83977 NOTE NUMBER 3 December 2013 LESSONS LEARNED e Global Partnership on Output-Based Aid Senegal Output-based Aid Sanitation Project DEVELOPMENT CHALLENGE final payment after a technical audit, which included field The water sector in Senegal is one of the most visits to a representative sample of beneficiaries to certify developed in Sub-Saharan Africa. Access to water construction and operating standards. in urban areas is almost universal, but sanitation lags behind. The government’s urban sanitation strategy RESULTS ACHIEVED calls for the development of on-site solutions at By December 2011, when the project closed, more municipal level, based on the approach of the than 103,000 people had benefited from an improved Programme d’Assainissement Autonome des Quartiers sanitation facility at home, representing 95 percent Peri-urbains de Dakar (PAQPUD). The predecessor of of end-of-project targets (11,495 facilities installed). the OBA project, PAQPUD was a large result-oriented, Other notable results included: pro-poor program that provided 63,000 facilities, as well as small-bore sewers, increasing sanitation „„ Effective pro-poor targeting. Slums for intervention coverage by 22 percent in the target areas in four were identified geographically, using urban years. PAQPUD ended in 2005 for lack of funds, characteristics (lack of sewer connections, traditional leaving demand for 74,000 demands unmet. compounds, and narrow streets) as proxies for income. All households within these areas were eligible as long THE PROJECT AND ITS PARTNERS as they would pay the upfront contribution. In addition, self-targeting ensured that only poor households The government requested a US$5.8 million grant1 would participate (excluding options typically attractive OBA Lessons to the Global Partnership on Output-based Aid to higher- income communities). CBOs that had Learned Series is a (GPOBA) in 2007 to build 15,100 on-site facilities in detailed knowledge about communities ensured that forum for discussing five municipalities originally targeted by PAQPUD. In the project could reach the poorest households. and disseminating OBA schemes, payments are linked to the delivery project insights at of pre-defined “outputs.” The OBA Senegal project „„ Cost-effectiveness of project technological the conclusion of linked payments to the installation of adequate choices. An analysis comparing unit costs and subsidy projects in supporting sanitation facilities in households. Unit costs varied rates of various sanitation solutions showed that the the delivery of basic depending on the type of facility.2 Beneficiaries subsidies needed to build individual or condominium services to the poor. provided 20 percent of total costs upfront and sanitation facilities are 2.0 to 2.5 times lower than those GPOBA is a partnership received a subsidy for the remaining amount. required for conventional sewers. established in 2003 Service delivery was contracted out by the Office „„ Subsidy efficiency. The average subsidy was US$45 by the UK (DFID) and National de l’Assainissement du Sénégal (ONAS) to per person, well below the US$54 per person the World Bank. Its the national agency for public works, the Agence maximum set at the beginning of the project. other donors are the d’Exécution des Travaux d’Intérêt Public contre „„ Capacity building. Stakeholders at all levels International Finance le sous-emploi (AGETIP), which prefinanced the acquired specialized skills, including social Corporation (IFC), the facilities. Local firms performed the works, consulting communication, operation, and management. Local Netherlands (DGIS), firms provided technical studies and supervision, firms, selected through competitive bidding, built Australia (AusAID), and neighborhood community-based organizations capacity to deliver works compliant with standards, and Sweden (Sida). (CBOs) carried out social intermediation, hygiene which is likely to further attract private investment For more information promotion, monitoring, and collected user in the sector. They also employed artisans and visit www.gpoba.org contributions. Municipalities engaged in information local workers, which benefited communities or email us at and communication activities. Disbursements to economically. (continued on page 3) gpoba@worldbank.org. AGETIP were made quarterly in three tranches, with Supporting the delivery of basic services in developing countries Lessons Learned 1 A demand-based and flexible approach is key to triggering and sustaining user uptake. A demand-based approach can spur user uptake and mobilize support, while social audit, beneficiaries realized savings by lowering their expenditures on health care (reductions averaged 46 percent); moreover, their costs to maintain sanitation and wastewater project rules should be flexible (and project funds fungible) to facilities and remove wastewater were reduced. In particular, the adjust to changing circumstances affecting demand. The project workload and time spent on these activities fell for women— had two phases. During the first 28 months, only 7 percent who invariably perform these tasks in Senegal—and children. of the planned facilities were realized. The global economic Women and children saw their workload and time spent crisis had reduced household willingness to invest in sanitation. on this task reduced. In addition, women played an active The low uptake was also due to a history of highly subsidized role in choosing the facilities. The technical audits during schemes and lack of credit facilities for household. In response, implementation provide assurance that, with regular the team reallocated some of the project budget to promotion maintenance, the facilities (which use simple techniques activities to reinforce outreach, combining mass communication and permanent materials) will continue to perform beyond and social marketing. The latter also provided valuable ten years after construction. The end-audit also shows that feedback about household motivations and hygienic practices households generally carry out proper use and maintenance (such as pride of owning “modern” facilities, or living in a clean of the facilities. This in turn helps sustain user satisfaction and environment), which was used to refine the menu of options ownership. Finally, through complementary investments for (for instance, the possibility of connecting to simplified sewers disposal and treatment, the government is now able to ensure was introduced). Because demand for sanitation is typically adequate sludge management in a comprehensive manner, low, OBA schemes in this sector should develop strategies and resulting in benefits to an even larger population and the wider allocate sufficient resources to capture household motivations, urban environment. unlock demand, and organize community mobilization at the outset. Another factor affecting user demand was the subsidy structure itself, which was defined as a percentage of costs, 4 Well-designed subsidy structures can leverage limited public and private resources. The level of subsidy was relatively high and is currently beyond the means solely of covering both the facility and its superstructure. The team decided to reinstate in-kind contributions and staged payments. public funding. As the subsidy was a percentage of unit cost, Moreover, the intervention areas were expanded, “following” local entrepreneurs had limited incentives to reduce prevalent the demand, and a 21-month extension was approved. These costs. This can be avoided in future schemes by setting the remedies triggered further gains: in particular, the line ministry subsidy as a pre-agreed fixed amount, and also leveraging provided an additional contribution of US$360,000 dedicated larger investments from households. Setting the subsidy as a to the poorest households. AGETIP immediately mobilized portion only of the core facility would also allow households to use this additional budget in the form of two promotional to provide the superstructure at lower cost (unsubsidized), campaigns focusing on the most requested sanitation facilities.3 and reduce their mandatory contribution. Other financing This boosted progress. In the end, 90 percent of all facilities innovations combined with policy reform could be explored as were built during the extension period. Notably, 67 percent of well, such as redirecting the sanitation surcharge on the water facilities were built in the new neighborhoods, and one quarter tariff to on-site sanitation. 5 of the built facilities represented technical options which were Top-level commitment is essential to improve municipal only introduced after the restructuring. sanitary conditions at scale. The project ensured that the 2 Drawing on experience and pursuing creative approaches government’s vision for urban sanitation remain priorities. can help overcome challenges, ultimately instilling a However, organizational changes undermined ownership. “culture of results”. The project clearly benefited from the Strengthening ONAS leadership, and ensuring that its dedicated qualified teams and partners that had implemented PAQPUD. on-site sanitation department is adequately staffed and For instance, AGETIP was used to manage a large number of resourced, remain essential if successor programs are to be contracts.4 But in addition to dealing with the above unforeseen implemented to reach the target of 78 percent urban sanitation challenges, the team was creative in addressing design issues, coverage by 2015, and achieve the water and sanitation such as the three-stage claim calculation (based on projections, Millennium Development Goals. Beyond metropolitan Dakar, all then actual installations, and final verification), which had led actors, from city leaders, private developers, and households, to delays in invoicing and payments, and the cumbersome should contribute to the expansion of sustainable sanitation monitoring and reporting system. The team created a services city-wide. spreadsheet that automatically tracked outputs and calculated payments, and tightened coordination and supervision. Finally, it instilled a stronger performance-based culture by establishing 1 Meeting the outstanding demand for 74,000 facilities would have required innovative contracts for CBOs (which were paid against US$54.5 million, which was more than five times the annual national sanitation collection targets for user contributions), and which were budget 2 From US$230 to US$824, including hardware, software, and project management.. eligible for extensions based on satisfactory performance. 3 Fifty-three percent of the sanitation facilities built were washing basins. Users’ 3 Sustaining project benefits requires strong ownership by priority was to prevent the dumping of wastewater to improve their living envi- ronment, a choice clearly influenced by population density and land occupancy in beneficiaries, and complementary actions downstream low-income areas. on the value chain. The project had a number of direct 4 Under PAQPUD, AGETIP was able to jump from 1,000 to 20,000 then to and indirect benefits. According to an environmental and 40,000 constructed facilities per year. The case studies are chosen and presented by the authors in agreement with the GPOBA program management team and are not to be attributed to GPOBA’s donors, the World Bank Group, or any other affiliated organization, nor do any of the conclusions represent official policy of the aforementioned organizations.