2019/20 WASH Budget BriefAchieving Universal Access to Water and Sanitation Services for All Malawians: Towards Attaining SDG 6

MALAWI

1 The water, sanitation and hygiene (WASH) budget has substantially increased in fiscal year (FY) 2019/20 compared to the previous, but allocations remain low in relation to national and international targets.

Recommendation: The Government is encouraged to develop an appropriate, affordable, innovative and inclusive WASH financing strategy to expand fiscal space for the WASH sector.

2 The current size and distribution of WASH resources to District Councils is not responsive to the different financial needs.

Recommendation: The Government is encouraged to tailor the size of transfers to District Councils for water and sanitation services in line with district needs and deprivations. A costing exercise to establish financial requirements at the local level is recommended.

3 Households are making considerable contributions to the WASH sector.

Recommendation: The sizeable household expenditure, especially for rural water supply, should be leveraged to support activities of Water Users Associations (WUAs), which currently operate with no dedicated funding.

4 WASH investments are skewed towards water development expenditures, the majority of which are largely donor-funded, with limited recurrent investments for operations and maintenance.

Recommendation: The Government is encouraged to refocus WASH investments to ensure a balance between the creation of new water infrastructure through donor funding and the related operations and maintenance costs, for continued functionality of water and sanitation services.

5 The water sector in Malawi is currently operating without a regulatory board, with financing implications for the sector in terms of tariffs and pricing of water.

Recommendation: In the short term, the Government should ensure the implementation of regulatory functions around tariffs and pricing for water. In the medium term, the Government should consider the establishment of an independent Water Supply Regulatory Authority.

Key messages and recommendations

1. INTRODUCTIONThis budget brief assesses the extent to which the 2019/20 Government Budget responds to the financing needs of the water, sanitation and hygiene (WASH) sector. The brief analyses trends, composition and equity of WASH spending from a child rights perspective. The brief concludes with a set of recommendations on how the Government of Malawi (GoM) can increase and improve the quality of public spending on WASH, including by enhancing efficiency, effectiveness and equity in the utilization of sector resources as the Government seeks to achieve universal access to WASH by 2030.

The budget analysis1 underpinning this brief is based on an in-depth review of the Program Based Budgets (PBBs) and Detailed Budget Estimates for fiscal year (FY) 2019/20. For the time series analysis, revised budget estimates were used from FY2016/17 and FY2016/17 is used as the base year for inflation adjustments. The analysis also benefitted from the review of the Water Sector Investment Plan (2012), the recently conducted WASH Public Expenditure Review (PER) (2020) and the WASH costing analysis based on the global tool developed by the Sanitation and Water for All (SWA) Secretariat.

2. OVERVIEW OF THE WASH SECTOR IN MALAWIWater and sanitation are priority areas for the Government of Malawi, as outlined in the Third Malawi Growth and Development Strategy (MGDS) III. Water development features under MGDS III key priority area 6.2, while sanitation features under priority area 6.6 (health and population). With regards to policy guidance, the delivery of WASH services is guided by the Water Policy (2005), the National Sanitation Policy (2008), the Water Resources Act (2013) and the National Sanitation and Hygiene Strategy (2018-2024). The Government is currently developing the third National Water Development Programme and the New National Open Defecation Free (ODF) and Hygiene Strategy.

Provision, financing and regulation of WASH services is the responsibility of several institutions at national and local level. In 2018, the Government established

1 In this budget brief, the WASH budget comprises of allocations to two Ministries, one Subvented Organization and water sector transfers to District Councils. The water budget is comprised of water supply, water resources development and management under the Ministry of Agriculture, Irrigation and Water Development (MoAIWD) – Vote 190, subvention to National Water Resources Authority (NWRA) and transfers to District Councils for the Borehole Fund and other recurrent transactions (ORT). Budgets to Regional Water Boards (Northern, Southern and Central) are accounted for under the MoAI-WD. Sanitation budgets are mainly under the MoAIWD and Ministry of Health and Population (MoHP) – Vote 310. Other MDAs, such as Ministry of Education, Science and Technology (MoEST) – Vote 250 also participate in the WASH budget. For instance, the MoEST has the responsibility to deliver school-based WASH services.

the National Water Resources Authority (NWRA) whose current mandate is to develop, manage, administer and protect water resources for the sustainable, effective and efficient provision of water for all its uses and utilization. The mandate of the NWRA does not currently include regulation of water tariffs, although the establishment of an economic regulation for water is currently a pending item on the sector agenda. At sub-national level, service delivery functions are performed by District Councils and Water Boards, both having responsibility for the operation and maintenance of water systems within their jurisdiction, with Water Boards focused on urban areas. In some Districts, operations and maintenance functions for water systems are performed by Water Users Associations (WUAs)2.

Malawi has realized considerable progress on some key WASH outcomes, scoring substantially better than the regional averages. Access to improved water source, for example, increased from 79.7% in 2010/11 to 87.2% in 2015/16.3 For this outcome, Malawi fared substantially better than the Sub-Saharan Africa (SSA) average (71%), the Least Developed Countries (LDCs) average (47%) and the Landlocked Developing Countries average (77%). Access to improved sanitation facilities in Malawi surged from 8.2%

2 The MoAIWD adopted the concept of the WUA to “empower the communities to own and manage the piped water supply systems in the market centres and rural areas on their own with minimum sup-port from outside”. These community-based WUAs are intended to act as ‘mini water boards’ – though do not receive any external financial support and are expected to collect the funds for running the systems from the community they serve.

3 Malawi Demographic and Health Survey (MDHS), 2015/16.

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© UNICEF/2016/Rich

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estimated at about US$6.36 million (MK4.7 billion)7.8 The floods disproportionately affected Chikwawa, Phalombe, Mulanje, Nsanje and Thyolo districts. Third, water point functionality remains a challenge, especially with regards to rural piped water supply systems, which is depriving rural communities’ access to safe water supply. Fourth, girl-friendly sanitation facilities in schools remain poor. In 2017, for instance, 62% of primary schools and 68% of secondary schools in Malawi had no hygiene services.9

KEY TAKEAWAYS

WASH policies and budgets should be reviewed so that they respond to observed disparities in WASH outcomes amongst districts and wealth quintiles.

The recurrence of emergencies requires dedicated funds from Government to respond to WASH needs.

7 See Annex 2 for details.8 Malawi 2019 Floods Post Disaster Needs Assessment Report page

28.9 https://washdata.org/monitoring/schools/dashboard

to 51.8% between 2010/11 and 2015/164. For this outcome, Malawi scores better than its neighbour Mozambique where as much as 76% do not have improved sanitation facilities and Tanzania with population with improved sanitation at 31%. Open defecation (OD) rate in Malawi declined from 15.7% in 2000 to 6.5% in 2015, better than Mozambique currently at 36% and Tanzania at 9.5%. However, using the standardized SDGs indicators for basic access to water and sanitation services, Malawi stands at 69% and 26% respectively5.

Despite the progress, several challenges remain, which require the attention of Government if the country is to realize sector targets and achieve SDG 6. First, significant disparities exist in WASH outcomes depending on geographic location and wealth quintile. For example, access to basic water services for the poorest quintile is below 65%, but nearly 85% for the wealthiest quintile6. Open defecation rates vary by region and district from as low as 1.1% in Rumphi to as high as 15.5% in Nsanje. Second, the recurrence of floods and droughts in Malawi has affected WASH infrastructure. In 2019, for example, the total effects of the Cyclone Idai induced floods were

4 MDHS (2015/16)5 Joint Monitoring Programme for Water and Sanitation (JMP), 2019

UNICEF and WHO https://washdata.org/data/household#!/mwi6 Multiple Indicator Cluster Survey (MICS), 2014.

3. SIZE OF WASH BUDGETS IN MALAWIThe WASH budget has substantially increased in FY2019/20 compared to the previous year. A total of MK26.3 billion was allocated to WASH in FY2019/20, up from MK15.6 billion in FY2018/19 (Figure 1). The FY2019/20 allocation represents a nominal increase of 69% and a 54% increase after adjusting for inflation. The nominal increase in the WASH budget is 3.4 times higher than the overall increase of the national budget, 20.1%. The growth in the WASH budget was largely driven by huge donor injections (152%) for water projects, notably the Lilongwe Water and Sanitation Project to be funded by the World Bank to the tune of MK10.9 billion in FY2019/20. In per capita terms, the total WASH allocation translates to MK1,499 (US$2) per each of the 17.56 million people per year. The per capita allocation is 69% nominally higher than the FY2018/19 level of MK889 (US$1.22).

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WASH Budget (MK, millions)

2019/202018/192017/182016/170.0

1.0

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3.0

4.0

WASH % of Gvt. Budget

2019/202018/192017/182016/17

37,103

18,674

15,609

26,331

FIGURE 1 Trends in WASH Allocations (MK millions)

MK,

mill

ions

Perc

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Source: Government Budgets (2016/17 to 2019/20)

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WASH spending in Malawi is relatively lower in relation to regional comparators. Comparative data from UNICEF WASH Budget Briefs show that in FY2018/19 Malawi allocated 1.1% of its budget to WASH compared to 1.4% in Mozambique, 2.3% in Zambia13 and 2.4% in Tanzania, as shown in Figure 3. Malawi also spend a lower share of its GDP on WASH programs relative to its regional comparators as shown in Figure 4.

13 Zambia is using loans to finance urban water expansion as user fees pay for the loans and grants for rural areas.

Despite the substantial increase, the FY2019/20 WASH budget lags behind international benchmarks. At 0.44% of GDP, the WASH sector budget allocation falls short of the Government’s commitment10 at the 2014 Sanitation and Water for All High-Level Meeting (SWA HLM) (commitment to the eThekwini Declaration) to allocate at least 1.5% of its GDP to WASH. Relative to other social sectors, WASH receives the least funding from Government. In FY2019/20, for example, whilst the WASH sector received 1.52% of the budget, education received 25%11, health 9.4% and social welfare 3.7% of the total budget. The WASH budget takes up 1.7% of estimated Government revenue in FY2019/20.

Current WASH investments translate to a quarter of sector financing needs. Through the Water Sector Investment Plan (WSIP) (2012)12 the Government estimated that Malawi needs to invest a minimum of US$140 million (MK105 billion, at current prices) annually in order to provide basic WASH services to all populations. At MK26.3 billion (US$35 million), Government commitment to WASH in FY2019/20 is about 25% of the WSIP financial requirement. Analysis of the investment needs using the SDG costing tool developed by the Sanitation and Water for All (SWA) secretariat, gives an annual WASH funding requirement of US$97 million (MK72 billion) for basic services and an additional US$259 million (MK194 billion) for safely managed services. Of the total amount required, communities would contribute about 70%.

10 This commitment was reinforced in the N’gor 2015 declaration, em-anating from the Africa San IV conference – organised by the African Ministers’ Council on Water (AMCOW).

11 The education figure includes Aid in Appropriation (the revenue assigned to and collected by public institutions which they are permit-ted by the Treasury to appropriate against expenditure approved by Parliament) for subvented education institutions. If aid in appropriation is excluded, the share of education spending stands at 18.5%.

12 This is the currently available investment plan for the WASH sector. UNICEF is currently undertaking a WASH sector SDG Financing Study.

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0.5

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1.5

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eThekwini WASH % of GDP benchamarkWASH % GDP

2019/202018/192017/182016/17

0.97

0.400.30

0.44

1.5

FIGURE 2 WASH allocations as a share of GDP

Perc

enta

ge (%

)

Source: Government Budget Estimates (FY2016/17-2019/20)

FIGURE 3 & 4 WASH Spending % of Total Budget and in Relation to GDP in Malawi and Regional Comparators in 2018/19

0.0

0.5

1.0

1.5

2.0

2.5

TanzaniaZambiaMozambiqueMalawiZimbabwe

0.4

1.1

1.4

2.32.4

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

WASH % of GDP

ZambiaMozambiqueTanzaniaMalawiZimbabwe

0.13

0.3 0.3

0.4

0.65

Perc

enta

ge (%

)

Source: UNICEF WASH Budget Briefs

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4. COMPOSITION OF WASH SPENDING Similar to previous fiscal years, the WASH budget weighs heavily on development projects, most of which are funded by donors. In FY2019/20, development expenditures constitute 94% (MK21.9 billion) of the Water Resources Development, Management and Supply (Program 04) budget. This means only 6% of the program’s resources are available to cover operations and maintenance, monitoring, behavior change campaigns and awareness raising. Limited budgets for operations and maintenance undermine the effectiveness of WASH development projects. Major development projects budgeted in FY2019/20 include the Lilongwe Water and Sanitation Project14 (MK10.9 billion), which takes up nearly half of the development budget for WASH. About three-

14 Other major projects include the Sustainable Rural Water Supply and Sanitation (MK4.5 billion of which MK4.38 billion is from donors) and Nkhatabay Town Water Supply and Sanitation (MK3.1 billion of which MK2.6 billion is from donors).

KEY TAKEAWAY

The WASH budget has substantially increased in FY2019/20, but allocations are lower than national and international targets, which is likely to derail efforts towards achieving sector targets and SDG.

quarters (MK8.2 billion) of the project’s funds is from the World Bank while Government’s contribution is MK2.7 billion.

About 88% of WASH resources for FY2019/20 will be channeled via MoAIWD (Vote 190) as shown in Figure 6. A total of MK23.3 billion of the WASH budget is under the MoAIWD, which is 83% higher than the FY2018/19 allocation of MK12.8 billion. The WASH budget under MoAIWD is divided amongst two sub-programs, namely Water Resources, Development and Management (sub-program 04.03) which absorbs 95% of the budget, and Water Supply and Sanitation (sub-program 04.04) receiving the remaining 5% (MK1.2 billion). Unfortunately, sanitation remains lumped up with water supply. This is despite Government’s commitment to come up with a standalone sanitation budget line under the eThekwini (2008) Declaration. The remaining 12% of the WASH budget is channeled as follows – 9% via District Councils for borehole fund (MK2.3 billion) and ORT (MK 270 million), 1% via Ministry of Health and Population (Vote 310) for environmental health and another 1% (MK200 million) is subvention for the recently established NWRA.

© UNICEF

WASH spending in Malawi is relatively lower in relation to regional comparators.

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The decline has widened the financial gap for ‘services for environmental and social determinants of health’ as costed in the HSSP II. In total, the Government allocated MK713 million15 to ‘Environmental and social determinants of health’ (program 22) in FY2019/20, which translates to US$951,250. This is only 6% when compared to required costs under HSSP II of US$16.3 million.

KEY TAKEAWAYS

WASH investments are largely developmental with limited budgets for operations and maintenance. Government should ensure balance between infrastructure creation and operations and maintenance to ensure continued functionality of water and sanitation facilities.

The decline in the budget for Environmental Health, introduced in 2018/19 is likely to negatively impact on the delivery of sanitation outcomes.

15 The MK713 million includes allocation to Health Promotion of MK457 million.

Relative to other programs under MoAIWD, water resources development receives a low budget share. In FY2019/20, for example, allocations to WASH programs constituted 14% of the total MoAIWD budget. This is compared to 33% for Agricultural Productivity and Risk Management and 18% for Sustainable Rural Development. The trend has generally been the same for the past two financial years. Figure 7 presents trends in WASH budget in relation to other programs under the MoAIWD budget.

The Government is commended for committing resources to the National Water Resources Authority (NWRA), which was established in 2018. A total of MK200 million was allocated to NWRA in 2019/20. The NRWA was established to develop, manage, administer and protect water resources for the sustainable, effective and efficient provision of water for all its uses and utilization. However, the low stakeholder awareness about the new institution and the legal framework that established and regulates it negatively impact the functioning of the institution.

Budget allocations to environmental health, which cover sanitation in health facilities, have considerably decreased in FY2019/20 compared to the previous year. A total of MK256 million was allocated to environmental health in FY2019/20 compared to MK415 million in 2018/19. This is equivalent to a 41% decline in nominal terms.

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Borehole FundWater Sector ORTNational Water Resources Authority

Environmental Health Water Supply and SanitationWater Resources Development and Management

2019/202018/192017/182016/17

FIGURE 5 Composition of WASH Budget by Program

Source: Government Budget Estimates (FY2016/17-2019/20)

FIGURE 6 Composition of WASH Budget by Delivery Channel

Source: Government Budget Estimates (FY2019/20)

District Council ORTDistrict Council Borehole FundNWRA

MoHPMoAIWD

88%

1%9%

1%1%

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5. EQUITY OF WASH SPENDINGThere are notable disparities in WASH outcomes amongst districts between rural and urban populations and wealth quintiles, which should be addressed through fiscal policies and budgets. Coverage of improved sanitation, for instance, varies widely from just over 30% in Mchinji to over 80% in Chitipa.16 Access to basic water

16 MDHS (2015/16), page 308.

FIGURE 7 Allocations to Water and Sanitation (Vote 04) in Relation to Other Programs Under MoAIWD

Source: PBB for FY 2017/18 to FY2019/20

0 20 40 60 80 100

Management and Administration

Sustainable Rural DevelopmentLivestock and Fisheries Production

Agricultural Productivity and Risk ManagementWater Resources Development, Management and Supply

2017/18

2018/19

2019/20 14%

12%

10% 75%

47%

3%

4%

1% 9% 4%

19% 17%

32%18%33%

FIGURE 8 Per Capita Water ORT Transfers vs Access to Improved Water Source by District

Source: MDHS (2015/16) and NLGFC FY2019/20

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30

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50

per capita ORT (MK)

MwanzaNeno

Chitipa

Nkhata Bay

Karonga

Nsanje

Chiradzu

ru

Ntchisi

Phalombe

Blantyre

Rumphi

Nkhotakota

Chikhwawa

Lilongwe

Salima

Mulanje

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services for the poorest quintile is below 65%, but nearly 85% for the wealthiest quintile. Moreover, the construction of WASH infrastructure by development partners is unevenly distributed across traditional authorities (TAs) as reported from district field visits during a WASH Public Expenditure Review (PER).

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KEY TAKEAWAYS

Geographic disparities in WASH outcomes are potential indicators of inequities in resource allocation.

Constituency-based and equalised distribution of the Borehole Fund does not consider differences in financial needs.

The size and distribution of water budgets to District Councils are not responsive to observed disparities. In FY2019/20, per capita Water ORT budget allocations ranged from MK3 in Zomba to MK43 in Mwanza17. In total, ORT budgets for Local Councils average MK7million (US$9,300) per year or MK550,000 (US$770) per month. Such allocations are too low to respond to district needs. There is no systematic correlation between ORT budget allocations and access to improved water source across districts as shown in Figure 8.

The current constituency-based distribution of the Borehole Fund is not responsive to district water infrastructural needs. The Borehole Fund was introduced in FY2017/18 for the construction of water structures in districts. Under the Borehole Fund, each constituency receives a fixed allocation, currently at MK12 million per year. This constituency-based approach does not consider varying needs by districts. Notably, there are districts with lowest levels of access to water, such as Dowa (65.9%) that are receiving the same allocation from the Borehole Fund as districts with better access. Figure 9 shows per capita borehole fund allocation by district in 2019/20.

17 Likoma District is an outlier owing to its low population of 14,000 people giving a per capita ORT of MK196.

There are districts with lowest levels of access to water, such as Dowa (65.9%) that are receiving the same allocation from the Borehole Fund as districts with better access.

FIGURE 9 Per Capita Borehole Fund Allocation by District Council

Source: NLGFC (2019)

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Nkhotakota

Ntchisi

Zomba

Phalombe

Blantyre

Lilongwe

Kasungu

Chikwawa

Ntcheu

Salima

Mangochi

Mchinji

Thyolo

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KEY TAKEAWAY

Funding allocated to WASH received under the DDF and the CDF are not traceable, limiting the capacity of quantification of the total investments at local level, the potential major differences in between Local Councils and the accountability of the expenditures.

6. FISCAL DECENTRALIZATION AND WASH BUDGETS The WASH sector is less advanced in terms of fiscal decentralization compared to other social sectors. Majority of the WASH budgets remain largely centralized with less than a tenth of total WASH expenditures for FY2019/20 being channelled via District Councils.ORT allocation to the sector were only 0.63% of total ORT transfers to District Councils, compared to health (30%) and education (20%). At MK20 per person (average), ORT budgets per district are too low to make a meaningful impact.

After swelling in FY2017/18, owing to the introduction of the Borehole Fund, the district water budget has not changed compared to the previous year (Figure 10). In FY2019/20, a total of MK2.5 billion was allocated to Local Councils – being MK2.3 billion for construction of water structures under the Borehole Fund and MK207 million for ORT. Compared to FY2018/19, the Borehole Fund has not changed in nominal terms while the ORT budget nominally increased by 5%. Overall, the district water budget has stagnated in nominal terms, but has declined by 9% in real terms. Local Councils also receive development funds under the District Development Fund (DDF) and Constituency Development Fund (CDF). However, the proportion of DDF and CDF allocated to WASH is unknown, but likely varies by district as it is spent at the discretion of the Controlling Officers. 0

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Borehole FundORT

2019/202018/192017/182016/172015/162014/152013/142012/13

FIGURE 10 Trends in District Water Budgets

Source: NLGFC (2019)

MK,

mill

ions

34 48 96 120 106 188

1392

2316

197 207

2316

7. BUDGET CREDIBILITY AND EXECUTION ISSUESThere are notable variations between approved and revised budget in the WASH sector, especially for donor-funded projects. For instance, in FY2019/20, the revised budget (MK948 million) for Mzimba Integrated Urban Water and Sanitation Project was only 15% of the approved budget of MK6.4 billion. There were also notable upward revisions for some capital projects mainly funded by donors. For example, the budget for Lilongwe Water and Sanitation Project swelled by 566% from the approved budget of MK900 million to a revised estimate of MK5.9 billion as shown in Table 1. The positive variance could be due to new funding from donors during the financial year. Unpredictability of size and timing of donor funds affects effective planning and budgeting in WASH.

While the overall development budget significantly varies from approved, the Borehole Fund has generally been entirely funded and expended. The Borehole Fund has been 100% funded since its introduction in FY2017/18. A possible reason for this is political pressure from Members of Parliament who handle the funds. However, the district ORT budget has suffered notable mid-year revisions over the past years. In FY2019/20, for instance, district ORT transfers were revised downwards by 38% from the approved budget of MK197 million to MK122 million. Such revisions are retrogressive to achieving universal access to basic WASH services, especially given that the ORT ceilings are already significantly low in relation to needs.

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8. FINANCING OF WASH SERVICES IN MALAWIWASH financing in Malawi is divided between Government, Donors, NGOs, households and water boards. Excluding households’ expenditures, donor funding represents the single largest source of public WASH investments in Malawi. A WASH PER (2020) revealed that donor funding constitutes an average of 21% of overall WASH spending over a five-year period FY2014/15 to FY2018/19. If households’ expenditures are included, donor funding becomes the second largest source as shown in Figure 11. Household expenditures, account for 59.3% of the overall WASH expenditures over the period FY2014/15 to FY2018/19, on average. Government contribution from domestic revenue has averaged 2.4% over the same period. The expenditure per household per year on water in urban areas was over MK 35,000; this figure drops to below MK 10,000 in rural areas.

Trends in overall WASH spending are primarily influenced by changes in the donor landscape. A WASH PER (2020) noted that donor funding is the most variable element of the WASH funding, exhibiting very large year-on-year variations as shown in Figure 12. Donor commitments are often disbursed with a lag. Analysis of ODA flows to the WASH sector over the period FY2014/15 to FY2018/19 reveal a notable funding path where actual disbursements have significantly lagged commitments.

KEY TAKEAWAY

Budget credibility for water development projects is a growing concern which should be investigated by the Government.

TABLE 1 Budget Revisions for Selected WASH Programs/Projects in FY2018/19

Approved Revised % Revision

Water Resources Development, Management & Supply 15,605 12,756 (18)

Mzimba Integrated Urban Water and Sanitation Project 6,416 948 (85)

Lilongwe Water and Sanitation 900 5,995 566

Sustainable Rural Water Supply and Sanitation (ADF) 2,556 5,484 115

District ORT budget 197 122 (38)

Source: PBB for 2019/20

There is no systematic way of siting and constructing boreholes across TAs. Field visits during a WASH public expenditure review (PER) conducted in 2019 revealed that there is little involvement of the District Water Development Officer (DWDO)in the spending decisions. The limited involvement of the DWDO has the potential to undermine quality assurance and future water point functionality.

The composition of donor funds to the WASH sector has also considerably changed over the past five years. Increasingly, external WASH commitments are predominantly loans, as opposed to grants, and are channelled through Water Boards. This is in line with the general trend in external finance to increasingly come from multilateral organisations and be directed through the public sector. It is concerning that donor funding for rural WASH programs is declining, with large new donor commitments to the sector (from the AfDB and World Bank) predominantly channelled to the water boards and focused in urban areas18. This skewed pattern has equity implications

18 Government of Malawi (2020), WASH PER

© UNICEF/2012/Asael

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given that the majority of the poor without access to WASH services reside in rural Malawi.

Malawi has long been considering introducing a Sector Wide Approach (SWAp)19 to coordinate funding to the water sector, in line with its commitment during the Sanitation and Water for All (SWA) Global Partnership in 201420. The Water Sector Investment Plan (2015)21 also recommended the introduction of a SWAp in the WASH sector in order to coordinate financing of the sector. However, some donors have cautioned against the introduction of a WASH SWAp before strengthening the PFM systems.

The funding of WASH in emergencies has been largely sourced from donors. District field visits during the WASH PER revealed that the majority of WASH activities in emergencies are financed by Development Partners either through UNICEF or other NGOs. At national level, the Department of Disaster Management (DoDMA) has the responsibility to manage disaster responses in Malawi. Each year through its clusters, DODMA prepares a budget for various response work. The Government established Disaster and Risk Management (DRM) offices at District level. The DRM coordinates emergency responses under a district WASH cluster22. In 2019/20, the Government allocated MK 1 billion to DoDMA, which translates to MK35 million (US$45,000) per district.

19 Under a SWAp, the Government and donors would agree to a com-mon investment program, implemented through common structures.

20 Malawi is part of the Sanitation and Water for All (SWA) partnership, under which 7 standing commitments have been made formalising a Sector Wide Approach (SWAp) in the WASH sector.

21 See the Water Sector Investment Plan (2015), page 70. 22 During disasters, the clusters main activities involve - (a) Provision of

safe water to the flood affected people (b) Provision of adequate san-itation and hygiene facilities. (c) Provision of hygiene education and information. (d) Provision of water, sanitation and hygiene facilities in health facilities and schools.

FIGURE 11 Five-year Composition of WASH Expenditure by Source of Funding

Source: Government of Malawi, WASH PER (2020)

59.30% 21.30% 2.40%

17.00%

Government

Households

DonorsWater Boards (excl. from HH)

0

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40

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120

ODA flows to WASH sector

20172016201520142013201220110.0

3.5

7.0

10.5

14.0

ODA flows to WASH % of Total ODA

116

13.8%

5.5%5.1% 5%

2.3%0.9%

8.4%

86

69

3728

14

117

FIGURE 12 Trends in ODA flows to WASH in Malawi

USD

$, m

illio

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Source: Government of Malawi, WASH PER (2020)

KEY TAKEAWAYS

The reduction of donor funding in rural areas for WASH interventions highlights growing equity of spending issues, as the majority of the poor with limited access to WASH lives in the rural areas.

Households remain the major contributor to the WASH sector, dwarfing donor interventions and resources from the Waterboards and the Central Government. Although contributions are higher in urban areas than in rural areas, these major contributions could be better leveraged to support operations of WUAs.

Better reporting of regular and emergency funds allocated to the WASH sector through the AMP or other means is necessary to allow for a better estimation of sector resources and needs.

Some donors have cautioned against the introduction of a WASH SWAp before strengthening PFM systems.

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14.23 There are also very high returns to improved sanitation and hygiene in schools, not just in improved health, but also in improved educational outcomes. Each dollar invested in school WASH programs, for example, generates over US$14 in benefits.

23 This result is in-line with the World Health Organization’s (WHO) finding that investments in “water supply and sanitation … bring economic benefits; US$1 invested would give an economic return of between US$3 and US$34”.

Annex 1: The Investment Case for WASH in Malawi

The case for investing in WASH services in Malawi is strong. Evidence abound to suggest that increased access to improved water and sanitation saves lives, reduces illness, and frees up time to be spent on work, studies, and childcare. A cost benefit analysis by the World Bank (2012) revealed that every dollar invested in the Malawi water and sanitation sector generate net benefits of between US$4 and US$14, depending on the sub-sector, as shown in Figure

FIGURE 14 Benefits and Costs of Investing in Different WASH Sub-Sectors

Source: Water Sector Investment Plan (2012)

Sector

Eliminate the Sanitation and Hygiene backlog at schools

Net benefit to investment ratio

Schools: More than $14 net Benefits: $1 invested

Rural: $14 netBenefits: $1 invested

Urban: $10 netBenefits: $1 invested

Rural: $4 netBenefits: $1 invested

Urban: $9 netBenefits: $1 invested

There is a high risk of transmitting diseases in schoolsChildren are particularly vulnerable to disease leading to death, malnutrition, time away from school and reduced concentration while in school.

Extend households’ access to improved waterImproved water has important health benefitsIncreased access reduces the time spent collecting water, a substantial part of many households’ days

Extend households’ access to improved sanitationImproved sanitation has similar health benefits to improved waterBasic toilets provide more privacy and reduce time spent finding a place to go to the toilet in the open

© UNICEF/2009/Pirozzi

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TABLE 3 Damage and loss of floods by affected Districts and Cities in million US$.

Damage Loss Total Effects

Dedza 0.11 0.00 0.12

Ntcheu 0.17 0.01 0.18

Mangochi 0.15 0.00 0.15

Machinga 0.14 0.01 0.16

Zomba 0.23 0.01 0.23

Chiradzulu 0.23 0.00 0.24

Blantyre 0.19 0.00 0.19

Mwanza 0.47 0.00 0.47

Thyolo 0.21 0.47 0.68

Mulanje 0.31 0.48 0.78

Phalombe 0.32 0.46 0.79

Chikwawa 0.57 0.48 1.05

Nsanje 0.27 0.47 0.74

Balaka 0.15 0.00 0.15

Neno 0.16 0.00 0.17

Zomba City - 0.01 0.01

Blantyre City 0.02 0.23 0.25

Total 3.72 2.65 6.36

Source: Malawi 2019 Floods Post Disaster Needs Assessment Report

Annex 2: WASH in Emergencies in Malawi

Over the years, Malawi has been consistently hit by floods, which have affected the delivery of WASH services. The economic costs of the floods have been huge. In 2019, for example, Cyclone Idai induced floods’ damage on WASH sub-sector was estimated at about US$ 3.7 million and loss was valued at US$ 2.7 million. The districts of Chikwawa, Phalombe, Mulanje, Nsanje and Thyolo were disproportionately seriously impacted. Table 3 provides a breakdown by district of the damage and loss resulting from the floods in WASH.

Damage to the WASH subsector included the destruction of infrastructure such as boreholes and piped water supply systems, a number of which were washed away. A number of sanitation facilities, including pit latrines, were damaged, resulting in the spillage of human waste into water, resulting in increased risk of borne and carried diseases. Loss to the subsector derived from increased operational costs associated with supplying potable and other water in the heavily affected areas. In addition, the Government incurred costs related to providing water and sanitation services, including latrines, to IDP. Loss in the subsector was also incurred due to costs associated with the removal of silt from water reservoirs or intake points; from reduced revenue from water supply; and from the cost of constructing temporary sanitation facilities. The prolonged unavailability of water resulted in many people, mainly women and girls, being required to spend greater time fetching water, thereby reducing the time available for other economic activities. Figure 15 shows damaged facilities in WASH in 2019.

FIGURE 15 Damaged facilities in water, sanitation and hygiene subsector

Source: Malawi 2019 Floods Post Disaster Needs Assessment Report

0 50 100 150 200 250 300 350 400

Boreholes (No.)

Shallow wells (No.)

Boreholes contaminated (No.)

Shallow wells contaminated (No.)

Water intake structures (No.)

Water supply conveyance pipeline (m)

Collapsed latrines (km)

Healthy facility letrines 140

258

30

27

19

332

81

396

www.unicef.org/malawi

UNICEF MalawiPO Box 30375Lilongwe, Malawi.Tel: +265 (0)1 770 770Email: lilongwe@unicef.org

ACKNOWLEDGEMENTS This budget brief was produced by Tapiwa Kelvin Mutambirwa under the overall guidance of Alessandro Ramella Pezza and Nkandu Chilombo. Useful comments were received from Bob Muchabaiwa and Matthew Cummins from the ESARO Office and Michele Paba and Patrick Okuni from the WASH Section.

For more information, contact:

UNICEF MalawiP. O Box 30375Lilongwe

Beatrice Targa Chief of Social Policy btarga@unicef.org

Michele PabaChief of WASHmpaba@unicef.org