WTF Concept Draft v 1x

Water Trust Fund Concept
Tajikistan Water Supply and Sanitation Project
Rural ‘Water Trust Fund’
Financed by:
Swiss Agency for Development and Cooperation (SDC)
Partners in implementation:
Government of Tajikistan | UNDP
Implemented by:
Oxfam (Great Britain)
Water Trust Fund Concept
Acronyms
CBO
Community Based Organisation
CSO
Civil Society Organisation
DDP
District Development Plan
DRR
Disaster Risk Reduction
GoT
Government of Tajikistan
M&E
Monitoring and Evaluation
KMK
Khojagii Manziliyu Komunali
MoLRWR
Ministry of Land Reclamation and Water Resources
MoU
Memorandum of Understanding
NGO
Non-Governmental Organisation
O&M
Operation and Maintenance
OGB
Oxfam Great Britain
SDC
Swiss Agency for Development and Cooperation
TajWSS
Tajikistan Water Supply and Sanitation Project
ToD
Tajik Ob Dehot
UNDP
United Nations Development Project
WS&S
Water Supply and Sanitation
WTF
Water Trust Fund
WUA
Water User Association
Water Trust Fund Concept
Foreword
‘The challenges facing the rural water supply and sanitation subsector (WS&S) in Tajikistan are multiple. The subsector
suffers from obsolete and deteriorating infrastructure; a lack of funds for the maintenance of existing systems and for
further investment in new construction, as only half the rural population of Tajikistan has access to water supply
infrastructure; the absence of an overarching legal framework; and a lack of clarity concerning the institutional
structure, especially at the local level. These challenges are subsequently compounded by a lack of funding for the rural
WS&S subsector. According to officials of the Ministry of Land Reclamation and Water Resources (MoLRWR), citing
interviews conducted in March 2012, only 30-35% of the needed financing for the subsector has been realised.
Oxfam Great Britain (OGB) in partnership with the District Authorities (Hukumat), MoLRWR, Khojagii Manziliyu
Komunali (KMK) and the United Nations Development Project (UNDP), funded by Swiss Agency for Development and
Cooperation (SDC), are currently implementing the Tajikistan Water Supply and Sanitation “TajWSS” project. The
TajWSS project, in cooperation with its partners and relevant stakeholders, has made significant progress in addressing
many of these overarching challenges, specifically in terms of influencing the development of an improved policy and
legal environment, providing further clarity concerning the subsector’s institutional framework and by establishing a
coordinated approach to address subsector related challenges.
To build on the previous progress delivered by the TajWSS project, and to support the Government of Tajikistan (GoT)
in its effort to promote decentralisation, district level Rural Water Supply and Sanitation Trust Funds (WTF) are being
established in Muminabad and Rudaki districts. The WTF aims to establish a mechanism which will promote increased
investment and financial sustainability in the subsector and improve coordination between legitimate stakeholders.
The objectives of the WTF are:
•
Encourage investment in the rural WS&S subsector aimed at supporting the rural population, with a specific
focus on the most vulnerable communities and families;
•
Serve as a cost-effective funding mechanism to secure financial resources from investors;
•
Provide a funding mechanism which increases transparency in decision-making and promotes decentralised
governance;
•
Support the practical implementation of the TajWSS project agenda, and the GoT’s Programme on the
‘Improvement of Providing the Population of the Republic of Tajikistan with Pure Drinking Water 2008 2020’;
•
Promote sustainability in the subsector by establishing an effective institutional framework and by
implementing projects using the best-practices which were developed and adopted, by the TajWSS project
over the past 2 years.
The WTF concept was designed to improve financial sustainability; to strengthen local capacities in management and
decision-making; to promote local ownership in the sector; to encourage decentralisation; to advance transparency in
decision-making and project selection; to increase operational efficiency in project implementation; and to be easily
replicable at the district level in other regions of the country.
The WTF is designed as a hybrid financing mechanism which will combine both funding from the GoT with investor
financing. The Ministry of Finance has encouraged the GoT to contribute 30% of the capital for the WTF, with the
remaining 70% provided by investors. This relationship ensures that donor funding will have a greater impact and
farther reach as every financial commitment from external investors will leverage additional public funding. The WTF
has been established by the signing of a Memorandum of Understanding (MoU) between the local Hukumat and the
Water Trust Fund Concept
TajWSS Project and by local GoT Decree. This agreement, founded in the Civil Code of the GoT, will outline the
financial and institutional structure of the WTF.
The following document provides an overview of the basic institutional structure, the operational framework and the
steps for establishing the WTF at the district level. The WTF was designed as a flexible mechanism, able to adapt to the
local context with specific consideration given to the social and the institutional structures. It is a replicable model
designed for country-wide up scaling that can be effectively utilised by a broad range of donors and investors and their
respective requirements.
It also outlines the concept of the WTF, and the specific benefits the model provides, with a particular focus in
promoting further interest and financing from prospective investors. The WTF is an effective mechanism by which
investment funds can be quickly, and transparently, channeled into vulnerable communities where access to potable
water and sanitation facilities are limited.
The WTF offers a viable option for donors who want an independent supervised mechanism for channeling support
funds to the rural WS&S subsector in Tajikistan.’
Ghazi Kelani
Oxfam
Country Director - Tajikistan
June 2012
Water Trust Fund Concept
Vision
The WTF is a funding mechanism for the rural WS&S subsector in Tajikistan, designed
to support and assist the most vulnerable groups in society. The WTF is owned and
operated by the local government, with support and facilitation from OGB. The local
government is the concept’s primary stakeholder, and decision-maker, retaining a
leading role in terms of funding decisions and project approval.
The aim of the WTF is not to create new or duplicate structures, but rather build on
the existing local government capacity to ensure the sustainability of the mechanism.
The WTF will be situated within the existing local government structure at the district
Hukumat, while the Chairperson of the Hukumat will be appointed as the Chair of the
Board of the WTF. Local government officials and civil society organizations (CSO),
active in the sector and present at the local level, will be represented in the Board. In
line with donor policies and guidelines concerning the subsector, the Board will hold
the primary decision-making power concerning project selection and funding
decisions.
FACTS & FIGURES
• Only 3% of the rural population in
Tajikistan are connected to adequate
sewerage systems
• 63.3% of supplied water does not
meet local or WHO standards
• 31.4% of water supply systems lack
facilities for disinfection
• Water Tariffs, for house-hold
consumption, were fixed 0.4 TJS/m³ in
June 2011. 25% of systems are no
economically viable.
• Price of water supplied by private
tankers varies from 45-200TJS/m³
48% of rural communities have
access to water supply
infrastructure; however, many of
these systems no longer function
Decentralisation and local ownership
are key components of the WTF concept; whereby those delegated with
the primary decision-making authority are based within the communities
they serve, thus better understanding the local conditions, needs and
context of the most vulnerable groups. This structure will inherently
ensure transparency and accountability, as community members will be
able to witness and monitor the decision-making process; understand the
procedure by which the outcome was reached, and who was responsible
for taking such a decision. Moreover, as the WTF is locally based, public
officials and key stakeholders active in the structure will be readily
accessible to the local community.
As duplicate structures are not being created, operational and overhead
cost will be kept to a minimal level since the WTF administration will be
located in the office of the Hukumat, increasing operational efficiency in
project implementation. In addition, since the key stakeholders and the
local structures are already present throughout the country, this model is
easily replicable and can be scaled up in other districts of Tajikistan. The expectation is that as further funding will be
allocated for the WS&S subsector, other donors and investors will recognise the effectiveness of the WTF mechanism,
and commit additional resources for its expanded implementation.
According to Often in the past, project implementation in the rural WS&S subsector has been carried out contrary to
official processes and regulations; proper official administrative permissions have not been obtained and there has
been a failure to adequately clarify the roles of ownership and operation, both which significantly reduce long-term
financial and operational sustainability. To ensure the success and the long-term sustainability of the WS&S subsector,
clarification concerning the roles and responsibilities of stakeholders, specifically in terms of regulation, ownership and
operation, needs to be clearly defined. Clarifying these roles was central to the activities of the TajWSS project.
Water Trust Fund Concept
Ownership
ToD
Jamoat
KMK
WUA
ToD
KMK
WUA
WUA
Support
provided
to the
WUA
Federation of WUA
Operation
Regulation
KMK, other
Departments &
Agencies
Rural WS&S Consumers
Figure 1. Institutional Structure of the Rural WS&S subsector
Building on the accomplishments of the TajWSS project and adopting the institutional framework, accepted by the
local government, and being piloted in Muminabad and Rudaki districts, the WTF (where applicable) will promote
Jamoat ownership, while Community Based Organisations (CBO) will act as operators (i.e. Water User Associations –
WUA). The need to promote and adequately support CBOs as service providers for the rural WS&S subsector has been
recognised by the GoT, through a Resolution adopted on March 31, 2011, from the Republican Conference on
“Drinking Water Supply and Sanitation, Challenges and Ways of Solutions.” This resolution states that authorities need
to recognise and acknowledge the traditional knowledge and experience which CBOs possess; this concerning local
environmental and geographic conditions; customary social dynamics and hierarchies; and traditional forms of water
distribution and collection methods.
In order to promote this structure and to empower CBOs, the WTF will ensure that they receive extensive training and
capacity development in terms of operation and maintenance (O&M), tariff collection and overall management
practices. This is currently being provided by the TajWSS project, in the pilot districts. Federations of WUA, in which
each WUA is a member, have also been established to continue to provide long-term support and engagement for
operators.
Moreover, in terms of regulation, the WTF will work closely with KMK which was defined as the regulator for the water
supply sector through GoT decrees 679/680, in December 2011. The WTF will promote a collective approach to
regulation, recognising that other departments and agencies, such as the Agency for Construction and Architecture and
the Department for Sanitation and Epidemiology also have important regulatory functions to fulfill.
The WTF concept is ‘beneficiary focused’ by both empowering applicants throughout the entire project-cycle and by
targeting project investment to the most vulnerable groups in society. Rather than implementing projects and simply
delivering a service, the WTF will ensure that local communities and CSOs are empowered to take the lead throughout
the entire project cycle and assume full ownership of the process and the resulting outcome.
The Executive and the Board (their roles are further explained in the following section) will provide the necessary
support and technical advice to local communities to assist service providers in completing their application, prefeasibility studies, implementation and post-project monitoring deliverables; however, applicant communities will own
the content of these documents, and take the lead in managing the processes.
Water Trust Fund Concept
As poverty vulnerability and access to potable water affect men, women and children unequally, special attention will
be given to the gender component in the application, pre-feasibility study and M&E framework. The gender analysis
component of these documents will be aimed at identifying how gender roles lead to distinctly different sets of needs
and concerns which will require varying strategies to address, and different indicators to assess their impacts.
Strategies aimed to identify, address and mitigate these concerns will be developed during the pre-feasibility study,
using field-based data collection methodologies which specifically take into consideration the issue of gender. The
Executive will work with the applicant to ensure that these issues will be properly addressed during each phase of the
project cycle.
As beneficiary groups are in the best position to understand their own needs, empowering them to take a leading role
in project design and implementation is the best way to ensure that project outcomes can be attained. Also, this type
of learning-by-doing is vital to the long-term sustainability and functionality of the WS&S subsector and is designed to
complement the capacity building program piloted in Rudaki and Muminabad districts as part of the TajWSS project.
1. Institutional Structure of the WTF
The WTF is composed of a Board of Trustees
and an Executive Office (see Figure 1.1). In
certain circumstances sub-committees will be
formed and tasked with further assessing
applications and making recommendations to
the Board regarding project prioritisation;
however, these decisions will require
ratification by the entire Board.
1.1. The Board of the WTF
WTF Board
Chair of the Board –
Head of the Hukumat
Subcommittee
Drinking Water Federation,
TajWSS Network Member,
Member of the Board of the
WTF, Executive, Hukunat etc.
Executive
Deputy Head of the
Hukumat & TajWSS
Assistant Project Manager
The Board will be comprised of a broad
collection of relevant stakeholders, including
local
government
officials,
and
representatives of civil society. The role of
Chair and Vice-chair of the Board will be held
Finance/Admin
Field Officer
Field Engineer
by representatives of the Hukumat. The Board
Hukumat &
TajWSS
TajWSS
TajWSS
will also consist of the relevant local
representatives of government ministries,
agencies, departments and regulators which
have a mandate to work in the WS&S
Reception
Hukumat
subsector. In addition, (3) places on the Board
will be reserved for members of the TajWSS
local Network. These members will act as a
Figure 1.1: Organisational Structure of the WTF
liaison between the Board of the WTF and the
local TajWSS Network, and serve as a focal
point by which information concerning best practices, lessons learned, policy advice, and dialogue can be disseminated.
It is expected that one body will compliment the work of the other and vice versa. Furthermore, since the local
Network consists of a wide group of stakeholders, including groups and associations representing beneficiaries at the
Water Trust Fund Concept
village and user level, Network members’ presence on the decision-making body of the WTF will increase the level of
local accountability of the mechanism exerts.
1.2. Subcommittee(s)
Sub-committee(s) can be formed by decision of the Board and can be charged with carrying out specific tasks related to
the operation of the WTF e.g. the registration process, the study of prospective project applications; to review and
analyze tendering and procurement procedures and/or documents; conducting monitoring and evaluation (M&E) and
research. Once a sub-committee has completed its task, it will report its findings back to the Board for further
consideration. Sub-committees can be composed of Board members, representatives of the Executive, members of
the Federation of WUAs, TajWSS Network members or other legitimate stakeholders. Members of sub-committees will
be chosen based on their specific knowledge and involvement with respect to the rural WS&S subsector.
1.3. The Executive Office
As part of the legal structure of the WTF (see section 5.0 Legal Framework
for further details), the Hukumat will delegate OGB to act as the Executive
of the WTF, while a representative of the Hukumat will be appointed to act
jointly with OGB staff. The Executive Office will be tasked with the day-today operation of the WTF, and implementing any decisions taken by the
Board. These activities will include, reviewing applications, organising
meetings, recording and distributing minutes, communicating WTF activities
with external stakeholders, co-signing agreements with sub-contractors,
conducting M&E and oversight of project implementation.
Establishment of the TajWSS Local Network in
Rudaki District
As promoting long-term financial sustainability and enhancing local ownership are two of the main development goals
of the WTF, the primary responsibility of the technical staff will be to empower local communities, and beneficiaries, to
complete the process themselves while providing tangible on-the-job training for a wide range of activities.
Board
Sub-committee
Executive
Primary decision-making body of the WTF
Carry out specific tasks related to the WTF and formed by decision of the Board
Implement the day-to-day operations of the WTF
2. The Project Cycle of the WTF
Once the Hukumat has issued an official Decree and authorised OGB to act as the Executive, in cooperation with the
Hukumat, operations of the WTF will begin by convening a meeting of the Board. During this meeting, additional
operational and reporting procedures will be established and a predetermined set of criteria by which applications will
be judged and prioritised will be decided and adopted by the Board. The choice of the criteria will be set by the Board;
however, the following criteria will be adopted (see box 1 / page 10 for a more comprehensive list which eligible
applications will reflect): the application must include an agreement between the applicant (service provider) and the
eventual owner of the project. This is vital to ensure that projects conform to the institutional structure, which has
been developed in cooperation with a wide array of legitimate stakeholders, adopted by the Hukumat, and promoted
by the WTF. This structure will best ensure the long-term financial and technical stability of the system. Gender, as
mentioned, will also be an important factor by which applications will be reviewed; applications must adequately
Water Trust Fund Concept
address the issue of gender to be given consideration by the WTF. Once the criteria are established, only a unanimous
decision of the Board can alter them.
2.1. Application Process and Prioritisation
The fund will follow a 12-month cycle (figure 2.1 details the approval and implementation process of the WTF),
whereby the Board will start the process by announcing the beginning of the application phase (1 month).
Project Approval Process
Project Implementation
Investor Capital
GoT Capital
Chairperson
Issues decree to establish the WTF,
Opens bank account, delegates
OGB to act as Executive
Service Provider (WUA)
WTF
Signs contract with the owner,
implements O&M plan, tariff
collection begins, engages in M&E
supported by the Executive
through on-the-job training
Board
Application process is announced,
criteria for short-list established,
delegates authority to the
Executive to short-list applications
Board/Ex./Network/Jam.
Sub-Committee
Opening and
registration of
applications, hand
over to Executive to
prepare short-list
Construction activities are
monitored and verified, contractor
registers the project with the local
authorities
Executive
Collects sealed applications, hands
applications over to SubCommittee for registration,
develops short-list based on
criteria set by the Board
Carries out activities according to
contract obligations
Board
Service Provider (WUA)
Sub Contractors
Receives short-listed applications,
decides on prioritisation, sends
applications to Sub-Committee (if
decision is not reached or
questions remain)
Enters into contract with
supplier/construction service
provider, supported by the
Executive and Jamoat
Sub-Committee
Conducts further
review of the shortlisted applications
Donor
Executive
Assists applicant with feasibility
study, facilitates the competitive
bidding process
Provides final approval for project
priorities
Figure 2.1: Project Cycle of WTF
Water Trust Fund Concept
The Executive will work with local government, civil society, service providers, operators, private organisations,
religious institutions or any other public office to disseminate information regarding the WTF, eligibility requirements
and the approval process. Engaging in extensive awareness activities will help to safeguard transparency and
inclusiveness concerning the WTF as every effort will be made to ensure that all eligible beneficiaries have an equal
chance to submit applications.
The responsibility to ensure the applications adhere to the parameters established by the WTF regarding operational
and financial sustainability, cost efficiency, technical feasibility and development need will rest with the respective
applicant; however upon request, support will be provided by the Executive, in the form of capacity development and
on-the-job training. Applications will be handed over to the Executive and/or the Hukumat in sealed envelopes and
after they are collected, the applications will be opened and registered by the Board. Registered applications will then
be handed back over to the Executive for further review. At this point the Executive will develop a short-list of eligible
applicants based on the predetermined set of eligibility criteria established by the Board.
Short-listed applications will be transferred back to the Board for further consideration and approval; at this point the
Board can decide to form a subcommittee to review the applications in greater detail if a decision cannot be reached or
if they wish to review the short-listing process carried out by the Executive. Approved applications will be sent to the
Donor for their final endorsement, after they have been approved by the Board. The review and approval phase will
last a total of (2 months).
2.2. Implementation
Once funding priorities have been determined by the Board and the Donor, it will be the task of the Executive, in
cooperation with the Hukumat and other relevant governmental and non-governmental stakeholders, to guide the
next phases of the project-cycle. As a first step in the implementation process, the applicant will be responsible for the
collection of base-line data and the preparation of a pre-feasibility study. At this stage the Executive and other
important stakeholders in the rural WS&S subsector will be engaging the applicant in further developing their
capacities concerning the long-term management of the water system, such as discussing appropriate O&M structures,
technical capacities of those charged with O&M, cost recovery and tariff collection mechanisms, financial governance
procedures and general awareness campaigns. Experience suggests
that important technical capacities developed during the
implementation of the project, including the preparation of the prefeasibility, competitive bidding and construction processes will be
vital to the long-term financial and technical stability of the projects.
Once pre-feasibility studies are completed, the WTF will enter into a
Funding Agreement with the applicant. Based on this Funding
Agreement, the applicant can enter into a contract with service
providers and/or suppliers for the execution of the project.
Contracts signed between the applicant and the service
provider/supplier will be co-signed by representatives of the
Executive and Jamoat (as the owner) and will be awarded based on a
competitive bidding process. This process will be carried out
according to the rules and regulations established by the TajWSS
The construction of a water system in Obi Navrusha
(Khatlon), funded by Oxfam GB
Water Trust Fund Concept
project, and will be executed under the supervision of a committee, including a member of the Board. The final
selection will be based on predetermined criteria, including financial, technical and managerial considerations. For
more complex projects, the sub-contracting phase will comprise two steps; a first firm will be selected to complete the
detailed designs, bills of quantities and to provide technical oversight during the construction process (Engineering
Service Provider) while an additional firm will be chosen to implement the construction activities (construction
company). This process, including the development of the pre-feasibility and base-line documents, will last (3) months.
When construction activities begin, monitoring of project implementation will be coordinated and conducted by
various nationally and locally based structures (see Figure 2.2). The local and national TajWSS Networks will conduct
M&E activities on a bi-annual basis, while the Board of the WTF will provide monitoring oversight at intervals which will
be decided internally by its membership (i.e. monthly or quarterly). Additionally, specific quality control and technical
oversight will be provided by the Executive (on a weekly basis), the Owner and Operator of the system, the Engineering
Service Provider, and the selected construction company (on a daily basis respectively).
Frequency increases, tech. specificity
increases, legal obligation increases
General oversight
provided by project
partners
TajWSS National & Local Networks (Bi-Annually)
Board (Timing TBD by the Board)
Executive (Weekly)
Owner, Operator,
Engineering Service
Provider, Construction
Company (Daily)
Compliance M&E, based
on contractual obligations
Projects being funded and implemented by the WTF
Figure 2.2: M&E system of the WTF (project implementation)
As part of the on-the-job training provided to the applicant organisation, they will be responsible for selecting
individuals who will take part in M&E activities conducted throughout the construction process. These individuals will
be paid a salary and will then work for the service provider after the completion of the project, bringing the knowledge
and experience gained during the project implementation to their daily work. The responsibility for providing the
verification that the contractor has fulfilled their obligations will be the coordinated responsibility of the Executive,
including the representative of the Hukumat, the owner of the system and the applicant organisation. This phase will
last a total of (6) months, 5 months for the implementation of the project and 1 month for the verification and
registration process, depending on the complexity of the project.
Water Trust Fund Concept
2.3. M&E and Continued Engagement
The WTF views capacity development as a lasting process, continuing throughout and beyond the life of the project,
rather than an activity which lasts for a fixed period. In order to ensure long
long-term
term sustainability, the WTF will engage
local actors at all levels during pre and post construction phases, empowering them to take ownership of the process.
The role of the Board and of the Executive will not end with the completion of the construction activities; the WTF
envisions a long-term
term engagement with communities
communities, lasting for a 24-month
month period after the
th project has been handed
over. This process is based on research conducted
conducted, and best practices adopted by the TajWSS project, indicating that a
continued engagement is required
d for at least a 24 month period to ensure an adequate knowledge transfer and to
allow for sufficient time to measure specific performance-based indicators relating to the technical and the financial
sustainability of the project. Thee Board and the Executive would, in addition to conducting
conduct
joint quarterly M&E
activities, use this period to fundraise,
raise, adding to the financial stability of the mechanism
mechanism..
This prolonged engagement is to ensure that sustainability benchmarks concerning social, technical
tech
and financial
aspects are attained. In addition, as gender will be a central component of the monitoring framework, measuring the
level to which gender related targets are achieved will be critical to the overall success achieved by the project.
Although it is an important step to raise
rai the issue of gender, achieving targets measured by quantifiable indicators is
the aim of the WTF.
Application phase, decided by the Board and announced by the Executive
Review of applications by the WTF, funding decisions taken by the Board and ratified by the Donor
Development of the feasibility documents, tendering process and selection of sub
sub-contractors
contractors
Implementation and hand-over
over of the project
Continued M&E and engagement with the community
commu
1 months
2 month
3 months
6 months
24 months
3. Financing
The WTF is an effective mechanism for streamlining investor funding to the district
rict level and for merging these
resources with funds already committed by the GoT for rural WS&S subsector activities.
es. The Ministry of Finance has
encouraged the GoT to provide 30% of the financing for the WTF,, in Muminabad and Rudaki districts, while the
remaining 70% will come from the investor. This announcement was
made on September 21, 2011. The WTF is a unique financing model
Funding Source
for Tajikistan that is endorsed by the GoT.
GoT 30%
The formation of the WTF will also encourage decentralis
decentralisation in the
provision of drinking water whilst providing a clear mandate to the
local government concerning their roles
rol and responsibilities, and
decision making activities. Since the provision of drinking water
constitutes ‘public funding’,’, the WTF will be accountable to the GoT
as well as the investor.
Investor 70%
The Ministry of Finance’s endorsement confirms the commitment by the GoT for both the rural WS&S subsector,
subsector and
the use of the WTF as a decentralised funding and implementation mechanism. In order to ensure that the WTF model
is realised, OGB has signed a MoU with the Hukumat in Muminabad and Rudaki districts to establish the necessary
legal and financial frameworks.
Water Trust Fund Concept
4. Legal Framework
The WTF will be established by signing a MoU between the TajWSS project and the local government and by the
issuance of an official Decree by the Hukumat. Under this framework, a Trust will be established without the
requirement to form a separate legal entity. The legal foundation for this relationship derives from article 452 of the
Civil Code of the GoT, which authorises the local government to enter into such
agreements.
Upon completion of the MoU and after an official Decree is announced, the
Hukumat will be authorised to open a bank account, according to Instruction 171 of
the National Bank of Tajikistan. The operation of the bank account will be governed
by the terms and conditions outlined in the Instrument of Contribution, which each
investor will sign before funds are transferred to the WTF. The Instrument of
Contribution will establish the policy and procedures governing the use of the funds
placed under control of the Trust, and outlines the specific purposes for which the
funds can be used; in this case solely for financing project implementation in the
rural WS&S subsector in the specified district.
This legal structure has several significant advantages. Primarily, the funds placed
under the Trust can be monitored not only by the Investor, but also authorised
In Zarnisor Village residents walk over
authorities of the GoT since the funds fall under state control. Specifically, these
3.0 km to collect drinking water
funds will be under the jurisdiction of the Agency for State Financial Control and
Fighting against Corruption. This additional control significantly increases the transparency and accountability of WTF
model.
In addition, as no other legal entity will need to be created and sustained, minimising the administrative and overhead
costs, the WTF will be a highly cost-effective institution. All the parties taking part in the Trust Agreement, and the
Board members, already exist as legal entities and do not require additional funds for their legal registration, or
continued operation. All Board and Sub-committee activities will be housed in the district Hukumat office at no
additional cost.
Article 452 - the Civil Code of the GoT
Article 171 - the National Bank of Tajikistan
Authorises the Hukumat to enter into a Trust with OGB
Authorises the Hukumat to open a bank account for the WTF
5. Eligibility
Once the WTF is established by local Decree, the Board will develop and adopt the eligibility criteria against which
applications will be judged. This will provide the framework by which the potential applications will be assessed. The
Board and the Executive will communicate these guidelines to potential applicants as part of the public awareness
campaign. Applicants to the WTF will be governmental or non-governmental organizations engaged in providing
services in the rural WS&S subsector, as community based WUAs, recognized by the GoT, are best suited to provide
services in rural locations. Eligible applications will reflect the following criteria (See Box 1).
Water Trust Fund Concept
Box 1:
1.
The application must include activities which expand the delivery of services for the rural WS&S subsector,
including the construction of new water supply systems or the rehabilitation or expansion of an existing
one. Eligible projects can include training, capacity development, hygiene or other activity agreed upon by
the Board; however, the expansion of existing services must be the core component of the application.
2.
Approved applications should be relatively equally geographically dispersed throughout the target district
to ensure that benefits of the WTF target a wide array of citizens and communities;
3.
The project must indicate significant levels of local ownership and involvement, and the application must
provide concrete details concerning a measurable and significant community contribution;
4.
The project must be approved by the applicants governing body;
5.
The application must clearly identify the institutional structure of the project, indicating the intended owner
and operator of the completed system, with supporting documentation;
6.
The project proposal must indicate how the issue of gender will be addressed by the project;
7.
The project must demonstrate an urgent need for the community and address acute problems present in
the WS&S subsector; however, the project must also address the issue of long-term financial sustainability;
8.
The community must submit a plan regarding post-construction M&E of the project over a 24-month
period. The plan must address who will conduct these activities and the relevant indicators which will be
measured, including those which relate to gender;
9.
The project must be recognised and accepted into the state’s District Development Plan (DDP), indicating
that it is a development priority for the local rural WS&S subsector;
10. The application must include appropriate technical plans and specifications so that technical feasibility,
O&M and financial sustainability, Disaster Risk Reduction (DRR) compatibility, environmental impact and
project cost can be adequately reviewed. These plans must include: description of the scope of the work,
estimated cost, target date for beginning construction, estimated date for completion, cost/benefit analysis
and all appropriate engineering feasibility reports;
11. The applicant must have a permit establishing their right of water use and this must be indicated in the
application including official documentation to support the claim.
6. Strengths
6.1. Sustainability
The primary strength of the WTF is that it is a highly sustainable institution; no additional office or structure will be
created when the WTF is launched. There is no NGO, association, CSO or private enterprise upon which the activities of
the WTF will depend and subsequently, the WTF will operate with minimal overhead or administrative costs. The entire
operation of the WTF will be located at the local Hukumat and all primary decision-makers and stakeholders exist in
their own right. Moreover, since the primary decision-makers and stakeholders already exist as government office
holders and are already active in the WS&S subsector, the WTF is not adding an additional function to their roles and
responsibilities of which they will need to be convinced or funded; rather the goal of the WTF is simply to re-focus a
portion of their already existing activities.
Water Trust Fund Concept
6.2. Decentralisation
The decentralised nature of the WTF encourages local decision-makers to make local decisions. The WTF concept
places the primary decision-making authority in the hands of local actors and removes much of the time consuming
consultation with national decision makers. The WTF takes a function which was primarily exercised by office holders in
Dushanbe and relocates it to the district level. The benefit to this type of decentralisation is that beneficiaries will have
increased access to the local decision makers, and those responsible for making the decisions will better understand
the local priorities, context, and dynamics of their own communities.
6.3. Local Ownership and Participation
The WTF is designed to encourage local ownership in the decision-making and project implementation processes. The
structure of the WTF places the decision-making authority in the hands of local government, while project proposals
originate directly from the beneficiary communities. The entire process
rests in the hands of local actors and therefore the level of buy-in will
increase when one has been included throughout the entire process.
Consequently, this process will lead to increased levels of success and
sustainability.
The WTF will establish a beneficiary focused funding mechanism in the
rural WS&S subsector. As local ownership is improved, the WTF will
actively engage the beneficiaries in the implementation of the project,
provide support and resources for its continued O&M, and provide
proper long-term monitoring of the resulting system.
Over 20% of rural residents get their drinking water
from irrigation canals (Ministry of Health 2009)
In addition, not only will the local community and local government be involved in the process from the very beginning,
but they will be contributing their own resources towards the project (15% from the central government, 10% from the
district government and 5% from the service provider). Therefore, the beneficiaries have a vested financial interest in
the success of the project.
6.4. Transparency
The WTF will improve transparency in decision-making. Each point in the decision-making process will be documented
with minutes and records kept; these will then be distributed to all concerned stakeholders and potential applicants.
There will also be pre-determined application criteria by which projects will be judged; all applicants will be made
aware of these criteria well before applications will be submitted and evaluated. Unlike many other programs, the size
of the fund and the project finances will be communicated by the Board and the Executive. Each applicant will know
the size of the WTF at the beginning of the project cycle, while the budget for each approved project will be
communicated in a timely fashion.
As the entire process will be unfolding at the district level, it will be much easier for citizens and communities to
participate in the proceedings and to approach and challenge decision-makers. In addition, since the endowment of
the WTF is under the authority of the local Hukumat, as outlined in the Trust Agreement signed between the
Chairperson and the Executive, those funds are subject to scrutiny of the Agency for State Financial Control and
Fighting Against Corruption.
Water Trust Fund Concept
6.5. Cost Efficiency
The WTF project delivery structure will reduce administrative and operational costs. As the WTF does not create any
additional structures, organisations or offices, there will be minimal funding requirements to sustain and operate the
WTF. This will ensure that the entire endowment of the WTF will be used for project investment purposes and not used
for covering overhead and administrative costs.
Strengths of the WTF: improved sustainability; increased decentralisation; promoted local ownership and
participation; advanced transparency in decision-making; improved operational efficiency in project implementation.
7. Threats and Mitigation Strategy
7.1. Institutional Capacity (Local Government)
Local government officials are involved in all aspects of the WTF; taking a leading role in the decision-making and
prioritisation process, while being involved in the ownership, management and monitoring of the projects once
construction activities are complete. The WTF foresees that their new roles and responsibilities, as part of the WTF,
could create an extra burden to their workload. In order to mitigate these effects the Executive, specifically during the
inception and set-phase of the WTF, will take a leading role in the overall day-to-day management and administration
of the WTF. The Executive would have a strong presence at the district level, especially during the peak phases of the
process such as during the advocacy and public information stage, application collection and assessment phase, and
during the development of the base-line and feasibility documents.
7.2. Institutional Capacity (Local and Community Level)
A lack of knowledge and capacity of the local communities, and service providers, to develop and provide adequate
proposals, base-line data, feasibility documents, and technical designs could impact on the efficiency of the WTF model.
Part of the responsibility of the Executive and the Hukumat will be to work with service providers through a process of
coaching which aims to strengthen their capacities to create these documents independently. Sufficient time has been
allocated during the project cycle to allow for consultations between the applicants, the Executive and the local
government to deliver this support where necessary. In addition, communities will not be left on their own once the
construction phase is completed; rather the WTF concept allows for a two-year period of support to local communities
with respect to M&E, and the provision of technical advice regarding O&M, cost recovery and management.
7.3. Financing
The financial capacity of the local authorities to co-finance projects in the rural WS&S subsector could be a significant
threat to the WTF model. Budgets at the national, regional and local level only cover a small proportion of the required
overall investment in the subsector. Additionally, tariff collection does not cover the operating costs of water supply
systems, further straining public finances. Water supply systems throughout the country are in need of extensive
rehabilitation and lack of adequate maintenance is widespread. However, the GoT has made significant progress in its
commitment to the subsector and in funding key activities. The TajWSS project, in cooperation with its partner
organisation UNDP, is working at the national level on the process of legislative and policy reform concerning key
components, such as taxation, including subsidisation for operators, financing, and clarifying the roles of operation,
ownership and regulation. To address specifically its commitment, and its financing capacity, the GoT has announced
that it is committed to a 30/70 co-financing and cost-sharing agreement for projects funded by the WTF.
Water Trust Fund Concept
7.4. Influence over Board Decision-Making
There could be a risk that certain Board members or stakeholders will try to influence the project-cycle process of the
WTF to their own advantage, by exerting their influence over the decision-making process. The WTF model addresses
this threat in the size and composition of the Board, as it will be comprised of a wide array of stakeholders, including
government officials from various offices and departments, and members of civil society. This composition will diffuse
the power that any one member may have over the Board decision-making process and WTF activities. Additionally,
the deliberation and prioritisation process of the WTF will be communicated to a wider audience to allow for greater
public scrutiny.
Threat
Mitigation Strategy
Institutional Capacity (local government)
Institutional Capacity (local community)
Financing
Influence over Board Decision-Making
Support from the Executive during key phases of WTF activities
Capacity building, on-the-job training and continued M&E and engagement
70/30 co-financing agreement between the WTF and the GoT
Diffusion of power through the Board and public awareness
8.
Future
Past project implementation in the rural WS&S subsector in Tajikistan has struggled to ensure long-term sustainability.
Often processes were developed with the sole intention of project implementation while an insufficient amount of
time and resources were devoted to ensuring that the governance structures are in place to ensure that O&M
ownership and regulation are properly addressed and subsequently recognised and accepted by the GoT. The WTF
from the very outset is making provisions for the way forward; whereby local service providers and the local authorities
can assume responsibility for completed projects and the Hukumat take over the WTF structure and operation.
The Hukumat is the central office responsible for providing a location for the WTF and for providing the legal
framework for the Trust, as well as working jointly with the TajWSS project as the Executive. It is logical that the
Chairperson of the district assume responsibility for the WTF once the TajWSS project begins to scale back its
involvement in Muminabad and Rudaki districts. Staff in the Hukumat, who have been involved in the operation of the
WTF from the outset will gradually assume the Executive role, in its full capacity, in the future. This scaling back and
handing over will be phased in gradually, to ensure a successful handover of roles and responsibilities, as well as the
ownership of the necessary physical capacities required for the WTF to function effectively.
The handover phase of the WTF to the Hukumat will take place at the end of a 3-year period; the transition will reflect
the local conditions in Muminabad and Rudaki, specifically the capability and the capacities of relevant stakeholders.
The handover would be implemented in a flexible manner to account for these considerations. The involvement of the
TajWSS project over a 3-year period is suggested because this time period will allow for a complete project-cycle (1year) and the subsequent continued technical support and capacity development (24-month) to finish. Certainly more
than one project-cycle will take place during this 3-year period and the subsequent activities of each cycle will overlap;
however, a 3-year involvement of the TajWSS project provides that one full cycle will be completed prior to the
handover. As mentioned earlier, experience suggests that a 24 month period of technical support and capacity
development is optimal to ensure the long-term financial and technical sustainability rural WS&S projects. Financial
and technically sustainable projects, as well as a capable Executive are important preconditions for a successful
handover of the WTF mechanism.
Water Trust Fund Concept
After this period, the TajWSS project, through the national and local Networks, would continue to provide oversight
and technical assistance in a manner decided upon by the membership of the Networks, and as requested by the
Hukumat or other relevant stakeholders. OGB would also continue to provide financial oversight to the WTF to ensure
that financial procedures conform to donor policies, while continuing to take the lead in fundraising efforts to secure
the financial sustainability of the WTF.
During the handover phase, the TajWSS project will begin to consult relevant stakeholders, through the national
TajWSS Network, to identify additional districts where the WTF can be replicated, building on the process established
in Muminabad and Rudaki. This consultation phase would also include a detailed evaluation of WTF activities over the
previous 3-year period. The review would evaluate specifically the structure, the operation, management and M&E
systems, and the objectives attained. The WTF concept would be updated and revised, based on the recommendations
and lessons learned which will be developed during this evaluation and review process.
9. Related Documents
If your organization requires copies of any of the related administrative documents required for the set-up and the
operation of the WTF, the following are available upon request:
•
•
•
Instrument of Contribution
Community Application Form
List of Board Members
10. Contact Details
For any additional information regarding WTF or TajWSS activities, please visit the TajWSS website at www.tajwss.tj or
contact Oxfam Great Britain at:
Oxfam GB
48, Ayni Street
Business Centre ‘Sozidanie’
Block A, 2nd Floor
734024 Dushanbe,
Tajikistan
Tel: (992) 701 51 21
[email protected]