Financing Sustainable WASH [webinar], 16 June 2022

Published on: 10/06/2022

Sustainable delivery of water, sanitation and hygiene services depends on a complex and interlinked WASH system, broadly made of nine building blocks. The building block of finance is rooted in the understanding that sustainable service delivery requires all the elements of a WASH service to be funded over their entire life-cycle. It includes planning, forecasting and budgeting the costs over life-cycle of the service, and identifying the sources of fund to finance the same.

The Government of India, in the last few years, has renewed its commitment to water and sanitation with the flagship schemes - Swachh Bharat Mission and Jal Jeevan Mission, for sanitation and water, respectively. This commitment has been translated into visible financial allocations in the Union Budget; the 2022-2023 Budget Estimate for water and sanitation, with an increase of 12% from the previous year, stands at Rs. 67,221 Crores [US$ 8.63 billion] . Further, as per the 15th Finance Commission fund guidelines, 60% of funds available to the rural local bodies is tied for expenditure on water and sanitation services. In the same vein various state governments have introduced state schemes on water and sanitation and encouraged rural government spending on the same through the state finance commission funds.

Experience shows that the majority of WASH funds is prioritised for infrastructure creation. Studies, however, have found that capital expenditure (CapEx) only covers the tip of the iceberg. For sustainable water and sanitation services, it is crucial to budget for Operation & Maintenance (O&M), Capital Maintenance Expenditure (CapManEx), Direct Costs. In the absence of factoring for these heads, there often is slippage in services due to minor and major breakdown, rendering the capital redundant overtime. As per estimates of the World Bank, achieving universal safely managed water and sanitation (SDG targets 6.1 and 6.2) would entail a capital expenditure of approximately US$ 114 billion per year. The recurring costs of sustaining and maintaining the infrastructure, it is estimated, would exceed the annual capital cost requirements by, approximately, 1.5 times.

In August 2020, a discussion on decentralised public finance was organised by Centre for Budget and Governance Accountability (CBGA), IRC, and WaterAid India (WAI). The webinar focused on the flow of finance for rural WASH and the challenges therein.

In this webinar, the aim is to understand:

1. The various sources of finance for the different heads of the life cycle cost of WASH services.
2. What and where are the gaps? How can we address them?
3. What are the best practices in WASH financing, in terms of sustainability of services?
4. If and how is climate change or water security to being considered in financing for sustainable WASH services?

Agenda

1. Welcome: Sujoy Mojumdar, UNICEF

2. Context setting: national overview on various sources of finance for the different for the life cycle costs of WASH services, Trisha Agarwala, CBGA

3. SIRD's perspective of working with local governments towards sustainable services (SDG 6), Saroj Kumar Dash,
SIRD Odisha

4. Questions and clarifications: Open discussion

5. Experience from the field, facilitator - Sujoy Mojumdar, UNICEF

• West Bengal and Maharashtra: Banashree Das and Vinay Harswal, WFP + Gram Panchayat Representative (TBC)
• Rajasthan: Mahendra Singh Rao, Budget Analysis Rajasthan Centre (BARC)
• Odisha:  Nabanita Das, Centre for Youth and Social Development CYSD + Gram Panchayat Representative (TBC)

4. Discussant: Neelesh Kulkarni, PriMove

5. Clarifications, questions, and discussions, facilitator: Sujoy Mojumdar, UNICEF

6. Closing: Nitya Jacob, SuSanA

Date and time: 16 Jun 2022, 15:00-17:00 IST | 11:30-13:30 CEST

Read the synthesis report of the webinar.