Paper 44792 3 Multi Village Water Supply Schemes in India The World Bank Policy Paper extracted from the World Bank Study on Review of Effectiveness of Rural Water Supply Schemes in India, June 2008 June 2008 Multi Village Water Supply Schemes in India T here are a large number of multi village In the 10-state study on the Effectiveness of Rural water supply schemes (including regional Water Supply Schemes undertaken by the World schemes) in India. The prime motivation Bank at the request of the Government of India, for setting up multi village schemes is based on a large number of multi village and regional the desire to provide full water supply coverage schemes were analyzed. An assessment of the cost to rural areas despite local water scarcity and of schemes and their performance was based on increasing contamination of sources. In such the survey data. The analysis brought out that circumstances, it becomes necessary to make use the multi village schemes are more costly than of distant water sources. However, treating and single village schemes, with inferior performance piping water from remote sources is often and lower cost recovery.1 complex and expensive, and it is felt that the cost of supply can be reduced and options broadened Costs of Multi Village Schemes if a number of villages are served by one scheme. and Cost Recovery Multi village schemes have the potential to Taking a weighted average across states, the capture economies of scale and provide a higher capital cost per household of multi village level of service. Scale economies arise from the schemes is found to be about 25 percent higher bulk water system and professional support for than that of the single village schemes, while the the scheme. There are, however, some serious operation and maintenance (O&M) cost of multi disadvantages of multi village schemes. Such village schemes is about 11 percent higher. The schemes require significant investment (longer cost of multi village schemes is somewhat low in pipe length due to dispersion of the population West Bengal and Orissa. If these two states are served), substantial technical capabilities, and excluded from the comparison, then the average coordination and cooperation among diverse capital cost of multi village schemes is found to groups. Further, there are problems of inequity be 50 percent higher and the average O&M cost in distribution, physical losses of water in the 25 higher higher than that of single village system, and efficiency losses due to erratic schemes (Table 1). power supply. The averages conceal the high variations that exist in the cost of schemes. In a number of 1The analysis of the comparative performance of multi village and single village schemes was confined to 9 out of the 10 states surveyed, leaving out Uttarakhand, since the scheme cost and operating conditions in Uttarakhand are quite different from other states. cases, the capital cost per household is very high 2 Paper 3 Supply Multi Table 1 Average Costs of Single and Multi Village Piped Water Supply Schemes Technology Capital cost O&M cost (Rs per household) (Rs per household per annum) V All states Excluding All states Excluding West Bengal West Bengal Schemes illage and Orissa and Orissa Single village scheme 5,300 5,300 280 270 Multi village 6,600 7,700 310 340 (including regional) schemes W ater in multi village schemes. The capital cost per whereas it is higher, at about 75 percent, for in household exceeds Rs 10,000 in 16 percent single village schemes. Very few among the of the cases, and exceeds Rs 20,000 in standpost users pay, and this reduces the level of India 4 percent cases. cost recovery. While the cost of multi village schemes is In Andhra Pradesh, Tamil Nadu, and West relatively high, the cost recovery from beneficiary Bengal, the single and multi village piped water households is relatively low. In consequence, supply schemes mainly serve the standpost users the financial burden on the central and state with very few paying customers, which causes the governments to construct and manage such level of cost recovery to be low. Overall, the schemes is much higher than what it would have level of recovery of the O&M cost through been if the same households were served by user charges is about 50 percent in single single village schemes. The proportion of private village schemes and about 35 percent in multi connection users who regularly pay towards the village schemes. O&M of the multi village schemes is 53 percent, Taking a weighted average across states, the capital cost per household of multi village schemes is found to be about 25 percent higher than that of the single village schemes, while the O&M cost is about 11 percent higher Performance of Multi Village Schemes The higher cost of multi village schemes would be justified if these provided a more reliable service. However, this is not so. Among the existing multi village and regional schemes, a fairly large number (one-third) are based on surface water. These surface water schemes are expected to be less affected by seasonal variations in groundwater availability and hence should provide a more regular supply of water. Indeed, the multi village schemes are designed to provide a regular supply of water at the level of 40 lpcd (liters cer capita per day) or higher. In reality, 3 Figure 1 Investment and Actual Lpcd, Single and Multi Village Schemes, Estimated Regression Equation Source: Estimated from scheme survey data. however, the multi village schemes are in many cases not providing water regularly and the supply level falls short of the government norm of 40 lpcd. An analysis of the relationship between investment per household and the actual lpcd level (as reported by the scheme management) shows that while in single village schemes, higher investment is associated with higher lpcd, this is not the case with multi village schemes (Figure 1). In many respects, the performance of multi village schemes is worse than the single village schemes. The design hours of supply of multi village schemes are on an average higher than that of single village schemes, but the actual hours of supply are about the same as that of single village schemes (Table 2). In other words, there is a larger gap between design and actual hours of supply in the case of multi village schemes. The actual lpcd level in multi village Table 2 Average Design and Actual Hours of Supply, Single Village and Multi Village Schemes Technology Design hours of supply Actual hours of supply Single village scheme 4.6 2.6 Multi village 7.7 2.9 (including regional) schemes 4 Paper 3 Supply Multi Figure 2 Water Supply in Summer, by Technology and State V Schemes illage W ater in India Source: Survey data. schemes in summer is generally less than that of schemes have a clear disadvantage (Figure 3). single village schemes (Figure 2). The gap is MPN coliform exceeds the permissible limit quite marked in the case of Uttar Pradesh in about 70 percent of water samples of multi and Maharashtra. village schemes. The multi village schemes perform worse than single village schemes not only in terms of the The multi village schemes perform quantity of water supplied but also in terms of worse than single village schemes some important parameters of water quality. not only in terms of the quantity of A study of water quality for 56 single village water supplied but also in terms schemes and 52 multi village (including regional) of some important parameters of schemes in seven states reveals that in terms of water quality total dissolve solids (TDS), nitrate, and fluoride the multi village schemes are doing better, but in terms of MPN coliform, the multi village Figure 3 Water Quality, Single vs Multi Village Schemes (Distribution Point) Source: Water quality survey. 5 Table 3 Performance of Single and Multi Village Schemes, Comparison of Select Parameters Single village schemes Multi village schemes % HH not able to meet more than half of their water requirement 21% 33% from scheme % HH getting water only once a week or 8% 13% 2/3 days a week In several other respects, the performance of multi village schemes is relatively worse than that of single village schemes. About 33 percent households using multi village schemes are able to meet less than half of their water requirement from the scheme; this proportion is lower at 21 percent for single village schemes (Table 3). About 8 percent households using single village schemes get water only one day a week or two/three days a week. This proportion is higher at about 13 percent for multi village schemes. There are various reasons for the poor performance of multi village schemes. It is well known that since the distribution is over a larger number of habitations, there is a considerable proportion of households who are at the tail-end of the scheme and face problems due to inadequate water supply and pressure. Also, the expenditure incurred on repair and maintenance in multi village schemes falls far short of the norm. In single village schemes the expenditure on minor repair and maintenance is about 1.3 percent of the total capital cost of the schemes. The corresponding figure for multi village schemes is about 0.4 percent. Similarly, expenditure on repair and maintenance per household served is Rs 40 per year in single village schemes, while it is about Rs 20 per year in multi village schemes. Evidently, the relatively lower expenditure on maintenance of multi village schemes adversely affects their performance. The problem of inadequate maintenance is further compounded by the problem of inadequate yield from the water source, especially during summer months. As a result, the supply and pressure is low. 6 Paper 3 Supply Multi V Schemes illage W ater in India Policy for Multi Village Schemes Given the relatively high cost and weak performance of Given the relatively high cost and weak multi village schemes, there is performance of multi village schemes, there is need for a major revamping of the planning and need for a major revamping of policy for such schemes. District-level planning the planning and policy for should identify areas where multi village schemes such schemes would constitute a sustainable option and are also cost-efficient, based on aquifer and watershed information. Catchment area programs need to be incorporated in district prepared for the appraisal and approval of multi plans for strengthening water supply sources. village schemes. Multi village schemes relying on surface water would need to be taken up mostly when aquifers In planning and implementing multi village are over-exploited or the groundwater is of schemes in areas where these are justified, new poor quality. approaches to management should be taken to improve scheme performance. The key elements An important issue in this context is the need for of these are unbundling of the management an independent appraisal and approval of function and providing communities a role in proposals for multi village schemes. As the decision-making and the management of water payment of `centage' to state engineering distribution at the village level. Thus, bulk water agencies could create perverse incentives, supply and water distribution need to be proposals for new multi village schemes need to unbundled. Bulk supply could be managed by a be independently appraised, according to clear professional public or private operator that enters technical and economic criteria, to ensure that into enforceable contracts with the Gram the least cost option is implemented. Therefore, Panchayats (GPs) and/or user committees that are guidelines, processes, and procedures need to be responsible for distribution at the local level. 7 The formation of user groups such as States need to encourage private Village Water and Sanitation Committees consultants, contractors, and and district/block user committees are operators becoming more active in critical for improving accountability of rural water service delivery, as several such schemes. However, many multi village examples in India show that they are schemes are often too large and costly to often more effective in improving be managed solely by user groups. A Memorandum of Understanding or formal service delivery contracts are other ways of increasing accountability between the user committee and the bulk water providers. These contracts can be the basis of detailed agreements regarding the performance targets, Finally, there is need for a change in the attitude including quantity and quality of water to be of state governments towards private sector supplied, payment for water supplied, and agencies in the context of rural water supply. penalties in case of non-payment. As regards the States need to encourage private consultants, existing multi village schemes, a similar move contractors, and operators becoming more active has to be made towards the decentralization of in rural water service delivery, as several service delivery. This requires unbundling multi examples in India show that they are often more village schemes into smaller schemes and effective in improving service delivery. This is handing over the O&M responsibility of particularly important for the planning and intra-village schemes to the GPs. implementation of multi village schemes. This Report has been prepared by Smita Misra (Sr. Economist, SASDU, World Bank), the Task Manager of this study. The study was carried out under the overall guidance of Sonia Hammam, Sector Manager, Water and Urban, SASSD, World Bank. Data analysis has been undertaken by Professor B.N. Goldar and his research team at the Institute of Economic Growth, Delhi and the consumer survey was carried out by the ORG Centre for Social Research (a division of A.C. Nielsen ORG MARG Pvt Ltd). Comments and inputs at various stages of preparation from the following World Bank persons are gratefully acknowledged: Michael Carter, Rachid Benmessaoud, Clive G. Harris, Alain R. Locussol, Francis Ato Brown, Alexander E. Bakalian, Oscar E. Alvarado, G.V. Abhyankar, R.R. Mohan, S. Satish, N.V.V. Raghava, and Policy Papers Catherine J. Revels (WSP-SA). Special thanks are due to the Department of Economic Affairs, Ministry of Finance, the Department of Drinking Water This is one of the six policy papers that have been prepared on the basis of the Supply, Ministry of Rural Development, and the Rajiv Gandhi National World Bank study on Review of Effectiveness of Rural Water Supply Schemes in Drinking Water Mission for their interest and collaboration in the study. India (June 2008). These policy papers, published along with the Report, are on the Comments and data inputs during the preparation of the Report are following themes: gratefully acknowledged from R.P. Singh and M. Nagaraju (DEA), Paper 1: Willingness of Households to Pay for Improved Services and Affordability Bharat Lal and R.K. Sinha (RGNDWM) and their team, and the Paper 2: Inefficiency of Rural Water Supply Schemes in India respective State Government officials. Paper 3: Multi Village Water Supply Schemes in India Paper 4: Operation and Maintenance Expenditure and Cost Recovery Paper 5: System of Monitoring and Evaluation The Report has been discussed with the Government of India but does not Paper 6: Norms for Rural Water Supply in India necessarily bear their approval for all its contents, especially where the Bank has stated its judgements/opinions/policy recommendations. Author and Task Manager: Smita Misra (Sr. Economist, SASDU, World Bank The World Bank Pictures by: Guy Stubbs/Water and Sanitation Program­South Asia June 2008 Created by: Write Media Printed at: PS Press Services Pvt. Ltd. The World Bank, New Delhi Office, 70 Lodi Estate, New Delhi 110 003, India Tel: (91-11) 24617241, 24619491