Model Terms of Reference: Implementing Zonal Management Approach to Urban Water Supplies

7/29/2019 Model Terms of Reference: Implementing Zonal Management Approach to Urban Water Supplies

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Model Terms of Reference

www.adb.org/water

Implementing Zonal

Management Approach toUrban Water Supplies

May 2006



Abstract

A. BackgroundB. Objectives

C. Scope

D. MethodologyD1. Policy and the Political Enabling EnvironmentD2. Technical, Financial and Organizational AnalysisD3. Project Management and ProcurementD4. Operational Management

E. Implementation Schedule

F. Human Resource Inputs

G. Financial Resources

H. Reports and Deliverables

1. Questionnaire for Water Utility (International Consultant)2. Questionnaire for SSPWP Piped Water Operators (Domestic

Consultants)3. Questionnaire for SSPWP Water Vendors (Enumerators)

4. Questionnaire for Bottled Water Supplier (Enumerators)5. Questionnaire for Consumer Survey (Enumerators)



Model Terms of Reference

Implementing Zonal Management Approach to Urban WaterSupplies

Abstract

Some 700 million people in the Asia and Pacific region still lacks access to improved water supply.

People who are not connected often spend 15% of their household income for water. They buy their water fromneighbours at inflated costs, or get it from standpipes or stand-posts, where access to water is only available forshort durations.

The core issue is getting connected to piped water promptly and on affordable terms, especially for the poor. Onceconnected, people are likely to pay only 1–2% of their household income for piped water.

Unfortunately, it is not so easy to improve operational performance of the whole distribution network.

A possible solution would be to sub-divide the network into smaller, more manageable hydraulically isolated zones.

This would enable operators to focus resources and efforts within each zone, thereby increasing the chances ofimproved performance, reduced levels of NRW, increased water conservation through effective consumer revenuemetering, and more. The savings resulting from these service efficiencies could be directed to adjacent zones andthe process progressively repeated until the whole network has been covered and overall performance improved.

This is the “zonal approach” to urban water supplies.

The zonal approach’s main objectives can be summarized as follows:

▪ 24 hour piped water to all▪ Affordable water

▪ Conservation of resources▪ Sustainability of service▪ Speedy Implementation of development

The zonal approach should not be implemented in isolation but must always be part of an integrated package thatincludes:

▪ Government endorsed and civil society informed policy on service levels, tariffs, tariff revisions, subsidies,private sector participation, etc.

▪ Covers water source and hydraulic zone selection, water audit, and assessment of financial viability,organizational and social aspects, and environmental impact.

▪ Project and utility management covering the development of people through leadership and strongmanagement, with managers free to manage without political interference, as well as the procurementof services.

▪ Based on management at the lowest practicable level, for example sub-zone caretakers.



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1. In the Asia and Pacific region, some 570million people still need to receive improved watersupply and about 1,820 million people still need toreceive access to improved sanitation to reach theMillennium Development Goals (MDGs).1 To

achieve the MDG targets by 2015, manydeveloping member countries (DMCs)acknowledge that it is important to reach Target10 on water and sanitation by 2010, because theeconomic impact of improved piped water supplyon health and education is significant.2 WhileADB-supported projects in some DMCs, forexample Phnom Penh in Cambodia and Dalian inthe PRC, have achieved 24-hour water supply,many utilities in other DMCs have low levels ofcoverage. At five persons per connection, theeffective water supply coverage with piped

connections in 20013 was 10% in Dhaka, 32% inHo Chi Minh City, 31% in Jakarta, 32% in Manila,and 46% in Delhi. People who are not connectedoften pay water vendors about 15% of theirhousehold income for delivery of water, buyingwater from their neighbours at inflated cost, orgetting water from standpipes or stand-postswhere they only have access to water for a veryshort time each day and have difficultytransporting it to their homes. In all cases, the coreissue is getting connected to piped water promptlyand on terms affordable to those living in peri-

urban areas, especially the poor. Once connected,people are likely to pay only 1–2% of theirhousehold income for piped water.

2. The main issues in urban water supply indeveloping countries may be summarized as: Levels are

typically 40-60% of production and often NRWcannot even be measured. Problems usuallyinclude leakage from old pipes and poorlyconstructed connections, illegal connections,illegal sale of water to vendors, poor metering /

reading / billing, and wastage from standpipes. In most of South Asia,

intermittent supply (such as 2 hours of pipedwater per day) is the norm. When asked why,the typical answer is “there is not enoughwater”. The example of Male in Maldives,where there is 24 hour piped supply at anaverage consumption of only 6m3 perhousehold per month, proves that this is not avalid answer.

Typically, directpiped water connections to consumer housesin Asian cities only cover around 35% of thepopulation, with the remainder relying onstandpipes and water vendors, etc.

Typically the poor pay around $20 per

month for about 6m3 of water per monthfrom vendors, or travel long distances each dayto collect water from a standpipe but eventhen they may not get water. Typically the richpay $4 per month for 30m3 / month for pipedwater. High connection charges alsodiscriminate against the poor who cannotafford to pay them in advance unless, forinstance, there are facilities for payment byinstallments.

. Groundwaterlevels in some cities are falling fast with

groundwater quality becoming increasinglysaline in some places. Where surface watersare polluted by industry, it is expensive to findmore remote good quality alternative sourcesand to transport this good quality water tocities.

. ADBand World Bank funded water supply projectstypically take 8-10 years to fully implement,whereas NGOs, the private sector, or localauthorities may take as little as one year for asimilar but smaller project. Time is of the

essence if the MDG targets are to be achieved.

3. Typical situations for the urban poor andthose living in peri-urban areas are: (i) utility pipedwater is not close and communities rely on small-scale water providers (SSWPs) or develop their ownsources; (ii) the utility only serves the area throughstandpipes/stand-posts, limiting per capita wateravailability and increasing inconvenience; (iii) theutility can serve the community but the cost of aconnection is so high and the terms so inflexiblethat only a few can afford to connect to pipedwater.

4. Improved operational performance of thedistribution system would lead to real benefits notonly for existing consumers through improvedservice levels and greater cost-efficiencies, butwould also enable people who currently are notconnected to the network to be supplied withwater from direct connections. Improvedoperational efficiency and an increased customer



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base would also encourage the utility to reduceconnection fees. Targeting the poor for such newconnections would materially assist in theachievement of the MDG water sector targets.

5. It is notoriously difficult to improveoperational performance of the whole distribution

network at the same time, but by sub-dividing itinto smaller, more manageable hydraulicallyisolated zones and systematically focussingresources and efforts within each zone to improveperformance can increase the chances of successand yield significant improvements in a shorttimescale. Benefits and savings in a zone can thenbe directed to adjacent zones and the processprogressively repeated until the whole network hasbeen covered and overall performance improved.This philosophy is termed the “zonal approach” tourban water supplies.

6. Further source development may not beneeded or could be deferred if NRW can bereduced to a more reasonable level, say to 20% ofwater entering the zone. Zones could cover up to 1million people, with caretakers appointed to betotally responsible for all services inside each sub-zone (<10,000 people) and who would also beaccountable for improvements such as 100%metering, 100% collection efficiency, leak repairsand identifying all illegal connections. Caretakerscould also enter every property to help with

wastage/leakage on the premises.

7. Poor people already pay more for one unitof water than the rich, so affordability is not anissue. In any case, a tariff based on a lifeline block and a sliding scale of charges for waterconsumption can be designed to cushion the poorwho are connected. It has also been demonstratedthat when the need for a policy based on full costrecovery from tariffs, as well as the need forautomatic tariff adjustments, is explained topoliticians they generally endorse it. In the case ofthe zonal approach, politicians need to endorse theprinciple that those enjoying a 24 hour supplyshould pay more than those on an intermittentsupply. If this leads to claims of financial hardshipthen consumers still have the option of reducingtheir consumption to minimize water bills. If theychoose to maintain their consumption level andpay the higher charges, then the extra revenuegenerated can finance further improvements in thezone. As well as technical service improvements the

zonal approach therefore provides an opportunityto introduce differential tariffs that reflect the levelof service provided. 24 hour supply would beintroduced in one sub-zone at a time, with highertariffs and strict metering and revenue collectionenforced. Water would be conserved not onlythrough reductions in NRW and avoidance of

wastage, but also through the impact of highertariffs on consumption.

8. Rapid implementation must be a pre-condition of success, for instance 3 years maximumto effect 24 hour supply in a zone of, say, onemillion people. It is unreasonable to expect peopleto wait longer than that, or indeed indefinitelybefore they experience improvements, especially ifothers are clearly seen to be benefiting in themeantime.

9. By implementing the zonal approach toreduce levels of NRW and to encourage waterconservation through effective consumer revenuemetering, service levels such as continuity of supplyand system pressures can be progressivelyimproved within each zone. Savings can be used tosupply new consumers within the zone and alsoimprove the water supply to adjacent zones withinwhich the zonal approach can then be

implemented. Improved efficiencies will also reducecosts, leading to more affordable water supply.

10. The main objectives may be summarized asfollows:

24 hour piped water to all Affordable water Conservation of resources Sustainability of service Speedy Implementation of development

11. The zonal approach should not beimplemented in isolation but must always be partof an integrated package which includes:

• -Government endorsed and civil society



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informed policy on service levels, tariffs, tariffrevisions, subsidies, PSP, etc.

• ▪

– data collection on water sources, systemcoverage and characteristics of the

distribution system from existing utilityrecords, followed by analysis to identify theselected special zone.

▪ - how many are served byhouse connection, stand-post, tanker,tricycle, pushcart, bottled water supplier?What amounts do they receive, how muchdoes it cost them and what is the waterquality? What is the role of small scalewater providers (SSWPs) in connectingpeople to piped water through small pipedwater networks (SPWNs)?

▪ - differential tariffs,automatic tariff revisions based on policyimplementation, 100% collection efficiency,etc.

▪ –allocation of appropriate staff to thespecial zone and arrangements forstakeholder liaison.

▪ – projected impacton sanitation and wastewater disposal.

• –project and utility management covering the

development of people through leadership andstrong management, with managers free tomanage without political interference, as wellas the procurement of services.

• - based onmanagement at the lowest practicable level,for example sub-zone caretakers.

12. A clear understanding of policy on servicelevels, tariffs, tariff revisions, subsidies, and PSP is

an essential pre-requisite. In addition, nothingshould be attempted unless the zonal approachand its objectives are first endorsed at the highestpolitical level in the country as well as at thehighest local authority level. There should also be aguarantee of no political interference at any stagein the consulting, procurement, contracting ormanagement processes. Transparency must play akey part in this and so it may be appropriate toinvite a strong independent organization such as a

well-respected NGO as well as the media andacademics to give implementation of the zonalapproach a high public profile at all times.

13. The quantity,

quality, reliability and sustainability of existingsources of water for the whole city should beassessed, including private and public dug wells,tubewells with hand-pumps, and motor drivenpumped tubewells. If a city-wide assessment is notviable then it should be undertaken in potentialspecial zones as part of the hydraulic analysis.

14. The hydraulic analysisseeks to identify where hydraulically isolated zonesalready exist or can be readily developed. Ideallyeach zone should be served by a reservoir or can

be monitored by a limited number of cross-boundary zonal meters. Existing data, howeverpoor, will be the basis of the initial hydraulicanalysis to determine how to divide the city intoappropriate hydraulic zones of, for example, aboutone million people. As further data is obtainedduring project implementation the hydraulicanalysis can be refined. It is sensible for the firstzone selected for attention to be adjacent to anyexisting 24 hour service area. When a suitable zonehas been identified then good maps and plans of itwill be needed, and if not available should be

prepared step by step in the subject zone. Inaddition, data on the age, size, material andcondition of pipes, valves and meters is desirable.

15. Data collection and analysisof water services begins with a comprehensivewater audit. Ideally this should be carried out forthe whole city, but if this is impracticable then itshould be focused on the special zone. Theobjective of the audit is to ascertain how manypeople are served by piped connection to theirhome, whether from the utility or some SSWP orhome association, and how those not served bypiped networks obtain their water supply. ADB hasalready prepared a model TOR for this activity,including questionnaires.

16. This element of theanalysis is important because it evaluates theprojected financial impact of implementingtechnical measures and adopting a new tariff for24 hour supply based on the new service levels,



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improved collection efficiency, reduced NRW level,and expanded customer base within the specialzone. The analysis also includes the cost ofprojected capital investments in pipes, meters,valves etc., as well as operational costs.

17. An assessment of

the institutional organization is necessary todetermine and agree with the utility which staffwill work in the special zone, how they will be paidand for how long. Utility staff would effectively beseconded, and once under the full control of thespecial zone management, revised remunerationand rules of work would apply. The objectivewould be to develop people seconded from theutility and thereby encourage sustainability.

18. It is important that peopleinside the special zone are represented during the

project, possibly through an NGO, home ownerassociation or local authority. The revised role ofwater vendors and SSWPs, consumer costs,consumer service levels, etc., will all need to beassessed and the proposed improvementsexplained to these community representatives soresidents are kept fully informed at all times. Ingeneral, it is important that the zone represents alarge number of people not currently served by apiped water system to their home.

19.

Consideration must also be given to theexisting environmental situation, includingsanitation and wastewater facilities, and specificallythe impact that the increased customer base andchanged consumption patterns will have onsewerage and wastewater collection, treatmentand disposal within the special zone. For instancethe volume of sullage water may increase or thedemand for water-borne sewerage may rise aspeople are connected to the piped water supplynetwork. Policies and design principles thereforeneed to be agreed and various options studied.Wherever possible, the treatment, disposal or re-use of wastewater within the zone should beadopted as a good principle to follow.

20. The critical parameter for success of thezonal approach is that . Thismay necessitate having new rules for recruitmentof consultants, procurement, contracting and

management so that decisions can be delegatedand contract disbursements made quickly.

21. are also vital,as there will be a need for parallel developments totake place with different contractors in acompetitive environment. Provided there is

transparency in the contract award process andthere is seen to be real competition amongcontractors, then this should help to eliminatedelays and corruption.

22. andare both key ingredients to the

success of the zonal approach but are not thesame thing. There is little sense in developing utilitystaff to manage a project, as it is more efficientand practical to appoint consultants to do that andbe responsible for all design work and contract

documentation, bid evaluation, constructionsupervision and recommend approval of payments,providing effective continuity for implementationin other zones. However, the Project Managerwould be answerable to the Zone Utility Manager,who ideally would have extensive experience in themanagement of utility operations but also have aprivate sector background. The Zone UtilityManager would be supported by competent staffin personnel, accounting, commercial operations,engineering, social development, public relations,and environmental affairs. Close co-ordination

between the Project Manager and the Zone UtilityManager will be essential at all times.

23. No large packages or civilworks contracts are envisaged. If large quantities ofpipe or other materials and equipment are to beprocured then at least two suppliers should becontracted on the same negotiated price basis.Appropriately sized and packaged pipe-laying andfittings installation contracts would be awarded tocontractors who would work in parallel for thesame negotiated contract rates. Close

over the excavation, reinstatementand resurfacing of roads would need to be well co-ordinated. Public notices would clearly specify to allconcerned stakeholders what is happening, whenand why. Procurement, as well as covering theinstallation of replacement and additional pipesand valves, etc., may also include the appointmentof specialist companies, for example, to undertakeleakage detection surveys on a performance



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contract basis, or repair leaks or replace metersunder a schedule of rates contract.

24. A good surrogate performance indicatorfor the effectiveness of a city water supply is the

percentage of the population receiving 24 hourpiped water to the home. Thus in the special zonethe objective will be to connect nearly everyone toa piped water supply. Apart from the utilityproviding direct connections, SSWPs can play amajor role here by obtaining a bulk supply fromthe existing utility distribution system and providepiped water to those using standpipes or watervendors by constructing SPWNs. However, thisshould be seen as an interim measure only until theutility can extend its network and take over theSPWN. SSWPs should therefore be represented in

the staffing structure of the special zone.

25. As well as the special zone itself, each sub-zone must be capable of hydraulic isolation, withall inflows and outflows monitored by introducinga District Metering System. All consumers would beprovided with new water meters, which would beread regularly by the sub-zone caretakers and billsissued simultaneously every month. Payment ofwater bills would be made easy with no-onehaving to go further than one kilometre to paytheir water bill. Utility staff would computerize all

billings and cash payments, and analyse the resultsfor each sub-zone. Any excessive or low usagewould be investigated. Adequate resources wouldbe available to each sub-zone to repair leaks,replace meters, etc. Sub-zone improvements wouldbe progressive so that 24 hour supply is establishedone sub-zone at a time. Where appropriate,elevated tanks would be constructed to provideadequate pressure and a 24 hour supply. Regularanalysis of the district and consumer meters wouldenable NRW to be calculated. Where it isconsidered to be high, inspections and leak detection exercises would be performed in the sub-zone to control it so that the NRW of each sub-zone is of the order of 20%.

26. Operational management of the specialzone should be based on the devolution of zonemanagement to the lowest practicable level, forexample to the sub-zone caretaker level. Allcaretakers will be accountable to District Managerswho will report to Area Managers and who in turn

will be accountable to the Zone Utility Manager. Ifthere are not many sub-zones, then the roles ofDistrict Manager and Area Manager can becombined. All operational activities such as valveoperations would be the responsibility of utilitypersonnel, and not the consultant or contractors. Aweekly report will be prepared by all managers at

each level detailing achievements made againsttargets. The Utility Manager will issue a weeklysummary report for the whole zone, as well as amonthly report for public access on the internet.An annual Development and Performance Reportwill be prepared for each Special Zone, so thatwithin three years one special zone has beendeveloped covering up to one million people witheveryone connected to a 24 hour piped watersupply and NRW at 20% or less. Work on a secondspecial zone should commence two years after thestart of the first one.

27. The consultant will hold discussions withauthorized representatives of national and localgovernment to clearly define policy on service levels,tariffs, tariff revisions, subsidies, and PSP. Inparticular, the consultant will seek firm guaranteesof no political interference in the process, and

reach agreement on government monitoring andapprovals requirements. Process transparency isessential to establish credibility and so thedissemination of information on policy and theenabling environment should be fed into thestakeholder consultations to be held during theanalysis stage to discuss technical options and togive implementation of the zonal approach a highpublic profile.

28. Sensitivity needs to be exercised in theseconsultations as there could be strong political

resistance to providing water services to illegallyestablished areas within the city, especially ifviewed as being at the apparent expense ofimproving service levels for existing consumers.Inevitably there could also be resistance from thosecurrently benefiting from an ample supply of waterat minimal cost if they see such costs likely to riseor their supply curtailed. Political buy-in andsupport at the highest levels is critical to thesuccess of the zonal approach, and without it



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progression to the project implementation stageshould be deferred.

29. The consultant will collect data from allexisting databases, reports, maps and drawings ofthe distribution network to obtain ascomprehensive an understanding as possible of thesupply situation concerning water sources, systemcoverage, as well as characteristics of thedistribution system. Where records are poor ornon-existent the consultant will undertakesupplementary surveys to obtain sufficientinformation to enable an analysis to be undertakenof the system in order to identify the location and

size of potential special zones. Potential zones willbe prioritised in terms of the ease and cost ofhydraulic isolation and monitoring, proximity toexisting 24 hour supply areas (indicative of theadequacy of water resources), the number ofunserved poor in the zone, etc. The consultant willdevelop a set of selection criteria and a weightingsystem acceptable to the relevant authorities toprioritise selection of the special zone.

30. The water audit will utilize existing dataalready gathered, supplemented by surveysundertaken by the consultant in the potentialspecial zones. The main steps in the audit processare:(i) of the water utility, SSWPs

and consumers in the potential zones, andto assess the size and

location of the target market and the capacityof existing SSWPs to meet the unfulfilleddemand.

(ii) with the targetcommunities, the utility, SSWPs, localgovernment representatives, NGOs, etc., and

, including time-bound licenses andMemoranda of Agreement with theMunicipalities and formal utility leading toultimate transfer of responsibility for serviceprovision to them.

31. The surveys will be undertaken bywho will be responsible for the survey

logistics and supervising the enumerators (thesecould be students) undertaking the surveys in theseparate geographic areas in the city. The domesticconsultants will pre-test the sample questionnairesfor all the surveys before use by the enumerators.

The domestic consultants will also be responsiblefor interviewing all existing SSWP piped waternetwork operators. will undertake 5%sample consumer surveys in each targetcommunity within a zone, as well as interviewingSSWP water vendors and bottled water suppliersoperating in each of their areas. Formal permissionto survey will be obtained from the localgovernment by the domestic consultants and acopy provided to each enumerator, who will alsoas a matter of courtesy introduce themselves to theleader of each community in which they operate.

will have overallresponsibility for the surveys, will interview thewater utility company, analyze all results and makerecommendations

32. The domestic consultants will brief theenumerators regarding (i) location, (ii) how tosample for interview, (iii) who to interview, (iv)length of interview, (v) number of interviews perday, (vi) transport, (vii) total time to completeinterviews, (viii) payment for work, (ix) clarifications,(x) testing of survey, (xi) permit to survey and (xii)

the questionnaire. Enumerators will also documentany anecdotal information given to them about thewater industry, and which may not correspond toany question asked.

33. Quality control on the surveys will bemaintained by random field checks undertaken byboth the domestic and the internationalconsultants. The name of the person beinginterviewed, their address and the name of theperson undertaking the interview and the date ofthe interview must be recorded on eachquestionnaire completed. If an enumerator isfound to be falsifying results they will not be paidand all work already undertaken by them will berepeated by a new enumerator interviewingdifferent people.

34. Questionnaires will be prepared as listedbelow and will be translated into the locallanguage by the domestic consultant: ADB hasalready prepared a model TOR for this activity



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including questionnaires (see forexample questionnaire templates).

35.Apart from details of individual customers this willidentify the recipients of bulk sales includingSSWPs, sub-divisions, homeowner associations, etc.

Its focus will be on identifying the water sourceand for each type of customer (non-domestic,house service connection, standpipe, etc.) the totalnumber of connections, the volume sold permonth and the revenue gained per month. It willprovide information on production volume versusconsumption volume to determine NRW, and willnote the extent of 24-hour piped water coverage.The international consultant will carry out theinterview.

36.

The domesticconsultant will carry out interviews with everySSWP in each survey area. The questionnaire willseek essentially the same information as for theutility except the quality of the service to thecustomer such as direct connection or hose anddrums will be determined. The method andfrequency of payment is an important output fromthis interview.

37.If water vendors operate in a survey

zone, then at least three different vendors of eachtype (water tanker, motorized tricycle, pedaledtricycle, rickshaw, pushcart, etc.) should beinterviewed by the enumerator to estimate thetotal number of vendors of each type operating inthat zone. Pertinent information sought includestheir source of water (to be visually checked),means of transport of water, number and type ofcustomers, average distance transported, volumesold and revenue gained. It is important toestablish how much the vendor pays at source forthe water and to whom it is paid.

38.The enumerator will

interview at least five different bottled watersuppliers in his/her survey zone and estimate thetotal number of bottled water suppliers and type(for example mixed goods shop, sole purposebottled water shop, treatment and sale on site,deliveries of bottled water, etc.) in that zone. Thefocus of the interview is to obtain information

about the source of water, type of treatmentprovided, volume of water sold per month, pricepaid and the total revenue.

39.The enumerator must obtain a 5%

representative sample of all water users in his/her

zone, identifying those served by the utility and bySSWPs, and surveying them in numbersproportional to their prevalence. The focus will beon water source (consumers may get water frommore than one source), access to water, waterquality, reliability of supply, availability of supply,volume consumed per month and cost per month.It is important to record the number of persons ineach household. This survey must include arepresentative number of non-domestic consumers,especially industrial users.

40. will be preceded byobtaining any clarifications required from thedomestic consultant and the enumerators. Thedomestic consultant will also collate andsummarize answers to all the questions. Theinternational consultant will then consider thepoints of interest, deriving the following basic datafrom the summary of results:

• Coverage % with 24 hour supply to individualhouse connection by utility

• Coverage % with individual house connection

by the utility• Coverage % including all utility domestic

connections and standpipes.• Coverage % with piped water in home (all

water providers).• Average household consumption per month by

different sources of supply• Average household cost per month by different

sources of supply.• Total monies paid by SSWPs at source per

month.• Average price of utility water.

• Average prices of SSWP water (network operator, vendor, water bottler).

• Revenue turnover (a) utility, (b) SSWPs(network operator, vendor, bottled watersupplier).

• Volume of sales (a) utility, (b) SSWPs (network operator, vendor, bottled water supplier).

• Official NRW figure from utility.• Comparison of cost and consumption - piped

water versus non-piped water



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• Proportion of utility water volume sold to non-domestic consumers

• Proportion of utility water revenue derivedfrom non-domestic consumers

• Comparison of average tariff for utility water:domestic versus non-domestic

• Proportion of all piped water where utility

maintains the reticulation• Rating of customer satisfaction with utility.

41. The main purpose of the assessment is tofocus on those not served with piped water and toassess the costs and benefits to them of switchingto a piped water supply, as well as the feasibility ofdoing so through an SSWP contract. The findingswould be presented and discussed at a stakeholderconsultation to guide the zonal approach program,enhance cost recovery and institutionaldevelopment to promote service sustainability,

encourage water conservation (including reductionof NRW), and ensure that as far as possible theurban poor are connected to piped water serviceswithin their ability to pay.

42. Following completion of the analysis, keyfindings will be disseminated to all stakeholders.About two weeks later, a one-day

will be convened for all stakeholders.The morning would be devoted to presentation ofresults, analysis of the surveys and discussion of thefindings, concluding with an overview of options

for the way forward. The afternoon would bedevoted to discussion of those options and todeveloping a consensus on the preferred wayforward. The stakeholder consultation will befacilitated by a domestic consultant skilled in suchwork, or by a well respected and capable localperson.

43. In cases where the formal utility decides foreconomic or technical reasons not to extend itsservices into some areas within the zone, thepotential for SSPWPs to provide the service in the

interim will be explored. ADB has prepared amodel PPTA ToR for mainstreaming SSPWPs whichcan be used if this approach to serve those areas isadopted. The following is a summary of theprocess to formally recognise the SSPWP by themunicipal authorities and also the formal utility toensure that the area will not be re-developed orthe water services network extended into it for aspecified number of years. Formal recognition willprovide security of tenure to the SSPWP and enable

plans to be developed with confidence and servicespriced to obtain an appropriate return on capitalduring the period of tenure and enable themaximum number of poor to be connected. Thiscould be achieved through a simple

, such as issuing a license detailing thearea of license jurisdiction, the obligations of each

party, reporting requirements and their frequency,periodic audits, remedies for failure to conform tothe license, an appeals process, the licenseduration, periodic license reviews, exit strategies orextension options at the conclusion of the licenseperiod. At the end of the license term the assetswill be transferred to the formal utility. Areasonable license fee could be charged to coveradministration costs. The terms of the licensewould also have to be approved by the formalutility. A separate Memorandum of Agreementshould be drawn up between the SSWP and the

formal utility to cover such issues as: appropriatetechnical standards and materials, provision of abulk water supply, maximum/minimum dailyvolumes, tariff, metering details, remedial actionsin the event of supply deficiencies, periodic reviews,etc. The municipal license and the utility agreementwould also safeguard the position of the SSWP inthe event of a regulatory body being subsequentlyset up to control the sector.

44. The license and Memorandum ofAgreement should be relatively simple documents,

with bureaucracy kept to a minimum. The localconsultant, with support from the internationalconsultant, will develop an appropriate licenseformat and a Memorandum of Understandingacceptable to the Municipality and the formalutility following consultation with existing SSPWPs.

45. The consultant will develop a simple Excelspreadsheet financial model to simulate the currentstatus of water supply in the special zone and toinvestigate projections of the impact of technicalimprovements such as reduced NRW, progressiveachievement of 24 hour supply and theintroduction of a new tariff, and the expandedpiped water customer base. Estimates will be madefor input into the model of the necessary capitaland recurrent operational expenditures to deliverthese projected new levels of service and tomaintain them. Different scenarios will benstudiedby the consultant and recommendations made



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regarding the optimal strategy tonimplement thezonal approach in the special zone. For instance,the selection of specific subzones that can yieldearly results and be used as demonstration areaswould serve to promote the strategy and resolveany major issues.

46. A key factor to take into consideration willbe the response of existing consumers to increasedtariff levels in the 24 hour supply sub-zones. Theconsultant will investigate price elasticity anddevelop a strategy for linking service levelimprovements to progressive tariff increases, andwill also make recommendations on the rate ofsuch tariff increases. For instance, to avoid majorcustomer dissatisfaction one strategy might be toonly increase tariffs initially by a small marginabove inflation so customers do not experience asudden increase in their water bills, followed by a

more rapid rate of annual tariff increases. Muchwill depend on existing tariff levels, and wheretariffs are currently unsustainably low it will bedifficult to increase them even by a reasonableamount if the increase represents a majorproportion of the original tariff. A balance willhave to be sought between moving towards a fullcost-recovery tariff and the impact on customerattitudes and responses.

47. The selection and allocation of appropriatestaff from the utility to work exclusively with theconsultant in the special zone will have a majorimpact on the success of the zonal approachstrategy, as they will have extensive detailed localinformation on the distribution network and itscustomers. The consultant will prepare a staffingstrategy in consultation with the water utility forthe secondment of selected staff and theirintegration into the project team. The strategy willalso include a training programme and knowledgetransfer plan to develop the skills of the secondeesand also to ensure the long-term sustainability ofthe special zones and ultimately the whole network as the zonal approach is implemented. A keyoutput of the strategy will be the development ofpeople through leadership and strongmanagement. The strategy will also define lines ofcommunication, operational responsibilities andreporting procedures (for example decisions onvalve operations, etc.), and arrangements forliaison with all stakeholders.

48. Stakeholder consultation and, in particular,the provision of information to and feed-back fromlocal residents on what is happening and overallprogress and achievements is very important andwill require the consultant to develop strong linkswith the various stakeholders. The consultant will

then develop a consultation strategy that promotesgood co-ordination and liaison and that fullyrepresents the views of people directly affected bythe work. This could possibly be achieved throughthe appointment of an NGO, home ownerassociation or the local authority to act as therepresentative of the local community.

49. The consultant will assess the impact ofimproved service levels and an increased customer

base on the environment of the zone. This willspecifically include the impact of increased sullageor grey water and the potential for increased use ofwaterborne sewerage facilities on the existingsewerage, sanitation and drainage systems and thegeneral environment within the zone. This shouldalso include consideration of revised waterconsumption patterns and the potential for theremoval of coping strategies for intermittent watersupply, for example ground tanks, pumps andoverhead tanks, etc. The consultant will alsoinvestigate appropriate solutions to any problems

identified, and develop policies and design criteriato satisfactorily address them. Findings andrecommendations will be discussed with theappropriate organizations responsible, and a reportprepared detailing the proposed improvementstrategy to up-grade the zonal environment andminimize potential detrimental impacts.

50. As the Project Manager, the consultant willbe fully responsible for the detailed planning andmanagement of the project as well as for all designwork and the preparation of contractdocumentation. This will include the undertakingof feasibility studies, outline and detailed designsfor contracts, preparation of contract documentsas well as notices and adverts, bid evaluationsincluding the development of evaluation criteriaand weightings, construction supervision andcommissioning. As part of his constructionsupervision duties the consultant will check and



10

review requests for payments by contractors andrecommend approval of those payments, andundertake periodic inspections to identify defectivework and subsequent inspections to ensure thatremedial work has been completed satisfactorily.The consultant will also issue SubstantialCompletion and Taking-Over Certificates, etc., and

ensure that record drawings have been preparedand are accurate.

51. The consultant will be answerable to, andwill liaise closely with, the Zone Utility Manager,who should be free to manage without politicalinterference and would be supported by a smallcore of competent staff with expertise in relevantdisciplines, including commercial operations,engineering, public relations, and environmentalaffairs. Where existing contractor selection andappointment procedures are considered

unnecessarily lengthy then the consultant willpropose and agree with senior utility managementappropriate new or revised rules and recruitmentprocedures so that decisions can be delegated,contract disbursements made quickly, andmanagement streamlined. Any revised or new rulesshould promote transparency and competition,and should also help to eliminate delays andcorruption.

52. The consultant will be responsible forpackaging the work required into contracts that

encourage more local suppliers and contractors tobid for the work. Where there are largeprocurement or construction requirements thenthe work will be split into packages such thatsmaller contractors can be contracted on the samenegotiated price basis. This will encouragecompetition, mobilize and develop local resourcesand speed up the contracting process and servicedelivery. The consultant and contractors will liaiseclosely with local authorities concerning theexcavation, reinstatement and resurfacing of roads.

53. Operational management of the specialzone will be based on the devolution of zonemanagement to the lowest practicable level: thesub-zone caretaker. All caretakers will beaccountable to District Managers, Area Managersand ultimately to the Zone Utility Manager. Weeklyreports will be prepared by all managers detailingachievements made against targets. The Utility

Manager will issue a weekly summary report forthe whole zone, as well as a monthly report forpublic access on the internet. An annualDevelopment and Performance Report will also beprepared for each special zone.

54. Each sub-zone will be capable of hydraulic

isolation, with all inflows and outflows monitoredby a District Metering System. All consumers willbe provided with new water meters, which will beread regularly by the sub-zone caretakers and billsissued simultaneously every month. Utility staff willcomputerize all billings and cash payments, andwill analyse the results for each sub-zone, with anyexcessive or low usage investigated.

55. District and consumer meters will beanalyzed regularly to determine NRW and toidentify trends. Inspections and leak detection

exercises will be performed in the sub-zone todetermine the physical leakage component fromnight-time tests, followed by leakage detectionsurveys in areas where high leakage is occurring.The aim will be to progressively reduce NRW until itis at its lowest practicable level in each sub-zone,aiming for an overall level of no more than 20% inthe special zone. Meter analysis and surveys will beundertaken regularly to determine base leakagelevels, monitor the situation and identifyunacceptable increases in demand that wouldtrigger more detailed surveys and leakage

detection and repair programs. Adequate resourcesshould be available in each sub-zone to repair leaks,replace meters, etc., and progressively improvesub-zones so 24 hour supply is established onesub-zone at a time.

Review policy and the politicalenabling environment

0.5 months

Surveys of utility, consumers and

SSWPs

1.0 months

Clarifications and preparation ofwater audit results

0.5 months

Hydraulic analysis and special zoneselection report

1.0 months

Stakeholder consultation andreport of findings

1.0 months

Development ofregistration/license procedures

0.5 months

Financial Analysis (during 1.0 months



11

stakeholder consultation period)Organizational and social analysis(during license development)

0.5 months

Environmental Impact (duringstakeholder consultation period)

1.0 months

Project Management andProcurement

31.5 months

Operational Management permanent

Enumerators (or students) 1 personmonth/community

Domestic water supplysurvey consultant

2 personmonths/community

Stakeholder consultation

facilitator (inc. preparation)

1 person

week/communityDomestic financialconsultant

2 person months

Domestic water designconsultants

12 person months

Domestic specification/ contract drafting consultants

6 person months

Domestic sociologist/ community liaison specialist

6 person months

Domestic watersupply/resident engineers

36 person months

Leakage/metering specialist 12 person months

International consultant 24 person months(Note: Seconded utility personnel and sub-zonecaretakers not included)

Enumerators, consultants, facilitator $Local transport $Project office and facilities $Stakeholder consultation $Reports / communications $

(Domestic Consultants)(International

Consultant)This two- part report will be due for completionnot later than three months after the start of theassignment.

This report will be due not later than four monthsafter the start of the assignment.



The license and MoA will be due not later thanfour and one half months after the start of theassignment.

This report will be due not later than four and onehalf months after the start of the assignment.



12

This report will be due in draft format one monthbefore the end of the project, with the final reportsubmitted 2 weeks after the receipt of comments.

1. Questionnaire for Water Utility (International

Consultant)2. Questionnaire for SSPWP Piped Water

Operators (Domestic Consultants)3. Questionnaire for SSPWP Water Vendors

(Enumerators)4. Questionnaire for Bottled Water Supplier

(Enumerators)5. Questionnaire for Consumer Survey

(Enumerators)



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Appendix 1

LESSONS LEARNED FROM ADB SANITATION PROJECTS

1. Latrines (Sri Lanka )– Demand overestimated 6,127 out of 10,000.2. Latrines- (Pakistan) Slum upgrading implemented except for pit latrines.

3. Sewerage – (Vietnam) Capacity for O&M is inadequate.4. Sewerage (Karachi) – Sustainability can only be assured if utility is in good financial

health.5. Sewerage (Karachi) –STP only operating at 54% of capacity. O&M problems – only

5 out of 18 pumps operating. Revenues insufficient to cover costs.6. Sewerage (Karachi) – Project objectives should be clear and monitorable not ”to improve

environmental sanitary conditions and alleviate pollution in coastal waters”.7. Sewerage (Rawalpindi) – Project took 9 years to complete.8. Sewerage (Rawalpindi) – Trunk sewers largely remain unutilized due to absence of

lateral or secondary sewers.9. Sewerage (Pakistan)– Three sewage treatment plants as well as collector and

secondary sewers were constructed but only about 20% of secondary sewers were

provided due to unpopular connection charges.10. Sewerage (Pakistan) – Only 622 connections made.11. Sewerage (Pakistan) – A sewage treatment plant and trunk and secondary sewers were

constructed but only 300 connections made as against 5000 envisaged.12. Sewerage (Pakistan)– A sewage treatment plant and sewer network was constructed

but only 1,600 connections out of envisaged 8,000 were constructed.13. Sewerage (Pakistan)– No charges are collected for sewerage services.14. Sewerage (Pakistan) - Project took almost 10 years to implement.15. Wastewater Treatment (Anhui) – Most important factor for success was strong

commitment from the Government institutions and excellent cost recovery.16. Wastewater Treatment- (Fuzhou) Failure to increase water and wastewater tariffs could

significantly jeopardize financial sustainability. More policy dialogue is needed.

17. Sewerage (Kathmandu)– Rehabilitation of sewage treatment plants and sewers needed.18. Sewerage – (Colombo)- Rehabilitation of sewerage system needed.19. Sewerage- (Bombay) – Sewerage services plus slum sanitation component.20. Sewerage – Only 232 cities/towns out of 4700 in India have sewerage. Average

coverage is 60%.21. Sewerage (Wuhan) – Three wastewater treatment plants and 100km of sewers. Total

investment of World Bank in wastewater treatment facilities in China is to top $10billionover 5-10 years.

22. Sewerage (Shanghai) 50% of pop. Relied on daily collection of nightsoil. Less than 2/3of wastewater collected is treated.

23. Sewerage (Wuhan) ADB Small-scale ADTA with objectives (i) improve public awarenessamong poor of benefits of connecting to sewer system (ii) improve sewer connection

rates among poor and (iii) assess effects of awareness and connection rates on qualityof life.

24. Sewerage and Sanitation (Madhya Pradesh) Project includes supply of equipment forseptic tank and sewer cleaning, construction of community toilets, construction ofsewerage networks and drainage improvements, construction of sewage treatmentplants. Project includes water supply and solid waste components too.

25. Low Cost Sanitation, Community Awareness and Health Education(PNG) Project.Bucket system and simple pit latrines to be replaced with ventilated improved pit latrines.

26. Wastewater Management (Hebei) 300 km of sewers and treatment plants for540,000m3/d combined domestic and industrial wastewater.



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Appendix 2

LESSONS LEARNED -WORLD BANK SANITATION PROJECTS

1. Project design should incorporate institutional building, financial viability and povertyalleviation. Link revenue to expenditures. More user pays instead of municipal budget

transfers.2. It is important of all polluters connecting to the system both to expand coverage and

increase numbers of paying customers. Political commitment is necessary with respectto pricing and enforcement of environmental standards.

3. Ongoing support for project preparation and implementation is important, includingconstruction management, financial and institutional development as well as a technicalreview panel.

4. In Jakarta the Bank’s advocacy of low cost sanitation against local advice caused theproject to fail. The sewerage part of the project was scaled down due to slow progressand limitations on the capacity of the treatment pond. People rely on septic tanks andleaching pits, both improperly designed. Most of the 3000 planned leaching pits couldnot be built because of insufficient space or unsuitable soil conditions. Disposing of more

liquid wastes from septic tanks and leaching pits into drains blocked with solid waste andbrim full with stagnant sewage has only exacerbated already unacceptableenvironmental conditions. And shows how trying to solve one part of the problem hascreated others. Sewerage and sanitation projects require a comprehensive approachthat takes into account the final disposal of waste. Open canals carrying raw sewageoverflow onto the streets. One thousand cases of cholera per year.

5. In Manila the Bank nurtured a dialogue with receptive well run municipal agencies.Deteriorating sewerage system reached only about 17% of city dwellers. Lack of costrecovery means the rehabilitated trunk sewers are not being maintained. Small borepipes connect septic tanks to drains which discharge to drainage canals but these areusually choked with garbage. Nevertheless health surveys reported significantimprovement in local health by removing sewage from around houses. Now in Manila,

World Bank are assisting the concessionaires with septic tank desludging equipment,with septage treatment facilities, and with package sewage treatment plants that treatthe septic tank effluent. Conventional centralized sewerage works are too expensive.



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Appendix 3

SOME GLOBAL CASE STUDIES

A. Introduction

1. There is no need to reinvent the wheel. There are enough both successful andunsuccessful examples around that give us the big picture on urban sanitation in developingcountries. Here are some examples:

B. Urban Environmental Sanitation PlanningLessons from Bharatpur (pop. 200,000), India.

2. Planning process began with a Situation Analysis involving all stakeholders includingNGOs. It culminated in a planning workshop in which sanitation problems and their root causewere examined. Conclusion was that the town’s problems lay not so much with lack of funds as

in poor planning and management.

3. The Guiding Principles of the Plan were:(i) Improve environment (river) and social aspects (health) with more latrines and

better SWM.(ii) Long term goal to be achieved in small steps (3 year priorities).(iii) Priority to be given to low income people where sanitation needs are the most

acute (due to cost factor).(iv) Great emphasis on improving existing O&M.(v) Community participatory approach to be adopted.(vi) Agencies to respect Plan through budget, staff, work plans.

4. Framework of Bharatpur Sanitation Development Plan(i) Goals(ii) Guiding Principles(iii) Management and Coordination(iv) Regulation and Enforcement(v) Roles and Responsibilities(vi) Financial Arrangements(vii) Capacity Building Needs(viii) Formal Status

5. Lessons Learned and Advice to other Municipalities(i) Adopt city-wide strategic planning

(ii) Ensure collaboration between stakeholders and agree on process to be followed(iii) Process must be made official(iv) Consider pilot projects for service delivery(v) Need for capacity building and awareness in (a) Government and (b) NGOs.(vi) Use of Sanitation Coordination Committee is good.(vii) Take small steps.(viii) Incorporate existing schemes(ix) Accept that ideal solution may not be available(x) Recognize there is no maintenance free option(xi) Recognize that sanitation is about behaviour



16

C. Sanitation in Metro Manila (Manila Water)

6. Current Situation(i) Polluted waterways(ii) Congested landscape(iii) Lack of planning of utilities

(iv) No proper sanitation facilities(v) 70% pollution load is domestic sewage(vi) Majority of population use septic tanks(vii) Lack of septic tank services emptying, treatment, disposal(viii) Lack of properly planned sewerage systems

7. Challenges to Sewerage Expansion(i) Congestion (Land for STP and laying pipes)(ii) Acceptance (willingness to accept when compared to septic tanks)(iii) Sewer rates (50% add on water)(iv) Wastewater regulations (legal / community)

8. Alternatives to the Sewerage Approach(i) Package Sewage Treatment systems (utilize existing septic tanks & sewers)(ii) STP constructed underground with community consultation. Costs around

$25,000 for 900 Households / Capacity 900 m3/d(iii) Septic tank emptying and septage treatment offered(iv) Community Sanitation Projects(v) Use of bio-solids and septage as soil conditioner

D. WSP Study Philippines

(i) In the past 30 years investments in sanitation in the Philippines totals only 1.5%of that spent on urban water supply. At least 14 sewerage feasibility studiesprepared in recent years and none implemented.

(ii) Coverage with sewerage is low. Only 8% in Manila and 1-3% in other cities.(iii) Urban poor remain excluded with unsanitary toilets or defecate in open. Top

priority is to provide sanitation services to disadvantaged urban poor. Most of thismust come from communal toilets as space and lack of water prohibits on-sitesolutions.

(iv) Private septic tanks are usually small single chamber tanks which provideminimal treatment and limited sludge storage. They seldom use effluent disposalsystems as regulated and are seldom desludged.

(v) Most urban households in Philippines prefer to pipe their effluent directly to a

nearby drain, canal or water course.(vi) It will require substantive evidence of environmental health risks associated with

current septic tank systems to pave the way for enforceable sanctions againstthe discharge of inadequately treated effluent.

(vii) Begin charging septic tank users (polluter pays) and then use this for sludge andeffluent collection and treatment facilities. A 10% environmental tax added towater bill will allow free septic tank desludging.

(viii) Local governments should not be service providers but monitor and regulate.



17

(ix) The development of technologies capable of upgrading septic tank systems andincorporating them into low cost sewer networks will enable more neighborhoodsto opt for this sort of improved sanitation.

(x) Urban households appear reluctant to pay for public sanitation services whenthere seems little wrong with their private facilities.

(xi) Independent sewerage systems and communal toilets are viable options for

urban sanitation on a smaller scale provided demand is genuine.(xii) Government funding is essential, notably for the provision of sanitation services

to the urban poor who remain excluded from public sanitation services andunable to develop private alternatives. Political support is essential to financingnew sanitation facilities and their sustainability.

(xiii) Key Constraints are:• Limited demand for alternatives to septic tanks• Shortage of financially viable options• Low awareness of environmental health risks• Ineffective enforcement of regulations and user charges• Competition from water supply for resources and politics

(xiv) Inflexible government financing rules give Water Districts few incentives to investin sanitation services or infrastructure in low income areas.

(xv) Urban households using septic tanks are generally very satisfied, noting thatfacilities are reliable and almost maintenance free, whereas sewer connectionswere perceived to be expensive and require frequent maintenance.

(xvi) Only one case study out of seven in Philippines (Zamboanga) had full O&M costrecovery.

E. Another Look At Urban SanitationLessons Learned From 20 Research/Pilots In Africa(PS EAU- France)

9. “The basic goal of Sanitation is the control of the advance of used waters, excreta andother liquid wastes produced by human activity, domestic or economic, so that the containedpollution, bacteriological and physico-chemical, do not spread infection risks for human healthand deterioration of the environment.”

(i) When associated with public health & hygiene there are not enough financialresources and know-how for large scale programs. But in association with watersupply, yes. The again sewerage networks are not necessarily good.

(ii) With the rapid growth of African cities autonomous forms of sanitation willbecome the predominant response at the disposal of the people. They are theonly ones which meet the policy objectives.

(iii) Sanitation management must solve these three problems:• Upstream improvement of household sanitation conditions• In Neighborhoods improvement of healthiness and urban hygiene• Downstream prevention of environmental degradation

(iv) Two problems with sewerage networks. (i) Delays in connecting mean not a highdegree of sanitation is achieved. (ii) Lack of information, education andcommunication mean people don’t know how to use it properly and can revert toautonomous systems.

(v) There are five types of domestic installations:• external, mere hole, no flush, no roof, dry pit, no cesspit



18

• external, mere hole, no flush, dry pit• Mere hole, roof, covered pit• Turkish (?), flush, roof, covered pit• Internal, washbasin, flush, septic tank, cesspit.

(vi) Mechanical (pump) emptying of cesspits most common but manual still frequent.(vii) The setting up of mini-sewerage networks to which may be connected some

types of already established autonomous installations may help to clean up aneighborhood whose housing densification has saturated the physicalenvironment.

(viii) The private sector is at times capable of proposing sustainable technical andfinancial solutions (for instance the profitable artificial lagoon for the processingof wastes of the company Sibeau in Cotonou, Republic of Benin, whose servicesare paid by the inhabitants).

(ix) Thanks to their rudimentary maintenance needs, the only purification stationsthat work sustainably in Sub-Saharan Africa are the artificial lagoons for thepurification of wastes.

(x) Recent anthropological studies have shown that “shame” in the neighborhood isa major factor in the motivations and strategies for equipping households. The

logic of hygiene plays a lesser role than the social logic (reputation or honor) orthe moral logic (shame).

(xi) Burkino Faso Water and Sanitation Board established in 1985 a 5% sanitationtax on the water bill. It recognized that in the short term the access of urbandwellers to sanitation will require the use of over 90% autonomous systems.Through 5% water tax for sanitation and ¾ financial investment provided by thepeople, Burkino Faso has shown it is possible to finance progressively the entireupstream link of sanitation without international intervention.

(xii) Research has shown the threshold of domestic recurrent expenditures onsanitation to be about 1% (water 5-10%) and this is limited to the emptying ofcesspits. But this puts the market at one million Euros for every one millioninhabitants and all without public intervention or incentives, so the market is

considerable.(xiii) The primary and secondary parts of the network system require heavy and costly

infrastructure, which need is generally linked to political image of city andtherefore financing may be negotiated in the political arena. Financing of theupstream links including emptying of cesspits and septic tanks is better byinhabitants because they are more explicit.

(xiv) Technicians provide information but it is not always understood. Likewise peopleexpress themselves about services and how to live but technicians don’tunderstand.

(xv) There is a good example in Tanzania (Moshi) of a sewerage success based onthe executive committee having tariff autonomy. Still even there 85% of peoplerely on autonomous systems.

F. Down To Earth – Eco-Sanitation V Sewerage

(i) The discharge of domestic sewage is leading to heavy pollution of rivers andurban groundwater aquifers requiring a huge investment in river clean up. Wedivert sewage to treatment facilities, but this sewage comes from the rich not thepoor. The more water we use the more investment is needed to clean it up. Thepolitical economy of sewer systems is atrocious for developing countries. Hardlyany poor city can recover its investments in sewer systems. Users get subsidies.



19

The users are the rich. Delhi’s sewers are choked and silted. Roman aqueductsare not a symbol of intelligence. They are a symbol of great environmentalstupidity. Sewage treatment plants when built often lie idle. Sewer systems arebuilt to protect the public health but badly managed systems become a hazard tohealth. The risks include river pollution from sewage outfalls, groundwatercontamination, piped water contamination, sewage backflows (plastic bags) and

overflowing sewers causing people to raise the floor level of their houses at greatcost. About 80% of the pollution of Indian rivers is from domestic sewage, yet thesewers in Delhi have also lost 80% of their capacity due to age and poormaintenance.

(ii) There is a growing concern for ecological sanitation and this is giving rise toinnovations from the concept of sewerless cities using new technologicalsystems which use extremely low or even no water at all and in which all thewastewaters and the solid wastes are recycled. This must be developed for therich because it is the rich persons flush that is the biggest environmental culprittoday. The objective is the safe disposal of human waste yet flush toilets andsewerage transfer the problem elsewhere. They are complicated ways ofspreading pathogens away from the user to the public at large. A family of five

using a water toilet contaminates more than 150,000 liters of water in order totransport just 250 liters of excrement in one year.

(iii) Water is a precious resource and should not be used to transport faeces. Wasteshould be managed as close as possible to its source. Also faeces and urineshould be considered as resources not waste products. We eat plants that getnutrients from the soil. We urinate and defecate and return nutrients to the soil.

(iv) Clivus Multrum is a single vault composting toilet used in Sweden, where urine,faeces and organic household wastes are combined and processed together.The heap decomposes reducing to less than 10% of original volume andgradually forms humus which is used as fertilizer and soil conditioner.

(v) Some developments for consideration are:• Condominial sewerage (Orangi Pilot Project)

• Decentralized effluent treatment• Use vacuum based sewerage (Germany)• Use black water to produce biogas and grey water treat with reed beds• Electric incinerator toilets• Eco-san toilet in Kerala (Paul Calvert) Don’t mix faeces, urine and water. If

two (urine and faeces) are separated urine can be used directly as a fertilizerwhile faeces can be sanitized and then used as a soil conditioner.

(vi) China has a large ongoing eco-san program. Faeces are dried in toilets and arecollected and used in three ways.• biogas digester for lighting and cooking• left over sludge applied to fields as soil conditioner (urine too)• faecal sludge used in aquaculture industry.

G. South Asian Ministerial Conference On Sanitation( Background Paper Dhaka Oct. 2003)

(i) Purpose of conference was to(a) raise the profile of sanitation, (b) generatepolitical commitments, (c) strengthen advocacy and leadership and (d) assessthe state of sanitation and hygiene



20

(ii) Sanitation Policies. Several Asian countries have recently developed sanitationpolicies. USAID issued a guide to sanitation policy development. Policies oftenrefer to

(iii) Decentralization to local government level(iv) Allocation of ministerial responsibility(v) Technology selection

(vi) Regulations and by-laws(vii) School sanitation(viii) Subsidies on new construction(ix) Emphasis on poverty elimination now so sanitation policy should be compatible(x) The most obvious impacts of sanitation and hygiene are in terms of improved

health and environmental protection, but economic productivity, education,empowerment of women and basic human dignity are all powerful argumentsthat need to be better articulated.

(xi) Institutional Arrangements (xii) Governments increasingly seen as facilitators not drivers(xiii) Lack of appropriate legislation and regulations(xiv) Severe institutional fragmentation

(xv) Finance, Economics and Equity (xvi) Where can the resources for sanitation and hygiene promotion be found?(xvii) Subsidies, demand responsive approaches and decentralized government

finances.(xviii) Demand and Choice (xix) Demand for sanitation may exist but it is limited(xx) It is well established that health is rarely the main reason why people build

latrines or connect to sewers. Social and cultural reasons dominate such asprivacy, dignity, convenience, freedom from smell, a cleaner household andimmediate environment.

(xxi) Sanitation in West Bengal improved dramatically when households reduced theircosts by buying only the most basic components to build their own latrines.

(xxii) Hygiene improvement and social marketing need attention.(xxiii) Advocacy, Communication and Mobilization (xxiv) Stakeholder analysis involves identifying the types of audiences/ groups to be

involved and determining how to approach them. Effective policy discussion canhelp legitimize the process and the result.

(xxv) Involvement of government remains critical.(xxvi) Sanitation and hygiene have been dominated for too long by technical

professionals without skills of political advocacy and public communications.(xxvii) We need more conferences just on sanitation.

H. Listening - WSS Collaborative Council

(i). Sheela Patel – SPARC/Mahala Milan/ NSDF Alliance (India)

10. In cities across India, communities working with this alliance have delivered sanitationfacilities that are properly thought through, well built and efficiently run. Unlike governmentlatrines, community toilets are clean, bright, and well ventilated. They have a good supply ofwater for flushing, hand washing and maintenance. They have separate areas for men andwomen and special latrines for children. Each block is operated by a management committeeand its running costs are paid by the purchase of a family toilet pass that costs 20 rupees permonth. The building of a toilet is also an opportunity to show the city authorities that given the



21

chance and the support, the inhabitants of slums are able and willing to solve many of their ownproblems.

(ii). Jockin Arputham (National Slum Dwellers Federation- India)

11. We come to help them get together, identify a problem, and tackle it today- using their

own knowledge, their own talents and their own money. – The people are the greatest resourcefor their own development. – It is my experience that savings schemes are the best way tospark a movement of self help in a poor community. Pitch the idea to a group that ispredominantly women. Sanitation is a very good place to start. If a community savings groupapproaches the Federation with a request for sanitation, we are able to help them through theprocess of planning and designing a toilet block, hiring contractors and builders and developinga system that will pay for the running and maintenance of the facilities. The NSDF is nowcompleting the construction of 280 community toilets that were funded with money that theMumbai City Corporation received from the World Bank. With an average of 20 seats per blockthis program is providing safe sanitation and clean water to half a million people every day.

(iii). Ratnakar Gaikwad (Former Municipal Commissioner of Pune)

12. This is an example of a Champion of the Cause. Sanitation has to be the city’s firstpriority. He built 10,000 toilet seats in 400 blocks of community toilets in just three years. TheCity paid for the capital works but the people for the O&M. “In order to keep the program ontrack I took personal responsibility for supervising the key players. Every Wednesday they wereasked to come to my office; NGO leaders, engineers, accountants and women from the slumssat at the table for a serious businesslike review of progress. I looked at how far we’d gone andtold people where I wanted them to be by next week. Procedures were simplified, decisionswere taken, obstacles were cleared. The drawn out process of awarding contracts for examplewas radically altered allowing some 200 work orders to be issued in the space of three or fourdays. The procedure for releasing money to NGOs was also adjusted to ensure promptpayment at every stage of construction. The Wednesday meetings were critical to success

because they cut out the hierarchies, the parasites and the red tape which can easily ruin agood program”..

(iv). Rehmatbi Qamar Ahmed (Mahila Milan – Women Together) – Contractor

13. When the community has worked out the design of their toilet block, decided where theyare going to put it and got the Corporation to agree to pay for it, they are going to need sometechnical help with the job of actually building the toilet. That’s where I come in. I’ve been thecontractor for five sites in Mumbai and I’ve now got my own contacts with people who supplymaterials and labor at fair rates. There is no shirking and no cutting corners when I’m on site.And that’s the point. I am on site all day every day. I do this because I earn good money (andpeople appreciate what she does).

(v). Surjya Kanta Mishra (Minister for Health and Family Development – WestBengal)

14. Sanitation as A Way of Life. That phrase implies a psychological adjustment that willlead not just to the use of latrines but also the washing of hands, the cutting of nails, the safepreparation of food, the refusal to spit in public places and the vigilant protection of local waterbodies from all sources of contamination. This attitude of mind – not building toilets will lead tothe really dramatic improvement in public health. The solution depends on the participation of



22

the people. That is being generated by a range of strategies that appeal to the need for privacy,to the economic benefits of hygiene to the social stigma of open defecation.

(vi). Sait Damodaran (Gramalaya an Indian NGO – Tamil Nadu)

15. I would advocate a campaign led by communities, civil society and NGOs to make the

people aware of the initiatives being promised by their government. If a community group hasnever heard of the Total Sanitation Campaign, how can they ask their representatives whynothing is happening? Clearly there is a place for local media in raising public awareness. Iflocal authorities are to be held accountable then the community must be in a position toquestion their methods and practices. Slum residents must have the confidence to challengelocal politicians and engineers. This confidence depends on communities having a sound graspof the new policies and having technical capacity to act as watchdog during implementation.NGOs can help.

(vii). Bindeshwar Pathak (founder of Sulabh International Social ServiceOrganization)

16. Sulabh is not an NGO that builds toilets. It is not a local charity that depends ongovernment grants to finance one off projects of water and sanitation. It is a self sufficientmovement employing some 50,000 dedicated staff who work day in and day out right across thecountry to promote the cause of sanitation as a means to eradicate poverty, disease and socialinjustice. The right to cleanliness, privacy and dignity can be used to rid India of a traditionwhich for centuries has sentenced people by their birth to the lifelong task of carrying awayother people’s excreta. We’ve managed to build over a million latrines but in India there aresomething like 120 million families who have no toilet at all. Sulabh charges both governmentsand users in order to maintain their high quality services. Sulabh has innovated technologicalsolutions for the design of toilets, for the treatment of wastewaters, and even for the creation ofbiogas and fertilizers from human excreta.

(viii). Kamal Kar (Social and Participatory Specialist – Bangladesh)

17. The practice of open defecation is a deeply ingrained habit of mind and body. It cannotbe reversed by offering subsidies. Human shit will find its way into people’s mouths. CommunityLed Total Sanitation (CLTS) is bringing 100% sanitation to rural villages and has as its mainobjective the elimination of open defecation. Local people know how to market sanitation.

(ix). Dipak Gyawali (Former Minister of Water Resources in Nepal)

18. It is the task of all ‘social auditors’ to speak out against the inefficiency and self interestof donor bureaucracies. Social auditors may include academics, students, investigative

journalists, activist NGOs, public interest lawyers or simply concerned individuals. If thesepeople collaborate across the North-South divide then they do have the power to influence bothnational and global policy. [This is a lesson that if ADB is going to help governments deliversanitation to the people in developing countries it must be efficient. When demand for sanitationis raised but not efficiently met then this does much harm. It is also a lesson for governmentsthat once a policy is declared social auditors are necessary to monitor the policy and ensure it isindeed implemented – ACM]



23

(x). Umesh Pandey (Founder of the NGO NEWAH in Nepal)19. Sanitation and hygiene have been neglected because professionals are not trained inthe social and cultural side of their work. They give no thought to the idea of community or localknowledge or social dynamics. This is a failure of the education system. --- If they speak outloudly civil society and the media can make a huge impact on public policy. Civil society iscomplicit in what amounts to an unforgivable neglect. There are a lot of good ideas being tried

out in Nepal. Eco-san toilets for example and CLTS. NEWAH has developed a sophisticatedstrategy for identifying different levels of poverty and is already using this to providedifferentiated subsidies to the very poor. But these kind of forward policies are not beingaddressed at the national level.

(xi). Ravi Narayan CEO of NGO WATERAID

20. The ability to develop local solutions in response to specific circumstances is the oneuniversal hallmark of successful interventions and it is also why no particular model can beaccepted as policy or replicated nationwide. But municipal governments do not have the kind ofskills and understanding demanded by the new approach. Very often they are untrained,unfamiliar and even unwilling to work alongside communities in the pursuit of people led, locally

specific solutions. So training and motivation of these people is needed.

(xii). Sandy Cairncross (Professor at London School of Hygiene and TropicalMedicine)

21. Creation of demand for sanitation requires social marketing. Instead of leaving that job toNGOs governments should be thinking about how they can put their own resources into creatinga marketing strategy on a national scale. It might mean diverting resources toward promotionrather than production of latrines. A more agile approach would be to rely on the involvement ofsmall-scale private sector producers. Municipal centers for social marketing could be linked tocenters that stimulate production, train masons, develop technologies, promote a range ofmodels, act as brokers between client and producers and regulate the work of hardware

manufacturers.



24

Appendix 4

SOME REFERENCES ON URBAN SANITATION

1. Low-Cost Sanitation John Pickford

2. Sanitation Connection Internet Site

3. Asian Water Supplies (ADB) Arthur McIntosh

4. Urban Environmental Planning WSP India

5. Sanitation in Metro Manila Manila Water

6. Sanitation in the Philippines WSP Philippines

7. Another Look at Urban Sanitation (Africa) PS EAU –( France)

8. Down to Earth – Eco Sanitation v Sewerage Internet Eco-Sanitation Site

9. EcoSanRes Publication Series Reports Stockholm Env. Institute

10. The Challenge of Financing Sanitation for WSP Africa 2004Meeting the Millenium Development Goals

11. Listening - WASH WSSCC



OUTLINE TERMS OF REFERENCE FOR CONSULTING SERVICESTO IMPLEMENT ZONAL MANAGEMENT APPROACH TO URBAN WATER SUPPLIES

A. Background

1. In the Asia and Pacific region, some 570 million people still need to receive improvedwater supply and about 1,820 million people still need to receive access to improved sanitationto reach the Millennium Development Goals (MDGs). People who are not connected often paywater vendors about 15% of their household income for delivery of water, buying water fromtheir neighbours at inflated cost, or getting water from standpipes or stand-posts where accessto water may only be for a very short time each day and there is difficulty transporting it home.The core issue is getting connected to piped water promptly and on terms affordable to thoseliving in urban and peri-urban areas, especially the poor. Once connected, people are likely topay only 1–2% of their household income for piped water.

2. It is notoriously difficult to improve operational performance of the whole distributionnetwork at the same time, but by sub-dividing it into smaller, more manageable hydraulically

isolated zones and systematically focussing resources and efforts within each zone to improveperformance the chances of success can be increased and yield significant improvements in ashort timescale. Benefits and savings in a zone can then be directed to adjacent zones and theprocess progressively repeated until the whole network has been covered and overallperformance improved. This philosophy is termed the “zonal approach” to urban water supplies.

3. Further source development may not be needed or could be deferred if NRW can bereduced to a more reasonable level, say to 20% of water entering the zone. Zones could coverup to 1 million people, with caretakers appointed to be totally responsible for all services insideeach sub-zone (<10,000 people) and who would also be accountable for improvements such as100% metering, 100% collection efficiency, leak repairs and identifying all illegal connections.Caretakers could also enter every property to help with wastage/leakage on the premises.

4. Poor people already pay more for one unit of water than the rich, so affordability is notan issue. As well as technical service improvements the zonal approach provides an opportunityto introduce differential tariffs that reflect the level of service provided. 24 hour supply would beintroduced in one sub-zone at a time, with higher tariffs and strict metering and revenuecollection enforced. Water would be conserved not only through reductions in NRW andavoidance of wastage, but also through the impact of higher tariffs on consumption.

B. Objectives

5. By implementing the zonal approach to reduce levels of NRW and to encourage water

conservation through effective consumer revenue metering, service levels such as continuity ofsupply and system pressures can be progressively improved within each zone. Savings can beused to supply new consumers within the zone and also improve the water supply to adjacentzones within which the zonal approach can then be implemented. Improved efficiencies will alsoreduce costs, leading to more affordable water supply. The main objectives may be summarizedas follows:

• 24 hour piped water to all• Affordable water



Outline TOR for incorporation in TA Paper

2

• Conservation of resources• Sustainability of service• Speedy Implementation of development

C. Scope

6. The zonal approach should not be implemented in isolation but must always be part ofan integrated package which includes:

• Policy and the Political Enabling Environment - Government endorsed andcivil society informed policy on service levels, tariffs, tariff revisions, subsidies,PSP, etc.

• Technical, Financial and Organizational Analysis: o Water Source and Hydraulic Zone Selection – data collection on water

sources, system coverage and characteristics of the distribution system from

existing utility records, followed by analysis to identify the selected special zone.o Water Audit - how many are served by house connection, stand-post,

tanker, tricycle, pushcart, bottled water supplier? What amounts do they receive,how much does it cost them and what is the water quality? What is the role ofsmall scale water providers (SSWPs) in connecting people to piped waterthrough small piped water networks (SPWNs)?o Financial Viability - differential tariffs, automatic tariff revisions based on

policy implementation, 100% collection efficiency, etc.o Organizational and Social Aspects – allocation of appropriate staff to the

special zone and arrangements for stakeholder liaison.o Environmental Impact – projected impact on sanitation and wastewater

disposal.•

Project Management and Procurement – project and utility managementcovering the development of people through leadership and strong management,with managers free to manage without political interference, as well as theprocurement of services.

• Operational Management: - based on management at the lowest practicablelevel, for example sub-zone caretakers.

D. Methodology

D1. Policy and the Political Enabling Environment

7. The consultant will hold discussions with authorized representatives of national and localgovernment to clearly define policy on service levels, tariffs, tariff revisions, subsidies, and PSP.In particular, the consultant will seek firm guarantees of no political interference in the process,and reach agreement on government monitoring and approvals requirements. Processtransparency is essential to establish credibility and so the dissemination of information onpolicy and the enabling environment should be fed into the stakeholder consultations to discusstechnical options. Sensitivity needs to be exercised as there could be strong political resistanceto providing water services to illegally established areas within the city. Inevitably there couldalso be resistance from those currently benefiting from an ample supply of water at minimal cost




3

if they see such costs likely to rise or their supply curtailed. Political buy-in and support at thehighest levels is therefore critical to the success of the zonal approach.

D2. Technical, Financial and Organizational Analysis

8. The consultant will collect data from all existing databases, reports, maps and drawingsof the distribution network and will undertake supplementary surveys to obtain sufficientinformation to enable a hydraulic analysis and zone selection to be undertaken in order toidentify the location and size of potential special zones. Potential zones will be prioritised interms of the ease and cost of hydraulic isolation and monitoring, proximity to existing 24 hoursupply areas, the number of unserved poor in the zone, etc. The consultant will develop a set ofselection criteria and a weighting system to prioritise selection of the special zone.

9. The audit survey will be undertaken after obtaining formal permission from the localgovernment. Enumerators will undertake 5% sample surveys of water consumers in the targetareas within the city, and will also survey all bottled water suppliers and water vendors operatingin their zone. Domestic consultants will supervise the enumerator surveys, and themselvessurvey all small piped water operators. They will then summarize the results of all the surveysand organize a stakeholder consultation. An international consultant will survey the water utility,and analyze and summarise the results of the surveys, including the size of the market and thecapacity of SSWPs to meet the unsatisfied demand. A domestic facilitator will convene aone-day stakeholder consultation to discuss the findings of the water assessment and identifythe preferred option to provide piped water supply to the community. Sample questionnaires forall the surveys will be pre-tested by the domestic consultants before use.

10. Licensing will provide formal recognition of the SSWP by the municipal authorities andalso the formal utility to ensure that the area will not be re-developed or the water servicesnetwork extended into it for a specified number of years. This will provide security of tenure andenable the SSWP to plan with confidence and price his services to obtain an appropriate return

on capital during the period of tenure. At the end of the license term the assets will betransferred to the formal utility. The license will detail the area of license jurisdiction, theobligations of each party, reporting requirements and their frequency, periodic audits, remediesfor failure to conform to the license, an appeals process and appointment of an independentombudsman, the license duration, periodic license reviews (if appropriate), exit strategiesincluding ultimately the transfer of responsibility for service provision to the formal utility orextension options at the conclusion of the license period. A reasonable license fee could becharged to cover administration costs. A separate Memorandum of Agreement should bedrawn up between the SSWP and the formal utility to cover such issues as: appropriatetechnical standards and materials (typically less onerous than those imposed on the formalutility and reflecting local conditions), provision of a bulk water supply if appropriate (if licensedby the Municipality, the SSWP would have legal status and could become a legitimate bulk

consumer of the formal utility) and covering maximum/minimum daily volumes, tariff, meteringdetails, remedial actions in the event of supply deficiencies, periodic reviews (if appropriate),etc. The license would be a relatively simple document, with bureaucracy kept to a minimum.

11. The consultant will develop a simple Excel spreadsheet model to assess the financialviability of the special zone by simulating the current status of water supply and to investigateprojections of the impact of technical improvements such as reduced NRW, progressiveachievement of 24 hour supply and the introduction of a new tariff, and the expanded piped




4

water customer base. Different scenarios will be studied and recommendations made regardingthe optimal strategy to implement the zonal approach in the special zone. A key factor to takeinto consideration will be the response of existing consumers to increased tariff levels in the 24hour supply sub-zones. The consultant will investigate price elasticity and develop a strategy forlinking service level improvements to progressive tariff increases, and will also makerecommendations on the rate of such tariff increases. Much will depend on existing tariff levels,and where tariffs are currently unsustainably low it will be difficult to increase them even by areasonable amount if the increase represents a major proportion of the original tariff. A balancewill have to be sought between moving towards a full cost-recovery tariff and the impact oncustomer attitudes and responses.

1. The selection and allocation of appropriate staff from the utility to work exclusively withthe consultant in the special zone will be undertaken as part of an organizational review, asthey will have extensive detailed local information on the distribution network and its customers.The consultant will prepare a staffing strategy in consultation with the water utility for thesecondment of selected staff and their integration into the project team. The strategy will alsoinclude a training programme and knowledge transfer modules to develop the skills of thesecondees and also to ensure the long-term sustainability of the special zones and ultimatelythe whole network as the zonal approach is implemented. The strategy will also define lines ofcommunication, operational responsibilities and reporting procedures, and arrangements forliaison with all stakeholders.

2. Stakeholder consultation and, in particular, the provision of information to and feed-backfrom local residents on what is happening and overall progress and achievements is veryimportant and will require the consultant to develop strong links with the various stakeholders.The consultant will undertake a social study to develop a consultation strategy that promotesgood co-ordination and liaison and that fully represents the views of people directly affected bythe work. This could possibly be achieved through the appointment of an NGO, home ownerassociation or the local authority to act as the representative of the local community.

3. The consultant will assess the environmental impact of improved service levels and anincreased customer base on the zone. This will specifically include the impact of increasedsullage or grey water and the potential for increased use of waterborne sewerage facilities onthe existing sewerage, sanitation and drainage systems and the general environment within thezone. This should also include consideration of revised water consumption patterns and thepotential for the removal of coping strategies for intermittent water supply, for example groundtanks and overhead tanks, etc. The consultant will also investigate appropriate solutions to anyproblems identified, and develop policies and design criteria to satisfactorily address them.

D3. Project Management and Procurement

15. The consultant will be fully responsible for the detailed planning and management of theproject as well as all design work and the preparation of contract documentation. This willinclude the undertaking of feasibility studies, outline and detailed designs for contracts,preparation of contract documents as well as notices and adverts, bid evaluations including thedevelopment of evaluation criteria and weightings, construction supervision and commissioning.Construction supervision duties will include checking and reviewing requests for payments bycontractors, and undertaking periodic inspections to identify defective work. The consultant will




5

also issue Substantial Completion and Taking-Over Certificates, etc., and ensure that recorddrawings have been prepared and are accurate.

16. The consultant will be answerable to, and will liaise closely with, the Zone UtilityManager, who should be free to manage without political interference and would be supportedby a small core of competent staff with expertise in relevant disciplines, including commercialoperations, engineering, public relations, and environmental affairs. Where existing contractorselection and appointment procedures are considered unnecessarily lengthy the consultant willpropose appropriate rules and recruitment procedures so that decisions can be delegated,contract disbursements made quickly, and management streamlined. Any revised or new rulesshould promote transparency and competition, and eliminate delays and corruption.

17. The consultant will be responsible for packaging the work required into contracts thatencourage more local suppliers and contractors to bid. Where appropriate, work will be split intopackages such that smaller contractors can be contracted on the same negotiated price basis toencourage competition, mobilize and develop local resources and speed up the contractingprocess and service delivery. There will be close liaison with local authorities concerning theexcavation, reinstatement and resurfacing of roads. Procurement, as well as covering theinstallation of replacement and additional pipes and valves, etc., may also include theappointment of specialist companies, for example, to undertake leakage detection surveys on aperformance contract basis, or repair leaks or replace meters under a schedule of ratescontract.

D4. Operational Management

18. Operational management of the special zone will be based on devolution of zonemanagement to the lowest practicable level: the sub-zone caretaker. All caretakers will beaccountable to District Managers, Area Managers and ultimately to the Zone Utility Manager. Alloperational activities such as valve operations will be the responsibility of utility personnel, andnot the consultant or contractors. Weekly reports will be prepared by all managers detailingachievements made against targets. The Utility Manager will issue a weekly summary report forthe whole zone, as well as a monthly report for public access on the internet. An annualDevelopment and Performance Report will also be prepared for each Special Zone.

19. Each sub-zone will be capable of hydraulic isolation, with all inflows and outflowsmonitored by a District Metering System. All consumers will be provided with new water meters,which will be read regularly by the sub-zone caretakers and bills issued simultaneously everymonth. Utility staff will computerize all billings and cash payments, and will analyse the resultsfor each sub-zone, with any excessive or low usage investigated.

20. District and consumer meters will be analyzed regularly to determine NRW and toidentify trends. Inspections and leak detection exercises will be performed in the sub-zone todetermine the physical leakage component from night-time tests, followed by leakage detectionsurveys in areas where high leakage is occurring. The aim will be to progressively reduce NRWuntil it is at its lowest practicable level in each sub-zone, with an overall level of no more than20% in the special zone. Meter analysis and surveys will be undertaken regularly to determinebase leakage levels, and to identify unacceptable increases in demand that would trigger moredetailed surveys and leakage detection and repair programs. Adequate resources should be




6

made available to each sub-zone to repair leaks, replace meters, etc., in order to progressivelyimprove sub-zones so that 24 hour supply is established one sub-zone at a time.

E. Implementation Schedule (total 36 months)

Review policy and the political enabling environment 0.5 monthsSurveys of utility, consumers and SSWPs 1.0 monthsClarifications and preparation of water audit results 0.5 monthsHydraulic analysis and special zone selection report 1.0 monthsStakeholder consultation and report of findings 1.0 monthsDevelopment of registration/license procedures 0.5 monthsFinancial Analysis (during stakeholder consultation period) 1.0 monthsOrganizational and social analysis (during license development) 0.5 monthsEnvironmental Impact (during stakeholder consultation period) 1.0 monthsProject Management and Procurement 31.5 monthsOperational Management permanent

F. Inputs

Enumerators (or students) 1 person month/communityDomestic water supply survey consultant 2 person months/communityStakeholder consultation facilitator (inc. preparation) 1 person week/communityDomestic financial consultant 2 person monthsDomestic water design consultants 12 person monthsDomestic specification/contract drafting consultants 6 person monthsDomestic sociologist/community liaison specialist 6 person monthsDomestic water supply/resident engineers 36 person months

Leakage/metering specialist 12 person monthsInternational consultant 24 person months

(Note: Seconded utility personnel and sub-zone caretakers not included)

G. Reports and Deliverables:

1. Water Audit and Hydraulic Analysis Report for Zone ______________ Date

Part A. Summary of Results of Surveys (Domestic Consultants)Part B. Analysis of Results (International Consultant)

This two- part report will be due for completion not later than three months afterthe start of the assignment.

2. Financial Viability and Implementation Strategy Report for Zone _________ DateLocal/International Consultant




7

This report will be due not later than four months after the start of theassignment.

3. Environmental Impact Report for Zone ___________ DateLocal/International Consultant


4. Report of Stakeholder Consultation on Water Supply in Zone ___________ DateInternational Consultant


5. SSWP License and Memorandum of Understanding for Community _____ DateLocal/International Consultant

The license and MoA will be due not later than four and one half months after thestart of the assignment.

6. Staffing and Training Strategy Report for Zone _________ DateLocal/International Consultant

This report will be due not later than four and one half months after the start of

the assignment.

7. Final Report for Zone _________ DateLocal/International Consultant

This report will be due in draft format one month before the end of the project,with the final report submitted 2 weeks after the receipt of comments.



Detailed TOR for PPTA Consultant

8

MODEL PPTA TOR

PROJECT PREPARATION TECHNICAL ASSISTANCE

TERMS OF REFERENCE FOR CONSULTING SERVICESFOR IMPLEMENTING ZONAL MANAGEMENT APPROACH TO URBAN WATER SUPPLIES

CONTENTS

A. Background

B. Objectives

C. Scope

D. MethodologyD1. Policy and the Political Enabling EnvironmentD2. Technical, Financial and Organizational AnalysisD3. Project Management and ProcurementD4. Operational Management




H. Reports and Deliverables

Appendices

1. Questionnaire for Water Utility (International Consultant)2. Questionnaire for SSPWP Piped Water Operators (Domestic Consultants)3. Questionnaire for SSPWP Water Vendors (Enumerators)4. Questionnaire for Bottled Water Supplier (Enumerators)5. Questionnaire for Consumer Survey (Enumerators)




TERMS OF REFERENCE FOR CONSULTING SERVICESFOR IMPLEMENTING ZONAL MANAGEMENT APPROACH TO URBAN WATER SUPPLIES

A. Background

4. In the Asia and Pacific region, some 570 million people still need to receive improvedwater supply and about 1,820 million people still need to receive access to improved sanitationto reach the Millennium Development Goals (MDGs).1 To achieve the MDG targets by 2015,many developing member countries (DMCs) acknowledge that it is important to reach Target 10on water and sanitation by 2010, because the economic impact of improved piped water supplyon health and education is significant.2 While ADB-supported projects in some DMCs, forexample Phnom Penh in Cambodia and Dalian in the PRC, have achieved 24-hour watersupply, many utilities in other DMCs have low levels of coverage. At five persons perconnection, the effective water supply coverage with piped connections in 20013 was 10% inDhaka, 32% in Ho Chi Minh City, 31% in Jakarta, 32% in Manila, and 46% in Delhi. People whoare not connected often pay water vendors about 15% of their household income for delivery ofwater, buying water from their neighbours at inflated cost, or getting water from standpipes or

stand-posts where they only have access to water for a very short time each day and havedifficulty transporting it to their homes. In all cases, the core issue is getting connected to pipedwater promptly and on terms affordable to those living in peri-urban areas, especially the poor.Once connected, people are likely to pay only 1–2% of their household income for piped water.

5. The main issues in urban water supply in developing countries may be summarized as:

• High non revenue water (NRW). Levels are typically 40-60% of production andoften NRW cannot even be measured. Problems usually include leakage fromold pipes and poorly constructed connections, illegal connections, illegal sale ofwater to vendors, poor metering / reading / billing, and wastage from standpipes.

• Intermittent supply. In most of South Asia, intermittent supply (such as 2 hours ofpiped water per day) is the norm. When asked why, the typical answer is “there isnot enough water”. The example of Male in Maldives, where there is 24 hourpiped supply at an average consumption of only 6m3 per household per month,proves that this is not a valid answer.

• Low piped water coverage. Typically, direct piped water connections to consumerhouses in Asian cities only cover around 35% of the population, with theremainder relying on standpipes and water vendors, etc.

• High price and limited access to water for the poor. Typically the poor pay around$20 per month for about 6m3 of water per month from vendors, or travel long

distances each day to collect water from a standpipe but even then they may notget water. Typically the rich pay $4 per month for 30m3 / month for piped water.

1 UN Millennium Project. 2005. Investing in Development: A Practical Plan to Achieve the Millennium

Development Goals, New York, 2005 estimate in Table 9.2 Every $1 invested in improved water supplies and basic toilets is expected to result in $3–$34 return in terms of savings in health costs and more time at work and in school. Source: World Health Organization. 2005. Water for

Life–Making It Happen. WHO.3 McIntosh, Arthur C. 2003. Asian Water Supplies–Reaching the Urban Poor . ADB and IWA.




2

High connection charges also discriminate against the poor who cannot afford topay them in advance unless, for instance, there are facilities for payment byinstallments.

• Deterioration of water sources. Groundwater levels in some cities are falling fastwith groundwater quality becoming increasingly saline in some places. Wheresurface waters are polluted by industry, it is expensive to find more remote goodquality alternative sources and to transport this good quality water to cities.

• Long implementation periods for projects. ADB and World Bank funded watersupply projects typically take 8-10 years to fully implement, whereas NGOs, theprivate sector, or local authorities may take as little as one year for a similar butsmaller project. Time is of the essence if the MDG targets are to be achieved.

6. Typical situations for the urban poor and those living in peri-urban areas are: (i) utilitypiped water is not close and communities rely on small-scale water providers (SSWPs) ordevelop their own sources; (ii) the utility only serves the area through standpipes/stand-posts,limiting per capita water availability and increasing inconvenience; (iii) the utility can serve thecommunity but the cost of a connection is so high and the terms so inflexible that only a few canafford to connect to piped water.

7. Improved operational performance of the distribution system would lead to real benefitsnot only for existing consumers through improved service levels and greater cost-efficiencies,but would also enable people who currently are not connected to the network to be suppliedwith water from direct connections. Improved operational efficiency and an increased customerbase would also encourage the utility to reduce connection fees. Targeting the poor for suchnew connections would materially assist in the achievement of the MDG water sector targets.

8. It is notoriously difficult to improve operational performance of the whole distributionnetwork at the same time, but by sub-dividing it into smaller, more manageable hydraulicallyisolated zones and systematically focussing resources and efforts within each zone to improveperformance can increase the chances of success and yield significant improvements in a shorttimescale. Benefits and savings in a zone can then be directed to adjacent zones and theprocess progressively repeated until the whole network has been covered and overallperformance improved. This philosophy is termed the “zonal approach” to urban water supplies.

9. Further source development may not be needed or could be deferred if NRW can bereduced to a more reasonable level, say to 20% of water entering the zone. Zones could coverup to 1 million people, with caretakers appointed to be totally responsible for all services insideeach sub-zone (<10,000 people) and who would also be accountable for improvements such as100% metering, 100% collection efficiency, leak repairs and identifying all illegal connections.Caretakers could also enter every property to help with wastage/leakage on the premises.

10. Poor people already pay more for one unit of water than the rich, so affordability is notan issue. In any case, a tariff based on a lifeline block and a sliding scale of charges for waterconsumption can be designed to cushion the poor who are connected. It has also beendemonstrated that when the need for a policy based on full cost recovery from tariffs, as well asthe need for automatic tariff adjustments, is explained to politicians they generally endorse it. Inthe case of the zonal approach, politicians need to endorse the principle that those enjoying a




3

24 hour supply should pay more than those on an intermittent supply. If this leads to claims offinancial hardship then consumers still have the option of reducing their consumption tominimize water bills. If they choose to maintain their consumption level and pay the highercharges, then the extra revenue generated can finance further improvements in the zone. Aswell as technical service improvements the zonal approach therefore provides an opportunity tointroduce differential tariffs that reflect the level of service provided. 24 hour supply would beintroduced in one sub-zone at a time, with higher tariffs and strict metering and revenuecollection enforced. Water would be conserved not only through reductions in NRW andavoidance of wastage, but also through the impact of higher tariffs on consumption.

11. Rapid implementation must be a pre-condition of success, for instance 3 yearsmaximum to effect 24 hour supply in a zone of, say, one million people. It is unreasonable toexpect people to wait longer than that, or indeed indefinitely before they experienceimprovements, especially if others are clearly seen to be benefiting in the meantime.

B. Objectives

12. By implementing the zonal approach to reduce levels of NRW and to encourage waterconservation through effective consumer revenue metering, service levels such as continuity ofsupply and system pressures can be progressively improved within each zone. Savings can beused to supply new consumers within the zone and also improve the water supply to adjacentzones within which the zonal approach can then be implemented. Improved efficiencies will alsoreduce costs, leading to more affordable water supply.

13. The main objectives may be summarized as follows:

• 24 hour piped water to all• Affordable water•

Conservation of resources• Sustainability of service• Speedy Implementation of development

C. Scope

14. The zonal approach should not be implemented in isolation but must always be part ofan integrated package which includes:

• Policy and the Political Enabling Environment - Government endorsed andcivil society informed policy on service levels, tariffs, tariff revisions, subsidies,

PSP, etc.• Technical, Financial and Organizational Analysis:

o Water Source and Hydraulic Zone Selection – data collection on watersources, system coverage and characteristics of the distribution system fromexisting utility records, followed by analysis to identify the selected special zone.o Water Audit - how many are served by house connection, stand-post,

tanker, tricycle, pushcart, bottled water supplier? What amounts do they receive,how much does it cost them and what is the water quality? What is the role of




4

small scale water providers (SSWPs) in connecting people to piped waterthrough small piped water networks (SPWNs)?o Financial Viability - differential tariffs, automatic tariff revisions based on

policy implementation, 100% collection efficiency, etc.o Organizational and Social Aspects – allocation of appropriate staff to the

special zone and arrangements for stakeholder liaison.o Environmental Impact – projected impact on sanitation and wastewater

disposal.• Project Management and Procurement – project and utility management

covering the development of people through leadership and strong management,with managers free to manage without political interference, as well as theprocurement of services.

• Operational Management: - based on management at the lowest practicablelevel, for example sub-zone caretakers.

Policy and the Political Enabling Environment:

12. A clear understanding of policy on service levels, tariffs, tariff revisions, subsidies, andPSP is an essential pre-requisite. In addition, nothing should be attempted unless the zonalapproach and its objectives are first endorsed at the highest political level in the country as wellas at the highest local authority level. There should also be a guarantee of no politicalinterference at any stage in the consulting, procurement, contracting or management processes.Transparency must play a key part in this and so it may be appropriate to invite a strongindependent organization such as a well-respected NGO as well as the media and academics togive implementation of the zonal approach a high public profile at all times.

Technical, Financial and Organizational Analysis:

13. Water Source Analysis: The quantity, quality, reliability and sustainability of existingsources of water for the whole city should be assessed, including private and public dug wells,tubewells with hand-pumps, and motor driven pumped tubewells. If a city-wide assessment isnot viable then it should be undertaken in potential special zones as part of the hydraulicanalysis.

14. Hydraulic Analysis: The hydraulic analysis seeks to identify where hydraulicallyisolated zones already exist or can be readily developed. Ideally each zone should be served bya reservoir or can be monitored by a limited number of cross-boundary zonal meters. Existingdata, however poor, will be the basis of the initial hydraulic analysis to determine how to dividethe city into appropriate hydraulic zones of, for example, about one million people. As furtherdata is obtained during project implementation the hydraulic analysis can be refined. It is

sensible for the first zone selected for attention to be adjacent to any existing 24 hour servicearea. When a suitable zone has been identified then good maps and plans of it will be needed,and if not available should be prepared step by step in the subject zone. In addition, data on theage, size, material and condition of pipes, valves and meters is desirable.

15. Water Audit: Data collection and analysis of water services begins with acomprehensive water audit. Ideally this should be carried out for the whole city, but if this isimpracticable then it should be focused on the special zone. The objective of the audit is toascertain how many people are served by piped connection to their home, whether from the




5

utility or some SSWP or home association, and how those not served by piped networks obtaintheir water supply. ADB has already prepared a model TOR for this activity, includingquestionnaires.

16. Financial Analysis: This element of the analysis is important because it evaluates theprojected financial impact of implementing technical measures and adopting a new tariff for 24hour supply based on the new service levels, improved collection efficiency, reduced NRWlevel, and expanded customer base within the special zone. The analysis also includes the costof projected capital investments in pipes, meters, valves etc., as well as operational costs. 17. Organization Analysis: An assessment of the institutional organization is necessary todetermine and agree with the utility which staff will work in the special zone, how they will bepaid and for how long. Utility staff would effectively be seconded, and once under the full controlof the special zone management, revised remuneration and rules of work would apply. Theobjective would be to develop people seconded from the utility and thereby encouragesustainability.

18. Social Analysis: It is important that people inside the special zone are representedduring the project, possibly through an NGO, home owner association or local authority. Therevised role of water vendors and SSWPs, consumer costs, consumer service levels, etc., willall need to be assessed and the proposed improvements explained to these communityrepresentatives so residents are kept fully informed at all times. In general, it is important thatthe zone represents a large number of people not currently served by a piped water system totheir home.

19. Sanitation, Wastewater and Environment Analysis: Consideration must also be givento the existing environmental situation, including sanitation and wastewater facilities, andspecifically the impact that the increased customer base and changed consumption patterns will

have on sewerage and wastewater collection, treatment and disposal within the special zone.For instance the volume of sullage water may increase or the demand for water-bornesewerage may rise as people are connected to the piped water supply network. Policies anddesign principles therefore need to be agreed and various options studied. Wherever possible,the treatment, disposal or re-use of wastewater within the zone should be adopted as a goodprinciple to follow.

Project Management and Procurement:

20. The critical parameter for success of the zonal approach is that time is of the essence.This may necessitate having new rules for recruitment of consultants, procurement, contractingand management so that decisions can be delegated and contract disbursements made quickly.

21. Transparency and competition are also vital, as there will be a need for paralleldevelopments to take place with different contractors in a competitive environment. Providedthere is transparency in the contract award process and there is seen to be real competitionamong contractors, then this should help to eliminate delays and corruption.

22. Project management and utility management are both key ingredients to the successof the zonal approach but are not the same thing. There is little sense in developing utility staffto manage a project, as it is more efficient and practical to appoint consultants to do that and be




6

responsible for all design work and contract documentation, bid evaluation, constructionsupervision and recommend approval of payments, providing effective continuity forimplementation in other zones. However, the Project Manager would be answerable to the ZoneUtility Manager, who ideally would have extensive experience in the management of utilityoperations but also have a private sector background. The Zone Utility Manager would besupported by competent staff in personnel, accounting, commercial operations, engineering,social development, public relations, and environmental affairs. Close co-ordination between theProject Manager and the Zone Utility Manager will be essential at all times.

23. No large procurement packages or civil works contracts are envisaged. If largequantities of pipe or other materials and equipment are to be procured then at least twosuppliers should be contracted on the same negotiated price basis. Appropriately sized andpackaged pipe-laying and fittings installation contracts would be awarded to contractors whowould work in parallel for the same negotiated contract rates. Close Local Authority liaisonover the excavation, reinstatement and resurfacing of roads would need to be well co-ordinated.Public notices would clearly specify to all concerned stakeholders what is happening, when andwhy. Procurement, as well as covering the installation of replacement and additional pipes andvalves, etc., may also include the appointment of specialist companies, for example, toundertake leakage detection surveys on a performance contract basis, or repair leaks or replacemeters under a schedule of rates contract.

Operational Management:

24. A good surrogate performance indicator for the effectiveness of a city water supply is thepercentage of the population receiving 24 hour piped water to the home. Thus in the specialzone the objective will be to connect nearly everyone to a piped water supply. Apart from theutility providing direct connections, SSWPs can play a major role here by obtaining a bulksupply from the existing utility distribution system and provide piped water to those usingstandpipes or water vendors by constructing SPWNs. However, this should be seen as aninterim measure only until the utility can extend its network and take over the SPWN. SSWPsshould therefore be represented in the staffing structure of the special zone.

25. As well as the special zone itself, each sub-zone must be capable of hydraulic isolation,with all inflows and outflows monitored by introducing a District Metering System. All consumerswould be provided with new water meters, which would be read regularly by the sub-zonecaretakers and bills issued simultaneously every month. Payment of water bills would be madeeasy with no-one having to go further than one kilometre to pay their water bill. Utility staff wouldcomputerize all billings and cash payments, and analyse the results for each sub-zone. Anyexcessive or low usage would be investigated. Adequate resources would be available to eachsub-zone to repair leaks, replace meters, etc. Sub-zone improvements would be progressive sothat 24 hour supply is established one sub-zone at a time. Where appropriate, elevated tankswould be constructed to provide adequate pressure and a 24 hour supply. Regular analysis ofthe district and consumer meters would enable NRW to be calculated. Where it is considered tobe high, inspections and leak detection exercises would be performed in the sub-zone to controlit so that the NRW of each sub-zone is of the order of 20%.

26. Operational management of the special zone should be based on the devolution of zonemanagement to the lowest practicable level, for example to the sub-zone caretaker level. Allcaretakers will be accountable to District Managers who will report to Area Managers and who




7

in turn will be accountable to the Zone Utility Manager. If there are not many sub-zones, thenthe roles of District Manager and Area Manager can be combined. All operational activities suchas valve operations would be the responsibility of utility personnel, and not the consultant orcontractors. A weekly report will be prepared by all managers at each level detailingachievements made against targets. The Utility Manager will issue a weekly summary report forthe whole zone, as well as a monthly report for public access on the internet. An annualDevelopment and Performance Report will be prepared for each Special Zone, so that withinthree years one special zone has been developed covering up to one million people witheveryone connected to a 24 hour piped water supply and NRW at 20% or less. Work on asecond special zone should commence two years after the start of the first one.

D. Methodology

D1. Policy and the Political Enabling Environment

27. The consultant will hold discussions with authorized representatives of national and localgovernment to clearly define policy on service levels, tariffs, tariff revisions, subsidies, and PSP.In particular, the consultant will seek firm guarantees of no political interference in the process,and reach agreement on government monitoring and approvals requirements. Processtransparency is essential to establish credibility and so the dissemination of information onpolicy and the enabling environment should be fed into the stakeholder consultations to be heldduring the analysis stage to discuss technical options and to give implementation of the zonalapproach a high public profile.

28. Sensitivity needs to be exercised in these consultations as there could be strong politicalresistance to providing water services to illegally established areas within the city, especially ifviewed as being at the apparent expense of improving service levels for existing consumers.Inevitably there could also be resistance from those currently benefiting from an ample supply ofwater at minimal cost if they see such costs likely to rise or their supply curtailed. Political buy-inand support at the highest levels is critical to the success of the zonal approach, and without itprogression to the project implementation stage should be deferred.

D2. Technical, Financial and Organizational Analysis

(i) Water Source and Hydraulic Zone Selection

29. The consultant will collect data from all existing databases, reports, maps and drawingsof the distribution network to obtain as comprehensive an understanding as possible of thesupply situation concerning water sources, system coverage, as well as characteristics of thedistribution system. Where records are poor or non-existent the consultant will undertakesupplementary surveys to obtain sufficient information to enable an analysis to be undertaken ofthe system in order to identify the location and size of potential special zones. Potential zoneswill be prioritised in terms of the ease and cost of hydraulic isolation and monitoring, proximity toexisting 24 hour supply areas (indicative of the adequacy of water resources), the number ofunserved poor in the zone, etc. The consultant will develop a set of selection criteria and aweighting system acceptable to the relevant authorities to prioritise selection of the specialzone.




8

(ii) Water Audit

30. The water audit will utilize existing data already gathered, supplemented by surveysundertaken by the consultant in the potential special zones. The main steps in the audit process

are: (i) Undertake surveys of the water utility, SSWPs and consumers in the potentialzones, and analyze the results to assess the size and location of the targetmarket and the capacity of existing SSWPs to meet the unfulfilled demand.

(ii) Hold stakeholder consultation with the target communities, the utility, SSWPs,local government representatives, NGOs, etc., and develop appropriate SSWPregistration procedures, including time-bound licenses and Memoranda ofAgreement with the Municipalities and formal utility leading to ultimate transfer ofresponsibility for service provision to them.

31. The surveys will be undertaken by domestic consultants who will be responsible forthe survey logistics and supervising the enumerators (these could be students) undertaking the

surveys in the separate geographic areas in the city. The domestic consultants will pre-test thesample questionnaires for all the surveys before use by the enumerators. The domesticconsultants will also be responsible for interviewing all existing SSWP piped water networkoperators. Enumerators will undertake 5% sample consumer surveys in each target communitywithin a zone, as well as interviewing SSWP water vendors and bottled water suppliersoperating in each of their areas. Formal permission to survey will be obtained from the localgovernment by the domestic consultants and a copy provided to each enumerator, who will alsoas a matter of courtesy introduce themselves to the leader of each community in which theyoperate. An international consultant will have overall responsibility for the surveys, willinterview the water utility company, analyze all results and make recommendations.

32. The domestic consultants will brief the enumerators regarding (i) location, (ii) how to

sample for interview, (iii) who to interview, (iv) length of interview, (v) number of interviews perday, (vi) transport, (vii) total time to complete interviews, (viii) payment for work, (ix)clarifications, (x) testing of survey, (xi) permit to survey and (xii) the questionnaire. Enumeratorswill also document any anecdotal information given to them about the water industry, and whichmay not correspond to any question asked.

33. Quality control on the surveys will be maintained by random field checks undertaken byboth the domestic and the international consultants. The name of the person being interviewed,their address and the name of the person undertaking the interview and the date of the interviewmust be recorded on each questionnaire completed. If an enumerator is found to be falsifyingresults they will not be paid and all work already undertaken by them will be repeated by a newenumerator interviewing different people.

34. Questionnaires will be prepared as listed below and will be translated into the locallanguage by the domestic consultant: ADB has already prepared a model TOR for this activityincluding questionnaires (see Appendices 1 to 5 for example questionnaire templates).

35. Questionnaire – Water Utility (Appendix 1). Apart from details of individual customersthis will identify the recipients of bulk sales including SSWPs, sub-divisions, homeownerassociations, etc. Its focus will be on identifying the water source and for each type of customer(non-domestic, house service connection, standpipe, etc.) the total number of connections, the




9

volume sold per month and the revenue gained per month. It will provide information onproduction volume versus consumption volume to determine NRW, and will note the extent of24-hour piped water coverage. The international consultant will carry out the interview.

36. Questionnaire – SSWP Piped Water Network Operators (Appendix 2). The domesticconsultant will carry out interviews with every SSWP in each survey area. The questionnaire willseek essentially the same information as for the utility except the quality of the service to thecustomer such as direct connection or hose and drums will be determined. The method andfrequency of payment is an important output from this interview.

37. Questionnaire – SSPWP Water Vendor (Appendix 3). If water vendors operate in asurvey zone, then at least three different vendors of each type (water tanker, motorized tricycle,pedaled tricycle, rickshaw, pushcart, etc.) should be interviewed by the enumerator to estimatethe total number of vendors of each type operating in that zone. Pertinent information soughtincludes their source of water (to be visually checked), means of transport of water, number andtype of customers, average distance transported, volume sold and revenue gained. It is

important to establish how much the vendor pays at source for the water and to whom it is paid.

38. Questionnaire – SSPWP Bottled Water Supplier (Appendix 4). The enumerator willinterview at least five different bottled water suppliers in his/her survey zone and estimate thetotal number of bottled water suppliers and type (for example mixed goods shop, sole purposebottled water shop, treatment and sale on site, deliveries of bottled water, etc.) in that zone. Thefocus of the interview is to obtain information about the source of water, type of treatmentprovided, volume of water sold per month, price paid and the total revenue.

39. Questionnaire – Water Consumer (Appendix 5). The enumerator must obtain a 5%representative sample of all water users in his/her zone, identifying those served by the utilityand by SSWPs, and surveying them in numbers proportional to their prevalence. The focus will

be on water source (consumers may get water from more than one source), access to water,water quality, reliability of supply, availability of supply, volume consumed per month and costper month. It is important to record the number of persons in each household. This survey mustinclude a representative number of non-domestic consumers, especially industrial users.

40. Analysis of results will be preceded by obtaining any clarifications required from thedomestic consultant and the enumerators. The domestic consultant will also collate andsummarize answers to all the questions. The international consultant will then consider thepoints of interest, deriving the following basic data from the summary of results:

• Coverage % with 24 hour supply to individual house connection by utility• Coverage % with individual house connection by the utility• Coverage % including all utility domestic connections and standpipes.• Coverage % with piped water in home (all water providers).• Average household consumption per month by different sources of supply• Average household cost per month by different sources of supply.• Total monies paid by SSWPs at source per month.• Average price of utility water.• Average prices of SSWP water (network operator, vendor, water bottler).• Revenue turnover (a) utility, (b) SSWPs (network operator, vendor, bottled water

supplier).




10

• Volume of sales (a) utility, (b) SSWPs (network operator, vendor, bottled watersupplier).

• Official NRW figure from utility.• Comparison of cost and consumption - piped water versus non-piped water•

Proportion of utility water volume sold to non-domestic consumers• Proportion of utility water revenue derived from non-domestic consumers• Comparison of average tariff for utility water: domestic versus non-domestic• Proportion of all piped water where utility maintains the reticulation• Rating of customer satisfaction with utility.

41. The main purpose of the assessment is to focus on those not served with piped waterand to assess the costs and benefits to them of switching to a piped water supply, as well as thefeasibility of doing so through an SSWP contract. The findings would be presented anddiscussed at a stakeholder consultation to guide the zonal approach program, enhance costrecovery and institutional development to promote service sustainability, encourage waterconservation (including reduction of NRW), and ensure that as far as possible the urban poor

are connected to piped water services within their ability to pay.

42. Following completion of the analysis, key findings will be disseminated to allstakeholders. About two weeks later, a one-day stakeholder consultation will be convened forall stakeholders. The morning would be devoted to presentation of results, analysis of thesurveys and discussion of the findings, concluding with an overview of options for the wayforward. The afternoon would be devoted to discussion of those options and to developing aconsensus on the preferred way forward. The stakeholder consultation will be facilitated by adomestic consultant skilled in such work, or by a well respected and capable local person.

43. In cases where the formal utility decides for economic or technical reasons not to extendits services into some areas within the zone, the potential for SSPWPs to provide the service in

the interim will be explored. ADB has prepared a model PPTA ToR for mainstreaming SSPWPswhich can be used if this approach to serve those areas is adopted. The following is a summaryof the process to formally recognise the SSPWP by the municipal authorities and also the formalutility to ensure that the area will not be re-developed or the water services network extendedinto it for a specified number of years. Formal recognition will provide security of tenure to theSSPWP and enable plans to be developed with confidence and services priced to obtain anappropriate return on capital during the period of tenure and enable the maximum number ofpoor to be connected. This could be achieved through a simple registration procedure, suchas issuing a license detailing the area of license jurisdiction, the obligations of each party,reporting requirements and their frequency, periodic audits, remedies for failure to conform tothe license, an appeals process, the license duration, periodic license reviews, exit strategies orextension options at the conclusion of the license period. At the end of the license term the

assets will be transferred to the formal utility. A reasonable license fee could be charged tocover administration costs. The terms of the license would also have to be approved by theformal utility. A separate Memorandum of Agreement should be drawn up between the SSWPand the formal utility to cover such issues as: appropriate technical standards and materials,provision of a bulk water supply, maximum/minimum daily volumes, tariff, metering details,remedial actions in the event of supply deficiencies, periodic reviews, etc. The municipallicense and the utility agreement would also safeguard the position of the SSWP in the event ofa regulatory body being subsequently set up to control the sector.




11

44. The license and Memorandum of Agreement should be relatively simple documents,with bureaucracy kept to a minimum. The local consultant, with support from the internationalconsultant, will develop an appropriate license format and a Memorandum of Understandingacceptable to the Municipality and the formal utility following consultation with existing SSPWPs.

(iii) Financial Viability

45. The consultant will develop a simple Excel spreadsheet financial model to simulate thecurrent status of water supply in the special zone and to investigate projections of the impact oftechnical improvements such as reduced NRW, progressive achievement of 24 hour supply andthe introduction of a new tariff, and the expanded piped water customer base. Estimates will bemade for input into the model of the necessary capital and recurrent operational expenditures todeliver these projected new levels of service and to maintain them. Different scenarios will bestudied by the consultant and recommendations made regarding the optimal strategy toimplement the zonal approach in the special zone. For instance, the selection of specific sub-zones that can yield early results and be used as demonstration areas would serve to promotethe strategy and resolve any major issues.

46. A key factor to take into consideration will be the response of existing consumers toincreased tariff levels in the 24 hour supply sub-zones. The consultant will investigate priceelasticity and develop a strategy for linking service level improvements to progressive tariffincreases, and will also make recommendations on the rate of such tariff increases. Forinstance, to avoid major customer dissatisfaction one strategy might be to only increase tariffsinitially by a small margin above inflation so customers do not experience a sudden increase intheir water bills, followed by a more rapid rate of annual tariff increases. Much will depend onexisting tariff levels, and where tariffs are currently unsustainably low it will be difficult toincrease them even by a reasonable amount if the increase represents a major proportion of theoriginal tariff. A balance will have to be sought between moving towards a full cost-recoverytariff and the impact on customer attitudes and responses.

(iv) Organizational and Social Aspects

47. The selection and allocation of appropriate staff from the utility to work exclusively withthe consultant in the special zone will have a major impact on the success of the zonalapproach strategy, as they will have extensive detailed local information on the distributionnetwork and its customers. The consultant will prepare a staffing strategy in consultation withthe water utility for the secondment of selected staff and their integration into the project team.The strategy will also include a training programme and knowledge transfer plan to develop theskills of the secondees and also to ensure the long-term sustainability of the special zones andultimately the whole network as the zonal approach is implemented. A key output of the strategywill be the development of people through leadership and strong management. The strategy will

also define lines of communication, operational responsibilities and reporting procedures (forexample decisions on valve operations, etc.), and arrangements for liaison with all stakeholders.

48. Stakeholder consultation and, in particular, the provision of information to and feed-backfrom local residents on what is happening and overall progress and achievements is veryimportant and will require the consultant to develop strong links with the various stakeholders.The consultant will then develop a consultation strategy that promotes good co-ordination andliaison and that fully represents the views of people directly affected by the work. This could




12

possibly be achieved through the appointment of an NGO, home owner association or the localauthority to act as the representative of the local community.

(v) Environmental Impact

49. The consultant will assess the impact of improved service levels and an increasedcustomer base on the environment of the zone. This will specifically include the impact ofincreased sullage or grey water and the potential for increased use of waterborne seweragefacilities on the existing sewerage, sanitation and drainage systems and the generalenvironment within the zone. This should also include consideration of revised waterconsumption patterns and the potential for the removal of coping strategies for intermittent watersupply, for example ground tanks, pumps and overhead tanks, etc. The consultant will alsoinvestigate appropriate solutions to any problems identified, and develop policies and designcriteria to satisfactorily address them. Findings and recommendations will be discussed with theappropriate organizations responsible, and a report prepared detailing the proposedimprovement strategy to up-grade the zonal environment and minimize potential detrimentalimpacts.

D3. Project Management and Procurement

50. As the Project Manager, the consultant will be fully responsible for the detailed planningand management of the project as well as for all design work and the preparation of contractdocumentation. This will include the undertaking of feasibility studies, outline and detaileddesigns for contracts, preparation of contract documents as well as notices and adverts, bidevaluations including the development of evaluation criteria and weightings, constructionsupervision and commissioning. As part of his construction supervision duties the consultant willcheck and review requests for payments by contractors and recommend approval of thosepayments, and undertake periodic inspections to identify defective work and subsequentinspections to ensure that remedial work has been completed satisfactorily. The consultant willalso issue Substantial Completion and Taking-Over Certificates, etc., and ensure that recorddrawings have been prepared and are accurate.

51. The consultant will be answerable to, and will liaise closely with, the Zone UtilityManager, who should be free to manage without political interference and would be supportedby a small core of competent staff with expertise in relevant disciplines, including commercialoperations, engineering, public relations, and environmental affairs. Where existing contractorselection and appointment procedures are considered unnecessarily lengthy then the consultantwill propose and agree with senior utility management appropriate new or revised rules andrecruitment procedures so that decisions can be delegated, contract disbursements madequickly, and management streamlined. Any revised or new rules should promote transparencyand competition, and should also help to eliminate delays and corruption.

52. The consultant will be responsible for packaging the work required into contracts thatencourage more local suppliers and contractors to bid for the work. Where there are largeprocurement or construction requirements then the work will be split into packages such thatsmaller contractors can be contracted on the same negotiated price basis. This will encouragecompetition, mobilize and develop local resources and speed up the contracting process andservice delivery. The consultant and contractors will liaise closely with local authorities concerning the excavation, reinstatement and resurfacing of roads.




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D4. Operational Management

53. Operational management of the special zone will be based on the devolution of zone

management to the lowest practicable level: the sub-zone caretaker. All caretakers will beaccountable to District Managers, Area Managers and ultimately to the Zone Utility Manager.Weekly reports will be prepared by all managers detailing achievements made against targets.The Utility Manager will issue a weekly summary report for the whole zone, as well as a monthlyreport for public access on the internet. An annual Development and Performance Report willalso be prepared for each special zone.

54. Each sub-zone will be capable of hydraulic isolation, with all inflows and outflowsmonitored by a District Metering System. All consumers will be provided with new water meters,which will be read regularly by the sub-zone caretakers and bills issued simultaneously everymonth. Utility staff will computerize all billings and cash payments, and will analyse the resultsfor each sub-zone, with any excessive or low usage investigated.

55. District and consumer meters will be analyzed regularly to determine NRW and toidentify trends. Inspections and leak detection exercises will be performed in the sub-zone todetermine the physical leakage component from night-time tests, followed by leakage detectionsurveys in areas where high leakage is occurring. The aim will be to progressively reduce NRWuntil it is at its lowest practicable level in each sub-zone, aiming for an overall level of no morethan 20% in the special zone. Meter analysis and surveys will be undertaken regularly todetermine base leakage levels, monitor the situation and identify unacceptable increases indemand that would trigger more detailed surveys and leakage detection and repair programs.Adequate resources should be available in each sub-zone to repair leaks, replace meters, etc.,and progressively improve sub-zones so 24 hour supply is established one sub-zone at a time.


Review policy and the political enabling environment 0.5 monthsSurveys of utility, consumers and SSWPs 1.0 monthsClarifications and preparation of water audit results 0.5 monthsHydraulic analysis and special zone selection report 1.0 monthsStakeholder consultation and report of findings 1.0 monthsDevelopment of registration/license procedures 0.5 monthsFinancial Analysis (during stakeholder consultation period) 1.0 monthsOrganizational and social analysis (during license development) 0.5 monthsEnvironmental Impact (during stakeholder consultation period) 1.0 monthsProject Management and Procurement 31.5 monthsOperational Management permanent

Total Implementation Period 36.0 (thirty six) months


Enumerators (or students) 1 person month/communityDomestic water supply survey consultant 2 person months/community




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Stakeholder consultation facilitator (inc. preparation) 1 person week/communityDomestic financial consultant 2 person monthsDomestic water design consultants 12 person monthsDomestic specification/contract drafting consultants 6 person monthsDomestic sociologist/community liaison specialist 6 person monthsDomestic water supply/resident engineers 36 person monthsLeakage/metering specialist 12 person monthsInternational consultant 24 person months

(Note: Seconded utility personnel and sub-zone caretakers not included)


Enumerators, consultants, facilitator $Local transport $Project office and facilities $Stakeholder consultation $Reports / communications $

Total $

H. Reports and Deliverables:

1. Water Audit and Hydraulic Analysis Report for Zone ______________ Date

Part A. Summary of Results of Surveys (Domestic Consultants)Part B. Analysis of Results (International Consultant)

This two- part report will be due for completion not later than three months afterthe start of the assignment.

2. Financial Viability and Implementation Strategy Report for Zone _________ DateLocal/International Consultant


3. Environmental Impact Report for Zone ___________ Date

Local/International Consultant


4. Report of Stakeholder Consultation on Water Supply in Zone ___________ Date




15

International Consultant


5. SSWP License and Memorandum of Understanding for Community _____ DateLocal/International Consultant

The license and MoA will be due not later than four and one half months after thestart of the assignment.

6. Staffing and Training Strategy Report for Zone _________ DateLocal/International Consultant

This report will be due not later than four and one half months after the start ofthe assignment.

7. Final Report for Zone _________ DateLocal/International Consultant

This report will be due in draft format one month before the end of the project,with the final report submitted 2 weeks after the receipt of comments.

Appendices

1. Questionnaire for Water Utility (International Consultant)2. Questionnaire for SSPWP Piped Water Operators (Domestic Consultants)3. Questionnaire for SSPWP Water Vendors (Enumerators)4. Questionnaire for Bottled Water Supplier (Enumerators)5. Questionnaire for Consumer Survey (Enumerators)



16

Ques t i onna i re

for Water Uti l i t y

Name of Water Utility Date

Name of Person who answered this questionnaire Position

1. Name of City

2. Population in City 3. Population in Utility Service Area

4. Population Served by Utility (Direct) 5. Population Served by Utility (Bulk Supply / Indirect)

6. Population Served by House Connection 7. Population Served by Shared Connection

8. Population Served by Standpipe or Community Tank 9. Population Served by Utility Tanker

10. Number of House Connection s

a. Metered b. Meter Not Working

c. Not Metered

11. Number of Shared Connections

a.Metered

b. Meter Not Working

c. Not Metered

12. Number of Standpipes


c. Not Metered

14. Number of Community Tanks


c. Not Metered

13. Number of Utility Tankers

a. Capacity of tankers

15. Number of Bulk Connection

s


c. Not Meter ed

16. Number of Connections to Industry/ Other


c. Not Metered

17. Number of House Connections with 24 Hour Service 18. Percentage of Service Area with 24 Hour Supply

19. Number of Sources of Treated Water for Piped Supply

20. Production sources metered and working

Appendix 1



17

21. NRW for Utility %

a. Leakage % b. Mis-Metering % c. Illegal Connection % d. Illegal Sale of Water %

22. Number of Meters replaced in last 12 months 23. Total Consumption by House Connection Per Month m 3

24. Total Consumption by Shared Connections Per Month m 3

25. Total Consumption by Standpipe or Community Tank per Month m 3

26. Total Consumption by Utility Tanker Per Month m 3 27. Total Consumption by Bulk Supply to Small Private Piped Water Operators/Vendors Per Month m 3

28. Total Consumption for Municipal Use Per Month m 3 29. Total Consumption by Industry/ Other Per Month m 3

30. Total Money Billed Per Month for House Connections *

31. Total Money Billed Per Month for Shared Connections *

32. Total Money Billed Per Month for Standpipes or Community Tanks *

33. Total Money Billed Per Month for Utility Tanker Services *

34. Total Money Billed Per Month for Bulk Supply to Small Private Piped Water Operators/Vendors *

35. Total Money Billed Per Month for Industry/Other *

36. Number of new connections installed in last 12 months (domestic)

37. Number of new connections installed in last 12 months (non- domestic)

38. New connection fee and terms of payment (domestic)*

39. Accounts receivable in equivalent months of billing

40. Number of people employed by utility.

*Please indicate in local currency.

NRW = Non-revenue Water = Production - Consumption%

Production

Consultant to independently and randomly check domestic meters (40), industrial meters(10), and accounts on computer (100).

Name of Consultant Interviewer



18

Ques t i onna i re

for SSWP - Piped Wat er Netw ork Operators

Name of Company/Organization if any Date


1. Location of Piped System 2. Total Population Served by the System

3. Population Served by House Connections 4. Population Served by Shared Connections

5. Population Served by Standpipe or Community Tank 6. Source of Water

7. Cost of Water at Source $/m 3 8. Volume of Water Received at Source m 3

9. NRW % 10. Number of House Connections

11. Number of Shared Connections 12. Number of Standpipes and Community Tanks

13. Population Receiving 24 Hour Supply by House Connection 14. Consumption Per Month from House Connections m 3

15. Consumption Per Month from Shared Connections m 3 16. Consumption Per Month from Standpipes or Community Tanks m 3

17. Money Received Per Month from House Connections * 18. Money Received Per Month from Shared Connections*

19. Money Received Per Month from Standpipes or Community Tanks * 20. Water Treatment Provided by the System

22. License or Agreement with Local Authority 21. How Long in Business

□ Yes

□ No

* Please indicate in local currency.

NRW = Non-revenue Water = Production - Consumption%

Production

Name of Consultant Interviewer

Appendix 2



19

Ques t i onna i re

for SSPWP - Water Vendors



1. Location of vendor 2. Population served by vendor

3. Population served by tanker 4. Population served by pushcart/tricycle

5. Businesses served by vendor 6. Source of water

7. Cost of water at source* 8. Average distance for delivery of water (km)

9. Volume of water delivered per day by tanker m 3 10. Volume of water delivered per day by pushcart / tricycle m 3

11. Revenue received per day for water delivered by tanker * 12. Revenue received per day for water delivered by pushcart/tricycle *

13. Number of tankers in your business 14. Number of pushcarts / tricycles in your business

15. Fuel cost per day for power cycles * 16. Fuel cost per day for tankers *

17. Approval of local government

□ Yes

□ No

18. License fee to pay *

19. How long in business 20. Average capacity of tanker m 3

21. Average capacity of full load in pushcart or tricycle (liters)


Name of Enumerator

Appendix 3



20

Ques t i onna i re

for SSPWP - Bot t led Water Suppl iers



1. Location 2. Source of Water

3. Cost of Water at Source 4. Treatment Provided On-Site

5. Volume of water sold per day 6.. Revenue in one day*

7. Proportion sold to business 8. Average household volume purchased per day

9. Average household cost per day 10. License fees to Local Government

11. How long in business 12. Smallest volume sold /cost

13. Largest volume sold / cost 14. Business growing or static

15. Delivery services / distance 16. Approx cost loading % for delivery*

17. Costs per month in power, chemicals, rent, staff etc*


Name of Enumerator

Appendix 4



Name of Person who answered this questionnaire Date

2. Who supplies you with water

□ Water Utility □ Water Vendor

1. Location

□ Small Private Piped Water □ Own Well 3. What is the source of water 4. Is the water treated

5. How much water do you use per month /per day m 3 (last two bills)*

6. How much does this cost you per month / per day (last two bills)*

7. How many people in your household 8. How much bottled water do you use per day (liters)

10. How far do you go to access water 9. How much does the bottled water cost you per day *

□ Home

□ < 100m

□ > 100m

11. How is the water quality 12. How is the service from the utility

□ Good

□ Fair

□ Poor

□ Good

□ Fair

□ Poor

13. For how many hours per day is water available 14. Is the supply reliable

15. How is the service of the Small Private Piped Water Operator 16. How is the service of the water vendor

□ Good

□ Fair

□ Poor

□ Good

□ Fair

□ Poor

17. If you get water from the utility is the supply metered and working 18. If you don’t have piped water then when do you expect it

19. What is your monthly power bill 20. Are there pipe leaks in your street

21. Are there water leaks in your home

Appendix 5

Documents

Model Terms of Reference: Implementing Zonal Management Approach to Urban Water Supplies