
thus discouraging private sector involvement. The scope of the PPP legislation is biased towards
government ministries and agencies, and contracting authorities, and a bit ambiguous on
devolved governments units, which are also key players in the sector. The effectiveness of PPP
legislation in Kenya, Rwanda, Tanzania, and Uganda is generally low due to the complex
procedures required to implement a PPP, while Burundi’s PPP efforts are too nascent to have a
record of performance. Specific gaps in Kenya’s PPP policies are highlighted below in Box 4. The
absence of PPP bids within the sector in the Basin points to limited understanding and appreciation
of the wastewater/sanitation management sector opportunities by the private sector.
36
Box 4: PPP Policy Gaps in Kenya
Although Kenya’s PPP Act of 2013 attempted to establish guidelines for setting up PPPs, it created
too much complexity, which precludes smaller scale private sector actors from participating in the
procurement process. Additionally, the Privately Initiated Investment Proposals outlined by this
act for private entities to propose initiatives to the government have relatively underdeveloped
laws and guidelines. There is no formal model for the government to sub-contract private sector
entities to provide sanitation services, which makes it difficult to encourage PSP in the space.
Setting up contracts, guidelines, and monitoring is a burdensome process, thus discouraging
private sector involvement.
Currently, private sector entities have limited capacity to establish large scale PPPs under the
existing guidelines. No private sector entity has been able to successfully pass a proposed PPP
through the criteria required by the PPP Act of 2013. The time and criteria required to go through
the process are too long and challenging for smaller, local private actors to undertake.
Additionally, the public sector faces challenges in its capacity to establish PPPs at the sub-national
level. There are no county level institutions yet to mirror the ones created at the national level to
review proposals for PPPs, no clear procurement methods for counties, and no capacity at the
local level to evaluate and approve PPPs. Removing some of the barriers to establishing PPPs
could potentially reduce the regulatory burden on local governments. It would also ensure that
private sector actors are closely collaborating with the government to maximize the impact of
their initiatives. The public sector is best positioned to formulate a national sanitation strategy
and to allocate resources to low income areas that may otherwise not be commercially attractive.
Therefore, by making it easier for private firms to collaborate with the public sector, their efforts
are much more likely to align with government priorities.
The use of PPPs in many LVB countries are still relatively new, particularly for the water sector;
across Africa, there have been a limited number of PPP projects in the water and sewerage sector.
In 2014, the World Bank’s Public-Private Infrastructure Advisory Facility (PPIAF) project database
showed only 51 PPPs in water and sewerage (including desalination) in Africa between 1992 and
2012, with the bulk of the investment going to North Africa. Additionally, many of the WSS-based
PPPs in Africa have faced challenges and not lived up to expectations. There is no formal model
for some governments to sub-contract private sector entities to provide sanitation services, which
makes it difficult to encourage PSP in the space. Successful PPP models for the WSS and ENR
sector are luckily available to the Basin from international efforts, as previously listed in Table 1
in Chapter 1, and are available for LVB countries to consider (LVBC Secretariat, 2012).
4.2 Complicated Regulations and Standard Frameworks
With the many different standard guidelines across the region for wastewater and sanitation, it
is unclear how comprehensive all of the standards are and how they effectively regulate private
sector activity to minimize ENR damage in the Basin. While the EAS has harmonized some
standards around ENR and WSS, it could be more comprehensive. Additionally, while the EAS
does provide regional standards, not all countries in the LVB have appropriately changed their
standards to enhance traceability, and there is insufficient staffing to manage the standards
37
regionally. One barrier to changing standards includes the current lack of sector pressure and
incentives for follow-through on standardizing standards.
Regulatory functions across countries in the Basin split across different institutions to set and
manage KPIs and standards for utilities in the sector and, with minimal staffing to manage these
functions, finding, and assessing data on standards compliance is difficult and are at times
unrealistic to achieve for lower-level administrative units. There is a need to explore having
different targets for local governments at various stages of development to ensure that the ones
who do well are encouraged to keep improving, while those who are less developed have feasible
targets. The region also lacks frameworks prescribing clear mandates of institutions in-charge of
assessments as well as analysis of standards and compliance, especially in Burundi. There is also
a lack of national standards and guidelines for wastewater for sewerage management, FS
treatment for onsite sanitation systems, other aspects of onsite sanitation, and reuse in the
region. The regulatory environment in the region is limited and fragmented, confusing the private
sector about which services should be offered how and what guidelines with which they should
comply and increasing challenges for entering the wastewater and sanitation management sector.
In Uganda, several effluent and water quality standards are missing while existing standards are
either inadequate or overdue for review and harmonization nationally and regionally. Sewerage
regulation, for instance, has never been implemented because of incompatible principles and
missing community-level by-laws. For Tanzania, consultations with communities and key
stakeholders not carried out in establishment of industries as required in basic EIA and audit
regulations, and there are no clear provisions on grievance redress for if an industry damages
communities’ well-being by polluting the Basin. Those that have standards need to review and
harmonize their metrics across the region, such as effluent discharge standards in piped sewers.
4.3 Ineffective Organizational Setup Despite each of the five LVB countries having a robust matrix of national ministries and local
authorities responsible for water and sanitation management, capacity in the governments to
manage the sector in a way that enables PSP is lower than what should be available. Sector-
related institutional frameworks in the region are in different levels of disarray, and each country
has several agencies with overlapping responsibilities. The overlap in mandates between various
entities presents a challenge to PSP, as it is time-consuming for the private sector to engage in
negotiations of contracts and long-term partnerships with the government. For example,
Burundi’s frameworks for WSS and ENR roles and responsibilities are weakly structured. Basin-
wide, there is no clear delineation of responsibilities among key government ministries and
agencies, which increases the private sector’s barrier to entry for the sector. This confusion and
bureaucratic systems can be a source of frustration to a potential investor and make doing
business in the region unappealing, as illustrated in Box 5 below by Uganda’s case.
38
Box 5: Doing Business in Uganda
Uganda has a well-regulated and highly liberalized economy in which all sectors are open for
investment, and there is a free movement of capital to and from the country. The business
operating environment allows the full repatriation of profits after the mandatory taxes have been
paid, as well as 100% foreign ownership of private investments. The incentive regime is
structurally embedded in the country’s tax laws making them non-discriminatory and accessible
to both domestic and foreign investment depending on the sector and level of investment (URA,
2017).
Despite having a fairly good legal and regulatory framework for undertaking business, Uganda
was ranked number 127 (score 57%) out of the 190 countries considered in the ease of doing
business assessment by the World Bank in 2019. Doing Business 2019 measured the processes
for (1) business incorporation, (2) getting a building permit, (3) obtaining an electricity
connection, (4) transferring property, (5) getting access to credit, (6) protecting minority
investors, (7) paying taxes, (8) engaging in international trade, and (9) enforcing contracts and
resolving insolvency.
Some bottlenecks still exist in the investment climate that especially have to do with transparency
and good governance while dealing with some of the Government agencies and the complex land
acquisition and ownership challenges in the country.
Additionally, responsibilities in many countries have not effectively devolved, and local
government are often unclear about their role in facilitating private sector relationships, effluent
discharge monitoring, and implementing water and sanitation systems. Even though the local
government has a key role in engaging and supporting the private sector, their role in countries’
organizational setups remain poorly outlined. While the central government agencies may have
the right personnel – in terms of numbers of staff or knowledge and skillsets – to support PSP
theoretical, local governments are limited in their resources and ability to appropriately engage,
facilitate, and oversee MSMEs in wastewater and sanitation management. In Kenya, where
devolution efforts are underway since 2010, there remains much uncertainty about the specific
roles of various local government bodies. While in theory there is an adequate structure written
in policies and legal frameworks, in practice there is a need to implement clear and devolved
responsibilities at district and commune-level government institutions. As a result, local
governments are only slowly domesticating national level policies. They do not receive clear
direction from the national level regarding policies and expectations because of overlap in
functions between ministries. Local governments want to maintain their autonomy from the
national government, so their openness to receive direction is tempered.
Similarly, the role local governments play is not explicit in PPP policies – which limit the scope of
PPP management to national ministries, departments, and contracting authorities. Relevant
policies and legislation are created primarily by government ministries, agencies, and contracting
authorities; these central government institutions often focus on designing policies that relate to
and fit only in their higher level of governance. As a result, policies remain ambiguous on local
administrative units, even though they are key players in developing and managing PPPs.
39
Therefore, limited guidance and action exists for forming local-level PPPs and for sub-contracting
private firms.
There are capacity limitations in the public sector to prepare and successfully execute PPP
contracts in the sector, particularly at the sub-national level. Poor governmental capacity also
limits awareness and clarity about PPP prospects in waste management and what steps the
private sector would need to take to engage in PPPs for wastewater and sanitation management,
which are often too time consuming and difficult for most private sector actors to try to
understand. There is also insufficient technical staff at the local level to monitor, collect, and
analyze the standards and compliance data for wastewater and sanitation service providers. For
enhanced regulation of private sector service providers, there needs to be data available to
evaluate performance and standard compliance for PPP contracts. For example, in Kenya, there
are only at most two NEMA technical staff members in each county handling the WSS and ENR
sub-sectors. Limited staff is overworked, undermining the government’s ability to regulate
properly and proactively engage with businesses. In Rwanda, regulators have been trained on
aspects of circular economy, but further training is needed to build capacity in industries to
strengthen their understandings of effluent discharge compliance parameters.
Capacity to enforce private sector compliance in ENR-related standards is also challenging.
Though it is important to test industrial effluent discharge to ensure compliance with private
sector actors, effluent testing in the region is carried out in laboratories that are not managed by
regulating agencies nor certified for the desired tasks. Inefficiencies often delay results, leading
to compromised monitoring and compliance. There is no structured network infrastructure (field
instrumentation, reference laboratories and data management systems) for practical
implementation of pollution management. Private sector industries are also not sensitized nor
trained - or even involved - by regulators in monitoring, reporting, and ensuring compliance for
effluent discharge, including BOD and COD.
Finally, often those that are creating policies and legislation about sanitation in the central
government do not possess local knowledge or context to implement appropriate solutions for
communities. For example, while directives from central governments urge investments to
increase sewerage coverage, locally-placed NGOs and community-based initiatives – often run by
MSMEs – work on cheaper onsite sanitation technologies, which are more appropriate for densely-
populated and poorer areas. These alternative technologies and approaches to sanitation are
compatible with goals to expand sanitation coverage, including sewerage, but are currently
overlooked by the government because of limited local understanding, which can discourage the
private sector from engaging the government about their projects.
4.4 Inadequate Financing Financing for wastewater and sanitation is covered by central government grants to local level
implementing agencies, but funds are small and tend to be hidden within budgets for water
provision, with the water sector often taking priority. Currently, wastewater and sanitation
services are poorly funded in budgets – for example, Uganda’s water and sanitation budget
represent less than 5% of the total national budget. Whatever budget is available for water and
sanitation services, water treatment often receives priority and funding is directed more towards
40
central government staff, making the financing of additional staff or training for local government
difficult. If local governments want to improve the poorest households’ access to sanitation, they
would need to generate their own funds to do so. With a regional trend to devolve governance,
there is need for clarity on what aspects sanitation funding from national government will support
– will it focus on expansion of networked sanitation infrastructure such as sewers, or will it also
support the investment of onsite sanitation facilities? Despite PPP legislation in the region often
provide for a project development facilitation funds to support these kinds of infrastructures –
such as in Kenya, Uganda, and Tanzania – the funds have not yet been operationalized and it
remains unknown how the funds would work in practice.
Leveraging private sector funding to address the funding gap is not always reflected in sector
budgets or strategic investment documents in the governments, making wastewater and
sanitation sector-related work rely on the meager public funding available. Additionally, private
funding requires a level of transparency and good governance between agencies that can be
challenging for governments to achieve. Private funding needs some levels of security from the
sector, such as clear creditworthy utilities and/or projects that are prepared to take on private
finance. Only Kenya has been able to provide some clarity on creditworthy service providers for
the private sector to assess for engagement.
Private funding also need the sector to have sufficient revenue to repay debt after covering
operating and management costs. Policies that cover tariff structures for wastewater and
sanitation services do not fully recover investment costs. The current tariff structure for sewerage
services is not attractive enough for private sector investment in sewerage systems, and often
are politically sensitive thus leveraged during election periods, to the disadvantage of water and
sanitation providers, such as in Uganda. Low tariffs do not provide incentives for the private
sector to seek out PPPs for wastewater and sanitation management, especially for local
communities that need support increasing coverage for low-income areas, which is an important
aspect of many LVB countries’ Visions. Combined with foreign exchange risks to the potential
foreign direct investments with foreign exchange currency volatility in many of the countries
increases risks, potential international private sector actors remain deterred.
41
5. Recommendations
The gaps discussed in the previous chapter need to be addressed by the LVB countries can
support and facilitate more PSP across the region. This chapter provides recommendations to
address these gaps within the region. The recommendations include countries implementing (1)
improved policy and regulatory frameworks, (2) stronger organizational setups within each
countries’ government, (3) enhanced finance for the sector, and (4) clearer PPPs through
guidelines and communications.
5.1 Improved Policy and Regulatory Frameworks LVB countries can improve policy and regulatory frameworks in a way that more easily enables
the private sector to participate in the WSS sector and liaise with governments. Below are
recommendations for how the region could make these frameworks more conducive to PSP.
5.1.1 Harmonize regional policies and regulatory frameworks. LVB countries should
work to harmonize their policies and regulatory frameworks, reforming policies to provide more
clarity around processes and government roles. Streamlining mandates and processes for
coordination within the region as well as between national ministries and lower-level
governance institutions to ensure all policies are translated into consistent, devolved legislation
would reduce confusion and create clarity among government stakeholders and the private
sector. Not only would this facilitate government decision-making and implement processes,
but it would also encourage PSP by reducing the costs of coordination with government
entities. With clearer roles and policies, the barriers to entry into waste management
diminishes and the private sector can better navigate the different government ministries and
agencies’ roles in the sector, especially for small scale sanitation projects in informal
settlements or by NGOs with cheaper technologies.
5.1.2 Simplify and better coordinate PPP policies. The region should simplify PPP policies
with easy-to-follow guidelines that are well-coordinated within the region. It would be ideal if
the EAC could facilitate conversations with each LVB country so that they can harmonize PPPs
regionally, which would make it easier for the private sector to work in and across the region.
Additionally, governments should amend policies to allow local governments to clearly
participate in PPPs since they play a crucial role. This should be followed by appropriate
guidelines and regulations specifically for local governments. Simplifying PPPs can be done by
establishing clearer and updated guidelines for setting them up, especially for smaller-scale
sanitation projects including those by NGOs and community-based initiatives in informal
settlements who are working on cheaper technologies. PSP in the space would, in turn, lead
to quicker scaling up of sanitation coverage throughout the region, as well as reduced costs
through more efficient use of resources.
5.1.3 Implement consistent standards and regulations across the region. LVB
countries also need to harmonize their standards and regulations for the sector. This ideally
would mean that the LVB countries would adopt and implement the EAS – ideally further
elaborating on standards with the EAS so it can be a central authority of the region’s standards
42
and regulations. One way to implement a harmonization of standards in the region could
include the EASC designing well-placed incentives for country governments to execute and
fully follow the EAS framework. This could be done by developing monetary support and
financial credits through the EAC, or offering awards and certification programs for local
governments who follow and enforce the EAS framework effectively. Conversely, for
compliance with effluent discharge, the EAS should also include regional fines for water
pollution from effluent discharge to update obsolete fines in the region to realistic current
figures that can deter non-compliance.
5.1.4 Introduce standards for onsite sanitation services. National standards and
guidelines need to go beyond just sewage and address onsite sanitation services, such as
percentage of waste safely captured. This would incentivize utilities to focus on providing these
services and subcontract private sector actors to implement them. Developing realistic waste
discharge standards and explicitly include FS management in the revised waste discharge
regulations is a key way to support onsite sanitation businesses. FS and wastewater treatment
need also to be included in the EAS, which would support national standards and better guide
investors in identifying and measuring what solutions would be ideal for investment
arrangements. These adjustments would require increasing EAC’s budget to build a team able
to monitor and regulate water quality in the Basin.
5.2 Stronger Organization Setups The gap analysis above clearly shows ineffective organization setups in the countries within the
Basin. By streamlining government roles and responsibilities and developing capacity
development opportunities, LVB countries can be better equipped to work with the private sector
for wastewater and sanitation management. Below are recommendations for how the region
could strengthen current setups to further support PSP.
5.2.1 Clarify and implement government roles across different levels. There needs to
be a formal document in each country clarifying how various institutions involved in sanitation
and wastewater management are supposed to cooperate with each other across different
levels of government. Clearly devolving roles to the local government in LVB countries is an
important step in ensuring municipalities can foster PSP i their areas and create clarity in roles
for municipal projects. While the frameworks can provide these roles clearly, implementing
and ensuring the local government can adequately perform these duties is vital to the success
of PSP and future PPPs in wastewater and sanitation management. Including local
governments in discussions of role ownership and policymaking forums with nation-states is
one key method to ensure local involvement, increased clarity on roles, and that policies and
organizational tasks are grounded in local contexts. Similarly, local governments should form
specific departments that can take over key sanitation functions, such as subcontracting private
sector actors to provide sanitation services.
5.2.2 Increase capacity at the local level, for the public and private sectors. All
government and private sector actors at the local level need to increase their capacity. The
Basin's countries should co-develop skills training and capacity development opportunities for
wastewater and sanitation management. This can include skills in budgeting, technical utility
43
management for wastewater and sanitation service provision, navigating regulatory standards
and compliance enforcement, and other crucial topics. Local governments also need increases
in staff available to manage sector regulations and compliance, PPP projects, and overall
relationship building with the private sector. Similarly, national ministries need to have the
opportunity to learn about local contexts and community needs that are unique in the Basin.
Having increased financial and human resources for the local level – as well as an appreciation
of local needs at the national level – will increase the region's ability to manage successful
PPPs and encourage more participation from different kinds of private sector actors. LVB
countries should also build the capacity of government departments to develop, procure, and
monitor PPP projects in wastewater and sanitation management so that PPP policies can be
operationalized. The LVB countries also need to build the capacity of the local private sector
by making it mandatory for international private partners to work with small regional
companies when participating in PPP projects. To make sure capacity development programs
are effective, each LVB country should assess the capacity of their local government staff to
determine what relevant skills gaps exist.
5.2.3 Create central dedicated regulatory bodies for WSS sector. Countries should
create dedicated national wastewater and sanitation regulatory bodies for clarity among
government institutions. The aim is to streamline or establish processes for coordination
between national ministries and lower level governance institutions to ensure all national
policies are translated into lower/devolved level legislation. Establish better equipped
laboratories for testing of effluent parameters (including BOD and COD) for use by the
regulating agencies. Conduct training on RECP for regulatory agencies and employ technically
trained staff so as to enhance capacity to undertake monitoring of industrial pollutants and
emissions. These dedicated regulatory bodies would then be able to directly liaise with the
EASC and make sure that regulation in the Basin are consistently done across different
countries and their utilities.
5.3 Enhanced Financing Capacity Financing opportunities exist in the LVB states in the provision of potable water, the provision of
garbage and refuse disposal facilities, and the provision of waste treatment facilities in all LVB
countries. Below are recommendations for the region to consider to help incentivize PSP further.
5.3.1 Increase public budget allocations to sanitation and wastewater
management. Since government funding will remain an important source of funding for
sanitation and wastewater management, countries can prioritize this space by increasing the
percentage allocated to sanitation from their overall budgets. This will increase interest in the
sector for the private sector and entice commercial financiers in exploring investment
opportunities in the sector, as its riskiness would decrease. Having predictable annual
sanitation budgets can allow local governments to undertake multi-year projects with a
coordinated spending strategy rather than ad-hoc annual initiatives. These initiatives have
enabled other countries to maximize the returns on its sanitation investments by creating a
system that makes it possible for local governments to contract private sector sanitation
services on an ongoing basis, which increases PSP in the space.
44
5.3.2 Provide clarity for what public funding is able to support. With a regional trend
to devolve governance, there is need for clarity on what aspects of wastewater and sanitation
services public funding from national government will support – for example, whether public
finance will focus on the expansion of networked sanitation infrastructure, and not invest in
increasing sanitation provision through offering onsite sanitation containment systems.
Government agencies also need to engage with the private sector more to understand how
much money is necessary to cover implementation costs.
5.3.3 Implement Project Development Facilitation Funds - nationally and
regionally. Implementing Project Development Facilitation Funds could particularly help
engage the private sector (as stipulated in PPP policies in several of the countries). These
Funds would help fund project preparation and a robust PPP pipeline, as well as act as a
liquidity reserve to serve as a backstop for liabilities and gap funding for economically viable
(yet financially unviable) projects. Funds should be available explicitly for the local government
to use to increase PSP and PPP efforts, to support local government’s role in managing PPPs.
PSP would not eliminate the need for public budgets in sanitation and wastewater; however,
it would assist in closing the current financing gap that prevents universal access to safe
sanitation. Dedicating government funding to sanitation and wastewater management is
necessary to promote PSP in the space, especially when it comes to the provision of services
to low-income households who do not have the resources to pay for the full cost of these
services.
5.3.4 Require lead agencies in each country to design and lead bankable concepts.
Lead implementing agencies should be tasked to develop bankable concepts for prospective
projects in the aspects of wastewater and sanitation management and have them captured in
their investment plans and budgets. These can form the basis for awareness creation about
prospects and engagement/stimulation of prospective private sector partners on the possibility
of taking part in infrastructure projects in waste management. However, caution has to be
taken in the project design to ensure that viability is secured. Piloting of the approach on a
smaller scale to provide lessons that can help in the long-term replication on a bigger scale
could be considered as an option in the PSP investments. It is important to note that for lead
implementing agencies to develop bankable concepts, they will need to have their capacity
built to do so. Additionally, further research would benefit each LVB country to understand
what are the exact requirements for bankable projects in their local contexts.
5.3.5 Assess creditworthiness of current WSS actors. Before new projects are created,
governments in the region should assess the creditworthiness of their current wastewater and
sanitation sector actors (utilities that are both private and public). Understanding the region’s
(and each country’s) creditworthiness will help agencies and institutions work towards
improving utility viability and bankability and creating more opportunities for current waste
utilities to access much-needed financing, as well as develop ways to monitor and regulate the
financial health of the sector. Creditworthiness is a crucial piece to institutionalize before any
implementing agency can understand how to effectively develop bankable future projects.
Kenya has begun to manage this task already, as mentioned in Box 6 below.
45
Box 6: Kenya’s Creditworthy Assessment of Utilities
In 2011, Kenya’s WASREB began to facilitate the process of improving sector finance by debuting
a shadow creditworthiness assessment of all utilities. These credit ratings were a step in the right
direction and should be ideally reviewed annually to serve as a reliable guideline for commercial
lending. They also helped utilities understand what improvements needed to be made to improve
their qualifications for credit.
5.3.6 Improve government tariff structures to increase private sector incentives.
The government can reform tariffs so to improve the overall financial viability and appeal of
the sector for PSP. Tariffs for WSS services provision is a vital aspect to incentivize the private
sector; the private sector can use government-set tariffs to help finance their services and use
the revenue to pay back commercial financing intended to support upfront costs to build service
provision capacity. It is important that, while improving tariff structures, to work with the
private sector to clearly understand what the right tariffs to charge customers would be to
cover service costs, and ensure that any revenues generated from sewerage and sanitation
activities are channeled back to increasing sanitation coverage. There are ways to adjust tariffs,
potentially by introducing block tariffs that increase for the high- and middle-classes, to
incentivize the private sector to increase coverage while keeping costs affordable for lower-
income areas. Adding surcharges/tariffs to electricity or water bills of high and medium-income
households to cross-subsidize wastewater and sanitation management has been used to
expand sanitation coverage in low-income areas in some places, and those demographics have
reported in some countries to be willing to pay for the provision of services to low-income
communities. This can promote PSP by raising funds needed for governments to subsidize
onsite sanitation services offered by private sector entities. Additionally, municipalities can be
responsible for the collection of tariffs from consumers to facilitate funding onsite sanitation
projects. This closer collaboration between local authorities and private sector actors would
facilitate PSP in the space by reducing transaction costs and increasing the ease of
collaboration, increasing the private sector’s interest in working with LVB country governments
in the sector.
5.4 Clearer Public-Private Partnerships (PPPs) Implementing PPP arrangements across the LVB would help facilitate more PPPs in wastewater
and sanitation management service provision. LVB countries should consider making navigation
of PPP as simple and clear as possible, while reducing the burden on public servants. Below are
recommendations for how the region could improve the current PPP systems.
5.4.1 Develop simple guidelines for PPP setup. Government institutions at national and
local levels should develop simpler guidelines for setting up PPPs and for subcontracting private
firms. For example, in Kenya the water sector developed a toolkit to assist local Water Service
Boards and water service providers with directions on how to collaborate and deal with PPP
projects. The toolkit described in detail how to assess where to place water kiosks, how to set
up contracts with private sector entities, what rights various stakeholders had, and other
important aspects of a project. A similar approach can be used in the area of sanitation and
wastewater management: private sector actors can work with utilities to set up onsite
46
sanitation in areas lacking access to basic services. A toolkit can be developed for
subcontracting private firms through a streamlined, simple, and repeatable process.
5.4.2 Develop PPP risk mitigation mechanisms. Effective risk management ensures
maximum benefits from PPP by risk limitation, mitigation, and allocation to the most suited
partner. Private investments are sensitive to uncertainty, and as such, risk management lies
at the heart of any effective PPP design. Where uncertainty is present, it is priced into PPP
projects by the private sector in the form of higher expected rates of return. For certain forms
of uncertainty, notably political, legal, and regulatory, it may even prevent private finance
altogether or result in an unsuccessful partnership. PPP projects thus require, by definition,
the management of uncertainty in the form of risk. To counter foreign exchange risks in the
PPPs, strong consideration must be given to local currency financing, service/off take payments
in local currency and the inclusion of local capital markets (e.g., social security funds, insurance
funds) that are highly liquid and looking for long term assets to match their long-term liabilities.
5.4.3 Increase PPP communication and build awareness about PPPs. To ensure PPPs
are established and promoted within the private sector, it is important to create more
awareness at all levels is important to improve communication about the sector and the private
sector’s role. This includes increasing awareness at different levels of government through
training programs and consistent messaging for private sector actors. Another method of
increasing communication messaging is through campaigns that include engagement and
conversations with the EABC and other private sector interest organizations to understand
better what kinds of topics and talking points are important to the private sector.
5.4.4 Clearly understand the challenges of PPPs for the WSS sector, and the
government requirements to run one successfully. PSP is not a panacea for wastewater
and sanitation management. Experiences from many developing countries show that PPPs
have their limitations that might result in a lower value for money for the government.
Therefore, it is important to establish PPPs only when they would bring in efficiency gains,
improved service levels, and relevant technical expertise. For PSP to be beneficial in
wastewater and sanitation management, governments must carefully select areas where
private sector actors can provide additional value and only set up PPPs if the benefits of the
partnership are clear. LVB countries need to also make sure they fully assess their
governments’ unique requirements for running PPPs, including being clear about what is
necessary in terms of trained staff, technical assistance, project funding, and what terms must
be detailed in PPP contracts.
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6. Concluding Remarks
The countries within the LVB have learned some key lessons from their recent work in supporting
PSP, which can be implemented into actions for governments to collaborate on and harmonize
across the region. One lesson for the LVB countries to learn through this study is the importance
of regional collaborations and harmonization as well as experience sharing and learning. As Lake
Victoria is a shared resource, institutional improvements at the Basin level can only go so far
without the countries around Lake Victoria working together to integrate and fully harmonize
these efforts. As the region’s wastewater and sanitation systems impact the lake, is it vital to
share responsibility for the Basin’s sustainable management through improving and supporting
PSP as a coalition.
Firstly, leveraging private finance for new infrastructure development is important. LVB countries
can work on identifying where in the Basin is new wastewater/sanitation infrastructure is
necessary, how to make their development projects bankable, and work as a region to pilot
several PPP models in these regions to determine which models work in what circumstances in
the region.
Secondly, where implemented, the private sector can be worthwhile partners, even if they are
not bringing much money into projects. LVB countries, with the help of its regional institutions
such as LVBC, can assess the private sector actors currently available in the Basin and determine
how much money they can provide for potential future new infrastructure development projects.
Then, the governments of LVB countries can work on pooling their budgets to cover the rest of
the financing needs for these projects by creating and managing a Pooled Regional Facilitation
Fund. It is recommended to further study how to develop a regional fund like this beforehand
and ensure that its structure is well-applicable to each of the countries’ institutional arrangements.
Lastly, small-scale PPPs have significant roles to increase coverage so that it reaches the poor in
the area. The EAC has the opportunity to determine if, aside from the new infrastructure
development pilot projects, there are local governments with the ability to take on smaller PPPs
in their region, and what kinds of private sector actors could work with those governments. These
smaller PPPs could likely be focused on onsite sanitation service management within particular
communities. This could also develop the case for governments to introduce better standards and
policies in the sector related to onsite sanitation as a viable local option to increase sanitation
access in the Basin. It would be ideal to study case studies of small-scale PPPs and their structure
so that the models replicated complement current PPP policies in each country and can be well-
implemented by LVB countries’ local governments.
This study synthesizes the findings and results of a set of three previously-written study reports:
a regional overview with some details about each country’s institutional arrangements, as well as
more detailed institutional assessment reports for Kenya and Uganda. Due to the limited amount
of information available, the study comprising this report and the other three reports face the
time and resource limitations for a deeper and thorough analyses covering equally all five LVB
countries To improve this study in the future, it would be ideal to have comprehensive
48
assessments and case studies of every country in the region to ensure full, strong, and practical
recommendations, in particular for building capacity, developing bankable projects, and creating
regional funding and PPP models. It would also be worthwhile to assess with a broader scope
and recommend what institutional changes would further support the development of wastewater
and sanitation management across East Africa and support last-mile connectivity to utilities.
49
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Rwanda
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33. AMCOW. 2011. “Water Supply and Sanitation in Tanzania. Turning Finance into Services for 2015 and
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54
52. Republic of Uganda. 2017. “Uganda National Strategy for Private Sector Development, 2017-2022”.
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water-supply-system
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The World Bank Group: Washington, DC. http://pubdocs.worldbank.org/en.
55
Annexes
Annex 1. List of Supplementary Technical Background Reports
1. "An overview of Policy, Legislation and Institutional Arrangements for Private Sector
Participation in the Wastewater and Sanitation Sector in the Lake Victoria Basin." Final Draft
(unpublished), 2019 . World Bank Group: Washington, DC.
2. "Institutional Assessment for Private Sector Participation in Wastewater Management in
Kenya." Final Draft (unpublished), 2019. ENGAGING PRIVATE SECTOR FOR GREEN GROWTH
IN THE LAKE VICTORIA BASIN PROJECT (P161265). World Bank Group: Washington, DC
3. "Institutional Assessment for Promoting Private Sector Participation in Wastewater
Management in Uganda." Final Draft (unpublished), 2019. The NDF-funded Project “Engaging
Private Sector for Green Growth in the Lake Victoria Basin (EPSGG-LVB) (P161265)” Technical
Report. World Bank Group: Washington, DC.
56
Annex 2. LVB Institutional Roles and Responsibilities in the Wastewater and
Sanitation Sector, Extended
BURUNDI
Institution Roles and Responsibilities
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
The Ministry of Environment,
Agriculture and Livestock
(MINEAE)
With responsibilities in water, environmental and land
conservation and protection and the realization of SDGs through
– the DG-Water Resources & Sanitation (DGREA); Burundian
Office for the Protection of the Environment (OBPE).
✓ ✓
Ministry of Public Health and
AIDS control
With responsibilities on hygiene sanitation and water quality
through – Directorate-Promotion of Health, Hygiene and
Sanitation (DPSHA). ✓
Ministry of Hydraulics,
Energy and Mines
With responsibilities on water, water infrastructures and
sanitation management through – DG-Rural Hydraulic
Infrastructure and Basic Sanitation (DG-AHAMR); and the
Burundian Rural Energy Agency (ABER).
✓
Ministry of Commerce,
Industry, Posts and Tourism
Housing the supervisory agency - the Burundian Bureau of
Standardization and Quality Control (BBN). ✓
Ministry of the Interior Charged with supervision of municipalities and some technical
services, including the Municipal Technical Services Board
(SETEMU) of the City of Bujumbura. Manages the fund for local
development.
✓
Ministry of Finance, Budget
and Economic Development
Cooperation.
Fiscal policy and budgeting
✓
DG-AHAMR Its main missions are the punctual execution of drinking water
supply and basic sanitation projects as well as awareness-raising
and education of the population on hygiene in accordance with
the policy of the government of Burundi in matters of access to
drinking water and sanitation in rural areas.
✓
Burundian Office for the
Protection of the
Environment (OBPE)
Mandated in environmental protection and protected areas
management. Ensure compliance with the Water Code, the
Forest Code, the Environment Code and other texts related to
the protection of the environment;
Establish and monitor mechanisms for international trade and
exchange of flora and fauna species;
Enforce environmental standards and propose all measures to
protect and protect nature;
Ensure monitoring and evaluation of development programs to
ensure compliance with environmental standards in the planning
and execution of all development projects, which may have a
negative impact on the environment
✓
Geographic Institute of
Burundi (IGEBU)
Mandated to e to collect hydro-climatic and map based data and
data relating to water resources. ✓
DG-Water Resources &
Sanitation (DGREA);
Charged with the implementation of the national water policy;
and execution of the national sanitation policy and fight against
water resources pollution.
✓ ✓
Municipal Technical Services
Board (SETEMU)
Charged with wastewater and fecal sludge management in the
urban areas focusing on Bujumbura. ✓
Water and Electric Authority
(REGIDESO)
Charged with the production, distribution and the
commercialization of water and electricity in urban areas ✓
Pr
ov
in ce DGEREA (Directorate
General for the Environment,
1. Promote risk management policies linked to climate change
in collaboration with IGEBU, OBPE and other services concerned,
✓
57
Water Resources and
Sanitation
2. Design and monitor the implementation, in collaboration with
the departments concerned, of national environmental policies
while ensuring the protection and conservation of water
resources,
3. Develop and enforce environmental protection and
management regulations.
CPEA Responsibilities in water infrastructures and sanitation
management
✓
DGEAE (Direction Generale
de l’Environnement, de
l’Agriculture et de l’Elevage)
Coordinate and Implement environmental, agriculture and
livestock project at provincial level ✓
Communal Water Authorities
(RCEs)
Rural drinking water service providers; not-for-
profit associations
✓
Com
mune
Direction Communale de
l’Environnement, de l’
agriculture et de l’elevage
Ensure Technical advice to the commune in terms of project
development and implementation in environmental, Agriculture
and livestock sector
✓
AHR Responsibilities in water infrastructures and sanitation
management
✓
Local Authorities Management of waste
✓
(?)
Communal Water Authorities
(RCEs)
Rural drinking water service providers; not-for-
profit associations
✓
KENYA
Institution Roles and Responsibilities
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Water &
Sanitation
Key institution in charge of sanitation management, policies for
urban water and sewerage, sector coordination, investment
planning, and resource mobilization
✓
Ministry of Health Responsible for public health (sometimes called environmental
health) regulation, which involves coordinating rural sanitation
and hygiene activities; only deals with on-site sanitation, not
sewerage
✓
Ministry of Environment &
Forestry
Develops environmental protection, including solid and liquid
waste disposal policies
✓
Ministry of Education Deals with on-site sanitation policy in the form of guidelines on
types of sanitation and hygiene structures in schools
✓
National Environmental
Management Authority
(NEMA)
Creates environmental management regulation, includes
licensing of waste transport and waste management; deals with
both on-site and sewerage regulation
✓
Water Services Regulatory
Board (WASREB)
Non-commercial state corporation; regulates and monitors
urban sanitation; core role is to issue licenses to service
providers; sets standards, tariffs, and service provision
guidelines. Under the 2016 Water Act, WASREB now also
licenses Water Service Providers (WSPs)
✓
Water Works Development
Agencies (WWDAs)
(previously Water Service
Boards (WSBs))
WWDAs develop, maintain, and manage cross-county water
infrastructure assets, which they own. They are also responsible
for the provision of technical services and capacity building to
county governments. Previously, WWDAs were called Water
Service Boards, but the Water Act of 2016 created the Water
Works Development Agencies. The WWDAs were officially
enacted in February 2019 when the Cabinet Secretary of Water
and Sanitation appointed chairpersons and members of eight
Water Works Development Agencies, without prior notice of
establishing the Agencies. This change has been controversial
and remains disputed.
✓
58
National Treasury Finance policy; budget-making; planning country projections;
allocation and transfer of resources between national and county
governments
✓
Water Sector Trust Fund
(WSTF)
Established with the Water Act of 2002, this is a state
corporation with a basket fund for the financing of pro-poor
water and sanitation projects (includes on-site sanitation)
✓
Kenya Water Institute
(KEWI)
National agency offering competency based training, research,
and consultancy in the water sector to enhance capacity building
and address the shortage of skilled personnel in the sector
(engineers, planners, technicians, technologists, etc.)
✓
County
County Departments of
Health & Sanitation
Sanitation and wastewater policy and provision of services at the
county level ✓ ✓ ✓
County Assembly Responsible for creating and passing county level legislation;
oversight of sanitation service provision
✓
Water Service Providers
(WSPs)
Under the county government, subcontracted by the Water
Works Development Agencies; responsible for service provision;
these are typically public water utilities
✓
County Department of
Finance
Responsible for budgeting, expenditure approval, and
management of county revenues and allotments
✓
Private sector Typically private sector firms are involved both in the production
of toilets, as well as the provision of services such as on-site
sanitation across the value chain (containment, emptying,
transport, treatment/disposal, and reuse)
✓ ✓
RWANDA
Institution Roles and Responsibilities
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of
Environment
(MINIRENA)
Formulation of Water resources management policy, strategic
planning, coordination, quality assurance, monitoring,
evaluation and capacity building. Put in place legal and
regulatory framework.
✓ ✓
Ministry of Health
(MINISANTE)
Policy formulation and promotion of hygiene and public health. ✓ ✓
Ministry of Local Government
(MINALOC)
Establishment, development and facilitation of the management
of efficient and effective decentralized government systems
capable of law enforcement and delivery of required services to
the local communities.
✓ ✓
Ministry of Education
(MINEDUC)
Promotion of education including/capacity building and curricula
development relating to water sciences and research on water
and sanitation management in schools and other educational
institutions.
✓
Ministry of Finance, Planning
and
Economic Development
(MINECOFIN)
Mobilization and allocation of financial resources for water
resources
development. ✓ ✓
Energy, Water and Sanitation
Authority (EWSA)
Autonomous agency responsible for the delivery of water supply
and sewerage services in the major towns and large urban
centers including provision of oversight and support services to
the local communities and
other water supply service providers.
✓ ✓
Rwanda Environment
Management
Authority (REMA)
Develop regulations and ensure protection and conservation of
the Environment and natural resources across the Country. ✓
Rwanda Utilities Regulatory
Agency (RURA)
Enforcement of compliance by public utilities with the laws
governing their activities. ✓
59
Rwanda Bureau of Standards
(RBS)
Provision of standards based solutions for Consumer Protection
and Trade promotion for socio-economic growth in a safe and
stable environment.
✓
Rwanda Natural Resources
Authority (RNRA)
Autonomous agency responsible for management of natural
resources including water resources management and allocation
✓
(?)
Rwanda Development Board
(RDB)
Facilitation of investment and support services to investors. ✓
Private Sector
Design, construction, operation and maintenance of water
resources management infrastructure. Conduct training and
capacity building for both central and local government staff.
Provision of other commercial services.
✓
Dis
tric
t /
Loca
l
Districts Implementation of the government policies and laws (delegated
management). ✓
Private Sector
Design, construction, operation and maintenance of water
resources management infrastructure. Conduct training and
capacity building for both central and local government staff.
Provision of other commercial services.
✓
EWSA representation ✓
REMA Representation ✓
RURA Representation ✓
RBS Representation ✓
User Communities
Management of water resources in the course of their productive
and consumptive activities on a day to day basis. ✓
TANZANIA
Institution Roles and Responsibilities
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Water and
Irrigation (MoW)
Functions comprise of policy and strategy development,
coordination of the planning process and financial mobilization
for projects of national importance. MoW ensures policy sectoral
planning and coordination, deals with transboundary water
resources issues of national interest, develops water resources
of national interest, maintains WRM sub-sector information,
monitors NWB and BWBs, and supervises Water Resources
Institute and Drilling and Dam Construction Agency
✓
Ministry of Health,
Community Development,
Gender, Elderly and
Children (MoHCDGEC)
Develops policy, guidelines and strategies for sanitation;
provides technical assistance to councils for sanitation; and
prepares Acts, Regulations and Standards for sanitation ✓
The Prime Minister’s Office -
Regional Administration and
Local Government (PMO-
RALG)
Involved in coordinating planning of projects from local
government authorities and their budgets. Houses the NEMC
and DOE. ✓ ✓
Ministry of Finance (MoF) Responsible for overall planning and budgeting ✓
National Water Board
Co-ordinates basin planning and management. Responsible for
integrated sustainable management and development of water
resources of the river basins in the country including
transboundary waters.
National Environmental
Management Council (NEMC)
Together with the Division of the Environment (DOE) – both
in PMO-RALG, is responsible for environmental management,
providing umbrella policy and legislation, and EIA procedures
and guidelines, regulations and standards.
✓ ✓
Energy and Water Utilities
Regulatory Authority
(EWURA)
Responsible for issuing licenses to WSSAs, based on the
submission of business plans, and for monitoring and regulating
performance of the WSSAs against the business plans. This will
include the approval of tariffs for water and sanitation services
✓
60
Dis
tric
t /
Loca
l Local Government
Authorities (LGAs i.e. City,
Municipal, Towns and District
Councils)
*Basin, catchment and sub-
catchment committees also
included here!
Are responsible for coordinating the
physical planning with WSSAs and coordinating WSSAs budgets
within Council Budgets
*Basin Water Boards co-ordinate technical aspects of trans-
boundary issues in the basin and approve basin WRM planning
and budgets; approve, issue and revoke water use and
discharge permits; and enforce water use permits and pollution
control measures.
✓
Water Supply and Sanitation
Authorities (WSSAs)
Manage and develop water supply
and sewerage infrastructure. WSSAs are responsible for
preparing business plans to provide water supply and sewerage
services including capital investment plans. The functions of the
WSSAs comprise also the securing of financing for capital
investments,
✓ ✓
Community Owned Water
Supply Organizations
(COWSOs); WUAs?
Own and manage water supply assets; operate and maintain
water supply assets; determine consumer tariffs; collect revenue
for the provision of services; and contract and manage Service
Providers.
✓
Services providers (public,
private, NGOs,
CBOs, WCAs)
Contracted by WSSAs and COWSOs to provide services to
consumers ✓
UGANDA
Institution Roles and Responsibilities
Po
licy
Re
gu
lati
on
Fin
an
cin
g
Pro
vis
ion
Pro
du
cti
on
National
Ministry of Water and
Environment (MWE)
Development of relevant sanitation/waste treatment policies;
Plan, finance and develop sanitation infrastructure (public
latrines, sewerage systems and treatment facilities for
wastewater and fecal sludge); and Technical support to the
districts through TSUs and WSDFs
✓ ✓ ✓
Ministry of Health (MoH) Development of relevant policies; The MoH is the custodian of
the 2000 Public Health Act and the 2005 Environmental Health
Policy. It has responsibility for sanitation promotion and hygiene
behavior at household level, and elimination of open defecation.
✓
Ministry of Education and
Sports (MoES)
The MoES is responsible for schools’ sanitation, and addresses
its mandate primarily through funding construction of latrines
and other WASH infrastructure as part of developing new
schools, and promoting hygiene through school-based learning
and schools’ health clubs.
✓
Ministry of Finance, Planning
and Economic Development
(MFPED)
The MFPD is responsible for mobilization and allocation of funds
and coordination of development partners. The PPP unit is
housed in this Ministry.
✓
National Water & Sewerage
Corporation
The mandate of NWSC as defined in the NWSC Act 2000, Cap
317, is to operate and provide water and sewerage services in
areas entrusted to it on a sound, commercial and viable basis.
NWSC is responsible for: the collection, transportation and
treatment of wastewater; and receiving/treating fecal sludge.
✓
National Environment
Management Authority
The National Environment Act (NEMA), Cap. 153, gives NEMA
the mandate to be the principal Agency in Uganda responsible
for the management of the environment by coordinating,
monitoring, regulating, and supervising all activities in the field
of environment.
✓
Regio
nal MWE
Deconcentrated at Regional level and part of regional institutions
incl. Technical Support Units (TSUs), Umbrella Authorities (UAs),
Water Management Zones (WMZs), Water and Sanitation
✓
MFPED ✓
61
Development Facilities (WSDFs), Regional water facility
regulation
NEMA Coordinating, monitoring, regulating, and supervising all
activities. ✓
Private sector Provide Design and Construction of sanitation/wastewater
management facilities. They also provide Operation and
maintenance services for the facilities. Technical Support Units
(TSUs) and Water and Sanitation Development Facilities
(WSDFs)
✓
Dis
tric
t /
Loca
l
District
Local Governments (DLGs)
They take responsibility for sanitation within the town
council/District; Solid waste management is also the
responsibility of Local Authorities. And are empowered by the
Local Governments Act (1997) to make and enforce ordinances
and by-laws; They can receive grant funding and may mobilize
local resources for implementing and supporting sanitation
activities in their areas of Jurisdiction. They operationalize
sanitation activities of the MWE, MOH and MoES
✓
NEMA Coordinating, monitoring, regulating, and supervising all
activities. ✓
Community Based
Organizations (CBOs)
Research, Advocacy for increased sector financing and better
sanitation services, implementation of sanitation programs and
projects. Community engagements.
✓
62
Annex 3. Organizational Setups in the LVB Countries’ Wastewater and Sanitation sector Burundi
63
Kenya
64
Rwanda
65
Tanzania
66
Uganda
67
Annex 4. In-depth Analysis of Policies and Regulatory Frameworks in the LVB BURUNDI
POLICY
1. Burundi Vision at the 2025
Horizon
The Burundi Vision 2025 expresses the desire for realization of economic and social evolutions
for Burundi. Throughout the vision document, Burundians wish to achieve comprehensive and
sustainable water resources management and development, in a manner that water resources
play a central role in Burundi’s social and economic development process.
2. The National Water Policy,
2009
The overall objective of this policy is to guarantee water needs to users through a harmonious
and sustainable development of national water resources.
LEGISLATION
1. The Constitution of the
Republic of Burundi (2005)
In its article 35 states that the country ensures the good management and sustainable
exploitation of its natural resources by preserving and conserving those resources for future
generations.
2. Environmental Code of
2000
Constitutes a framework addressing all major aspects of environmental
protection and management. Other laws and regulations complete the ECB by governing specific
sectors.
3. The Water Act (1992)
(Décret-Loi nº 1/41)
The provisions of this decree (law) are intended to protect the aquatic environment, preserve
the common water resource and reconcile the interests of all different users.
4. Public Health Code (1982)
(Décret-Loi No.1/16 du 17 Mai
1982)
Article 2 of the code, provides that any water collecting project should respect international
standards
of drinking water.
5. Law n ° 1/14 of 27 April 2015 Covers the general scheme of Public-Private Partnership Contracts
6. Law No. 1/01 of 4 February
2008
On the Public Procurement Code in Burundi (applicable to public services delegations)
REGULATIONS
1. Decree on Environmental
Impact Assessment (EIA),
2010
Lays down the content, rules, principles, and procedures for EIA. Was
further completed through a ministerial order on the scoping in the EIA process in Burundi.
KENYA
POLICY
1. Kenya Vision 2030
Kenya Vision 2030 sets the goal of universal access to safe water and sanitation in the country.
It proposes strategies for achieving this objective, such as increasing community sanitation,
improving the planning of informal urban settlements, and encouraging public-private
partnerships in the building and management of sewage infrastructure.
2. Kenya Environmental and
Sanitation Hygiene Policy
(KESHP) 2016-2030
KESHP was launched in 2016 to create broad guidelines for both state and non-state actors in
their efforts to achieve universal access to water and sanitation. It aspires to make Kenya open
defecation free (ODF) by 2030 and to increase public funding of sanitation from its current level
of 0.2% of Kenya’s GDP to 0.5% in 2020 and 0.9% in 2030. The policy includes provisions for
improving urban sanitation facilities and ensuring safe waste disposal and management through
low-cost technologies in slum and peri-urban areas.
Most relevant to this report, KESHP also seeks to encourage private sector participation,
especially as it relates to providing lower cost, market-based solutions for lower income
households. It mentions the potential of establishing subsidies to achieve this goal, recognizing
the possibility of “market-compatible financing options including new types of cash transfers and
social subsidies to enable households in the lower wealth quintiles to purchase through the
market, while maintaining incentives for others who can afford to purchase on their own”.
KESHP has been an effective step towards promoting PSP because it allowed private sector
actors to engage with different government stakeholders on sanitation matters across the value
chain. By recognizing the importance of the private sector and the need for innovative sanitation
delivery options, it has created the space for private firms to begin offering sanitation services.
While it is too early to see a tangible increase in PSP resulting from this policy, KESHP has been
effective in setting up sanitation matters in Kenya in the absence of a national act. The policy
has been useful to counties such as Nakuru and Kisumu in helping them create local level
sanitation acts and policies.
PPP Policy, 2011 Policy to articulate Kenya’s commitment to PPPs as a priority mechanism to address
infrastructure budget shortfalls as well as to provide a basis for enactment of a primary law for
delivery of PPPs.
LEGISLATION
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1. 2010 Constitution
Chapter five is dedicated to land and environment. Under article 67(2) (d) the Constitution
mandates the National Land Commission to conduct research related to land and the use of
natural resources, and make recommendations to appropriate authorities. In article 69(1) (a)
the Constitution impose an obligation to the state to ensure sustainable exploitation, utilization,
management and conservation of the environment and natural resources, and ensure the
equitable sharing of the accruing benefits.
2. Environmental
Management and
Coordination
(Amendment) Act, 2015
The main regulatory, enforcement, and licensing body related to sanitation and wastewater
management in Kenya was created with the passing of the Environmental Management and
Coordination Act of 1999. To this day, the National Environment Management Authority (NEMA)
remains the only body responsible for regulating the sector and licensing private sector
providers.
3. Water Acts of 2002 and
2016
The Water Acts of 2002 and 2016 are the principal water and sanitation sector laws. The 2002
act introduced major reforms that separated water and sewerage asset ownership from the
provision of water and sanitation services. The Water Act of 2016 was issued to reflect the
institutional reforms occurring in Kenya as a result of devolution.
4. Public Private Partnerships
Act of 2013
Although not directly related to the wastewater and sanitation management sector, this act is
significant in the general guidelines it provides for public-private partnerships. While this is a
step in the right direction to facilitate PSP, its effectiveness is low due to the overly complex
procedures required to implement a public-private partnership.
REGULATIONS
1. Environmental
Management and
Coordination (Waste
Management) Regulations
2006
Waste management regulations covering the different waste categories including solid waste,
hazardous waste, pesticides and toxic substances, biomedical waste, radioactive waste, etc. Also
outlines Responsibilities of waste generators, segregation of waste by generators and also
cleaner production principles.
2. Environmental
Management and
Coordination (Water
Quality) Regulations, 2006
In relation to water used for domestic, industrial, agricultural, and recreational purposes; water
used for fisheries and wildlife purposes, and water used for any other purposes, the regulations
prohibit discharge of effluent into the environment contrary to the established standards. The
3rd schedule of the regulations further provides guidelines and standards for the discharge of
poisons, toxins, noxious, radioactive waste or other pollutants into the environment.
3. PPP Regulations, 2014 The PPP Regulations provide detailed guidelines to the PPP Act for smooth implementation of
the Act.
In addition, there are four Draft regulations to address arising issues including the devolved
government structure.
• PPP (County Government) Regulations 2015 (draft)
• PPP (Petition) Regulations 2015 (draft)
• PPP Petition Guidelines, 2014 (in force)
• PPP (Project Facilitation Fund) Regulations 2015 (draft)
RWANDA
POLICY
1. Rwanda Vision 2020 Infrastructure development is identified as a key pillar in achieving the Country’s development
goals, in particular ensure that by 2020 all Rwandans have access to clean water, and the rural
and urban areas have sufficient sewerage and disposal systems.
2. The National Policy and
Strategy for Water Supply
and Sanitation Services
(2010)
With the overall objective is to ensure sustainable and affordable access to safe water supply,
sanitation and waste management services for all Rwandans, as a contribution to poverty
reduction, public health, economic development and environmental protection. A key specific
objectives of the water supply sub-sector is to raise rural water supply coverage to 85% by 2012
and to 100% by 2020, whereby the Districts plan, design, finance and implement infrastructure
projects. Under sanitation sub-sector, a key specific objective is to raise household sanitation
coverage to 65% by 2012 and 100% by 2020, and promote hygiene behavior change,
3. The National Policy for
Water Resources
Management (2011)
It replaces the 2004 policy and has been necessitated by the ill-alignment between the 2004
policy and Water Law No. 62/2008, which embraced many modern and cutting-edge principles
of sustainable water resources.
4. The National
Environmental
Management Policy (2010)
The overall objective of the Environment Policy is the improvement of man’s well-being, the
judicious utilization of natural resources and the protection and rational management of
ecosystems for sustainable and fair development.
5. Rwanda Private Sector
Development Strategy
2013-2018
Aimed at addressing the small but growing Rwandan private sector, to develop an
entrepreneurial, innovative and competitive sector that delivers broad-based and inclusive
economic growth resulting in many more and better-paid jobs for Rwandans.
LEGISLATION
1. Constitution 2003
Regarding environment and natural resources, article 49 provides that the State and every
person has the duty to protect, safeguard and promote the environment and a law will determine
the modalities for protecting, safeguarding and promoting the environment. Also article 171 (5)
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provides that one of the functions of the National Police is to ensure respect for the law relating
to air space, borders and waters.
2. Law No. 04/2005 on
Environment
Organic Law determining the modalities of protection, conservation and promotion of
environment in Rwanda.
3. Law for Conservation,
Protection and
Management of Water
Resources Regulations,
2008
provides for establishment in the Prime Minister’s office a Water Inter-ministerial Committee
which shall be consulted on all legislative drafts/Bills regarding planning in the water domain
elaborated at the national level, as well as on matters of national, regional or international level.
4. Ministerial Order No.
003/2008
Ministerial Order relating to the requirements and procedure for environmental impact
assessment.
5. Ministerial Order No.
004/2008
Ministerial Order establishing the list of works, activities and projects that have to undertake an
environment impact assessment.
6. Law Nº14/2016 of
02/05/2016 for Governing
PPPs in Rwanda.
The Law defines the types of PPP arrangements and potential sectors; identifies institutions to
be involved; outlines processes for procurement of PPP projects; delineates roles for institutions;
and institutionalizes governance framework for PPPs. The Law requires the Rwanda
Development Board (“RDB”) to issue general Guidelines for procurement of PPP projects and
advise the GoR on matters related to PPPs.
REGULATIONS
1. Environmental Impact
Assessment Guidelines,
2006
Concerning Environmental Impact Assessment by the Rwanda Environment Management
Authority (REMA)
2. Rwanda PPP guidelines,
2018
Law Nº14/2016 requires the Rwanda Development Board (“RDB”) to issue general
Guidelines for procurement of PPP projects and advise the GoR on matters related to PPPs.
TANZANIA
POLICY
1. Development Vision 2025 The overall aim of the National Vision 2025 is to transfer Tanzania from a least developing to a
middle income country. Tanzania’s Development Vision 2025 aims at achieving an absence of
abject poverty and attaining a high quality of life for all people by 2025. Water supply and
sanitation is seen as an essential tool in the effort to reduce the levels of poverty and to mitigate
its effects, especially in the rural areas where it is endemic.
2. The National Water Policy
(2002)
NAWAPO 2002 sets out the future direction for the Water Sector in achieving sustainable
development and management of the Nation’s water resources for economy-wide benefits and
an increase in the availability of water supply and sanitation services, and for maintenance of
the environment.” It is oriented towards reaching the MDGs for water and sanitation in Tanzania
and incorporates the overall development goals set out by the Vision 2025 and the National
Strategy for Growth and Reduction of Poverty (MKUKUTA, 2005?).
These reforms are now being implemented through the Water Sector Development
Programme 2006-2025. Other supporting or related legislation include: Environment
Management Act of 2004, the Fisheries Act, 2003, the National Parks Act, the Forest
Act, 2002, the Mining Act, the Land Act, Land Use Planning Act and Local Government
Laws.
3. The National Water Sector
Development Strategy
2006-2015
The NWSDS has been developed to support re-alignment of the water related aspects of other
key sectoral policies (for example, energy, irrigation, industry, mining, and the environment)
with the National Water Policy, and to provide a focus on specific roles of the various actors
through clearly defining roles and responsibilities and hence the removal of duplications and
omissions.
4. National Public Private
Partnership (PPP) Policy,
2009
Aimed at the creation and operation of an appropriate enabling environment to guide public and
private sectors, donor community and other stakeholders in PPPs. to contribute to the
achievement of national development goals.
LEGISLATION
1. Constitution, 1977
(Amendment 2005)
According to article 27 it is the duty of every person to protect the natural resources of the
country, the property of the state authority and all property collectively owned by the people.
Also every person is required to combat all forms of waste and squander, and to manage the
national economy assiduously with the attitude of people who are masters of the destiny of their
nation.
2. The Water Resources
Management Act, 2009
Part VI of the Water Resources Management Act, 2009 addresses the issues of protection of
Water Resources. Section. This Legislation goes further by defining the duties of different
institutions and actions to be taken in the whole process of monitoring pollution events and
remedial measures which have to be taken.
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3. The Environmental
Management Act (EMA),
2004
The Act prohibits environmental pollution as a whole. Part V from section 60 to 62 clearly
highlights Environmental obligations under water laws; and the power of the Ministry to advise
on the discharge of sewerage and make rules governing issues of permits for the discharge of
effluents into water bodies.
4. Tanzania Public-Private
Partnership Act 2010? and
Tanzania Public-Private
Partnership (Amendment)
Act 2018
The Act rationalizes the PPP framework by merging the two original PPP Units into one PPP
Centre, replacing the PPP Technical Committee with the Public-Private Partnership Steering
Committee, and deleting the National Investment Steering Committee. Further, the PPP
Amendment Act 2018 provides that the Minister of Finance and Planning may exempt
procurement of an unsolicited project from the competitive bidding process where it meets the
given criteria.
REGULATIONS
1. Guidelines for Water
Resources Monitoring and
Pollution Control, 2012
Main objective of this guideline is to enable any stakeholder to comply with EMA, 2004. Covers
both Ambient Water Quality Monitoring (AWQM) and Effluent Quality Monitoring (EQM). For
monitoring the country’s ground water and surface waters in rivers, streams, lakes and similar
water bodies and marine waters (coastal estuaries and offshore line); including the monitoring
of quality of effluent from industries and other regulated wastewater dischargers.
2. Tanzania Public-Private
Partnership Regulations
(2011)
The PPP Regulations govern the procurement procedures of PPPs in Tanzania.
UGANDA
POLICY
1. Vision 2040 Vision 2040 seeks to transform Uganda from a peasant society to a modern prosperous country
within 30 years. This will involve changing from a predominantly low income to a competitive
upper middle country within 30 years.
2. The National Water Policy
1999
This is the principal water sector policy. It promotes an integrated approach to the management
of water resources in Uganda, and covers water resources management, development and use.
The Policy sets out core national objectives and strategies that guide water/wastewater sector
regulation.
3. The National Environment
Policy (NEMP), 1994 and
Draft NEMP, 2014
This was adopted in 1994 following the National Environment Action Plan. It sets out the overall
policy objectives and principles of environment management.
4. Second National
Development Plan (NDP II)
[2015/16-2019/20]
This National Development Plan (NDPII) is the second in a series of six five-year Plans aimed at
achieving the Uganda Vision 2040. The goal of this Plan is to propel the country towards middle
income status by 2020 through strengthening the country’s competitiveness for sustainable
wealth creation, employment and inclusive growth.
5. Public-Private Partnership
Framework Policy for
Uganda, 2010
With aims - better utilization and allocation of public funds, more efficient delivery of public
infrastructure, provision of good quality public services, and increased economic growth and
foreign direct investment.
LEGISLATION
1. Constitution, 1995
The Uganda Constitution advocates for a clean and healthy environment. The Constitution
empowers central government, local governments and the communities/municipalities to ensure
that every citizen in Uganda has access to a clean and healthy environment.
2. The Water Act, Cap 152 The Water Act is the principal water and sanitation sector law. It was enacted in 1995 based on
recommendations of the Water Action Plan (WAP) which included those relating to the reform
of the then existing water sector legal and institutional Framework.
3. The National Environment
Act, Cap 153
The National Environment Act was made in 1995. It is the principal legislation governing the
environment in Uganda. Its objective is to provide for sustainable management of the
environment including protection of natural resources such as water.
4. The National Water and
Sewerage Corporation Act,
Cap 317
The Act establishes and governs the legal status, mandate, powers and functions of the National
Water and Sewerage Corporation (NWSC).
5. The Public Health Act (Cap
381)
The Public Health Act is the principal sector law regulating all aspects of public health. Aspects
of public health regulated under the Act, include water, sanitation, sewerage and drainage. This
Act once fully enforced directly impacts on the volumes of waste that can be treated. And
therefore increased demand for treatment which is an incentive to the private sector. However,
the Act has some outdated information that need to be updated e.g. Fines for Non-compliance.
The Act is under review by MoH. Accompanying regulations are already in place to facilitate
enforcement of standards.
6. The Local Government Act,
1997 (Cap 243)
The Act implements the Government’s policy of decentralization and devolution of powers and
services delivery to district councils and other lower governments. Local authorities are
mandated to make their own specific by-laws or ordinances. E.g. KCCA has a solid waste
ordinance which is part of the legal framework that was used to engage the private sector in
solid waste management in Kampala.
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7. Sanitation Ordinances and
By-laws
The Local Governments Act makes provision for Local Authorities to develop their own specific
by-laws/ordinances. These have to be approved by the Local Council and checked by the Solicitor
General to ensure consistency with other laws. A number of Local Authorities have developed
sanitation specific by-laws to address local sanitation challenges. Some examples of the local by-
laws include:
• The Local Governments (Kampala City Council) (Solid Waste Management) Ordinance, 2000.
KCCA has utilized this ordinance as the basis for engaging the private sector in formalized
solid waste collection in Kampala.
• The KCCA (Sewerage and Fecal Sludge Management) Draft Ordinance (2018). This
ordinance is for the collection, transportation, treatment and reuse of fecal sludge within
Kampala City; and to regulate the service providers engaged in fecal sludge management.
It is yet to be approved by the council.
• Kitgum Municipal Council (Sanitation By-Laws) Revised in 2015. Kitgum Municipal Council
developed their own bylaws and have successfully improved sanitation in the town by
enforcing the provisions in the bylaws. They have also engaged the private sector in
Management of the Fecal Sludge Treatment Facility using the same law.
8. The Public Private
Partnerships Act, 2015
The PPP Act seeks to regulate the identification, preparation, procurement, implementation,
maintenance, operation, management, monitoring and evaluation of PPP throughout the project
cycle in Uganda. It also creates an institutional framework with appropriate roles and
responsibilities for the conduct of different functions and processes.
REGULATIONS
1. The Water (Sewerage)
Regulations (S.1.152-3)
These were made under the Water Act. They apply to “sewerage areas” declared by the Minister
of Water and Environment under section 45 of the Water Act.
2. The Water (Waste
Discharge) Regulations
(S.1.152-4)
These were made by NEMA in consultation with the Directorate for Water Development (DWD)
as the lead agency for the water sector under section 26 of the National Environment Act.
3. The Water (General Rates)
Regulations (S.1.152-6)
and The Water Act (General
Rates) Instrument 2006
These provide general water rates by different categories of customers in NWSC operated towns.
They also provide guidelines for applicable rates in the supply of water and sewerage services.
4. PPP guidelines for Local
Governments, 2013
Guidelines intended to outline for local governments/agencies, potential private sector bidders
and the public the general direction and principles that will be adopted and used for
implementing PPPs.