MDG and MKUKUTA Water Sector Costing
German Development Institute in cooperation with the MoWLD and the
Millennium Project
Prepared by Florian Misch and Joseph Kakunda
Shared with the MKUKUTA Secretariat
23rd June 2005
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OUTLINE
1. Introduction to MDG and MKUKUTA Costing
2. Review of Existing Costings in the Water Sector
3. Analytical Framework for the MDG and MKUKUTA
Costing
4. Costing
5. Financing Strategy
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Introduction to MDG and
MKUKUTA Costing
Status of MDG and MKUKUTA Costing
 Costing is part of MKUKUTA implementation
– Initially water, health, education and agriculture sectors are costed
 Costing will be undertaken jointly by respective sector
ministry, ESRF, Millennium Project and GDI
 Despite several earlier costings, there is the recognized need
for a comprehensive medium- and long-term MDG and
MKUKUTA costing
 Time horizon for costing:
– 2006-2010 for MKUKUTA
– 2006-2015 for MDGs
 MDG and MKUKUTA Costing has no implications for current
budget process
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Introduction to MDG and
MKUKUTA Costing
Costing and Needs Assessments (1)
 ‘realistic’ and ‘best computed’ assessment of
resource needs to meet MKUKUTA Targets and
MDGs
 Determine the gap between resource
requirements and available resources to meet
MDGs and MKUKUTA targets
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Introduction to MDG and
MKUKUTA Costing
Costing and Needs Assessments (2)
 Needs assessment is critical to develop future
financing strategies (total requirements must be
known)
 Tanzania is well positioned to access additional
(not necessarily sufficient) external resources if
MKUKUTA and MDGs are costed
– MKUKUTA targets and MDGs are approved by
GoT and development partners
– Strong governance
– Supportive donor community
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Introduction to MDG and
MKUKUTA Costing
Guiding Principles for Costings (1)
 Transparent
– assumptions and methodology must be clearly visible and
modifiable
 Methodology adapted to Tanzanian context
– Millennium Project methodology should be seen as
guidance only
– esp. consideration of cross-cutting as well as crosssectoral issues and capacity constraints
 Must strive for maximum disaggregated results
– e.g. between urban and rural, by year
 Must allow the calculation of the financing gap
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Introduction to MDG and
MKUKUTA Costing
Guiding Principles for Costings (2)
 Costing refers to interventions needed to meet MDGs
and MKUKUTA targets
– Interventions are defined as investments in goods,
services and infrastructure required to meet the MDGs,
e.g. the construction of new water supply schemes
– List of interventions based on political decisions about
strategies, institutional set-up, etc.
 Involvement of stakeholders
–
–
–
–
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Choice of interventions
Development of methodology
Political decisions and choices influence results
Ensures that the results are broadly accepted
Review of Existing Costings in
the Water Sector
 Existing studies
– National Rural Water Supply and Sanitation Programme
(NRWSSP)
– Tanzania Country Stategy for Attaining MDGs and WSSD
Targets for the Water and Sanitation Sector (MoWLD)
– The Cost of Water and Sanitation MDGs for Tanzania
(WaterAid)
– The Millennium Project Case Study in Tanzania
(preliminary only)
– Country Assessment – Tanzania (MoWLD / World Bank)
 Ongoing work
– National Urban Water Supply and Sewerage Strategy
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Review of Existing Costings in
the Water Sector
MoWLD
NRWSSP
Millennium
Project
WaterAid
MoWLD / World
Bank
MDGs
MDGs
MDGs
MDGs
MDGs
Timeframe
2004/2005-2015
2003/20042015
2005-2015
2000-2015
2000-2015
Geographical
scope
Tanzania
(Dar Es Salaam
partially
excluded)
mainland
Tanzania
mainland
Tanzania
Rural / urban
rural and urban
rural
rural and urban
rural and urban
rural and urban
Areas costed
Water Supply
Sanitation
Awareness
Raising
IWRM
Water Supply
Sanitation
District Manag.
Support
Inst.
Strenthening
Water Supply
Sanitation
Wastewater
Treatment
Hygiene
Education
Water Supply
Sanitation
Water Supply
Costing
Costed goals
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Review of Existing Costings in
the Water Sector
Capital Cost for Rural Water Supply
600,000,000
500,000,000
400,000,000
Expansion
Rehabilitation
300,000,000
Construction of new
infrastructure
200,000,000
100,000,000
0
MoWLD
NRWSSP
Millennium
Project
WaterAid
MoWLD /
World Bank
Notes: Different definitions of rehabilitation; in prices of first year of respective costing; values may be
implicit and based on own calculations; figures of WB costing include management and planning costs;
NRWSSP recognizes substantial rehabilitation costs, but does not quantify them
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Review of Existing Costings in
the Water Sector
 MKUKUTA targets have not been considered
 Scope of costing varies
 Due to different results, further analysis is
required
– Compare and evaluate different methodologies,
different assumptions and different data used
– Compare interventions that are costed
– Enhance analysis by interviewing stakeholders
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Analytical Framework for the
MDG and MKUKUTA Costing
 Costing builds upon
– MDG and MKUKUTA targets
– Previously identified interventions
 Subdivision of the Sector
– Water Resource Management
– Water Supply
– Sanitation
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Analytical Framework for the
MDG and MKUKUTA Costing
Water Resource Management Targets

MKUKUTA
 Allocation of water
–
–
–
–
–





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Domestic
Irrigation
Livestock
Industry
Energy
Pollution
Water Harvesting
Vulnerability
Disaster Management
MDGs are broader as well as more general and
require interpretation (MKUKUTA can be used)
Analytical Framework for the
MDG and MKUKUTA Costing
Water Supply and Sanitation Targets
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
MKUKUTA
 Increased proportion of rural population with access to clean
and safe water from 53% in 2003 to 65% 2009/10 within 30
minutes of time spent on collection of water
 Increased urban population with access to clean and safe
water from 73% in 2003 to 90% by 2009/10
 Increased access to improved sewerage facilities from 17% in
2003 to 30% in 2010 in respective urban areas
 Reduce households living in slums without adequate basic
essential utilities
 100% of schools to have adequate sanitary facilities by 2010
 95% of people with access to basic sanitation by 2010
 Reduce Cholera out-breaks by half by 2010

MDGs
 Halve, by 2015, the proportion of people without sustainable
access to safe drinking water and sanitation
Analytical Framework for the
MDG and MKUKUTA Costing
Cross-Sectoral and Cross-Cutting Issues
 Focus on gender, environment and HIV/AIDS as critical
cross cutting issues
– e.g. the impact of water on gender:
Reduced time, health, and care-giving burdens from
improved water services give women more time for
productive endeavors, adult education, empowerment
activities, and leisure.
 Focus on sanitation as critical cross-sectoral issue
– strongly related to health
 Identification of additional requirements due to crosssectoral and cross-cutting issues
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Analytical Framework for the
MDG and MKUKUTA Costing
Interventions

Type of interventions
 Infrastructure related
 Institutional strengthening
 Awareness raising

Scaling-up
 Identify constraints for the scaling-up of
interventions
 Determine pace of scale-up and
 Identify Tanzanian ‘quick wins’
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Costing
Refinement of methodology
 Consideration of capacity constraints
 Consideration of cross-sectoral and cross-cutting
issues
 Take into account suggestions from stakeholders
 Identify critical parameters
 Develop transparent model (spreadsheets)
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Costing
Data and assumptions
 Based on methodology, establish data
requirements
 Possible data sources:
–
–
–
–
MoWLD
Existing costings
Donor funded projects
International values
 Fill data gaps with appropriate assumptions (e.g.
for population projections, rural-urban migration
etc.) as made by stakeholders
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Example: Costing the
Construction of Water Supply
Infrastructure
Critical Parameters
– Settings
(timeframe and targets, geographical scope)
– Demography
(population, share of rural population, population
growth, projected rural urban migration rate)
– Coverage
(current rural coverage, current urban coverage,
rural target coverage, rural urban coverage)
– Technology mix
(current technology mix, target technology mix)
– Unit Cost
(rural unit cost by technology, urban unit cost by
technology)
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Example: Costing the
Construction of Water Supply
Infrastructure
 Calculation (1)
Base year
population X current
coverage
Target year
population X target
coverage
Technology 1
Technology 2
Technology 3
Population using
technology 1 in
base year
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Population using
technology 1 in
target year
Costing
 Calculation (2)
– Calculate incremental number of people using technology
i:
Population using technology i in target year –
Population using technology i in base year
– Calculate cost of technology i:
Incremental number of people using technology i X
per capita unit cost of technology i
– Calculate total costs for rural or urban, respectively
Sum of costs of all technologies
– Repeat Steps for urban or rural, respectively
– Total Costs
Sum of urban and rural
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Costing
 Presentation of Results
–
–
–
–
By year
By subsector
By type of cost
Rural / urban
 Sequenced and costed intervention and
investment plans as basis for a long-term strategy
to attain the MDG and MKUKUTA targets
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Financing Strategy

Determine level of current financing
 Government spending
 Communal and private contribution
 External finance
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
Determine the financing gap

Present options for additional resource mobilization

Future short-term financing strategies (next budget
guidelines and MTEFs) can be built on resource
availability and resource requirements
Discussion
Thank You!
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