09 Water and Environment Sector
2016/17 Sector Grant and Budget Information – BFP Draft 1
IMPORTANT: This is a draft paper for use by local governments in their preparation of Budget
Framework Papers. It therefore may to be subject to change. A final paper will be issued
alongside the second budget call circular in February. As a draft it should not be regarded as
the final the policy position of any Government of Uganda institution.
1. National Sector Policy Priorities
The overall policy objectives of the Government for the sector according to the National
Development Plan (NDP) are:
-
Increase water supply coverage in rural areas from 65% (2012/13) to 79% (2019/20) while
ensuring that at least each village has a clean and safe water source.
Increase urban water supply from 77% (2012/13) to 95% (100% NWSC towns) 2019/20).
Increase access to improved sanitation from in rural areas from 69% (2012/13) to 77% (2019/20)
and in urban areas from 77% (2012/13) to 100% (2019/20) for urban areas.
Increase wet land ecosystem coverage from 10.9% (2013/14) to 12% (2019/20); increase forest
cover from 14% (2012/13) to 18% (2019/20); and enhance environmental compliance from 70%
(2013/14) to 90% (2019/20).
2. Roles, responsibilities and mandate of Local Government
The Local Government Act (Cap 243) specifies that Local Governments have the responsibility to
deliver “water services – the provision and maintenance of water supplies in liaison with the
Ministry responsible for natural resources, where applicable” and “forests and wetlands”. Two vote
functions are used to distinguish in the budget between the responsibilities for water and for
environmental management.
In the Water sub-sector, districts have primary responsibility for the construction of water
facilities/points in rural areas and to support the operation and maintenance of water services by
community-based organisations such as Water User Committees. Municipalities and urban councils
and districts are also responsible for the development, management and operation of urban water
services, apart from those managed by the National Water and Sewerage Corporation, although
construction of facilities is typically funded from central government projects, such as the Water and
Sanitation Development Facility. Other activities include providing water for production and the
promotion of rainwater harvesting. Mandates for sanitation and hygiene are shared between the
Water, Education and Health sectors. Under the Water sub-sector, Districts are responsible for
hygiene and sanitation interventions around water points.
Responsibilities in the Environment sub-sector include monitoring and oversight of environmental
compliance, including forestry, river and wetlands management. Vote Functions are summarised in
the table below.
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Vote Function
Rural Water Supply and Sanitation
Urban Water Supply and Sanitation
Natural Resources & Environment
Associated LG Mandate
Promotes access to safe water, through rehabilitation and
increasing coverage; and funds sanitation and hygiene
outreach and informational dissemination around water
points for rural and urban areas respectively.
Monitoring and oversight of environmental compliance,
including forestry, river and wetlands management.
3. Transfer Details
Overall Structure and Purpose of transfers and Overall Allocations
The proposed structure of sector grants and the purpose of each grant in the sector are:
Grant
Non-Wage Conditional Grant
o/w Rural Water and Sanitation
District
o/w Natural Resources &
Environment
Development Conditional Grant
Water and Environment
Transitional and Support
Services Grant
o/w Support Services Non-Wage
Recurrent - Urban Water
o/w Transitional Development Sanitation
Purpose
Deliver sanitation and hygiene outreach and information
dissemination around water points; management of the water
sector.
To provide for maintenance of rural water sources by sub-county
local governments.
Funds protection of natural resources, including forests and
wetlands
Provision and rehabilitation of rural water infrastructure that
enables access to clean and safe water.
Funds the operation and maintenance of piped water systems in
towns within a district, bridging the gap between local revenue
collection and operation costs.
This funds sanitation activities in a limited number of districts.
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Grant Allocation Formula
The proposed grant allocation variables are outlined in the table below. These are different for the
two vote functions in recognition of the very different objectives they serve.
For the Water Supply and Sanitation Vote Function, the proposed water variables and weightings for
use in the allocation formula are:
Variable
Weighting
RWS
NRM
NW
NW
Devt.
Justification
Fixed Allocation
82
0
50
Rural Population
5
83
0
Estimated Cost of
Providing Water Per
Capita
0
0
5
Land Area
10
5
0
Population in Hard to
Reach Hard to Stay
Areas
Rural Unserved
Population for SCs with
Coverage below 77
percent capped at
50,000
Rural Unserved
Population for SCs with
Coverage below
National Average
capped at 50,000
Poverty Headcount
3
2
0
0
0
15
0
0
30
To cover the fixed costs of a District Water
Office and ensure a minimum investment
allocation for each local government.
Indicator of scale of rural water and
sanitation services required. Similarly for
the environment sector. The higher the
population the more people requiring
services.
The cost of delivering water facilities varies
greatly across the country due to
geographical and other factors. This
indicator compensates for these variations.
Land area is considered a proxy for the
scale of natural resources management
activities
Those areas which are hard to reach are
more costly to deliver services and
therefore are given priority.
These variables are used to add weight to
the most under-served areas within a local
government, to target funding to areas
which are most lagging behind both the
national average and sector target. The
figures are capped, to limit the total
availability of funding to LGs and ensure
absorption of funds.
0
10
0
This is used as a proxy for need for natural
resource management services, targeting
allocations on the poorest areas.
Allocations under the support services grant would remain ad hoc, and not formula based. The
support services grant is current comprised of:
Item
o/w Support Services Non-Wage Recurrent - Urban Water
o/w Transitional Development - Sanitation
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Allocation Basis
2015/16 allocations
2015/16 allocations
The medium term phase in plan for the allocation formulae, in line with the 1st Budget Call Circular
was as follows:
Water & Environment
Water and Environment - Non Wage
Recurrent Conditional Grant
o/w Rural Water & Sanitation - Non
Wage Recurrent
Percentage formula usage
o/w Natural Resources &
Environment - Non Wage
Recurrent
Percentage formula usage
Water and Environment - Development
Conditional Grant
Percentage formula usage
Transitional Development Grant Sanitation (Water & Environment)
Percentage formula usage
2015/16
2016/17
2017/18
2018/19
2019/20
2020/21
59
59
70
81
94
113
1
6
7
8
8
10
0
5
5
6
7
8
-
100%
100%
100%
100%
100%
1
1
2
2
2
2
-
100%
100%
100%
100%
100%
53
48
58
67
78
94
-
50%
100%
100%
100%
100%
2
2
2
3
3
4
-
100%
100%
100%
100%
100%
3
3
3
4
4
4
-
100%
100%
100%
100%
100%
Support Services Grant - Urban Water
Percentage formula usage
4. Overview of Sector Requirements
In order to access conditional grant funding local governments are required to adhere to a number
of specific requirements relating to the relevant sector budgets. These are specified in the following
sections, and are summarised in the table below.
For the Water Supply and Sanitation Vote Function:
Water and Sanitation:
Area
Budget Requirements
Salaries
Summary of Requirements
Allocations to wages based on approved LG structures and funded
from the unconditional grant, which must cover:
- Water Engineer (Water)
- Engineering Assistant (Water/Borehole Technician)
- 4 Assistant Water Officers (1 water supply, 1 for Mobilisation, I
for Sanitation and for Planning)
Monitoring, management
and administration of
service delivery
In the event that the contracted staff are not funded from the
unconditional grant, they should be budgeted for in the development
budget funded from the sector development grant. The contracted
staff may include the water officer and the 4 water assistants, in the
event that these positions have not yet been be filled by the District
Service Commission.
Up to 60% of the non-wage recurrent budget of for rural water and
sanitation should be allocated to:
- The operation costs of District Water Offices
- Coordination activities
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Area
Summary of Requirements
- Routine Monitoring of Water Sector Activities
The development budget may be used for:
- Payment of contracted staff (as above).
- Investment servicing costs (see below).
Promotion of Sanitation ,
Hygiene and community
based mobilisation
Operation and
maintenance of piped
water systems in urban
settlements/RGC within a
district
Rehabilitation and
Maintenance of Water
Sources by Sub-counties
Overall wage, non-wage recurrent and development management,
monitoring and administration of service delivery should not exceed
11% of the sector recurrent and development budgets combined.
A minimum of 40% of the non-wage recurrent budget for rural water
and sanitation should be allocated to:
- Promotion of Sanitation and Hygiene
- Mobilisation and promotion of community based maintenance of
water sources
In addition up to 15% of the sector development budget can be used
for software activities associated with rural water and sanitation. For
those local governments receiving funds under Support ServicesSanitation, additional allocations should be made in the development
budget to sanitation activities.
In line with allocations to support services – urban grant, allocations
should be made to urban settlements and RGCs. The full amount of
grant allocations from the Support Services Urban O&M grant should
be allocated as Lower Local Services to the piped water schemes and
umbrella organisations identified by MWE.
Overall, a maximum of 15% of the Sector Development Budget can be
allocated to rehabilitation major repair of water sources at both the
subcounty and district levels.
Within this, a minimum 10% of the Sector Development Grant
Allocation should be allocated to sub-counties for rehabilitation and
major repairs of water points. This will be transferred directly to subcounties from the treasury on the basis of allocations in the LG Budget
(lower local services).
Sub-county allocations to rehabilitation and other major repairs to
rural water sources will be based on the maintenance and
rehabilitation requirements of each of the sub-counties, as reported
on in the sector MIS. Each sub county has its unique maintenance and
rehabilitation needs.
New Infrastructure
Investments
Routine maintenance, including minor repairs, remains the
responsibility of communities and associated water user committees
within each sub-county.
A minimum 75% of the sector development budget should be
allocated to capital - infrastructure, facilities and equipment as well as
rehabilitation and maintenance of district specific access and O&M
needs. Such facilities include:
- Water sources/points
- Public toilets
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Area
Summary of Requirements
- Sewerage disposal
Districts can use part of the sector development grant for office
construction and other administrative investments upon requesting
and authorization by District Water Department.
The following principles should be adhered to in selecting
development projects
- Priority 1: All those below the national average must be allocated
investments before any other sub-counties
- Priority 2: If there are more funds available, they should be
allocated to sub counties below the national target level.
- Priority 3: If there are funds remaining, then allocations can be
made to other sub counties.
A list of sub counties under each category using data from the MIS will
be distributed to Local Governments alongside the IPFs and these
requirements.
Capacity Development
Up to 5% of the value of sector infrastructure investments can be
allocated to investment servicing costs, including feasibility studies,
procurement and monitoring costs.
No funds from sector development grant can be spent on capacity
development (for staff). Training and capacity development will be
provided by the centre. The LGs, using their own local revenue and
the DDEG, can also provide support to capacity development.
Budget Requirements have yet to be fully elaborated for Natural Resources Management. In the
interim the following should be adhered to.
Grant
Budget Requirements
Salaries
Non-Wage Recurrent
budget
Capacity Development
Development & Capital
Investments
Summary of Requirements
Allocations to wages base on approved LG structures and funded from
the unconditional grant. No contract staff should be hired from the
non-wage conditional grant.
The non-wage recurrent budget for the natural resources department
should at least be the value of the non-wage recurrent grant
allocation to natural resources management.
No funds from sector development grant can be spent on capacity
development (for staff). Training and capacity development will be
provided by the centre.
No funds from the sector development grant to be spent on natural
resources management, instead funds come from the DDEG, UCG
and/or locally raised revenues.
The table below provides an indicative list of capital investments and other development activities
which may or may not be funded under the sector development budget from central government
grants:
Area
Indicative Positive List (Eligible)
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Indicative Negative List
Capital
Investment
Development
Activities
(Ineligible)
 Water sources/points:
 Household toilets
o protected springs;
 Household water
o shallow wells,
harvesting
o boreholes (hand pump, motorised)
systems/tanks;
o piped water supply system (GFS,  Drainage/storm water
borehole pumped, surface water)
drains
o communal water harvesting systems
 Cross-district piped
 Public toilets
water systems
 Sewerage disposal
Water & Sanitation
 Training Water User Committees for any water
investment funded by the DDEG
 Awareness raising in hygiene and sanitation
Natural Resources Management
 Restoration of degraded wetlands and forest
reserves
 Demarcation of wetland and forest reserves
boundaries
 Demonstration of wetland edge gardening,
apiary farming, cottage industries from waste
products such as cups from clay, crafts from
papyrus, craft houses and community training
centres, pottery groups
 Training in environmental best practice (e.g.
energy conservation, tree nursery
establishment)
 Other awareness campaigns and sensitisation
on environment and climate change activities
 Surveying and titling institutional land
 Land rights awareness training
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