Willingness to pay for improved sanitation services and its implication on demand responsive approach of BRAC Water, Sanitation and Hygiene Programme

This study aimed to provide some insights into sanitation-related strategies taken by the BRAC Water, Sanitation and Hygiene (WASH) Programme from an economic point of view. The aim of this report included measuring and identifying the factors that influence willingness to pay for improved sanitation services for the households without any latrine facilities in rural Bangladesh.

A contingent valuation survey was carried out in four upazilas under the BRAC WASH programme to determine household willingness to pay and affordability to pay for basic sanitary latrine options. The results indicate that about 80% of the households were willing to pay for improved sanitation services. Of the total households who were interested in paying for sanitary latrines about 92% preferred payment in monthly installments. The mean willingness to pay was found to be Tk. 69 if paid monthly installments and Tk. 825 if paid in single payment. The mean willingness to pay for the overall sample size was found to be within the range of 1-2% of the disposable income of the households.

Economic hardship was found to be the major reason for not installing sanitary latrine. Health, cleanliness and prestige were found to be three major motivating factors for installing sanitary latrines. Regression analysis using ordered logit model showed that odds for spending money for improved sanitation services were higher for households with better income, households who believed that unsafe sanitation leads to diseases and households belonging to already intervened programme areas.

As programmatic implications, this study suggests that credit facilities along with convenient location of the village sanitation centers are necessary to fulfill sanitation-related targets set by the programme. This study has also established a causal relationship between health awareness and willingness to pay for improved sanitation services. However, it was found that even if all the stated conditions are met, there will be some households who would not be able to pay for their latrines and will need some sort of cash incentive or subsidy. (author abstract).