Municipal service delivery: new accounting software improves transparency in Kerala, India

The financial transparency of urban local bodies (ULBs) in the south Indian state of Kerala has increased thanks to an Asian Development Bank (ADB) project. The municipal corporations of Cochin and Trivandrum now publish their financial accounts online.

The ADB technical assistance (TA) project “Capacity Building for Municipal Service Delivery in Kerala” (2006-2008) assisted municipal corporations and selected municipalities to (i) improve their capacity to organize, record, update, and manage financial and other information on a routine basis; (ii) increase the efficiency and integrity of the data being collected; and (iii) promote good governance in relation to financial management. The TA project aimed to help ensure the sustainability of the investments under the Kerala Sustainable Urban Development Project (Loan 2226-IND), a $221.2 million loan approved by ADB on 20 December 2005 and which became effective on 19 March 2007.

The TA project successfully installed and implemented municipal accounting software in five municipal corporations and two municipalities. As a result of continuous recording, updating and managing financial information on a routine basis using accrual-based double-entry accounting, they managed to publish their financial statement regularly.

Some of the major lessons are:

• Accounting system alone does not do anything – it is just software. It became meaningful when the necessary financial information is entered in accordance with the new accounting policy, which had to developed. The necessary financial information includes the past income and expenditure, assets and liability, and cash flow statement for the last five years. In ULBs, there are backlogs in accounts for four to five years. Recovery of the backlogs and data entry tasks absorbed enormous amount of ULB staff’s and consultants’ time.

• Feeding income and expenditure information can be computerized by connecting the accounting system with the Payroll module and the demand collection balance (DCB) module. Staff salary is the largest expenditure item in the ULB and computerization by the payroll module will bring efficiency in accounts work. The DCB module compares (a) demand: how much to be collected, (b) collection: how much actually collected, (c) balance: how much is still due. This will help ULB in capturing the amount of the uncollected in tax and charges for urban service delivery, which is a good start for ‘management accounting.’ However, the amount of data entry is the same as the number of households in one ULB—again, this requires enormous amount of time and labour.

Read the full Technical Assistance Completion Report

Lessons from implementing water supply, sanitation and hygiene promotion activities in the coastal belt of Bangladesh

A new document [1] describes the key lessons learned from the large Coastal Belt Project, which was supported by Danida and the Government of Bangladesh during 1997-2009. The document highlights the processes, achievements and challenges of providing more than 12 years of extensive assistance to rural and small towns water supply, sanitation and hygiene promotion in the coastal regions of Bangladesh. During the years the project gradually changed its implementation modalities towards a high degree of alignment with national institutions and systems, including use of national planning and budgeting processes and public procurement rules.

The Project was largely successful in achieving its physical targets of more than 30,000 arsenic-free deep hand tube wells (DHTWs) and promoting construction of over 300,000 household latrines, construction of piped water supply in core areas of nine pourashavas, albeit with delays and additional costs.

The Project was implemented as a bilaterally-executed project. This gives rise to inherent differences resulting from parallel management structures, multiple sets of roles and rules and differing personal and institutional loyalties.

Following the devastating cyclone Sidr (“The Eye”) in November 2007, the Project constructed 1,050 additional tube wells, 1,000 household latrines and other infrastructure in storm-ravaged areas.

Photo from the Danida report

The sustainability of DHTWs and household latrines in rural areas is seen as high. Additional management and technical support is required to ensure the long-term sustainability of piped water supplies in pourashavas and mini-piped systems in rural areas, as well as public toilets and school latrines.

The Project’s efforts to assist pourashavas to improve solid waste management and drainage was less than successful. The situation in pourashavas in these areas remains unsatisfactory. There are serious difficulties locating sanitary dumping sites, which pose a potentially serious environmental hazard.

Following the Paris Declaration on Aid Effectiveness in 2005, the Project’s planning process and management has been more closely aligned with GOB and DPHE’s systems and procedures.

During its long life, the Project produced a wealth of documentation; manuals, guidelines, training and IEC/BCC materials. This material constitutes an important part of the Project’s contribution to the sector. Some of the most important and useful of these materials are listed in the publication.

In spite of its long life, the Project leaves behind unmet demand and a number of unresolved issues which will to a large extent determine the long-term impact of the Project’s many achievements.

A number of factors are seen as contributing to the Project’s successful achievements.

1. Conducive policies, strategies, regulations, rules and procedures adopted and practiced in implementing organizations
2. Experienced and dedicated professional/technical staff
3. Responsibility, commitment and accountability for results at all levels
4. Firm commitment to guidelines and procedures for poverty targeting, social mobilization and siting of facilities
5. Rate and quality of DHTW construction
6. Social mobilization/customer briefings supported by high quality IEC materials
7. Adequate cost-sharing to promote ownership
8. Cooperation from DPHE and local government (pourashava mayors and UP chairmen)
9. Appropriate and adaptable technologies to suit various hydrogeological conditions
10. Thorough documentation, accurate reporting, MIS and database updated and used
11. Baseline data, effect monitoring and impact assessments
12. Post-construction technical and managerial support for urban and school WSS facilities

The Project has helped to produce a number of competent sector professionals who continue to make important contributions to the sector. Outside the coastal belt, this may prove to be one of the Project’s most important and lasting legacies.

[1] Pendley, C.J. and Minhaj Uddin Ahmad, A.J. (2009). Learning from experience : lessons from implementing water supply, sanitation and hygiene promotion activities in the coastal belt of Bangladesh. Dhaka, Bangladesh, Royal Danish Embassy. 27 p.
Download full document [PDF file]

Web sites:

• Danish Embassy Bangladesh – Water & Sanitation
• Bangladesh – Department of Public Health Engineering
• GoB-Danida WSS Policy Support Unit

Contact persons:

• Dr. Guna N. Paudyal, Danida Senior Adviser, Bangladesh. (e-mail: guna [at] hysawa.org)
• Dr. Niaz Chowdhury, Programme Officer, Embassy of Denmark (e-mail: niacho [at] um.dk)
• Mr. Jan Møller Hansen, Deputy Head of Mission, Embassy of Denmark, Dhaka. (e-mail: janmha [at] um.dk)

Community kiosks: learning from water supply failures in Malawi

The Lilongwe Water Board is the sole water supply authority in Malawi’s capital city. However, its service suffered from inadequate response to system and community problems and lack of transparency in water billing. In response to a request for assistance from the community, WaterAid Malawi developed a strategic partnership with the Lilongwe Water Board, aimed at improving management of water services in unplanned low-income neighbourhoods.

An [April 2008] paper from WaterAid Malawi describes its partnership with the Lilongwe Water Board and a local non-governmental organisation – the Centre for Community Organization and Development (CCODE).

WaterAid research indicated that the system to distribute water through water kiosks was not working. Poor households owed huge sums to the Lilongwe Water Board – the monopoly water provider. They were paying far too much: prices at communal kiosks in low-income areas were twice as high as those in high-income areas. Charging systems were inconsistent and billing was not transparent. Some households paid equal monthly fees for different levels of consumption while others were paying per bucket.

Political and traditional leaders corruptly controlled kiosk management committees and failed to pass on funds they collected from communities to the Lilongwe Water Board. The private operators who were able to pay their utility bills resold water to poor people at high and unregulated tariffs. Many meters were vandalised but even those still working were often not read for over a year. The water board charged customers for estimated, not actual, consumption. Without consultation with users, the utility factored in arrears into water bills to cover money misused by community leaders.

Further problems included: illegal installation of boreholes, failure to check water quality, dependence of on unsafe sources when kiosks were disconnected, high leakage rates

[Following a reform programme] the utility now regards itself as a public service provider with obligations to consult users and to extend the network to unserved communities, while also embracing private sector principles to improve the efficiency of billing, debt collection and reduction of water losses.

Reform has also involved:

• establishing a focal point within the Lilongwe Water Board to whom community kiosk users could take their grievances: the Kiosk Management Unit regulates prices and promotes timely reporting of faults and prompt action to fix them
• WaterAid providing technical and financial advice and funding to rehabilitate communal water kiosks, replace meters, construct meter boxes and improve drainage facilities at kiosks
• building CCODE’s capacity to mobilise communities’ capacities to identify kiosk management options, settle debts, monitor the utility and promote hygiene education.

Source: id21, 01 March 2009

Water privatisation: Yerevan water supply, going private gradually

In 1998, the Government of Armenia began to seriously weigh a private sector solution to the worsening situation with the water supply system in the country’s capital, Yerevan. The Government’s eventual decision to engage the private sector through a 4-year management contract – backed up by donor-funded projects-helped address some of the system’s biggest issues, such as high nonrevenue water and low revenue collection rates. With the system in a more promising condition following the management contract, the Government proceeded with a greater commitment to work with the private sector and offered a 10-year lease contract over the system.

For Yerevan, the Government employed the two-step approach to engaging the private sector: first with a short-term management contract (4 years, extended to 5 years) then a longer-term lease contract (10 years) with a private operator. The Yerevan experience proves the approach’s viability for attracting the private sector to an ailing utility. The Government has already put its second largest water utility-Armenia Water and Sewerage Company, a closed joint stock company-on the same path as Yerevan.

This model may provide confidence where governments are hesitant about involving the private sector but facing few alternative sources for the capital infusion and technical expertise that their failing systems call for. An Asian Development Bank (ADB) case study focuses largely on how the Government first embarked on private sector participation in its water supply and sewerage sector, which was through the 4-year management contract in Yerevan. The case study also examines Yerevan’s transition to the 10-year lease contract, which concluded its second year of private operations in 2008.

Read the full ADB case study (Aug 2008, 16 p.) here.

Institutional reforms: introducing a customer charter and quality circles in Sri Lanka

To improve customer service,  Sri Lanka’s National Water Supply and Drainage Board (NWSDB) introduced a customer charter and quality circles.

“Water Champion”, M.A.M.S.L. Attanayake, Deputy General Manager for the Regional Support Centre- Central of NWSDB explains how these innovations came about and what they have achieved.

Read more:  Ma. Christina Dueñas, ADB, Dec 2008

The policy implications of accountability in municipal service delivery in Sudan

Musch, A. (2008). The policy implications of accountability in municipal service delivery in Sudan. The Hague, The Netherlands, Ministry of Foreign Affairs. 11 p. Download here.

This paper highlights the importance of issues of local government accountability to citizens, analyses how changes in accountability mechanisms have been accomplished in a specific case, and examines the policy implications. The analysis is based on the case of the city of Gedaref, in Sudan. Over a period of about eight years, many channels were created in the city through which citizens could express their concerns and demands. This compelled the local government to improve the quality of its services (drinking water, waste, health and education), issue rules that were seen to be fair, and allow the leaders of a great many citizens’ associations and participatory platforms access to decision-making procedures. Key elements in the process were increased public awareness of rights and standards, changed civic attitudes, the involvement of a critical mass of citizens, and recognition by the city authorities that they are dependent on these associations and platforms. Outside help was provided by Eindhoven, a twin city in the Netherlands through hands-on municipal service projects. Much of the funding came from VNG International’s LOGO South programme. This paper looks at how results were achieved in Gedaref and where the external actors had the greatest influence in bringing about change. It concludes with lessons and advice for donors who may wish to facilitate similar processes.

The paper recommends that donor officials:

• accept that effecting changes in accountability takes between five and ten years;
• spend less time on designing the best aid distribution channels and more time on finding trusted implementers;
• reward approaches that create choice for citizens and reach a critical mass of participation, and discourage approaches based on ‘the best accountability mechanism under the circumstances’, which are only open to a small group;
• accept approaches based on general principles that involve many civic organisations and multiple ways to reorient accountability downwards, but insist on details when it comes to the incentives.

Strengthening accountability for improved service delivery: SNV’s local capacity development approach

Todd, B. (2008). Strengthening accountability for improved service delivery :  SNV’s local capacity development approach. The Hague, The Netherlands, Ministry of Foreign Affairs. 15 p. Download here

Better accountability improves service delivery performance. Based on more than twenty-five case studies in over twelve countries, this paper describes the attempts of SNV Netherlands Development Organisation to strengthen the accountability capacity of citizens, government and service providers. Breaking accountability down into five actions, it examines a number of strategies that have produced good results. It finds multi-stakeholder approaches particularly valid and highlights the critical need to empower citizens, especially marginalised groups. Greater investment in developing the accountability capacity of local actors to delegate, finance, perform, inform and enforce, can produce significant improvements in service delivery.

While accountability is not a silver bullet, it is a powerful driver of change and improved performance. To really improve service delivery, it needs to be accompanied by other elements (such as increased resources, improved infrastructure and equipment, better technical capacity and internal reforms), which all are complementary to building capacity for greater accountability.

Examples of SNV”s work in the water sector mentioned in the paper are:

• Capacity building support for the Public Health Engineering Division of the Bhutanese Ministry of Health has resulted in an increase in drinking water coverage from 45% in 1990 to 85% in 2005. The service provider has adopted and institutionalised participatory approaches to community operation and maintenance, and to hygiene education, which communities have enthusiastically supported.

• In collaboration with the Water Resources Development Bureau in southern Ethiopia, SNV designed and supported a comprehensive governance and service delivery assessment of household access to safe water. The survey motivated the Bureau to rehabilitate 16 water schemes in two months and improve water access for 1,600 households. It also generated long-term, institutional momentum for continuous improvement.

• SNV has been working with municipal water companies in Ecuador, Honduras and Nicaragua to enhance efficiency, quality of services and sustainability through organisational development, integrated management and improved local water governance. This has helped to establish the conditions for sustainable and improved service delivery for about 355,000 people in urban areas and has created opportunities for improved livelihoods for about 210,000 rural dwellers.

• Service providers in Ghana are delegated huge responsibilities which can only be fulfilled through better coordination and collaboration with all stakeholders. In the northern capital of Tamale, the service provider can only guarantee water supply for two to three days a week. A multi-stakeholder consultation process facilitated by SNV agreed that the key to improvement lies in a new water governance system. This will involve delegating some of the service provider’s responsibilities to decentralised and non-state local providers. [...] The lesson learned is that, even within a weak institutional environment at national level, it is possible to improve performance at local level through better leadership, partnership and coordination.

How Water Utilities Can Strengthen Themselves

Many a water utility has been overwhelmed by the prospect of developing a capacity building and institutional strengthening program (CBISP). Where do they start? Which aspects are negotiable and which ones aren’t?

An effective CBISP for a water utility should enable the utility to:

• develop full autonomy within the organizational structure
• define managerial responsibility and accountability
• implement integrated business, operation, and financial planning
• achieve financial self-sufficiency
• manage competitive human resources.

An effective CBISP should review, define, and implement the following functionally-linked activities:

• Business Planning
• Human Resources Development (HRD)
• Information Technology (IT)
• Management Information Systems (MIS)
• Financial Management Development (FMD)
• Financial Modeling and Tariff Development
• Geographic Information Systems (GIS).

The conventional approach to developing CBISP is to have a consultant assess the water company’s status [...]. The downside of such an approach is that the usually expensive international consultants work in isolation from the client. As such, they produce a “best practices” report that does not have much client ownership. In many cases, the programs ensuing from such an approach are doomed from the start.

To enhance this conventional approach, utilities can start working on a business plan guided by the standards set by the International Organization for Standardization (ISO), such as:.

• ISO 9001/9002 (Quality)
• ISO14000/18000 (Environmental Management and Safety)
• ISO 24510: Guidelines for the improvement and assessment of the service to users
• ISO 24511: Guidelines for the management of wastewater utilities and assessment
• ISO 24512: Guidelines for the management of drinking water utilities and assessment of drinking water services.

[...]

Strengthening an institution requires a strong leadership that can drive a top-down transformation process [and] good governance [without which] capacity building efforts will have a more than usual uphill battle.

Source: Hubert Jenny, Asian Development Bank, Sep 2008

Privatization Revisited: Lessons from Private Sector Participation in Water Supply and Sanitation in Developing Countries

A study [1] by the Asian Development Bank (ADB) shows that private sector participation (PSP), has not shown encouraging results in the water supply and sanitation (WSS) sector. In particular, private resources have not been adequately mobilized to solve WSS sector problems as anticipated by the proponents of PSPs. PSPs in the WSS sector managed to succeed in environments where effective regulation, good governance, and contract enforcement were prevalent. Effective demand for improved WSS services and innovative approaches for competition also paid an important role. Experience also showed that public water utilities can work well when anchored on reforms with ingrained internal and external accountability, customer orientation, and autonomy. While ownership itself hardly influences the efficient provision of WSS services, the interdependence of the public and private players should not be overlooked; a reasonably well-functioning public sector is a precondition for the success of private provision of WSS.

[1]  Gunatilake, H. and Carangal-San Jose, M.J.F. (2008). Privatization revisited : lessons from private sector participation in water supply and sanitation in developing countries. (ERD working paper ;  no. 115). Manila, Philippines, Asian Development Bank. 49 p. Download here [PDF file, 2 MB]

Lessons for out-scaling and Up-scaling from DFID’s RNRRS Studies and Research

Key lessons for up-scaling and out-scaling of DFID research

Authors: W. Richards; Research Into Use Programme, DFID
Publisher: Department for International Development, UK, 2008

Full text of document

This report consists of a series of short syntheses which bring together key lessons for up-scaling and out-scaling research based on 19 key reviews, summaries and reports detailing DFID natural resources research. Each synthesis provides background information and key points, while the lessons learned are illustrated using examples and case studies.

Key lessons learned include:

• Start from what’s on the ground: most successes in spreading the uptake of research findings came about when the people involved understood  what was happening on the ground, including indigenous  knowledge on practices and processes, and worked with it. This is true at the local level, in communities, and at administrative and government levels.
• Understand the key players and build relationships: starting from what is on the ground leads to an understanding of who the key players and local champions  are, and how they operate. This mapping of institutions and understanding of their roles in a network are pre-requisites for deciding who we need to invite to join ‘coalitions’ (ie the groups of people and organisations who get
  together to out-scale or up-scale research findings). Understanding what they want and where they are coming from also helps build trust and relationships with them.
• Be realistic about what can be achieve: sometimes one has to face up to the fact that the conditions for uptake of research findings just aren’t  conducive. For example, experience shows that any innovation in developing countries where innovation frameworks and infrastructure are weak is tough. Outscaling and up-scaling research findings have a better chance of success where governments have encouraged
• Partner, communicate, advocate and build capacity strategically: an understanding of the local context, the key players and what can realistically be achieved will help develop clear strategies for ‘how’-partnering, communicating, advocating and building skills-out-scaling and up-scaling will be achieved. adoption of new technologies by, for example, supporting producer prices, subsidising inputs and credit for new technologies, and investing in irrigation, roads and marketing systems.
• Capture your own learning and learn from others: it is essential to capture  opportunities to learn and share learning with others. Learning what works and what does not is going to be vital in out-scaling and up-scaling. A good way to capture lessons learned is through a formal system of monitoring and evaluation that emphasises learning rather than accountability.

However, one size does not fit all. The lessons learned will be worked, reworked and adapted by practitioners to different  situations.

Source: ELDIS