Master Thesis Presentation - Kingsley

Evaluation of Financial & Technical Performance of representative Small Town
Water Supply Systems in Ghana

MASTER THESIS PRESENTATION
KINGSLEY ENNINFUL
Masters Infrastructure Planning

20
th
October 2014
http://fosatconsult.com/fosat/FGallery/index.html
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CONTENTS
1. INTRODUCTION
Background of Study
Research objectives
Research Scope
Research Methodology

4. STUDY AREAS
STWSS in Ghana
Criteria for Selection
Details of Systems in
Study Areas

2. STWSS & EVALUATION IN LITERATURE
Small Town Water Systems (STWSS)
Pros and Cons of STWSS
Evaluation and its advantages
Technical & Financial Aspects of
Evaluating STWSS

5. PERFORMANCE EVALUATION
Methodology
Selected Performance Indicators
Technical Performance Assessment
Financial Performance Assessment

3. GHANA WATER SECTOR
Interventions
Stakeholders
Regional Coverage
Technical and Financial Aspects
Forms of Evaluation

2/20
6. CONCLUSION & RECOMMENDATIONS
Conclusion
Recommendations
Further Research

INTRODUCTION
Background of Study
Problem Statement
...as a country, there is a lack of conscious
and deliberate actions to ensure that
facilities keep working for as long as their
designed lives (Dotse, 2010).

Small Town Water Supply Systems
(STWSS) in Ghana are operating at;
low coverage
inconsistent service supply
low water quality
network inefficiency
Research Objectives
To examine STWSS and performance
evaluation mechanisms in literature.
To examine the performance of selected
representative STWSS in Ghana both
technically and financially.
To understand how evaluation of the selected
representative STWSS can influence policy
recommendations.

Research Methodology
Analysis of documents i.e. scientific
literature, textbook literature etc.
Analysis of existing data material,
Field studies & analysis of their
results.
Qualitative methods:
Verbal description,
Graphical description,
Quantitative methods:
Calculation of cost effectiveness
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STWSS & EVALUATION IN LITERATURE
The term Small Town Water Supply Systems (STWSS) has different meanings in
different parts of the world.
United States Environmental Protection Agency (USEPA) < 3,300 people
The Irish EPA < 5,000
In Russia <fewer than 10,000 people ( Tim et al, 2005 )
In developing countries like Ghana, a small town is;
Small in terms of population size (2,000 50,000 - CWSA).
Isolated and have scattered population.
Limited administrative skills.
Strong leadership and social structure are identified.
Smet and Wijk (2002)
Evaluation is a necessary stage in the cycle of any project as it tries to answer
the question Did the project work? (Carter, 2006)
Advantages of Evaluating STWSS
Significantly reduces service
interruptions.
Improves the financial
stability of the service.
Provides information on the
water service.
Promotes transparency and
conflict resolution.
Financial
Aspect
Technical
Aspect
Institutional
Aspect
Community
Aspect
Environment Sustainable
STWSS
Source: CWSA (2010)
4/20
GHANA WATER SECTOR (STWSS & Evaluation Mechanisms)
Source: Water Aid, National Water Sector Assessment, May 2005
Year Intervention
1928

First development of public water supply systems, operated by the Hydraulic
Division of the Public Works Department
1965

Ghana Water and Sewerage Corporation (GWSC) established to be
responsible for urban and rural water supply
1986 Removal of operational subsidy on water supply
1991 GWSC efficiency increased by cutting jobs and recruiting qualified personnel
1994

The operation of Rural and Small Town Water supplies moved from GWSC
to be community managed. Semi-autonomous Community Water and
Sanitation Division established to be responsible for facilitating the
community water supply management
1995

Stakeholder meeting selects the lease option for restructuring the urban water
sector
1996 Water Resources Commission established
1997 Public Utility Regulatory Commission established
1999

GWSC replaced with the publicly owned Ghana Water Company Ltd (GWCL)
in urban areas and the Community Water and Sanitation Agency (CWSA) in
rural areas. Responsibility for urban sanitation transferred to ministries of local
Government
2003 Modification of water sector restructuring project so that management contract
option is also available to urban water project
2004 Preparation of a National Water Policy
Interventions in the Ghana Water Sector
AR BAR CR ER GAR NR UER UWR VR WR Nat
Percentage 73% 54% 44% 59% 59% 58% 52% 77% 54% 41% 57%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
P
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Legend
AR =Ashanti Region BAR = Brong Ahafo Region CR = Central Region ER = Eastern Region GAR = Greater Accra Region NR =
Northern Region UER = Upper East Region UWR = Upper West Region VR = Volta Region WR = Western Region Nat = National
Regional Coverage Rates in Small Towns in Ghana in 2008
Source: MAPLE Consult and WSMP (2011)
Summary of main Small Town Water Supply Actors and Functions
Source: Ghana Integrity Initiative, May 2011
5/20
GHANA WATER SECTOR (STWSS & Evaluation Mechanisms)
TECHNICAL ASPECTS OF STWSS IN GHANA
FINANCIAL ASPECT OF STWSS IN GHANA METHODS OF EVALUATION IN GHANA
COLLECTION
Groundwater extracted
with submersible pumps
installed in the boreholes
TRANSPORT
PVC/HDPE pipes laid
from tank to other
components
TREATMENT
Limited depending on
water quality. Chlorine
by Sanikit
STORAGE
Usually high level
concrete or pressed
steel tanks
DISTRIBUTION
Pipelines in PVC including
standpipes & connections
to private houses
MAIN INCOME ITEMS
Tariffs
Vendors operating
standpipes
Household Connection fee
MAIN COST ITEMS
Repairs
Salary
Chlorine
Fuel for generators
Source: Ghanas National Water Supply Integrity Study, 2001

GOVERNMENT
National Annual Water Supply Report
Water & Sanitation Performance Report (Targets based)
CWSA
Service Level Indicators (SLI)
Service Provider Indicators (SPI)
DONOR AGENCIES
Cost Effectiveness Analysis
DAC published guidelines (e.g. KfW)
6/20
SELECTED REPRESENTATIVE STUDY AREAS
STWSS IN GHANA
434 STWSS serves an estimated 3,027,456 people (12% of Ghanas
population) in small town communities with potable water.
Town Region Zone Economic Activity* Management Responsibility
Charia
UW North Low
Community managed
Funsi
UW North Low
Community managed
Busa
UW North Low
Community managed
Apinamang
E North Medium
District Assembly
Abokobi
GA North High
Public utility managed
1. Geographic location (North & South) 2. Economic situation (Based on MPI).
3. Population 4. Availability of data
5. Form of Management
CRITERIA FOR SELECTION OF STUDY AREAS
NORTHERN ZONE
Northern Region
Upper West Region
Upper East Region
SOUTHERN ZONE
Brong Ahafo Region
Ashanti Region
Western Region
Central Region
Eastern Region
Greater Accra Region
Volta Region
Location of Small Town Water
Supply System
7/20
CHARIA
Location: Upper West Region

2000 2010 2013 (Projected)
Population: 2,488 3,762 4,256

Social Structure: Mostly residential and has not seen much outward expansion

Water Facilities
Standpipes in number of: 7 Large institutions with bulk connection: 1
Private household connections: 76

FUNSI

2000 2010 2013 (Projected)
Population: 4,900 6,443 6,999

Social Structure: Central business district with highly dispersed habitations

Water Facilities

8/20
BUSA

2000 2010 2013 (Projected)
Population: 2,611 3,948 4,466

Social Structure: Old residential town with few public infrastructure and low outward
expansion

Water Facilities

APINAMANG
Location: Eastern Region

2000 2010 2013 (Projected)
Population: 5,399 7,625 8,478

Social Structure: Fast growing peri-urban community with a mix of urban-rural
characteristics

Water Facilities

9/20
ABOKOBI
Location: Greater Accra Region

2000 2010 2013 (Projected)
Population: 18,695 31,037 36,135

Social Structure: Mostly residential with high outward expansion.

Water Facilities

Town
Gross
Land Area
(Ha)
Gross Population Density
(Inh./Ha)
Charia 63 68
Funsi 41 170
Busa 28 160
Apinamang 82 104
Abokobi* 185 195
Charia Funsi Busa Apinamang Abokobi
Population 2010 3,762 6,443 3,948 7,625 31,037
Population 2013 4,256 6,999 4,466 8,478 36,135
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
N
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Population of Selected Representative STWSS Towns for 2010 & 2013
Abokobi
195
Apinamang
104
Busa
160
Funsi
170
Charia
68
Gross Population Density
10/20
ASSESSING THE PERFORMANCE OF THE SELECTED STWSS
METHODOLOGY
Select and define performance indicators (Technical & Financial).
Obtain data (2010-2013) from interviews with stakeholders (system managers &
consumers).
Use CWSA guidelines as benchmark.
Analyze and illustrate results (graphically where applicable) and interpret.

Group Performance Indicators
Technical
Service coverage
Continuity of service
Condition of the infrastructure
Water quality
Network efficiency
Financial
Balanced income and expenditure
Bill Collection Efficiency
Annual Auditing and Transparency of Accounts to users
Correct book keeping
The indicators selected are not exhaustive. They however, create a coherent
set of data that can be used for detailed reporting on the technical and
financial performance of the selected STWSS.
Selected Performance Indicators for STWSS
Source: IWA, CWSA 2012 modified
Performance
Indicators
Meaning Measure Measured in
Service coverage

Coverage is an indication of the number of people using the
service. It involves households with access to the network,
private connection or standpipe.
(population served / total
resident population) x 100
%
Continuity of
service
Continuity of service measures the number and length of service
interruptions over a given period.
Number of service
interruptions over 2013
No.
Condition of the
infrastructure
Examining the condition of key infrastructure in the water system.
Visual inspections/
interviews
-
Water quality

Checking whether water quality tests are carried out and how
often they are carried out.
Water Quality test Test results
Network
efficiency
Network efficiency is comparing the volume of water metered to
the volume of water produced.
(Volume of water metered
/ Volume of water
produced)
%
Performance
Indicators
Meaning Measure Measured in
Balanced
revenue and
expenditure
Difference between revenue and all the expenses
required to run the service on an ongoing basis.
Examples include salaries, management expenses etc.
Revenue minus
expenditure
GH
or
US$
Bill Collection
Efficiency
This involves comparing the number of bills issued over
the period to how many have been collected.
(No. of bills paid/
No. of bills issued) x
100
%
Annual Auditing
and
Transparency of
Accounts to
users
Auditing involves the checking of accounts by an external
body. This covers both revenue and expenditure made in
the year under review. Check if results are made public to
allow for the public access to such information.
Availability of audited
account/easy access of
accounts to the public
-
Correct book
keeping
Book keeping involves keeping records for water sold at
standpipes, bills issued and expenses made (operative
and administrative)
Examination of records -
Selected Financial Performance Indicators
Selected Technical Performance Indicators
11/20
ASSESSING THE PERFORMANCE OF THE SELECTED STWSS TECHNICAL
SERVICE COVERAGE
Overall Service Coverage in 2010 & 2013
It is necessary to distinguish between long service interruptions (several
days) and smaller, regular service interruptions (a few hours a day):
Performance
Indicator
Benchmark
Coverage
20% of the population - design target for private household
connections
80% of the population - design target for standpipes.
Percentage of number of
inhabitants served to the total
number of inhabitants in the
small town
72%
39%
69%
84%
24%
69%
38%
64%
78%
21%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010
2013
16%
11%
16%
5%
3%
20%
12%
16%
8%
4%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
56%
28%
53%
79%
20%
49%
26%
47%
71%
17%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Household Connections Standpipes
CONTINUITY OF SERVICE
Overall, 57% in 2010 all small
towns (~22,700 without access)
Dropped to 54% in 2013
(~25,900 without access)
Highest Coverage - Apinamang
(highest drop 6%)
Lowest Coverage - Abokobi
Performance Indicator Benchmark
Reliability
The facility is providing water for at least 95% of the year,
interpreted as at least 345 days of regular service, without
interruption.
13%
2%
2%
3%
23%
0%
5%
10%
15%
20%
25%
P
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(
%
)

P
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Percentage of Long Service Interruptions in 2013
Source: CWSA 2012
Source: CWSA 2012
MAIN CAUSES OF INTERRUPTIONS
Power outage
Break down of generator sets
Breakdown of electromechanical components in pump
house
Problem with iron removal plant
INTERRUPTIONS IN DAYS
Charia - 48
Funsi - 6
Busa - 7
Apinamang - 12
Abokobi - 84
12/20

CONDITION OF INFRASTRUCTURE
The quality of water indicator measures the number of times the water
quality test is carried out and reports on issues affecting the water quality
and how it is being addressed.
This indicator examines the key infrastructure in the water system to establish if
they are in good working condition.
QUALITY OF WATER
Scoring for Water Quality Testing
Source: CWSA 2005
Source: CWSA 2012
Component Design Period
Standpipes
10 years
Pumps
10 years
Tanks
10 years
Distribution mains
10 years
Transmission mains
15 years
Transformers
15 years
Source Capacity
15 years
System Components Charia Funsi Busa Apinamang Abokobi
Borehole
Pump House
Submersible Pump
Transmission Line
Electromechanical Equipment
Storage Tank
Distribution network
Standpipes
Iron removal plant NA NA NA NA
Abokobi had most problems with
infrastructure (older system 2006)
Charia had to replace the submersible
pump
Reasons for lack of repair is due to lack of
funds to carry out the repairs
Design Period of System Components of STWSS
Results of the Condition of Infrastructure of the selected STWSS

Problems with Infrastructure Abokobi STWSS
Score Performance Indicator
Excellent
Water quality testing and analysis done by certified laboratories twice a year
and is paid for by the community through tariff
Very Good
Water quality testing and analysis done by certified laboratories twice a year
but not paid for by the community through tariff
Good
Water quality testing and analysis done by certified laboratories but only done
once a year
Fair
Water quality testing and analysis done, but less often than once a year or not
by certified laboratories
Poor
Water Quality testing and analysis not done at all
= System component functioning and operational and does not require repair = System component not functioning or functional poorly, requires repair
Abokobi was the only system to conduct
water quality tests twice a year by
certified
Consumers in Charia complained of the
level of iron and the salty nature of the
water
Reasons for not undertaking water
quality test was due to lack of funds
13/20

NETWORK EFFICIENCY
The indicator is computed by determining the ratio of the volume of water
metered over the period to the volume of water produced (pumped) over the
period expressed as a percentage.
KEY ISSUES Technical Performance of STWSS
CWSA Recommendations
Network efficiency at 95% on new networks.
Leak detection is recommended should it drop below 90%.
Charia recorded the
lowest in 2010 but
increased to 52% in
2013.

Funsi and Apinamang
recorded the highest in
part due to the high
collection of tariffs.

The number of illegal
connections on the
network contributes to
non-revenue water
Towns Charia Funsi Busa Apinamang Abokobi
Illegal Connections
identified
2 3 0 12 20
Network Efficiency of the STWSS from 2011 to 2013
Illegal Connections identified on the selected STWSS by the system managers
2011 20% 93% 49% 92% 74%
2012 47% 91% 44% 84% 74%
2013 52% 82% 24% 84% 73%
20%
93%
49%
92%
74%
47%
91%
44%
84%
74%
52%
82%
24%
84%
73%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
N
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14/20
Gradual reduction in service coverage over time due to lack of add-on infrastructure
like standpipes and DPPC for house connections.

High incidence of break in continuity of service due to poor maintenance, slow access
to repair and lack of funding.

Generally good condition of infrastructure but lack of repair where problems occurred.

Overall, water quality meets WHO standards except where high iron contents were
identified. Challenges in operating iron removal plant by system operators.

Incidence of water theft/illegal connections as a consequence of low household
connections.

High percentage of non-revenue water (NRW).
Accessing water at
standpipes
Operating Iron Removal Plant Performing basic water
quality tests
BALANCED REVENUE & EXPENDITURE
The indicator determines the percentage of the ratio of bills collected to
bills issued. The analysis for this indicator was done with figures relating to
household connections which receive monthly bills and not standpipes
which have a pay and fetch system operated by vendors.
No existing bench mark exists from CWSA for this indicator.
The balanced income and expenditure indicator is to determine if there is a
positive annual revenue/ expenditure balance. Comparing revenue and
expenditure helps to assess the overall financial stability of the service.
BILL COLLECTION EFFICIENCY
Billing and Collection efficiency of the STWSS from 2011 to 2013
Scoring for Revenue and Expenditure Balance by CWSA
15/20
ASSESSING THE PERFORMANCE OF THE SELECTED STWSS FINANCIAL
Score Narrative Description
0
No records of financial data available ***
No generation of revenues **
Annual revenues lower than annual expenditure *
100
Annual revenues higher than annual expenditure
Small Towns
Revenue and Expenditure Balance
2011 2012 2013
Charia 100 0* 0*
Funsi 0*** 0* 100
Busa 0* 100 100
Apinamang 100 100 100
Abokobi 100 100 100
Revenue and Expenditure Balance of the selected STWSS
Two out of five systems showed consistent positive revenue/expenditure
balance (both in economically medium to high range).
Reasons for low revenue include;
Non-payment of bills.
Low collection rate by vendors at standpipes.
2011 41% 70% 63% 83% 86%
2012 74% 53% 53% 60% 90%
2013 44% 50% 22% 63% 80%
41%
70%
63%
83%
86%
74%
53% 53%
60%
90%
44%
50%
22%
63%
80%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
B
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Funsi and Busa over the three years, recorded progressively, decreasing
collection efficiencies.
Charia, Apinamang and Abokobi showed mixed patterns. Charia increasing
sharply by 33% in 2012 and then dropping by 31% 2013 (Pump problem).
Abokobi had the most consistent billing and collection efficiency with an
average of 85%.
ANNUAL AUDITING AND TRANSPARENCY OF
ACCOUNTS TO USERS
Correct book keeping serves as an accountability indicator. It takes into
account operational records, minutes of meetings and financial records are
kept and presented to the community at least once very six months
Auditing involves the checking of accounts by an external body. This indicator
checks if auditing is done and if it covers both revenue and expenditure made in
the year under review. Also, that the results are made public to allow for the
public access to such information.
CORRECT BOOK KEEPING
Scoring for Correct Book Keeping
Source: CWSA 2005
Scoring for Annual Auditing & Transparency of Accounts to Users
16/20
100
There is a bank account, up-to-date cash book and rendering of accounts to the
community on an annual basis
75
There is a bank account, up-to-date cash book and rendering of accounts to the
community but not on an annual basis
50
There is a bank account, up-to-date cash book and but no rendering of account to
the community on an annual basis
25
There is a bank account or cash book, or when there is both a bank account and
cash book, the cash book is not up to date
0 There is no bank account and no cash book
2011 50 25 100 75 25
2012 50 50 100 75 50
2013 50 50 100 75 50
0
25
50
75
100
S
c
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e

Overall, all five
communities had bank
accounts.
Funsi and Abokobi
were found not to have
up to date cash books
in 2010.
Busa was the only town
found render accounts
to the community on an
annual basis.
100
All records are kept and are up-to-date, and have been presented to the
community, at least every six months
75
All records are kept and are up-to-date, and have been presented to the
community, but less frequent than every six months
50
All records are kept and are up-to-date, but have not been presented to the
community
25
Some records are kept, or all records are kept, but these are more than a month
behind schedule
0 No records are kept
2011 50 25 75 75 25
2012 50 50 75 50 25
2013 50 50 75 50 25
0
25
50
75
100
C
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B
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In general, all five
STWSS kept some
records over the period
of 2011 to 2013.
Busa was the only one
found to have all records
kept which were up-to-
date, and have been
presented to the
community.
Overall, the challenge
was with presenting the
information to the
community.
COST EFFECTIVENESS ANALYSIS (CEA)
Some STWSS had unsustainable financial management with
expenditure exceeding revenue in some cases.
Most STWSS recorded a low bill collection rate which affects revenue
needed for operating the system.
Generally, books are audited but its frequency is irregular.
Existence of book keeping, however updating records regularly is a
challenge.
Low levels of transparency as consumers in small towns are uninformed
or are not updated with financial details of the system.

Cost - effectiveness analysis is a technique that relates the costs of a program to
its key outcomes or benefits (Levin and McEwan, 2001).
A CEA on STWSS therefore provides viable information for policy makers. It
helps in their decision to either promote or modify the systems.
The effectiveness measure adopted for this study is the change in improved
water consumed per household per year.
KEY FINANCIAL ISSUES
17/20
Busa Charia Funsi Apinamang Abokobi
CER (US$/ liter) 0.9 1.1 1.6 1.7 2.3
0.0
0.5
1.0
1.5
2.0
2.5
U
S
$
/

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Cost Effectiveness Ratio of Selected STWSS
Item
Representative Small Town Water Systems
Total annual Cost of
Interventions(GH)

56,705

84,202

45,064

65,547

89,114
Population (Inhabitants) 4,256 6,999 4,466 8,478 36,135
Number of households
(population/Household size)
532 875 558 1,060 4,517
Water consumed (litres)
/household / year before
intervention
29,200 29,196 29,213 21,900 21,895
Improved water consumed (litres)
per household per year after
intervention
81,760 81,760 81,760 61,320 61,320
Change in improved water (litres)
consumed / household/ year
52,560 52,564 52,547 39,420 39,425
CER (US$/ liter) 1.1 1.6 0.9 1.7 2.3
Computation of Cost Effectiveness Ratio for the selected STWSS
CONCLUSIONS AND RECOMMENDATIONS
18/20
CONCLUSIONS
Existing regulation on regular evaluation of STWSS needs to be
enforced. If possible, regulation needs to be expanded to also include
evaluation conducted by system managers and reviewed by the
WATSAN board, preferably half yearly to detect problems early.
The WATSAN boards and system managers need to be reinforced
and obtain stronger technical and managerial support. It also would
be good to explore possible incentives for their task.
The WATSAN boards need to improve considerable transparency by
organizing meetings with users as prescribed in the CWSA manual
and consulting users in decision making.

STWSS play a significant role in the water sector of developing
countries like Ghana.
STWSS in Ghana face challenges of low service coverage, high
number of service interruptions and financial management problems.
Evaluation when adopted on a regular and effective way for STWSS
will ensure that technical and financial challenges are identified early
and addressed.
CWSA, March 2014
RECOMMENDATIONS
Empower the WATSAN boards to proceed with technical
improvements in the system including increasing the number of
meters and improving meter reading practice, installation of more
check valves and bulk water meters to improve water distribution,
understanding and control.
FURTHER RESEARCH
Consumer dependence on alternative sources, despite the
provision of improved water supply facilities.
Further study into the nature and institutional framework for
regulating STWSS with private sector involvement in Ghana must
be encouraged.
...as a Country, a conscious and deliberate evaluation of performance
of STWSS will ensure that they keep working for as long as their
designed lives
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19/20
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Thank you for your attention.
Questions & Comments are duly welcome.
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Evaluation of Financial & Technical Performance of representative Small Town

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