The World Bankdocuments.worldbank.org/curated/en/209221468282917188/... · 2016-07-15 · document of the world bank report no: 32309 implementation completion report (ida-32820 ppfi-q1160)

Document of The World Bank

Report No: 32309

IMPLEMENTATION COMPLETION REPORT(IDA-32820 PPFI-Q1160)

ON A

CREDIT

IN THE AMOUNT OF SDR 18.7 MILLION(US$ 25 MILLION EQUIVALENT)

TO THE

REPUBLIC OF GHANA

FOR A

SECOND COMMUNITY WATER AND SANITATION PROJECTIN SUPPORT OF THE FIRST PHASE OF

THE COMMUNITY WATER AND SANITATION PROGRAM

June 9, 2005

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CURRENCY EQUIVALENTS

(Exchange Rate Effective May 10, 2005)

Currency Unit = Cedi (GHC) GHC 1 = US$ US$ 0.00011

US$ 1 = 9050 Cedis

FISCAL YEARJanuary 1 December 31

ABBREVIATIONS AND ACRONYMS

AfDB African Development Bank APL Adaptable Program Loan BH BoreholeCBRDP Community Based Rural Development ProjectCAS Country Assistance StrategyCIDA Canadian International Development AgencyCWSA Community Water and Sanitation AgencyCWSP Community Water and Sanitation Project CWSP-2/1 Second Community Water and Sanitation Project Phase 1 COM Community Ownership and ManagementDA District AssemblyDACF District Assembly Common FundDANIDA Danish International Development Agency DOM District Operational ManualDWSP District Water Sanitation PlanDWST District Water Sanitation TeamEIA Environmental Impact AssessmentERR Economic Rate of ReturnEU European UnionFMPs Facility Management Plans GoG Government of Ghana GPRS Growth and Poverty Reduction StrategyHDW Hand Dug WellHIPC Heavily Indebted Poor CountriesICR Implementation Completion ReportIRR Internal Rate of ReturnJICA Japan International Cooperation AgencyKfW Kredistanstalt fur Wiederaufbau (German International Cooperation Bank)MDG Millenium Development GoalsMFEP Ministry of Finance and Economic PlanningMTR Mid-Term ReviewNGO Non-Governmental OrganizationNPV Net Present ValueO&M Operation and Maintenance PAD Project Appraisal Document

PCD Project Concept Document POM Project Operational ManualPHASTParticipatory Hygiene and Sanitation TransformationPPIAF Public Private Infrastructure Advisory FacilityPRSP Poverty Reduction Strategy PaperQAE Quality at EntryQAG Quality Assurance GroupRWST Regional Water and Sanitation TeamSoE Statement of ExpenditureSPA Sub-Project AgreementSTWSSP Small Towns Water Supply and Sanitation ProiectTTL Task Team LeaderVIP Village Infrastructure ProjectWATSAN Water and Sanitation CommitteesWSDB Water and Sanitation Development Board

Vice President: Gobind T. NankaniCountry Director: Mats KarlssonSector Manager: Eustache Ouayoro

Task Team Leader/Task Manager: Arthur M. Swatson

GHANASecond Community Water and Sanitation

CONTENTS

Page No.1. Project Data 12. Principal Performance Ratings 13. Assessment of Development Objective and Design, and of Quality at Entry 24. Achievement of Objective and Outputs 45. Major Factors Affecting Implementation and Outcome 106. Sustainability 117. Bank and Borrower Performance 128. Lessons Learned 149. Partner Comments 1610. Additional Information 16Annex 1. Key Performance Indicators/Log Frame Matrix 17Annex 2. Project Costs and Financing 22Annex 3. Economic Costs and Benefits 23Annex 4. Bank Inputs 26Annex 5. Ratings for Achievement of Objectives/Outputs of Components 29Annex 6. Ratings of Bank and Borrower Performance 30Annex 7. List of Supporting Documents 31Annex 8. Borrower Comments 32Annex 9. APL Triggers Phase 1 41

Project ID: P050616 Project Name: Second Community Water and SanitationTeam Leader: Arthur Majoribanks Swatson TL Unit: AFTU2ICR Type: Core ICR Report Date: June 9, 2005

1. Project DataName: Second Community Water and Sanitation L/C/TF Number: IDA-32820; PPFI-Q1160

Country/Department: GHANA Region: Africa Regional Office

Sector/subsector: Water supply (33%); Sanitation (32%); Central government administration (25%); Other social services (10%)

Theme: Participation and civic engagement (P); Rural services and infrastructure (P); Water resource management (P); Decentralization (S); Pollution management and environmental health (S)

KEY DATES Original Revised/ActualPCD: 07/22/1998 Effective: 01/01/2000 07/07/2000

Appraisal: 06/17/1999 MTR: 11/23/2002Approval: 08/31/1999 Closing: 06/30/2003 12/30/2004

Borrower/Implementing Agency: GOVERNMENT OF GHANA/MINISTRY OF WORKS AND HOUSING/COMMUNITY WATER AND SANITATION AGENCY

Other Partners: None

STAFF Current At AppraisalVice President: Gobind T. Nankani Jean-Louis SarbibCountry Director: Mats Karlsson Peter HarroldSector Manager: Eustache Ouayoro Letitia A. ObengTeam Leader at ICR: Arthur Majoribanks Swatson Jennifer J. SaraICR Primary Author: Tracy Hart; Arthur Majoribanks

Swatson; and Amal Talbi

2. Principal Performance Ratings

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)

Outcome: HS

Sustainability: L

Institutional Development Impact: SU

Bank Performance: S

Borrower Performance: S

QAG (if available) ICRQuality at Entry: HS HS

Project at Risk at Any Time: No

3. Assessment of Development Objective and Design, and of Quality at Entry

3.1 Original Objective:The Development Objective of the Second Community Water and Sanitation Project Phase 1 (CWSP-2/1) was to increase access and achieve effective and sustained use of improved community water supply and sanitation services in villages and small towns in four regions, namely Ashanti, Brong Ahafo, Upper East and Upper West Regions.

Specific objectives of CWSP-2/1, as stated in the Project Appraisal Document (PAD), were the following:

(a) Implementing demand-responsive and sustainable Community Water and Sanitation (CWS) services, providing basic drinking water and sanitation facilities to about 550,000 people in rural communities through construction and rehabilitation of water points, piped water supply systems, and sanitation facilities; (b) Strengthening community capacity to manage services by assisting communities in planning, implementing and administering services, forming and training Water and Sanitation Development Boards (WSDBs) and Water and Sanitation Committees (WATSANs) and training community members in better hygiene practices;(c) Developing district-level capacity to deliver CWS services, encouraging an active role by the private sector and Non-Governmental Organizations (NGOs) in delivering goods and services and assisting District Assemblies (DAs) in planning and providing community support in service planning, implementation and management; and(d) Strengthening CWSA's capacity to assume the facilitator role by implementing a management fee payment scheme and supporting the national CWS program.

These objectives are fully consistent with the Letter of Sector Policy issued by the sector Ministry and dated August 1999. The project has also contributed to furthering the goals of the National Community Water and Sanitation Program (NCWSP) which seeks to increase sustainable access to CWS services and the Ghana Poverty Reduction Strategy (GPRS), which identifies accelerated access to water and sanitation as a priority. Hence, the objectives are entirely relevant and responsive to the sector objectives of increasing sustainable access to water and sanitation.

The project objectives further support Ghana’s decentralization policy agenda by developing capacity at the local level to enable water supply and sanitation services to be decentralized to local governments. The project directly supports two themes of the 2000 Country Assistance Strategy (CAS), namely, Private Sector Development and Decentralization, and two key pillars of the 2004 CAS, namely the Service Delivery and Human Development pillar and Empowerment.

The project objectives were clear and realistic and the design of the project was appropriate. The project's design took into account the latest lessons learned on the community based approach, in particular, the lessons learned from the previous water project, the First Community Water and Sanitation Project (CWSP1). The risk assessment under the project was appropriate and the project's design included a flexibility to face those potential issues during implementation. To support the project objectives, the components represented a strategic mix of interventions involving community infrastructure, capacity building and institutional support. The performance indicators were mostly specific, relevant, and measurable, and the first phase of the Adaptable Program Loan (APL) had quantifiable triggers to assess their achievement (see Annex 9).

3.2 Revised Objective:

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There were no revised project objectives.

3.3 Original Components:The project had three components as follows:

1. Community Sub-projects ($21 million): This component provided grants to communities and schools through their DAs to construct water and sanitation facilities and to finance technical assistance and community development activities. Community capacity was strengthened in planning, implementing, operating and maintaining water and sanitation facilities in an effective and sustainable manner. Under this component, communities and small towns first submitted proposals for water and sanitation facilities and following their approval and appraisal, the project provided the facilities. This demand-driven approach provided a good basis for strengthening community ownership and management as well as sustainable operation and maintenance.

2. Sector strengthening ($3.2 million): This component supported (i) local providers of goods and services (private sector and NGOs), (ii) DAs and their District Water and Sanitation Teams (DWSTs), and (iii) national program development. Under this component, the capacities of both the public (CWSA and DAs) and private sectors were strengthened to ensure adequate implementation capacity in critical areas such as procurement and financial management, planning, monitoring and evaluation, project and contract management. NGOs were also recipients of training.

3. Program Management ($2.5 million): This component included remuneration on a fee-for-service basis to the Community Water and Sanitation Agency (CWSA) for the incremental costs of managing CWSP-2/1 and providing technical assistance to the DAs. Under this component, CWSA was strengthened in order to better perform its new role under the ongoing decentralization process. CWSA fully assumed its role as facilitator rather than implementer, managing the program at the national level.

3.4 Revised Components:There were no revised project components. However, bringing in the lessons from the ICR of the previous project (CWSP1), there was a need to strengthen the integration of hygiene education with water and sanitation. This integration involved supporting the design and implementation of a national hygiene Information, Education and Communication campaign (IEC) to promote handwashing with soap at critical times to reduce the incidence of diarrhoeal diseases. This national campaign is part of the global handwashing initiative supported by the Water and Sanitation Program (WSP) and the London School of Hygiene and Tropical Medicine (LSHTM) and is designed to promote behavioral change in mothers and children towards handwashing with soap.

Three key enhancements were made. First, the initial household sanitation approach required 50% of households in a community to sign up for latrines before a subsidy could be given. This initial approach was modified to focus on sanitation promotion, whereby the subsidy was given regardless of the percentage of households signing up for latrines. Second, a pilot was included to test the Participatory Hygiene and Sanitation Transformation (PHAST) approach to sanitation and hygiene education delivery. Finally, the project secured Public Private Infrastructure Advisory Facility (PPIAF) financing for a pilot approach to local private sector management of two small towns water supply systems in the Western Region aimed at improving post-construction operation and maintenance of town supplies.

During the Mid-Term-Review, CWSA and the Bank team agreed that the triggers for phase two were too many, overlapping and in some cases, difficult to measure. The number of triggers was therefore reduced in order to focus on the most relevant and easily measurable ones (see Annex 9). This focus on a few triggers

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was in line with CWSA's (Head Office and Regions) capacity to develop a harmonized monitoring system to assess the attainment of these triggers (see Annex 1).

3.5 Quality at Entry:The Quality At Entry is assessed as Highly Satisfactory. In 2000, the Quality Assurance Group (QAG) assessment also rated the project as highly satisfactory.

Quality at entry is assessed as Highly Satisfactory due to: (i) the project’s consistency with the Bank and government priorities; (ii) quality of the design; and (iii) the project’s largely successful anticipation of risk.

Project consistency with Bank and Government priorities. As stated above (see section 3.1) the project was directly supportive of the Government’s priorities and consistent with the CAS objectives. The project directly built upon CWSP1, which successfully supported policy reforms in the water supply and sanitation sector.

Quality of design. QAG reviewed the Quality At Entry (QAE) of the project and rated it Highly Satisfactory because the project was based on lessons learned from the CWSP1 and the policy reforms already in place as a result of CWSP1. The project also put in practice the concept of demand-driven services together with a financing mechanism that was replicable on a large scale in Ghana. The only three issues noted in the QAE included Environmental, Poverty and Financial Management aspects. With regards to Environmental Aspects, QAG noted that although some potential aspects were inluded in the Project Operational Manual (POM), they were not fully analyzed and that the Environmental Impact Assessment (EIA) was not fully completed. On poverty, the QAE indicated that the project did not clearly assess its impact by income group. The QAE also noted that financial management information systems and reporting were not fully addressed.

Anticipation of risk. The QAE section on risk assessment indicated that the main country risk of insufficient counterpart funding was adequately addressed by requiring the necessary budgetary allocations. Noting the success of the previous project, combined with strong government ownership and the APL approach as a mechanism for adjustment, risk assessment was rated as Highly Satisfactory.

4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective:Since the inception of the National Community Water and Sanitation Program (NCWSP) in 1994, the Bank has financed a number of CWS projects to support the implementation of the national sector strategy. However, the CWSP2/1 is the first CWS project that places districts in the driver’s seat and directly provides funding to DAs. Putting the DAs at the center of decision making process was particularly challenging due to (i) DAs’ weak capacity, (ii) the need for CWSA and DAs to adjust to their new roles, (iii) the initial lack of support by some stakeholders in the approach, (iv) the Government's delay in the release of the District Common Fund allocation, and (v) the sudden surge in demand for goods and services at the DA level.

Implementation pace was initially slow as capacity building efforts took a while to yield the required results. Disbursement was in turn, slow, and less than 30% of the credit was disbursed as at mid-term review. However, after implementation capacity was effectively developed through the learning-by-doing approach, the implementation pace accelerated. By the close of project, 100% of the credit had been disbursed and most targets were largely exceeded. The project also generated significant demand for more

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community subprojects, which will be funded through the Community Based Rural Development Project (CBRDP) (see section 6.2). Hence, despite initial implementation challenges, the decentralized approach of the project was largely successful. This approach has been emulated by some donors active in the rural water sector in Ghana including DANIDA. The project’s outcome is therefore rated Highly Satisfactory, as the project exceeded the water supply access target set in the project objectives, and succeeded in developing capacity at the national, district, and community levels for the delivery of sustainable water and sanitation services. In addition, the project achieved the triggers of the first APL phase (see Annex 9).

The project successfully implemented decentralized delivery of water and sanitation services at the local government level thereby institutionalizing the process of planning and implementation in participating DAs. Communities have had their capacities developed through training of gender-balanced WATSAN Committees and Water Boards, Latrine Artisans, Area Mechanics and Pump Caretakers and have been fully involved in planning, construction and O&M of their water and sanitation facilities. The Community Ownership and Management (COM) approach, private sector responsiveness to district demand for services, promotion and technical support from RWSTs are key factors that have contributed to the effective delivery of water and sanitation facilities and will ensure sustainability of these facilities.

The achievement of the four specific project objectives and outputs is evaluated as follows (see Annex 1 for the performance indicators):

Objective (a) - Implementing demand-responsive and sustainable Community Water Sanitation (CWS) services, providing basic drinking water and sanitation facilities to about 550,000 people in rural communities.

The project achievement of objective (a) is rated Highly Satisfactory. Access to safe water supply and sanitation in communities and small towns in Ghana is low (less than 50% for water) and requires concerted effort to achieve a scaling up of sustained access. The project succeeded in contributing towards this national priority by providing an estimated 794,900 people (representing about 6% of the total rural population in Ghana) in 2,000 communities with safe water supply and sanitation facilities. This increase in access to safe water supports efforts of the Governement to meet Millenium Development Goals (MDGs) in water supply and sanitation.

Indicator Target Achievement RemarksAccess 550,000 people 794,900 144% achievementCommunities adequately using and managing their facilities

980 2014 200% achievement

Objective (b) - Strengthening community capacity to manage services The project achievement of objective (b) is rated Satisfactory. This rating is supported by (i) the presence of over 2,000 communities adequately using and managing their water supplies, doubling the initial target of 980; (ii) 90% of the communities submitting subproject proposals that were appraised and approved, whereas the original target was 85%; and (iii) the high number of gender balanced WATSANs (3,143) and Water Boards (41) formed and trained in various aspects of community management of water and sanitation facilities. The project demonstrates the high impact of gender and its importance, which is central to the management of water and sanitation at both household and community levels. Gender balanced

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WATSANs are an indication of more involvement of women in water-related decision making. The project also provided technical assistance to the communities to help them prepare and submit their proposals. The high percent of appraised and approved community subproject proposals (90%) illustrates the extent of community strengthening.

Objective (c) - Developing district-level capacity to deliver CWS services, encouraging an active role by the private sector and NGOs in delivering goods and services and assisting DAs in planning and providing community support in service planning, implementation and management.

The project achievement of objective (c) is rated Satisfactory, supported by the following: (i) the high number of participating Districts, with active District Water and Sanitation Programs, which met their contributions to capital cost; and (ii) the number of active private sector providers at the District level. 42 Districts out of a total of 135 in Ghana are actively implementing water and sanitation programs, while the original target was 32. Each of these 42 districts met the entry requirements by having a District Water and Sanitation Plan (DWSP), a District Water and Sanitation Team (DWST) in place, and ensuring a budgetary allocation of their 5% contribution to capital costs. DAs had initial difficulties meeting their financial contributions to capital cost due to delays in the release of the District Assembly Common Fund (DACF) by the Central Government, which adversely affected project implementation at the beginning. This situation however, improved after funding was provided through the series of Poverty Reduction Strategy Credits (PRSCs) by the Bank and the Multi-Donor Budget Support (MDBS) program to the Government.

Although the project succeeded in creating a very high demand for water and sanitation services supported by the high number of community subproject proposals, one major issue affecting sound implementation is the weak project planning at the district level. DAs tended to select more communities for subprojects than they could possibly support in a given period of time, which created high expectations among communities. In the context of an APL, this over-commitment can be carried forward in the next phase; however, there is a need to strengthen the planning capacity at the District level. DAs in particular should match available resources to community demand while maintaining the overall momentum for enhancing delivery in the sector.

Private sector activity at the district level was significant and DAs issued over 300 contracts to the private sector. This level of activity was positive for the private sector and for the water sector in general, as it encourages the development of a vibrant local private sector which can respond to demand from DAs. In a number of cases, there were multiple awards to firms across different Districts and Regions.

Objective (d) - Strengthening CWSA's capacity to assume the facilitator role

The project achievement of objective (d) is rated Satisfactory, as CWSA and its Regional Teams (RWSTs) internalized their roles as facilitators. The management fee concept to cover incremental costs associated with DA support was operationalized with CWSA, and the Agency improved and maintained a Monitoring and Evaluation (M&E) system (see Annex 1). This national M&E system, the Financial Management software (NAVISION) and the recently updated Strategic Investment Plan with projections for achieving the MDG targets for water by 2015, all enhance national program management. At present, the national M&E system is deployed at the RWST level and is aggregated at the national level. The M&E module is also being deployed at the DA level as well, where indicators on subproject implementation can best be monitored.

The project also funded management training for CWSA staff, which among others, was designed to assist

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the Agency transition from an implementation role to that of facilitation. Incremental costs associated with RWST coaching and guidance to DAs were met from the management fees ($1.3m IDA). Though this amount was to be additional resources over and above the core operating costs, in reality it offered CWSA relief from an under-funded budget. Therefore, aspects of the management fees, such as the incentive pay for staff and funding of study tours, were not fully implemented. A learning-by-doing approach enabled both CWSA and the DAs to adapt to their new roles during the project.

4.2 Outputs by components:Component 1 – Community SubprojectsPAD US$ 21.1 million, 75% of total cost; Actual disbursed US$22.96 million (71%)

The overall output of this component is rated Highly Satisfactory. Access rules for subprojects were clearly defined in the Project Operational Manual (POM) and were known and understood by the DAs and the communities. Targets for community subprojects including delivery of water and sanitation facilities and training of community-based WATSAN committees were largely exceeded.

Access rules transparently outlined the process, with clear criteria for district selection, community pre-selection and community subproject appraisal. The subproject cycle and processing of sub-project grants were clearly outlined to stakeholders, with all the sub-project steps including: district selection, community pre-selection, subproject appraisal criteria, financial policy, technical design criteria, minimum content of social process, linkages between community and DA, and supporting documentation. The process of community selection was based on the “first-come first-served” principle. Of importance was for DAs to ensure that all communities received the information on time so that they could submit their applications without being disadvantaged by a delay in accessing the information.

All the physical targets for water supply and sanitation were exceeded, except for the household latrine component, which achieved 96% of the target. Table 1 below summarizes the major outputs, while Annex 1 provides more details.

Table 1: Summary of the Outputs under Component 1Outputs Target End of the project Achievement in %Number of Pre-selected communities 1,200 3,292 274Number of Pre-selected Communities that submit acceptable proposals which are appraised, approved and funded by DA.

980 2,963 302

Number of Boreholes drilled 1,200 2,723 227Number of Hand Dug Wells built 380 57 15 (due to low

community demand)Number of Small Towns Systems rehabilitated 17 9 53 (due to initial

low DA demand)Number of House hold Latrines completed 6,000 5,818 96Number of School Latrines completed 240 440 183

With respect to small town facilities, nine small towns were rehabilitated, while an initial batch of 30 small towns is being prepared for construction under the new Small Towns Water Supply and Sanitation Project. The low delivery of small town water supply systems was largely caused by an initially low demand for small towns by Districts. Implementation was demand based and under CWSP-2/1, District demand was initially towards point sources as DAs were more inclined in the early stages of the project to allocate their resources to cover a larger number of rural communities rather than a few small towns. As this was their first experience with contracting under the project, and the first time that RWSTs were 'coaching' the DAs, this was a reasonable development.

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The household latrine target was not met, as the delivery was initially slow, until the strategy was revised at mid-term review resulting in an acceleration of the delivery thereafter and 96% of target was achieved. The initial approach to household sanitation was to provide subsidies only if at least 50% of households request a latrine; however, this approach resulted in serious delays and a lag in delivery. This strategy was subsequently revised at Mid-Term Review.

Component 2 –Sector StrengtheningPAD US$3.2 million, 11% of total cost; Actual disbursed US$3.07 million (96%)

The overall output of this component is rated Satisfactory. As stated above in both objectives (b) and (c), capacity building through training of DAs, private sector, and NGOs was conducted to ensure a strong delivery capacity at the district level. In terms of strengthening private sector and NGO capacity for long-term delivery of goods, equipment and services to communities, the number of service providers trained and or operational at the district or the community level is summarized in table 2. 42 districts have an active water and sanitation program (see Table 3). CWSA complemented with project resources a PPIAF grant to develop a private sector support strategy for local Small and Medium Enterprises (SMEs) operating in the water sector.

Table 2: Summary of the number of service providers trained and or operational under component 2.Service Providers Number trained and/or

operational at the District/Community level

Latrine Artisans 498Hand-Dug Well contractors 19Area Mechanics 35

Small Town operators 2

Consultants for TA services (31) and drillers (24) were awarded more than one contract across the 42 districts. Table 3 shows the breakdown of their active presence in the participating regions:

Table 3: Summary of districts with active water and sanitation program as well as TA consultants and drillers active in districts. Participating Regions Districts With

Active Water and Sanitation Programs

TA Consultants active in Districts (Point sources and small towns)

Drillers active in Districts (point sources)

Ashanti 13 8 8Brong Ahafo 13 6 6Upper West 5 7 2Upper East 6 8 7Northern (Pilot District) 1 1 1

Western (Pilot district) 4 1Total 42 31 24

About 120 DA staff received various forms of training ranging from computer literacy and financial management coaching to supervision of latrine and hand-dug well construction. DAs also received an

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annual financial allocation for logistical support to the DWSTs including the purchase of motorcycles and office equipment to enhance their operations.

Component 3 – Program Management PAD US$2.5 million, 9% of total cost; Actual disbursed US$5.59 million (17.3%)

The overall output of this component is rated as Marginally Satisfactory, as the management fees were supposed to cover the incremental costs of CWSA associated with facilitating District implementation of the project; however, the management fees were used to supplement an under-funded CWSA budget thereby limiting its intended impact.

4.3 Net Present Value/Economic rate of return:The economic analysis in the PAD and thus the Implementation Completion Report (ICR) focuses on the water and sanitation community subprojects subcomponent of the project, which represents 71% of total project costs. The economic analysis for the ICR is based on the assumptions of the CWSP-2/1 PAD, Annex 4: Cost Benefit Analysis Summary, updated with unit cost estimates from the CWSP-2/1 Unit Cost Study, as updated, and the Impact Assessment Studies for CWSP-2/1 preparation.

The project team’s original cost-benefit estimations used in the PAD were not available at the time of the ICR. Therefore, the PAD estimates were recalculated from the assumptions provided in Annex 4 of the PAD. The ICR uses the same methodology, updating the average actual unit cost information for borehole and hand-dug well installation from project implementation.

Sensitivity analysis completed for the ICR is based on two scenarios: The first, accounting for an average 70% well success rate, and the second, inclusion of the costs of the sector strengthening and project management components into total physical costs so as to capture all costs associated with improving access to water.

Table 4: Economic/Internal Rate of Return PAD ERR ICR IRR

Borehole Baseline 35% 21%Hand-Dug Well 18% 32%Borehole Sensitivity – Lower Bound N/A 14%Hand-Dug Well – Lower Bound N/A 15%

Alternatively, analysis of actual project costs for physical facilities (water points and latrines) and accompanying community development yields actual per capita unit costs as noted below. These end-of-project per capita unit costs are lower than either pre-project or mid-term review estimates. This was noted in the CWSA Unit Cost Study and the Evaluation of Selected Aspects of Implementation of CWSP-2/1 in Support of CWSP-2/2 Preparation (Africon Report). Per (water point) facility unit costs are estimated in the range of $5,000 to $6,000.

Table 5: Actual Cost Per CapitaCategory Actual Total Actual Per CapitaPhysical Facilities $18.61M $23.40Community Development $4.35 M $5.47Total $28.87

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4.4 Financial rate of return:The PAD calculates ERRs with no specification as to how financial NPV analysis and IRR calculations would serve as a measure of economic benefits arising from the project. Lacking the required PAD assumptions converting financial returns to economic returns, the ICR assumes that the financial returns closely approximate economic returns. This assertion is supported by the adjustments of incremental financial costs (capital investment and O&M) for inflation in the IRR calculations. Time savings estimations, rather than water fees collections, largely determine the economic success of the project.

4.5 Institutional development impact:The institutional development impact of the project is rated as Substantial based on (i) the outcomes of the community-level technical assistance, sector strengthening, and project management components (see Section 4.1), all of which contribute to capacity building of the sector, and (ii) improvements in sectoral policy formulation and implementation as a result of CWSP-2/1 implementation.

The new draft water policy requires CWS projects to be implemented at the district level showing the success of CWSP-2/1 in providing evidence that DA implementation is feasible. Indeed, prior to CWSP-2/1, implementation of rural water programs was still centralized and arguments were made against District implementation on the basis of District's weak capacity. However, through the CWSP-2/1 participating Districts assumed the role of project implementers and CWSA the role of facilitator, consistent with the decentralization agenda of the Government. The learning-by-doing approach throughout project implementation and the targeted capacity building programs resulted in capacity being developed at the District level and helped both DAs and CWSA internalize their respective roles. Hence, sector policy dialogue and formulation of rural water supply and sanitation projects have been enriched as a result of the experiences gained from CWSP-2/1 implementation.

5. Major Factors Affecting Implementation and Outcome

5.1 Factors outside the control of government or implementing agency:Factors outside the control of the Government and CWSA included: (i) unfavorable hydrogeological conditions in some districts, affecting siting/drilling success rates, and the issue of natural fluoride contamination of groundwater in parts of the Upper East Region; (ii) delays in mobilizing the 5% capital contributions in small towns; and (iii) capacity of local private sector to provide adequate numbers of drilling rigs to complete drilling in a timely fashion.

5.2 Factors generally subject to government control:Factors subject to government control were (i) ensuring timely availability of the 5% DA financial contribution to capital costs; (ii) inadequate number of staff at DA level to match significantly increased workprogram; (iii) the transfer of DA staff trained under the project, which adversely impacted the effectiveness of training and follow-up in the project; and (iv) limited incentives for private sector to invest in spare parts, which is a concern for sustainability.

5.3 Factors generally subject to implementing agency control:Factors subject to implementing agency control are (i) the irregularity in submission of Statements of Expenditures (SoEs) by the DAs; (ii) the limited proactiveness in addressing dry, low yielding and fluoride-contaminated wells; (iii) the irregular annual updates of the District Water Sanitation Plans (DWSPs); and (iv) poor use of the contract award monitoring database to properly coordinate advice on decisions regarding multiple awards to contractors and consultants operating across different geographical regions when capacity was an issue.

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5.4 Costs and financing:Annex 2 provides the detailed information on project costs and financing. The total project costs were estimated at SDR 18.7 million, or US$25 million equivalent. The final costs are $27.97 million (IDA), i.e. 120% of the Project Appraisal Document (PAD), due to the strengthening of the SDR against the dollar over the project implementation period. The project original closing date was extended by 18 months. The delay resulted from an extended period of learning of new roles by the relevant institutions, namely CWSA Head Office and its RWSTs and the DAs. In particular, the districts went through an intensive and extended period of capacity-building in procurement and project implementation which resulted in an initially low implementation pace and disbursement rate for this decentralized operation.

6. Sustainability

6.1 Rationale for sustainability rating:Sustainability for this first phase of the APL is rated Likely. The resilience of CWSP2/1 to risk of net benefit flows over time, as noted in the PAD, rests on two key elements: community willingness and capacity to manage and sustain services, and availability of goods and services in the local markets.

Community management within CWSP2/1 was strengthened in terms of community (WATSAN and WSDB) organization, financial management, operation and maintenance, and hygiene/sanitation practices. WATSANs were assisted to draft their own constitution and prepare Facilities Management Plans. The focal role that Districts are now playing under this project also places them closer to the needs of communities, which will enhance the post-construction monitoring and support. In addition, the role of DAs will be even more strengthened with the passing of a set of new legislation including the Local Government Service Act and the Procurement Act.

Arrangements for post-construction operation and maintenance of the facilities have been implemented and include the following: establishment of the WATSAN Account, training of Pump Caretakers, mobilizing funds for O&M and the identification and training of Area Mechanics. The sustainability is also likely based on four indicators: (i) DAs have been strengthened and now have an active water and sanitation program, allowing them to plan water and sanitation facilities with a long-term vision; (ii) DAs are actively contributing financially to CWS services as 100% of DAs met their financial contributions towards investment costs and 83% have certified audit accounts; (iii) under the project, approximately 656 service providers have been trained or are operational, despite the fact that this indicator has to be coupled with a sustainable supply chain; and (iv) a stakeholder assessment (CWSP 2/2 Community Participation Assessment and Stakeholder Workshop, September 2004) conducted in 20 point sources across the 4 regions, randomly selected to ensure a representative sample. The assessment shows that 12 communities raised the O&M by a monthly flat rate to be paid by each household or individual, 7 communities were charging an amount (50 to 100 cedis per bucket), which is set as a sufficient amount to cover future breakdowns.

Sustainability in terms of scaling-up can be assessed by reviewing the unit costs as detailed in Section 4.3 above. Facility level unit costs are competitive with those projects implementing through more centralized delivery chains. However, private sector investment in hand-pump spares in local markets is a continual challenge due to limited profitability margins of spare parts businesses. Government-imposed price ceilings on spare parts serves as the primary disincentive to local business entry and survival. With regards to follow-on technical assistance to communities, communities are still learning to approach the DWSTs as their primary source of technical advice. These DWSTs are being integrated into the Districts’ Department of Works so as to ensure long-term integrated support of community-managed infrastructure. This support is key to assuring communities’ access to technical assistance.

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6.2 Transition arrangement to regular operations:CWSP-2/1 is the first part of a three-phased APL, of which the second phase CWSP2/2, has been redesigned so that delivery of community point sources will be carried out under the Bank-financed multisectoral Community Based Rural Development Project (CBRDP) while delivery of piped schemes in small towns will be maintained under the Small Towns Water Supply and Sanitation Project (STWSSP). During the simultaneous preparation of the second phase of the CWSP2/1 and the CBRDP, both of which had rural water supply components and were to be DA-implemented, the need to harmonize the two projects became apparent.

The process of harmonization culminated in the CBRDP focusing on the delivery of point sources while the second phase of CWSP2/1 (STWSSP) focused on small towns water supply and sanitation. This change in scope though occurred quite late in the preparation stage and presented quite a challenge for both the Bank and the Client. To ensure smooth implementation, a Memorandum of Understanding (MOU) has been entered into between the CWSA and the MLGRD spelling out the roles and responsibilities of both institutions regarding the delivery of point sources. This harmonization also allows CBRDP to benefit from integration of the successful approach to point service provisioning and sustainability in water service, while also assuring a focus on small towns implementation through a targeted sectoral operation.

7. Bank and Borrower Performance

Bank7.1 Lending:The Bank’s performance during lending is Satisfactory. The project included the lessons learned from CWSP1 and applied the right tools to implement a decentralized approach at the district level. The Quality Assurance Group rated the Quality At Entry Highly satisfactory (see section 3.5).

7.2 Supervision:The Bank’s supervision is rated Satisfactory.The high quality of Bank lending and supervision can be attributed to the following factors: (i) a complementary mix of Washington and Country Office staff; (ii) an optimal mix of technical expertise in water supply, sanitation, community development and gender, hygiene, procurement, and financial management; (iii) continuity of the core task team through the span of project implementation through to preparation of the follow-on project; and (iv) sustained commitment to the approach of district-level implementation from Bank management as well as from the Government. Most notably, as the Task Team Leader (TTL), the Financial Management and Procurement Specialist are all located in the Ghana Country Office, continuous and seasoned support to CWSA and DAs was provided.

All of the issues mentioned in this ICR such as the delay by DAs in submitting financial returns (SOEs), the cash flow from centre to districts, the incidence of dry wells in some areas, fluoride contamination of wells in parts of Upper East, household sanitation delivery approach and DA financial contributions were raised in the supervision Aide Memoires and solutions were discussed and agreed upon with the implementing agency. In addition, the supervision team ensured a continuous coordination and dialogue with other donors working in the water sector. For example, a joint sector review mission was conducted with major donors in the sector as well as ensuring active participation in water sector Development Partner/Government meetings.

7.3 Overall Bank performance:The overall rating of the Bank’s performance is Satisfactory.

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Borrower7.4 Preparation:The borrower’s performance in preparation is rated Satisfactory. The sector Ministry supported the preparation of the project and CWSA provided a team to prepare the project. Though there were strong initial objections to the district-based implementation approach from within the Agency on the basis of weak DA capacity, CWSA staff took up the new challenge and contributed to project preparation. A pilot phase preceded the full-scale project and provided useful lessons for project design. The Project Operational Manual (POM) was widely discussed and several implementation issues addressed, characterizing the high quality of the document.

7.5 Government implementation performance:The government implementation performance is rated Satisfactory. Though there were differing opinions in the donor community and at times within CWSA on the policy of District contribution to capital costs, the Ministry of Works and Housing and Ministry of Finance and Economic Planning (MFEP) firmly committed to this policy provision. The sector Ministry was proactive in following up on the problem of DA contributions by arranging an inter-Ministerial consultative process with the Ministry of Local Government and the Office of the Administrator of Common Fund to find ways of improving DA financing of its contribution. The MFEP and the District Assembly Common Fund (DACF) Administrator were strong in their support to resolve the initial problems with the DA contributions and discussed various measures to address the issue including effective use of other sources of funding such as the Highly Indebted Poor Countries (HIPC) savings to meet this requirement.

Even when the disbursement level was low during the initial phase of the project, there was Government commitment to the approach which signified that long term institutional development objectives were a priority.

7.6 Implementing Agency:The implementing agency performance is rated Satisfactory.CWSA during implementation had to move effectively from its former role as implementer to its new role as facilitator. This required an intensive period of redefining roles and responsibilities vis-a-vis DA implementation.

i) Regional Water and Sanitation Teams (RWSTs): RWSTs, as regional offices of CWSA, supported the DAs during implementation. RWSTs internalized their roles as they carried out all reviews of DA procurement and guided the 42 DWSTs in the technical aspects of their work. This “learning-by-doing” approach was very intensive and demanding for the Regional staff who had to balance the need to achieve targets with the need to build capacity for implementation. Despite these implementation challenges including an initial steep learning curve, project implementation pace picked up and targets were largely exceeded.

ii) CWSA Head Office:CWSA Head Office staff provided dedicated support to the RWSTs during the project especially in the area of planning, budgeting and financial management. Overall project management though could have been stronger. Multiple donor demands on the limited staff, and a heavy workload of the Finance Department were some of the factors constraining improved project management. There was, however, a marked improvement towards the latter half of project implementation with regular and effective project management meetings. A proactive approach towards problem solving, tighter project management, and strong technical backstopping for RWSTs are necessary in the implementation of the follow-on project.

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CWSA developed monitoring and evaluation indicators (see annex 1) and consolidated the information provided by regions. This monitoring and evaluation framework enables benchmarking the achievement among regions and identifying proactively potential bottlenecks.

7.7 Overall Borrower performance:The overall rating of the borrower performance is Satisfactory.

8. Lessons Learned

1. Decentralized delivery of water and sanitation services has potential for scaling-up access.

• Decentralization has potential for scaling up access: The project’s ability to exceed the access target in the Development Objective by an additional 40% coupled with the strengthening of local institutions and systems to ensure sustained delivery capacity demonstrates the potential of decentralized water and sanitation services to contribute significantly to the scaling up of access in CWS.• Strong District Ownership and Leadership is Key: Districts that demonstrated strong ownership of the project and commitment to results were able to take advantage of the available project resources to deliver more community subprojects.• Funds Flow From Center to Local Level should be efficient: The pace of implementation depends a lot on the efficiency of resource transfers from the Center to the Districts. Strengthening of financial management systems and oversight as well as implementation capacity is necessary to ensure quick turnaround of project funds by Districts.• Capacity building strengthens implementation and operation and maintenance: Capacity building for implementation at local level and the existence of clear and enforceable “rules-of-the-game” contributes greatly to the success of decentralized implementation. “Learning-by-doing” approach to capacity-building is time-consuming but has proven to be effective. Developing implementation capacity is initially slow but when fully achieved results in accelerated delivery of services. Maintenance is ensured by the communities putting in place financing arrangements for meeting the operation and maintenance costs.• District planning underpins strategic decision-making: Weak District planning undermines project implementation and often results in a mismatch between available resources and commitments. DWSPs should be maintained as the key planning tool.

2. Adequate capacity on the supply side is necessary to respond to scaled-up demand.

• Private sector capacity to respond to demand is crucial: Increased demand for water and sanitation services requires corresponding capacity on the supply side to match. Forty-two (42) DAs advertised for works, goods and services and the capacity of the private sector to respond adequately to the surge in demand was severely tested. Though this generated a lot of private sector activity at the District level with about 300 contracts being awarded, there were also issues with the limited capacity of the private sector, notably in the drilling industry. Private sector support initiatives should therefore be tailored to develop capacity of SMEs in the water sector to respond adequately to business opportunities emanating from local demand and could be supported by projects or be part of the overall government capacity building programs. • Adequate supply chains promote efficient and sustainable delivery: It is important for handpumps that meet sector specifications to be readily accessible through local suppliers to Districts implementing water programs. The one-stop-shop approach was thus designed to stimulate local supply response to handpump demand and to eliminate potential coordination and timing problems arising from split responsibilities for borehole construction and handpump installation. A key lesson is to ensure

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sufficient advance mobilization is provided to drillers to procure handpumps upfront of the drilling works and to ensure adequate integration of Area Mechanics in the installation process to keep this industry vibrant for sustainable post-construction maintenance. 3. Effective marketing of sanitation and offering cheaper options will contribute to scaling up sanitation.

• Effective promotion of sanitation and cheaper sanitation: The project design recognized that significant benefits could only be derived if at least half of community members owned latrines and made this an access criteria for subsidies. This approach was difficult to implement in practice and resulted in significant delays in the implementation of household sanitation delivery until the criteria was eliminated as an upfront requirement. A key lesson learned is to provide cheaper latrines (using for example local materials) and design sanitation interventions with an emphasis on sustained community-level marketing. Restrictive criteria for access to subsidies do not work.

4. Continuity of commitment to Demand-responsive approach ensures sustainability.

• Government and Bank Consistent in its Commitment to a Demand-responsive approach: Government of Ghana ownership was consistent at all levels, most notably the Ministry of Finance, the Ministry of Local Government, the Ministry of Works and Housing, and the Community Water and Sanitation Agency. Government-led dialogue with donors laid solid policy and institutional foundations. The project confirmed the appropriateness of implementation modalities in private sector management and sanitation and hygiene through first-year pilots. Lastly, the programmatic-level commitments to the demand-responsive approach initiated in CWSP1, as well as the continuity of GoG and Bank staff, assured a fluid transition into an APL approach of CWSP-2/1.• Demand Responsiveness promotes sustainability: Over 2,000 communities assisted by the project are adequately using and maintaining their water facilities. All these communities participated in the planning, proposal formulation, implementation and management of their facilities therefore ownership is strong. Gender-balanced WATSANS engaged actively with NGOs, private sector providers and the DAs in all stages of the subproject and made informed choices on appropriate levels of service on the basis of the available technical and financial options discussed with them. Arrangements for post-construction maintenance of the facilities including the establishment of the WATSAN Account, training of Pump Caretakers, mobilizing funds for O&M and the identification of Area Mechanics have been implemented. These elements will ensure the sustainable operation and maintenance of the facilities. In addition CWSA is in the process of establishing Monitoring of Operation and Maintenance Units (MOM) in all 10 regions (MOM units are already operational in several Regions) to ensure adequate follow up and support to DAs on post-construction sustainability issues.

9. Partner Comments

(a) Borrower/implementing agency:The borrower/implementing agency comments are provided in Annex 8.

(b) Cofinanciers:N/A

(c) Other partners (NGOs/private sector):Some of the issues discussed during two ICR debriefing meetings held with private sector consultants and contractors included the following: (i) adequacy of equipment in relation to borehole drilling, success rate and unit costs; (ii) timeliness of completion of contracts; hydrogeological factors affecting borehole success rates; (iii) length of tendering process; (iv) delays from consultants and contractors in submitting invoices

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for reimbursement by District Assemblies; (v) delays from District Assemblies in payment of invoices; and (vi) contract management issues, such as delay in payments.

The four following issues were discussed during an ICR debriefing meeting held with sector donor partners (AFD, CIDA, DANIDA, DFID, EU, JICA, and KfW): (i) management fees, (ii) the evolving role of CWSA, (iii) decentralization, and (iv) coordination of capacity-building activities. Specifics relating to the management fees focused on how to ensure a better use of the management fees (project facilitation vs. core budget support as stated above in section 4.1 Objective d), including a detailed accounting of services received for the fee. The evolving role of CWSA as facilitator was discussed and the need for CWSA to clarify its role to all stakeholders in order to achieve a common understanding was underscored. Decentralization centered on the capacity of DAs to hold bottom-line responsibility for infrastructure implementation. Some donor partners voiced concerns that their institutional procedures may not concord with the revised draft National Water Policy, which establishes project implementation at the DA level as the standard. The final issue was related to the need to coordinate capcity-building support provided by donors in order to prevent overlap and ensure optimization of support to the sector.

10. Additional Information

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Annex 1. Key Performance Indicators/Log Frame Matrix

Hierarchy of Objectives

Key Performance Indicators

Regional Data Achievement and Target

Program Purpose/Goal

End of Program

Ashanti B/Ahafo Upper East Upper West

Northern (Pilot)

Western (Pilot)

TOTAL

Ref KP1: Extend coverage of sustainable facilities to 85% of actual population in Ghana by 2009. (Vision 2020)

KP1: Number of communities adequately using, managing and sustaining improved service.

522 482 542 364 9 14 2,080 200% achievement. Target is 980

Project Development Objective:

Outcome/Impact

Ref KP2: Increase coverage and achieve effective and sustained use of improved community water and sanitation services in villages and small towns in 4 regions by end of Phase 1

KP2a: 550,000 people with access to CWS and adequately using, managing and sustaining their improved services by end of Phase 1

258,300 179,500 184,500 149,500 2,700 20,400 794,900 143% achievement. Target is 550,000

KP2b: 32 districts with functioning private sector delivery system of goods and services to support and sustain CWS by end of Phase 1

13

13

6

5

1

4

42 131% achievement. Target is 32

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End of Program


Northern (Pilot)

Western (Pilot)

TOTAL

KP3: CWSA operates efficiently to assume its role of NCSWP facilitator and policy development

Currently managing one project and efficiently too

-

Output from component

Output Indicators:

Ref KP5: Demand-responsive community proposals and facility management plans (FMPs) for improved services appraised and approved by DA and CWSA

KP5a: Total number of Pre-selected communities

877

801

930

645

25

14

3,292 336%achievement. Target is 980

KP5b:Number of Pre-selected Communities that submit acceptable proposals which are appraised, approved and funded by DA.

877

776

642

635

19

14

2,963 302 %achievement. Target is 980

Ref KP6: Water and sanitation facilities constructed in project areas.

KP6a: # of Boreholes drilled

861

609

646

598

9

2,723

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End of Program


Northern (Pilot)

Western (Pilot)

TOTAL

# of Hand Dug Wells built

40

8

4

5

-

-

57 15% achievement

Target is 380 Low demand for HDW.

KP6b: # of Handpumps fitted(BHs). Target 1,200

861

571

547

592

9

2,573 207% achievement. Target is 1,200

KP6c: # of Small Towns Systems constructed

1

6

-

Additional works on 13 sytems from Gap 2

2

9 53% achievementTarget is 17

Low demand for small towns systems.

KP6d:# of HH Latrines completed

4,041

926 390

229

108 -

120

5,814 96% achievement. Target is 6,000

KP6e: # of School Latrines completed

211

158

18

46

3

4


KP6f: # of communities where 50% of households have demanded latrines

N/A N/A N/A -

N/A - Policy changed at mid term review to accelerate pace

Ref KP7:WATSAN Committees and water boards formed and trained in organisation Management and community members in hygiene education

KP7: Number of gender-balanced WATSAN communities and/or Water Boards trained and functioning

877

801

722

722

9

12

3,143

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WSDBs Trained

12

19

10

2

43





End of Program


Northern (Pilot)

Western (Pilot)

TOTAL

Ref KP8: Private Sector and NGO capacity for long-term delivery of goods, equipment and services to communities strengthened.

KP8: Number of service providers (TAs, Artisans, Drillers, Consultants, Contractors, Suppliers, etc.,) trained and/or operational at the District/Community levels.

198: TA=8, Drillers = 8, Consultants = 9, HDW ontractors = 8, LA = 165

145: TAs =6, LAs = 110, Drillers = 6, Hydro Consultants = 5, HDW Contractors = 1, Small town Operator=1

180: TAs = 8, Mechs = 25, LAs = 140, Contractors = 7

107: TAs=7, Drillers=2, Consultants=2, Suppliers = 1, HDW Contractors=10, AM=10, LAs=75

13: TA=1, Drillers=1, Hydrogeological Consultants=1, Lartine Operators=10

13: TA(PHAST)=1;TA(PPIAF)=1;Private operator=1;Contractor(KVIP)= 1;Contractor(Small Towns)=1; LAs = 8

656

Ref KP9: DA capacity strengthened to provide support to communities in planning, implementation and sustaining of services

KP9a: Number of Districts with active District Water and Sanitation Programmes, trained and with capacity to fulfill role in CWSP2

13

13

6

5

1

4


KP9b: # of participating Districts that meet their 5% financial obligation

13

13

6

5

1

4


KP9c: # of contracts negotiated and/or signed by Districts and/or community

112

29

57

120

7

4

329

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End of Program


Northern (Pilot)

Western (Pilot)

TOTAL

Ref KP10: Efficient CWSA facilitation NCWSP, policy strengthening and management of CWSP-2

KP10a: Number of DAs with certified audited accounts as per cent of participating districts

83% 35 DAs covered. 7 of the 42 DAs were new.

KP10b: CWSA operates efficiently within approved budget lines.

Agency operated within budget

KP10c: Amount of resources disbursed by CWSA relative to approved budget.

Adequate

KP10d: Consensus built and sector policies and guidelines improved periodically through consultation with broad range of stake-holders.

Regional and National level consultations were held. Sector policy under review.

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Annex 2. Project Costs and Financing

Project Costs by Component

(Amounts are in USD million)

(in US $ equivalent) Appraisal Estimate Actual/Latest Estimate Percentage of Appraisal

Component IDA GOG Total IDA GOG Total IDA GOG Total

1. Subproject Grants (a) water and sanitation facilities 15.60 1.70 17.30 17.41 1.20 18.61 111.6% 70.6% 107.6% (b) community development 3.80 0.00 3.80 4.35 4.35 114.5% 114.5% 2. Sector Support and Training 3.20 0.00 3.20 3.07 3.07 95.9% 95.9% 3. Project Management 1.20 1.30 2.50 1.12 4.47 5.59 93.3% 343.8% 17.3 4. PPF Refinancing 0.80 0.00 0.80 0.62 0.62 77.5% 77.5% 5. Unallocated 0.40 0.00 0.40 0.00 0.0% 0.0% Total Project Costs 25.00 3.00 28.00 26.57 5.67 32.24

Project Costs by Procurement Arrangement (in US$ equivalent) Appraisal Estimate Actual/Latest Estimate

Expenditure Category ICB NCB Other N.B.F Total ICB NCB Other N.B.F Total 1. Community Subprojects 0.00 14.00 7.10 0.00 21.10 22.96 22.96 financed by IDA 0.00 13.00 6.40 0.00 19.40 21.76 21.76 2. Goods 0.60 0.10 0.20 0.00 0.90 0.52 0.52 financed by IDA 0.60 0.10 0.20 0.00 0.90 0.52 0.52 3. Consultant Services and Training 0.00 0.00 2.30 0.00 2.30 0.25 2.05 0.25 2.55 financed by IDA 0.00 0.00 2.30 0.00 2.30 0.25 2.05 0.25 2.55 4. Miscellaneous (PPF) 0.00 0.00 0.80 0.00 0.80 0.62 0.62 financed by IDA 0.00 0.00 0.80 0.00 0.80 0.62 0.62 5. Management Costs 0.00 0.00 2.50 0.00 2.50 5.59 5.59 financed by IDA 0.00 0.00 1.20 0.00 1.20 1.12 1.12 6. Unallocated 0.00 0.00 0.40 0.00 0.40 0.00

financed by IDA 0.00 0.00 0.40 0.00 0.40 0.00

Total Project Costs 0.60 14.10 13.30 0.00 28.00 0.25 26.15 5.84 0.00 32.24

Financed by IDA 0.60 13.10 11.30 0.00 25.00 0.25 24.95 1.37 0.00 26.57

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Annex 3. Economic Costs and Benefits

The economic analysis in the PAD and thus the ICR focuses on the water and sanitation community subprojects subcomponent of the project, which represents 71% of total project costs. The economic analysis for the ICR is based on the assumptions of the CWSP2/1 PAD, Annex 4: Cost Benefit Analysis Summary, updated with unit cost estimates from the CWSP2/1 Unit Cost Study, as updated, and the Impact Assessment Studies for CWSP2/1.

PAD and ICR results are summarized as follows:PAD ERR ICR IRR

Borehole 35% 21%Hand-Dug Well 18% 32%

The project team’s original cost-benefit estimations used in the PAD for Annex 4 were not available at the time of the ICR. Therefore, the PAD estimates were recalculated from the assumptions provided in Annex 4 of the PAD. The ICR uses the same methodology, updating the average actual unit cost information for borehole and hand-dug well installation from project implementation.

The major assumptions for the economic analysis are as follows:

§ A 15-year analysis period is used (number of years used in the PAD is unstated);§ Discount rate is 15%, as is the case in the PAD;§ Consumption is 20 liters per capita per day;§ Average community size is 300 inhabitants;§ 95% capacity utilization, decreasing 2% per year, except in year 5, when minor repair brings up to initial capacity utilization;§ Unit costs are estimated at $5000 per borehole and $2200 per hand-dug well;§ O&M costs for the analysis period are represented as 1/4 of installation costs for borehole and 1/3 of installation costs for hand-dug well;§ Benefits derive solely from time savings to households as a result of decrease in time spent fetching water;§ Time saved is calculated net of average fetching wait times at improved water sources. In the case of boreholes, it is assumed that 5/7th of the time used (i.e. weekdays) can be spent in commercially productive activities. In the case of hand-dug wells, this assumption is reduced to ½ time due to the incidence of hand-dug well siting in more rural communities; § The wage rate is estimated at 75% of the unskilled wage rate, as is the case in the PAD;§ Both investments and benefits accrue starting in 2003 due to delays in disbursement;§ ICR comparisons to the PAD are given in IRR terms due to the fluctuations in cedis over the project preparation and implementation time frame; however, cedi calculations have been normed to 1999 cedis (PAD rate).

Sensitivity analysis completed for the ICR is based on two scenarios: the additional cost of an average 70% well success rate and the implicit cross-subsidy occurring between the water and sanitation facilities sub-component and the community development sub-component, the sector strengthening and the project management components in terms of measurable benefits.

The combined sensitivity analysis results above test sensitivity to (i) decreases to 70% well success rate in siting and drilling as well as (ii) inclusion of ½ of the total project costs of the three non-infrastructural

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components as part of the economic returns to point sources. Results are as follows:

Sensitivity Scenarios: Boreholes PAD ERR ICR IRR

Baseline 35% 21%A: 70% well success rate N/A 16%B: Community/sector/project management strengthening

N/A 17%

A +B N/A 14%Sensitivity Scenarios: Hand-Dug Well PAD ICRBaseline 18% 32%A: 70% well success rate N/A 19%B: Community/sector/project management strengthening

N/A 22%

A +B N/A 15%

The cost-benefits estimation for the physical infrastructure component does not include either health benefits accruing to the consumption of improved drinking water nor does it include cost-benefits estimation for the community-based household and institutional (school) latrine facilities, which would also base benefits on health impacts. These estimates were not completed in the PAD and therefore no baseline for economic benefits and costs exists. Additionally, cost-benefits estimation of small towns systems was not included in PAD Annex 4 and therefore a comparison has not been featured here.

The community, sector, and project management strengthening sub-components have supported all of the community-led physical investments (i.e. the community-level improved point source, household and institutional latrine, and small towns piped systems sub-components), and so the sensitivity should be considered a lower bound on IRR estimations.

Furthermore, as 98% of CWSP2/1 point source construction has been boreholes, the borehole IRR should be considered the primary analysis for the ICR. Returns to both boreholes and hand-dug wells were calculated for the ICR, as they were both featured in the PAD.

Alternatively, analysis of actual project costs for physical facilities (water points and latrines) and accompanying community development yields actual per capita unit costs as noted below. These end-of-project per capita unit costs are lower than either pre-project or mid-term review estimates. This was noted in the CWSA Unit Cost Study and the Evaluation of Selected Aspects of Implementation of CWSP 2/1 in Support of CWSP2/2 Preparation (Africon Report). Per (water point) facility unit costs are estimated in the range of $5,000 to $6,000.

Category Actual Total Actual Per CapitaPhysical Facilities $18.61M $23.40Community Development $4.35 M $5.47Total $28.87

With regards to increasing access to water and social inclusion, a 2003 beneficiary assessment study of

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poverty and gender aspects of the Bank CWS Program noted that capital cost contributions were high across income-gender groupings, with ranging from 87% of poor, female-headed households to 96% of non-poor households. A similar 2002 Study of Community Contributions Towards the Capital Cost of Water Facilities indicates that 94% of the communities do not impose restrictions on individuals unable to contribute to capital costs, and allow fetching for those, most frequently single-resident elderly households, or households with disabled, sick, or unemployed residents, not able to afford the access tariff. In some cases, WATSANs / communities introduced a longer payment period, reduced payments, or accepted in-kind labor or other assets (harvests, for example) for these same households.

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Annex 4. Bank Inputs

(a) Missions:Stage of Project Cycle Performance Rating No. of Persons and Specialty

(e.g. 2 Economists, 1 FMS, etc.)Month/Year Count Specialty

ImplementationProgress

DevelopmentObjective

Identification/Preparation11/17/1998 10 MISSION LEADER (1);

INSTITUTIONAL SPECIALIST (1); SOCIAL SPECIALIST (1); (Robert Roche); COMMUNITY DEVELOPMENT SPECIALSIT (1); REGIONAL WATER and SANITATION GROUP (1); (Rudy Polson); (Charles Boayke); FINANCIAL MANAGEMENT (1); PROGRAM ASSISTANT (1)

11/17/1998 10 MISSION LEADER (1); INSTITUTIONAL SPECIALIST (1); COMMUNITY DEVELOPMENT SPECIALSIT (1); REGIONAL WATER and SANITATION GROUP (2); (Charles Boayke); (Letitia Obeng ); (Mercy Lawson Doe); (Anthony Oyo); MANAGEMENT SPECIALIST (1)

Appraisal/Negotiation06/17/1999 10 MISSION LEADER (1);

SENIOR COUNSEL (1); PROCUREMENT SPECIALIST (1); ENGINEER (1); COMMUNITY DEVELOPMENT SPECIALSIT (1); INSTITUTIONAL SPECIALIST (1); MANAGEMENT SPECIALIST (1); FINACIAL MANAGEMENT (1) REGIONAL WATER and SANITATION GROUP (1); PROGRAM ASSISTANT (1)

Supervision

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11/03/2000 4 ENGINEER (1); PROCUREMENT (2); FINANCIAL MANAGEMENT (1)

S S

02/15/2000 4 MISSION LEADER (1); PROCUREMENT SPECIALIST (1); CONSULTANT (1); FINANCIAL SPECIALIST (1); CONSULTANT (1)

S S

02/05/2001 6 TEAM LEADER (1); WATSAN SPECIALIST (1); PROCUREMENT (1); HYGIENE CONSULTANT (1); FINANCIAL MANAGEMENT (1); TEAM ASSISTANT (1)

S S

03/13/2001 4 TEAM LEADER (1); WATER & SANITATION SPE (1); SOCIAL SCIENTIST (1); COMM. DEV. SPECIALIST (1)

S S

07/14/2002 4 SANITARY ENGINEER (1); WATER & SANITATION SPE (1); CONSULTANT (1); TEAM LEADER (1)

S S

12/11/2002 4 TEAM LEADER (1); SOCIAL DEV. SPECIALIST (1); PROCUREMENT SPECIALIST (1); FINANCIAL MANAGEMENT (1)

S S

09/15/2003 5 TEAM LEADER (1); FINANCIAL MANAGEMENT (1); PROCUREMENT (1); MUNICIPAL ENGINEERING (1); TEAM LEADER, PHASE 2 (1)

S S

02/13/2004 5 Task Team Leader (1); Procurement Specialist (1); Program Assistant (2); Financial Management (1)

S S

10/07/2004 4 TEAM LEADER (1); PROCUREMENT SPECIALIST (1); FINANCIAL MANAGEMENT SPECIALIST (1); PROGRAM ASSISTANT (1)

S S

12/03/2004 4 TEAM LEADER (1); SOCIAL DEVELOPMENT SPECIALIST (1); PROCUREMENT SPECIALIST (1); FINANCIAL MANAGEMENT SPECIALIST (1)

ICR02/18/2005 4 TEAM LEADER (1); S S

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SENIOR ECONOMIST (1); WATER SUPPLY SPECIALIST (1); PROGRAM ASSISTANT (1)

(b) Staff:

Stage of Project Cycle Actual/Latest EstimateNo. Staff weeks US$ ('000)

Identification/Preparation 31 67,381.60Appraisal/Negotiation 16 34,777.60Supervision 203 284,911.08ICR 26 57,151.12Total 276 445,221.40

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Annex 5. Ratings for Achievement of Objectives/Outputs of Components(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)

RatingMacro policies H SU M N NASector Policies H SU M N NAPhysical H SU M N NAFinancial H SU M N NAInstitutional Development H SU M N NAEnvironmental H SU M N NA

SocialPoverty Reduction H SU M N NAGender H SU M N NAOther (Please specify) H SU M N NA

Private sector development H SU M N NAPublic sector management H SU M N NAOther (Please specify) H SU M N NA

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Annex 6. Ratings of Bank and Borrower Performance

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bank performance Rating

Lending HS S U HUSupervision HS S U HUOverall HS S U HU

6.2 Borrower performance Rating

Preparation HS S U HUGovernment implementation performance HS S U HUImplementation agency performance HS S U HUOverall HS S U HU

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Annex 7. List of Supporting Documents

1. Staff Appraisal Report, CWSP1, March 19942. Impact Assessment Studies for CWSP-2 Final Report, February 19993. Community Water and Sanitation Division (CWSD) Unit Cost Study, Final Report, June 19994. Project Appraisal Document of the Second Community Water and Sanitation Project Phase 1, August 19995. Quality Assurance Group, Quality at Entry Assessment, CWSP 2, April 20006. CWSP 2 Project Operational Manual (POM), 2000 version7. Implementation Completion Report, CWSP 1, January 20018. Study of Community Contributions toward the Capital Cost of Water Facilities, CWSA and Wardrop, April 2002.9. CWSP 2/1 PSRs10. CWSP 2/1 Aide-Memoires and Back-to-Office Reports (see Annex 4 for dates)11. CWSP 2/1 Mid-Term Review12. Findings. Poverty Reduction & Economic Management, November 2003. The first Ghana Community Water and Sanitation Project: Poverty and Gender Issues. 13. Evaluation of Selected Aspects of the Implementation of CWSP 2/1 in Support of CWSP 2/2 Preparation (Africon Report), May 200414. CWSP 2/2 Preparation Aide-Memoires and Back-to-Office Reports15. CWSP 2/2 Community Participation Assessment16. CWSP 2/2 Capacity Building Assessments17. Regional Implementation Completion Reports, CWSA: Ashanti, Brong Ahafo, Upper West Regions, February 2005

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Additional Annex 8. Borrower/Implementing Agency Comments

1.0 SUMMARY

The Second Community Water and Sanitation Project CWSP2 – was the first to adopt large scale decentralized approach in the planning, implementation and management of safe water supply and improved sanitation facilities/services in Ghana. The project design empowered the DAs to be at the pivot of rural/small town water supply and sanitation delivery. The methodologies and processes outlined under the project have been well accepted by stakeholders. Other rural water supply projects financed by DANIDA and ADB have followed similar design.

Due to effective facilitation by CWSA and commitment of DAs to increase communities’ access to sustainable safe water supply and improved sanitation services up to 794,900 persons instead of the target of 550,000 (Annex1), have been served with potable water and 5,814 household and 440 school latrines constructed.

Total project cost was US$32.24 million (see Annex 2 for details).

2.0 INTRODUCTION:

A. Project Objectives

The project objective of Phase 1 of CWSP2 was to increase service coverage and achieve effective and sustained use of improved community water and sanitation services in villages and small towns in four regions in Ghana. The programme assisted Ghana Government in: (a) implementing demand-responsive and sustainable water and sanitation services in rural communities and small towns; (b) strengthening the capacity of communities to manage such services; (c) strengthening district-level capacity to deliver community water and sanitation services, including the private sector and Non-Governmental Organizations (NGOs) to deliver goods and services and the capacity of District Assemblies to plan and provide support to communities; and (d) strengthening CWSA’s capacity to effectively play the role as facilitator in the implementation of the national-level community water and sanitation programme.

B. Project Description

The CWSP2/1 had three focal areas:

Investments: - test and refine decentralized implementation strategy as well as piloting community contracting,Capacity building: - Build capacities of DAs, NGOs, and private sector in 4 regions and also establish foundation for sustainable and competitive supply chain.Policy: - Support CWSA through pilot management support (management fee). Discuss and consult on decentralized approach and promotion of higher cost recovery.

C. Project Components and Geographical Coverage

The project had three main components: (a) Community Sub project; (b) Sector Strengthening and (c) Programme Management

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The community subprojects provided grants to communities and schools through their DAs for construction of water and sanitation facilities and to finance technical assistance and community development activities to strengthen community capacity to plan, implement, operate and maintain water and sanitation facilities in an effective and sustainable manner.

The Sector strengthening component was used to support: (a) local providers of goods and services (private sector and NGOs), (b) DAs and their District Water and Sanitation Teams and (c) national program development. Through the sector strengthening component provision of technical advisory services, equipment and training were given to the National Community Water and Sanitation Programme development. This included, among other things, initial equipment and vehicles for CWSA at both Head Office and four regional levels; participatory programme reviews by all stakeholders, applied research on topical issues, mass media campaigns for disseminating hygiene education and external impact assessment, exchanges with other countries, other special studies, including strategies for reducing unit costs of boreholes and sustainable spare parts distribution networks.

To re-emphasise integration of water and sanitation facility provision with hygiene promotion, and as part of the lessons learnt from the CWSP1 ICR, CWSA joined the global community on Public-Private Partnership (PPPH) in Hand washing Initiative early 2001. Themed “Ghana Truly Clean Hands”, the campaigns sought to prevent diarrhea related illness and deaths in Ghana by promoting the practice of hand washing with soap and water at critical times, especially among mothers and care givers of children under five (5) and school children throughout the country.

The third component, Programme Management, included CWSA remuneration on a fee-for-service basis for the incremental costs of managing CWSP2 and providing technical assistance to the DAs.

Table 1: Basic Geographical and Drilling Information.

Region Settlement Pattern

Type of vegetation Success Rate for borehole Drilling

% with access to safe water as at Yr. 2000**

% with access to safe water as at Yr. 2004

Ashanti Region Nucleated Forest & semi-deciduous forest

80% 32% 52%

Brong Ahafo Region

Nucleated Forest & semi-deciduous forest

70-80% 18% 43%

Upper East RegionScattered Savanna 65-70% 35% 55.6%Upper West Region

Scattered Savanna 65-70% 43% 68%

** Baseline information as found in the POM

D. Intended Major Project Outputs

The key results areas expected by the project included the provision of sustainable safe water to 550,000 persons; 32 District Assemblies with functioning private sector delivery system of goods and services to support and sustain community water and sanitation by the end of the project; and CWSA operating efficiently as facilitator of the NCWSP and policy development. Annex 1 column two shows the intended major outputs.

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3.0 PROJECT OUTPUTS AND KEY PERFORMANCE INDICATORS

3.1 Key Performance Indicators at the Beginning of Project

The second column of Annex 1 provides the summary list of the key performance indicators set at the beginning of project.

3.2 Change in Indicators at Mid-Term-Review or Any Other Stage of the Project

There were no major changes made in performance indicators at the mid-term-review. However few project refinements were made in the course of implementation, based on the recommendations from CWSA. These were: (a) the requirement that at least 50% of households in a community sign up for latrines before subsidy could be given was dropped. The project thus provided subsidies irrespective of number of households that applied for sanitation facilities in a community; (b) the closing date of phase 1 was extended from June 2003 to December 2004; (c) Ghana joined the Global Public-Private Partnership in Handing Washing Initiative as a means to intensify the integration of hygiene promotion with water and sanitation delivery; (d) the inclusion of two pilots to test the PHAST Approach to sanitation and hygiene promotion in the Western Region. (e) launching the PPIAF programme to pilot local private sector management of small towns water supply systems in the Western Region. (f) modification of the trigger indicators from Phase 1 to Phase 2.

3.3 Achievements of Project Performance Indicators (By Output)

Annex 1 (attached) shows the achievements by output. Targets for several outputs were exceeded. For instance 794,900 persons had access to sustainable safe water supply instead of the target of 550,000 persons.

4.0 IMPACT EVALUATION OF THE GOVERNMENT OF GHANA, CWSA, COMMUNITIES, NGO’s AND PRIVATE SECTOR

4.1 General Observation on the Project

The CWSP2 project was the first to practically implement the Ghana National Community Water and Sanitation Programme (NCWSP) and the CWSA Act, Act 564 of 1998 by making the DAs play pivotal roles in the planning, implementation and management of sustainable safe water supply and improved sanitation facilities and services. The procedures and processes adopted conform to government programs on decentralization, and participation of citizens in development efforts with the ultimate goal of reducing poverty.

Under the project, resources were channeled to districts based on their expressed demand as seen in the over 2,600 boreholes drilled, 57 hand dug wells and 5,814 household latrines and 440 school latrine constructed. As a result, the capacities of DAs and communities have been built for the provision of other communal infrastructure.

The project also created jobs through the private sector’s provision of goods and services.

4.2 The Government, CWSA and Communities Contributions

The Government of Ghana provided multi-disciplinary staff that facilitated the project at all levels – national, regional and districts. Thus personnel emoluments and administrative cost associated with the staff were

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borne by the Government of Ghana. At the local level, staff of the District Assemblies provided invaluable services of project co-ordination, planning, implementation and management. The DAs played pivotal roles by; (a) preparing and reviewing annual DWSPs; (b) signing of sub-project agreements with CWSA, (c) promoting projects in all communities; (d) ensuring the formation and training of gender-based WATSANs and WSDBs. (e) financing the operational expenses of the DWST; (f) making 5% contribution to the capital cost of water facilities; and (g) resolving conflict at the community levels.

The various participating communities contributed cash equivalent to 5% of the capital cost for water, gave much of their time by participating in meetings and discussions during the planning, and implementation of community sub-projects. For sanitation, individual households contributed 50% of the cost of latrines.

4.3 Popularity of the Project Activities at Community Level

The CWSP2 was popular among the participating communities judging from the high demand from communities for project support. The WATSANs, WSDBs and the communities were active at all stages of the project planning, implementation and management. By linking some communities to banks, the culture of savings has been inculcated into some, which is a necessary pre-requisite for poverty reduction.

However, the project suffered some set backs during implementation: (a) delay in project take off which was partly due to change of Government at all levels in 2001; (b) long time between application and facility provision due mainly to delayed mobilization of respective DA and Community 5% capital cost contributions and the drag in the application of the procurement rules; (c) delays in the installation of the hand pumps on drilled wells specifically in the UWR. This was as a result of procurement of wrong type of hand pumps, at the initial stages of the project

5.0 PROJECT ACHIEVEMENTS AND CHALLENGES

The following were the achievements and challenges of the project:

5.1 National

The POM, developed by the Government of Ghana provided detailed processes and procedure that guided project management at all levels. In addition, the CWSA developed such documents as: (a) Small Towns Water and Sanitation Policy; (b) Technical Design Guidelines; (c) Operation and Maintenance Guidelines; (d) Bidding Documents including standard specifications and standard drawings that were useful for programme implementation and management at the DA level. (e) hygiene and sanitation were given much focus through multi-media IEC (PPPH Initiative). The hygiene practice of Ghanaians especially nursing mothers, caregivers, school children, and food vendors to wash hand with soap was emphasized. The following awards were won:

• Chartered Institute of Marketing Ghana (CIMG) Best TV Award 2003;

• Advertising Association of Ghana (AAG) Gong-gong Awards 2003: Gold Awards TV (Corporate and Social Services), Gold Award Radio (Corporate and Social Services) and overall Platinum Award Best TV.

5.2 Regional and District (see table following)

5.3 NGOs and Private Sector

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Achievements and challenges of NGOs and the Private Sector run through all four regions.

Achievements • Capacities of the private sector and NGOs were enhanced.• The project created jobs for them.

Challenges • Inadequate equipment holding;• Limited managerial skills; and• Low capital base

5.2 Regional & District

Table 2: Project Achievements, and Challenges

REGION ASHANTI BRONG AHAFO UPPER EAST UPPER WEST

RWST

Achievements(a) Facilitated project in 13 out of 18 districts in the region; (b) Played lead role in fine-tuning TOR for Technical Assistants, Training of Latrine Artisans and Training of hand dug well contractors

Achievements:(a) Facilitated project in all 13 districts in the region. All participating DAs established the appropriate structures and institutions for effective planning, implementation and management. As in Annex 1, several targets set for the region (POM) were exceeded;(b) Supported DAs to implement demand responsive and sustainable community water supply and sanitation services to 179,500 persons through construction and rehabilitation of water points, piped systems and sanitation facilities.

Achievements(a) The RWST facilitated project in all 6 Districts;(b) The project has provided 150,000 persons with access to safe water and decent latrines; (c) The RWST forged close collaboration among all sector stakeholders with RCC support.

Achievements(a)All 5 DAs participated in the project.(b) The RWST got the RCC to play its catalytic role in co-coordinating project through routine quarterly stakeholder meetings and sharing of project information especially through the monthly project bulletin.

(c)Over-subscription for the projects by DA/Communities due to effective project promotion.

RWST

ChallengesInadequate financial resources to meet the demand generated;(b) Some DAs did not have adequate capacity to manage contracts, hence RWST had to provide much support in terms of coaching and frequent visits;(c) Financial reports from DAs on disbursements not

Challenges(a) Some key district officials such as District Finance Officers, Planning Officers etc. did not allocate enough time to the project, because of numerous projects being attended to by the same officers; (b) Difficulty in attracting drilling contractors to bid in

Challenges(a) Delayed Project time table due to unwitting tardiness of DAs in coming to terms with • The concept of “learning by doing”;• Novelty of political and fiscal decentralization;(b) Poor response to the 5% DA and community contribution;

Challenges(a) Delay in project take off due to late mobilization of 5% community contribution;

(b) Time for mobilization of funds (5%) was too short.(c) Lack of access to some communities at certain times of the year because of heavy rains.

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delivered in timely manner. (d) Poor performance of some private sector operators; especially borehole drilling companies e.g. in the Bosomtwe Kwanwoma District;(e) Difficult geological terrain in districts such as Sekyere East, Sekyere West and Ejisu Juaben made drilling difficult and costly.(f) Getting the RCC to play its co-ordinating and monitoring role in support of project implementation and management.(g) There was no budget for post project monitoring or follow up.

certain districts, e.g. Sunyani and Dormaa Ahenkro because drilling in these areas require special expertise; (c) Inadequate financial resources to meet the rather high demand generated through effective project promotion.

(c) Too many stages in the project cycle for a community to complete a sub-project early. It undermined interest of some community members;(d) Procurement delay and delayed financial reports from the DAs; (e) Delayed cash flow from CWSA Head office to the DAs for payments due of untimely financial reports from the DAs; (f) High fluoride content in ground water especially in the Bongo District.

(d) Difficulty in planning for the provision of safe water for seasonal migrants.(e) Non-availability of spare parts outlets in the region. The nearest shop is at Tamale, several hundred kilometers away.

DISTRICT ASSEMBLY

Achievements:(a) Have successfully integrated sustainable safe water supply and improved sanitation services, including effective hand washing practices in the district development agenda.(b) Resources from the project were used to enhance capacities of District Officials including DWSTs. Consequently requisite skills and capacities in safe water planning and management have been built among district staff.

Achievements:(a) All participating communities owned and managed the services provided. (b) Integrated Water-related sanitation and hygiene education, including effective hand washing practices throughout the process.(c) Integrated safe water supply & environmental sanitation in their annual work plans and budgets (viz. review of DWSPs).(d) DAs signed sub-project agreement with CWSA, promoted and disseminated information on CWSP2.(e) Ensured formation of gender balanced, active WATSANS/WSDBs.(f) Amicably resolved all conflicts on safe water supply and sanitation delivery.

Achievement:(a) Capacity building for DA staff, especially the DWST, DPCU and the Finance Officers and community members were achieved.(b) Project resources were made available for the furnishing of offices, purchase of computers, office equipment and other office supplies.

Achievements:(a) DAs effectively promoted project and generated very high demand for sub-projects;(b) The project promoted networking among DAs at the RCC level; (c) Capacities of DA staff were strengthened through training and equipment supply (computers, motor bikes, office supplies etc).

DISTRICT ASSEMBLY

Challenges:(a) Irregular release of the DACF, which is the primary source of funds for development activities; this

Challenges:(a) The sensitization of key project stakeholders overlooked RCC officials;

Challenges:(a) The endemic nature of poverty in communities limited their ability to have

Challenges:(a) High attrition rate of WATSANs, trained Latrine artisans, some DWSTs and PO staff;

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adversely affected the DAs ability to pay their 5% contribution as spelt out in the POM; (b) Delay in submission of SOEs by districts to CWSA. Delays were due to the following:(i) Limited Numbers of staff in the finance department(ii) Inadequate knowledge in computer skills(iii) Lack of incentive from the project for the accounting staff (and all otherDistrict Assembly staff working on the project).

(b) Attracting experienced contractors to participate in project;

(c) Mobilization of adequate financial resources to meet the high demand generated among communities.

effective demand (backed by financial resources) for the sub projects; (b) Irregular flow of project funds from CWSA Head Office adversely affected timely payments to service providers.(c) DAs spent much time in learning to follow procurement plans; (d)DA Finance departments appeared overloaded.

(b) Reluctance of people to serve on WSDBs due to lack of motivation; (c) DAs understaffed so adequate time could not be committed to Water and Sanitation activities

6.0 IMPACT EVALUATION OF THE BANK

6.1 Project Design

The project design was satisfactory. However, it would have been much better if the coordinating roles of the RCC had been well integrated into project implementation and management. In addition, the strategy for sanitation delivery in small towns was not well developed. Also there was no budget for post project implementation activities. Future projects have to address these issues in order to accelerate the delivery of sustainable safe water and improved sanitation services for rural communities and small towns.

6.2 Quality design and implementation support mission

The Task Team Manager and her/his able supported team worked with CWSA as partners in development. Issues and challenges were proactively addressed at all times of project implementation. The supervision mission provided useful technical assistance to the Agency and DAs. Experiences were shared and problems solved during such visits. The Aide memoirs had been useful tools of communication.

6.3 Government, CWSA and Bank Relationship

It was very satisfactory as there was reciprocal respect for each party.

7.0 LESSONS LEARNED AND RECOMMENDATIONS

A) Project Design

Due to the scattered settlement patterns in the Upper East and Upper West Regions, the design standard of 300 persons to one borehole should be reviewed downwards if the populations in these regions are to be adequately served within the standard 500 metres radius. Similarly, in order to reduce delays in project implementation, future project designs should include the development of standard simplified documents, such as bidding documents, design for latrines and various terms of reference for the engagement of the private sector to guide project management at the district and community levels. These documents should be available for use at project effectiveness.

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B) Demand Driven

To sustain community and district enthusiasm in a demand driven environment, the supply side of the project, in terms of the readiness and commitment of the private sector and timely fund flow to the local level, should be harmoniously planned and co-coordinated. From the field, it can be observed that demand responsive approach to delivery of water and sanitation facilities seem to be the best means to ensure sustainability as well as instilling into beneficiaries a sense of ownership.

C) Decentralized Implementation

The involvement of communities in mobilization and planning of their water and sanitation facilities led to effective and efficient project management and implementation. Through the project, decentralization and devolution of power were given further boost at the district and community levels. However, some DAs were still weak in terms of the support they gave to the DWSTs. Also, partisan politics sometimes affected the smooth running of the existing institution such as WATSANs and WSDBs

D) Capacity Building

The capacity-building element in the CWSP2 improved performance of stakeholders and it is reflecting in the output of the regions. DA evaluation and financial reporting skills have greatly improved over the period; Knowledge and skills acquired (at the community level) from safe water supply and related sanitation have been channeled into other areas of rural development.

Also sustained community mobilization and animation is important to ensure success of community level project implementation, which involves behavioral change. TA activities raised awareness in communities. Training of WATSANs helped them in fund mobilization and financial management. The TAs themselves built capacity as they interacted with communities. Women can also do excavation of pit for household latrine construction when effective animation has taken place. For instance in Vapuo, in the Upper West Region, the women dug the pit as almost all the men had embarked on seasonal migration. The logistical support to the private sector and the DA should be coordinated by the MLGRD to address timely and relevant capacity needs of these stakeholders and avoid duplication of efforts by various projects.

E) Stakeholder Consultation and Co-ordination

Institutionalizing quarterly project meeting at the RCC level helped in networking and information sharing (especially on the performance of the DA and the private sector) amongst all the implementing districts. Equally, quarterly management meetings amongst all the participating RWST, CWSA-Head Office and the World Bank, Ghana Office helped in resolving implementation problems/issues. In future, some DAs and service providers should be invited to participate in these useful project management meetings. At the ministerial level, effective consultation and co-ordination should be institutionalized especially between, CWSA, MOWH, MLG&RD, NDPC and MoFEP.

8.0 CONCLUSION

The CWSP2 has contributed greatly to minimize the incidence of water and sanitation related diseases in the beneficiary communities. Furthermore, the project has contributed immensely towards the Governments’ decentralization and poverty reduction agenda. DAs, through the project, have been empowered to play pivotal role in development programmes through effective planning, implementation and management –

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especially on contract management/administration.

Community ownership and management has been embraced and further enhanced through the empowerment of community institutional structures such as WATSANs and WSDBs.

Appendix 1: CWSP 2 PHASE 1 – IMPLEMENTATION PROGRESS STATUS AS AT 30TH DECEMBER 2004 (concords to Annex 1 in World Bank ICR)Appendix 2: PROJECT COSTS AND FINANCING (concords to Annex 2 in World Bank ICR)

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Additional Annex 9. APL Triggers Phase 1

APL Trigger APL Triggers Performance as of May 2004 and based on the correspondance of Minster of Works and Housing to Country Director.

Investment Efficiency of Decentralized Service Delivery Model80% of phase 1 implementation targets met (physical, social, and financial)

Trigger has been metPhysical: - Target 1,200 achieved 1,548- 1,108 hand pumps fitted, which represents 70% of the 1,582 point sources.- Target 7 small towns piped systems constructed. The 7 Number target would not been achieved; however, one CWSP1 rolled over system and six rehabilitation works have been completed. Target 6,000 household latrines. - Target 240 schools latrines. This target will be exceeded by the end of the project. Social:- Target: 980 communities adequately using, managing and sustaining improved services. Target is already exceeded as 1,150 communities are using and managing their improved systems. - Target: 550,000 people with access to CWS . Achievement: 550,000 people would be provided with access to CWS services by the end of 2004.- Target: 32 DAs with functioning private sector. Achievement: 38 active participating districts. - Target CWSA operating efficiently. Achievement: CWSA manage 10 projects in the CWSP2/1 regions. - 3,272 pre-selected communities of which 2,949 submitted acceptable proposal that were appraised. - 2,974 gender balanced WATSANs- 643 service providers trained and/or operational: Financial:- 38 participating districts meet their 5% obligation- 298 contracts have been negotiated

Phase 2 APL Triggers

500,000 people provided with access to improved water supply.

50,000 people provided with access to improved sanitation services.

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- 25 Districts have certified audited accounts - CWSA has not exceeded approved budget lines- CWSA have disbursed US$17,304,712.40 out of the budget line of 26,312,483.46.- Draft document”Drinking Water Policy” is drafted aimed at reaching consensus on sector policies and guidelines.


Effectiveness/Impact of Approach on Decentralized Implementation ModelDemand-based approach: at least 80% of pre-selected communities submit proposals, 85% of proposals are positively appraised and 100% of these are funded (within DA approved budget ceiling)

This trigger has been metMore than 80% of pre-selected communities submit proposals currently and within DA approved budget ceilings, more than 85% of proposals are positively appraised and 100% of these are funded.

Sustainability: 85% of water and sanitation systems properly functioning in sample area.

This requirement would be achieved.


District Level Capacity Strengthened80% of DAs participating in CWSP2 meet funding requirements within (district water and sanitation plan, support to District Water and Sanitation Team, Audited accounts, financial obligation met).

All 38 participating districts currently their 5% financial obligation.

APL Trigger APL Triggers Performance as of May 2004 and based on the correspondance of Minster of Works and Housing to

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Country Director. Sustainability Supply ChainsNumber of providers of goods and services working in each district increases over time.

The number of service providers trained and/or operational are 643 of which: TAs 30, Latrine Artisans 494, Drillers 17, Suppliers 1, HDW contractors 29, Area mechanics 52, small town operators 1, and consultants 19.


PolicyStake-holder consultation, including ESAs, NGOs and others (degree to which they participate in dialogue measured through client surveys and interviews),

This trigger has significantly been met: at the national level, bi-monthly donor meetings have been held to review various policy issues, including two stakeholder workshops on the direction of the 5% contribution to facility delivery; there was Annula Donor Joint Review meeting in 2000 and another is proposed for 2004. Project steering Committee meetings have been established on other development partner projects and these have been effective in shaping policies and strategies within the sector to date. The Annual NGO Review Meetings (referred to as the Mole Series) were held and a coalition of NGOs in the water and Sanitation sector is being established within the jurisdiction of the Ministry of Works and Housing.

Evaluation of program strategy, effectiveness, efficiency and impact: improvements to strategy, as required, based on monitoring and evaluation (measured through recommendations and actions presented at the Annual Sector Review).

Evaluation of program strategy, effectiveness, efficiency and impact: improvements to strategy, as required have been achieved through various studies as well Software and Technical forum, Project Steering Committee Meetings, District Level Round Table Meetings, Regional Stakeholders Review Workshops all of which feed into CWSA’s Annual Review Meetings with project operational concerns.

The Triggers below were in the original list of triggers, but were not kept in the MTR. Length of project cycle in community equal or less than under CWSA 1 (baseline is 18 months)Per capita costs of implementation: at least 10% lower than for CWSP-1 (baseline available in unit cost data base)Effective facility use: 70% of users demonstrate improved hygien, sanitation and environmental protection in sampled area Hand pump spare parts available for sale in 50% of the districtsTesting of methods for achieving increased cost recovery from communities ( 5% of sub-project grant components achieves at least 10% contributions from communities)Length of project cycle in community equal or less than under CWSA 1 (baseline is 18 months)Per capita costs of implementation: at least 10% lower than for CWSP-1 (baseline available in unit cost data base)Effective facility use: 70% of users demonstrate improved hygiene, sanitation and environmental protection in sampled area

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That at least five percent of subproject grant resources are channeled to communities for community contracting.

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