WATER SERVICES TRUST FUND
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1 1 WATER SERVICES TRUST FUND Financial support for improved access to water and sanitation P.O. Box , Nairobi 1 st Flr, CIC Plaza, Mara Rd Tel: / Fax: Website: What You May Want to Know about the Water Services Trust Fund! 1. INTRODUCTION WATER SERVICES TRUST FUND, KENYA is a State Corporation established under the Water Act, 2002 with the mandate to assist in financing the provision of water services to areas of Kenya which are without adequate water services. The organisation is guided by the Trusts Deed of 26 th April, 2004 and nested on rapid, proactive and innovative measures stipulated in its core values of accountability, transparency, good governance, teamwork, equity, fairness, honesty, integrity, customer focus, and lifework balance. We are one of the water reform institutions, and act as a basket fund for mobilizing resources and providing financial assistance towards capital investment costs of providing Water Service and Sanitation (WSS). The Trust Fund s mission is to provide financial support for improved access to water and sanitation in areas without adequate services. According to the Trust Deed, WSTF s mandate incorporate supporting capacity building activities and initiatives that aim at enabling communities to plan, implement, manage, operate and sustain water servicesby creating awareness and disseminating information regarding community management of water services, and encouraging their active participation in implementation and management. Water Services Trust Fund strategy has to-date rested on the fact that the development of water sector in Kenya has been constrained by limited funding, and planning that do not respond to increasing population and emerging trends such as institutional
2 2 weakness, poor management, limited water resources, knowledge and choice of technology. 2. STRATEGIC OBJECTIVES Water Services Trust Fund strategic objectives are informed by its vision to be dynamic and innovative leader nationally and in Africa in the financing of the water sector. Our overall goal is formulated and designed in order to positively and most effectively influence the environment in a manner that most efficiently contributes to our mission and visions. 2.1 Overall strategic objectives: 1. Mobilise adequate resources nationally and internationally to enhance provision of water services. OUTPUT: To raise Kshs billion by 2013 for WSS on rural and urban areas. 2. Develop and apply systems that ensure proper targeting, financing and implementation and sustainability of water and sanitation projects. OUTPUT: To fund 1,127 projects-605 under rural, 160 in urban informal settlements, and 362 water resources management. 3. Establish and nurture partnership with stakeholders. OUTPUT: To achieve 80% customer satisfaction rating. 4. Continuously strengthen the WSTF institutional capacity and enhance staff skills for effective and efficient service delivery. OUTPUT: To achieve highest rating against performance contract with GoK. 5. Facilitate capacity building of agents to deliver on the provision of water services. OUTPUT: To have performance of agents rated as high in performance contract. 3. WSFT AS FINANCIER OF WATER AND SANITATION SERVICES We are a national body mandated to mobilize resources for underserved areas in rural and informal settlements in urban Kenya. WSTF does this through four instruments (also known as windows ) namely; Community Project Cycle (CPC), Urban Project Cycle (UPC), Water Resources Users Association Development Cycle (WDC) and Output Based Aid (OBA). 1. The Rural Window This covers funding for rural water and sanitation namely: o The Community Project Cycle (CPC) - is our window for rural water and sanitation projects. o Output Based Aid (OBA)- is a micro-credit window within the World Bank and facilitated through K-Rep Bank.
3 3 o WASH- is a Hygiene and Sanitation programme that WSTF is implementing in partnership with UNICEF and three Government Ministries (Water, Public health & Education. 2. The Urban Window Under its Urban Window the WSTF is financing projects targeting the urban poor. The WSTF only finances projects which are implemented by licensed Water Service Providers. For its Urban Window the Fund has developed the Urban Projects Cycle (UPC). 3. The Water Resources Management Window This covers funding for water resources projects. Also Water Resources Users Association Development Cycle (WDC). 4. HOW AND WHERE DO WE WORK? 4.1 Our Target Groups These are those institutions and people who are affected and affect what we do. Our partners include: 1. Water sector institutions WSBs, WRMA, and WASREB 2. The poor and marginalized communities in rural and urban areas 3. Service providers and consultants 4. Donors and development partners 5. GoK and Ministry of Water and Irrigation (MWI) 4.2 Our Target Locations Priority areas are compiled from national poverty survey report- Geographical Dimensions of Well-being in Kenya. Out of this 350 most deserving locations in Kenya were selected as target locations, 50 from each of the WSBs. Other criteria include (i) the Poverty Index, (ii) level of investment in water and sanitation infrastructure, (iii) access to quality water services and (iv) sanitation coverage levels. 5. WSTF S STRUCTURE OF OPERATION WSTF takes cognizance of the role of other stakeholders in the success and execution of its mandate. The aforementioned thus calls for continued collaboration with the Water Boards (WB), Water Resources Management Authority (WRMA) At the internal operational level, the unit is headed by a Chief Executive Officer (CEO) who is aided by a team of Senior Management Team (SMT) and staff. The first two levels work together with the Chairperson and Board of Trustee who give the strategic direction to the Fund.
4 4 6. OUR COOPERATING PARTNERS We have two kinds of donors that support our course- financial and technical. According to the Water Act, 2002, WSTF receives most of its budgetary allocations from the Government of Kenya (GoK). This is complimented by other development partners devoted to water and sanitation such as the Danish International Development Agency (Danida), German Development Agency (GTZ) and the German Development Bank (KfW), the Swedish International Development Agency (Sida), European Union (EU), United Nations Children s Fund (UNICEF) and the African Development Bank (AfDB). Currently, negotiations are on with the Spanish government to assist with funding of renewable energy projects to a tune of 10 Million Euro. This support is evidence of the increasing investor confidence in the WSTF. We aim at enhancing the existing relationships with our partners, and continue to establish and nurture new ones. 7. ACHIEVEMENTS AND CHALLENGES The benchmark for WSTF s success is the number of additional (poor) Kenyans with access to WSS and improved water resources at the end of each planning period. Over the years the fund has gained remarkable experience, especially on fund management and the importance of implementing sound appraisal and monitoring structures to ensure that funds are delivered to sustainable projects. Since inception in 2004, more than 192 water and sanitation projects in the rural areas have received funding with an estimated reach of 1.4 million women, men and children. Of this, 30 are completed, and 163 under implementation. Others include: adequate and well supported technical and financial support from GoK and donors, notable utilization of 83% of funds in implementing rural water and sanitation projects. WSTF is periodically reviewed and is developing into a leading funding agency in the sector for the poor and marginalized areas of the Country. 7.1 The Challenges We Face The WSTF also faces a number of challenges: Slow uptake and development of proposals. Turn-around period of proposals rejection. Loopholes in monitoring application of funds. Establishing investor confidence. 8. STRATEGIC PROJECTIONS The WSTF has formulated a Strategic Plan that aims to consolidate the gains made, identify new options to increase and expand. This strategy aims at fulfilling targets set
5 5 by the National Water Services Strategy ( ), National Water Resources Strategy ( ), Pro-Poor Investment Plan (PPIP) and Vision 2030 sector plans. THE WATER ACT 2002 In March 2003 the Water Act 2002 came into effect. The Water Act 2002 provides the legal framework in line with the new policy changes. New institutions with separate functions were established, and decentralised decision making is now reflected in autonomous and regional bodies. WATER INSTITUTIONS UNDER THE WATER ACT 2002 Institution Roles and responsibilities 1. Ministry of Water and Irrigation (MWI) Development of legislation, policy formulation, sector coordination and guidance, and monitoring and evaluation. 2. Water Resources Management Planning, management, protection and conservation of water resources. Authority (WRMA) Planning, allocation, apportionment, assessment & monitoring of water resources. Issuance of water permits. Water rights and enforcement of permit conditions. Regulation of conservation and abstraction structures. Catchment and water quality management. Regulation and control of water use. Coordination of the IWRM Plan. 3. Catchments Area Advisory Advising WRMA on water resources issues at catchment level. Committees (CAACs) 4. Water Resource Users Associations Involvement in decision making process to identify and register water user. (WRUAs) Collaboration in water allocation and catchments management. Assisting in water monitoring and information gathering. Conflict resolution and co-operative management of water resources 5. Water Services Regulatory Board Regulation and monitoring of Water Services Boards. (WSRB) Issuance of licenses to Water Services Boards. Setting standards for provision of water services. Developing guidelines for water tariffs. 6. Water Services Boards (WSBs) Responsible for efficient and economical provision of water services. Developing water facilities. Applying regulations on water services and tariffs. Procuring and leasing water and sewerage facilities. Contracting Water Service Providers (WSPs). 7. Water Service Providers (WSPs) Provision of water and sewerage services 8. Water Services Trust Fund Financing provision of water and sanitation to disadvantaged groups. 9. The Water Appeals Board (WAB) Arbitration of water related disputes and conflicts. 10. National Water Conservation and Pipeline Corporation (NWCPC) Construction of dams and drilling of boreholes 11. Kenya Water Institute (KEWI) Training and Research 12. National Irrigation Board (NIB) Development of Irrigation Infrastructure Source: National Water Resources Management Strategy (January 2007).
6 6 9. HOW WE WORK The WSTF staffing structure was reviewed to ensure that a mix of skills and experience is available, equal to the task, and will deliver the aims and targets stated. The structure ensures that the core functions of this financing institution are all catered for under the following roles: Investment Management, Finance and Administration including Procurement, Resource Mobilization, Planning, Quality Assurance includes Monitoring and Evaluation), Public Relations Management and Internal Audit. The structure will be reviewed as necessary, and especially mid-term to the Strategy period. The following structures support in different and important ways the management and implementation of the Plan: WSTF Board of Directors Chief Executive Officer The Management Team Program Officers More importantly, the structure ensures that individuals and teams are responsible to plan, undertake the activities in place and achieve the aims and objectives of this Plan. In this regard, three core teams are included: the investment team, the financial management team and monitoring and evaluation team. The Board of Trustees. The role of the Board includes policy review and direction, strategy review and tracking, governance, financial regulation and oversight, management of high level relationships and fund raising support. The Board responsible for approving the annual budgets and implementation plans, including the projects to be funded. This forum will be convened by the Chair and prior meeting schedules prepared and circulated to provide guidance to the process. The Board meets at least once a quarter to review progress and approve the funding of projects. Meetings can be convened more regularly as, and on need basis. The key decisions anticipated each year are the: Review of annual plans prepared by the WSTF team with their associated outputs, targets and budget allocation; Review of the funding base and sources for increased funding; Review and adoption of quarterly and annual progress reports; Coordination of key stakeholder forums. The Chief Executive Officer. The CEO provides strategic direction, is responsible for the overall management of the organisation and ensuring that WSTF is achieving the objectives and targets set. The CEO is responsible for the day-to-day management of all aspects of the institution to ensure the smooth running of the Institution. In addition,
7 7 this position is responsible for fundraising and the development and maintenance of partnerships. The Management Team. This team includes the positions that relate to the core functions of the WSTF the investment manager, finance and administration, internal audit and quality assurance/monitoring and evaluation. Other members will be included as necessary. The management team meets every two weeks to receive updates and progress on the priorities and targets set for the period. The key decisions expected from the management team include: track progress of the water projects cycle proposals received, appraised, approved, implementation process, and address any arising challenges. Quarterly, the team will review progress reports and recommend action on an ongoing basis; recommend policy areas to improve implementation; support the CEO in consultations with the Board of Directors. Annually, the management team reviews priority areas for inclusion in the annual work plans; propose budget allocations. The Program Officers. These Officers are responsible for the day to day implementation of the detailed work program developed from each strategy and have the mandate to ensure that the plan is implemented effectively. In addition, program officers: provide technical support to in the design and review of systems, coordinate the development of annual plans and budgets, develop progress reports, work with the their managers to track progress and bring up issues requiring policy decisions from the Board, and prepare documentation for funding. Staff meetings are held monthly.
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