World Bank Documentdocuments.worldbank.org/curated/en/459861468097200658/pdf/mul… ·...

Document ofThe World Bank

FOR OFFICIAL USE ONLY

Report No: 23363

IMPLEMENTATION COMPLETION REPORT(33220)

ON A

LOAN

IN THE AMOUNT OF US$256.0 MILLION

TO THE

FEDERAL REPUBLIC OF NIGERIA

FOR THE NATIONAL WATER REHABILITATION PROJECT

December 28, 2001

Water & Urban 2 DivisionAfrica Region

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization.

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

CURRENCY EQUIVALENTS

(Exchange Rate Effective)

Currency Unit = NairaUS$ 1 = 17.26 Naira (1992)

23.46 Naira (1993)21.94 Naira (1994)71.75 Naira (1995)81.49 Naira (1996)82.20 Naira (1997)82.00 Naira (1998)87.20 Naira (1999)103.00 Naira (2000)

FISCAL YEARJanuary 1 to December 31

ABBREVIATIONS AND ACRONYMS

DWSQC Departrnent of Water Supply and Quality ControlERR Economic Rate of ReturnFGN Federal Government of NigeriaFMWR Federal Ministry of Water ResourcesHRDU Human Resources Development UnitICR implementation Completion ReportMTR Mid-terrn ReviewNEPA Nigerian Electric Power AuthorityNUWSRP National Urban Water Sector Reform ProgramNWRI National Water Resources InstituteNWRP National Water Rehabilitation ProjectO&M Operation and MaintenancePMC Project Management ConsultantPMO Project Management OfficePPF Project Preparation FacilityPSP Private Sector ParticipationRC Regional ConsultantSAP Structural Adjustment ProgramSAR Staff Appraisal ReportSWA State Water AgencyUFW Unaccounted for Water

{ ~~~~~~~~~Vice President: Callisto MadavoI (?ali~~~~~Contry Director: Mark Tomlinson

FOR OFFICIAL USE ONLY

CONTENTS

Page No.1. Project Data 12. Principal Performance Ratings 13. Assessment of Development Objective and Design, and of Quality at Entry 14. Achievement of Objective and Outputs 45. Major Factors Affecting Implementation and Outcome 76. Sustainability 97. Bank and Borrower Performance 98. Lessons Learned 119. Partner Comments 1210. Additional Information 12Annex 1. Key Performance Indicators/Log Frame Matrix 13Annex 2. Project Costs and Financing 14Annex 3. Economic Costs and Benefits 17Annex 4. Bank Inputs 19Annex 5. Ratings for Achievement of Objectives/Outputs of Components 21Annex 6. Ratings of Bank and Borrower Performance 22Annex 7. List of Supporting Documents 23Annex 8. Borrower's Contribution 24Annex 9. Implementation Schedule 32Annex 10. List of Studies Completed 33

This document has a restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not otherwise be disclosed withoutWorld Bank authorization.

Project ID: P002084 Project Name: WATER REHABTeam Leader: David A. Henley TL Unit: AFTU2

ICR Type: Core ICR Report Date: December 20, 2001

1. Project Data

Name: WATER REHAB L/C/TF Nwnber: 33220Country/Departmient: NIGERIA Region: Africa Regional Office

Sector/subsector: WU - Urban Water Supply

KEY DATESOriginal Revised/Actual

PCD: 03/20/87 Effective: 08/27/92 08/27/92Appraisal: 05/19/90 MTR: 06/20/96 06/30/96Approval: 05/21/91 Closing: 06/30/99 06/30/2001

Borrower/Implementing Agency: FED. GOVT. OF NIGERIA/FMWR AND STATE WATER UTILITIESOther Partners:

STAFF Current At AppraisalVice President: Callisto E. Madavo E.V.K. JaycoxCountry Manager: Mark D. Tomlinson C. Koch WeserSector Manager: Letitia A. Obeng T. PellegriniTeam Leader at ICR: David Henley Elaine Patterson1CR Primary Author: E. Warner; P. Kriss; E. Okongwu

2. Principal Performance Ratings

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

Outcome: U

Sustainability: UN

Institutional Developnment Impact: M

Bank Performance: S

Borrower Performance: U

QAG (if available) ICRQuality at Entry: U

Project at Risk at Any Time: Yes

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

3.1 Original Objective:The objectives, as stated in the SAR, were to: (i) improve the level of water supply service in selectedurban and semi-urban areas by meeting the highest priority rehabilitation needs; and (ii) begin to addressthe most significant institutional weaknesses of State Water Agencies (SWAs) in order to improve theircapability to efficiently operate and maintain water supply systems. The project was intended to provide amechanism for financing sub-projects in individual states in order to meet the stated objectives.

The objectives appear to have been consistent with the implicit goal to improve provision of water to asmany people as possible within the urban and semi-urban areas of Nigeria through rehabilitation andinstitutional strengthening. They were reasonable in the light of the sector situation where there wasuniversal high demand for water versus very low production; systems were operating at 20 to 30 percentcapacity largely due to their state of disrepair and under-maintenance; and institutional weaknessesstemming from the lack of autonomy and consequent weak incentives to run efficiently SWAs . It isnoteworthy that given the state of disrepair of the nation's water assets, the government wanted a nationalproject that would catalyze the process of gradual improvements throughout the country.

The project design took account of its complexity and nationwide coverage, and risk containment measureswere built-in to minimize problems related to: capacity of the Federal Government to manage a project thatis geographically widely dispersed; and the states' commitment to providing counterpart funding.Administrative measures were set up to handle the former risk through the setting up of a projectmanagement consultant team (PMC) within the Project Management Office (PMO) at the federal level;regional consultants (RCs) located in zonal offices to handle groups of SWAs; quarterly reporting along aformat identified at appraisal and refined as the project developed; annual workshops to be attended by allparticipating SWAs and the Federal Ministry for Water Resources (FMWR); the Bank also planned forincreasing its supervision efforts. Counterpart funds were deducted directly from the federation accountsof each participating state which addressed the second risk.

3.2 Revised Objective:N/A

3.3 Original Components:The original components as stated in the SAR include:

i. Setting up of a mechanism for financing the highest priority rehabilitation needs of state water supplysystems through subloans of up to US$10 million equivalent per state;

ii. Rehabilitation of existing facilities by repair or replacement of civil works, plant and equipment withthe objective of restoring the output of water supply systems to their original design capacitieswherever possible;

iii. Leakage detection and repair program;iv. Institutional strengthening components to improve operation and maintenance, financial management,

staffing and stores management;v. Strengthening the Department of Water Supply and Quality Control (DWSQC) of FMWR, including:

(a) developing policy guidelines for design and maintenance of water supply systems, waterquality standards, equipment standardization, standards for water treatment chemicals,improved tariff structures and cost recovery, and manpower development;

(b) establishing and maintaining a database to monitor key performance indicators of SWAs;(c) establishing and maintaining a water resource and water quality database for both surface

and groundwater sources used for domestic and industrial purposes;(d) identifying the most critical training needs in the sector and assessing the capability of

local training institutions to meet those needs; and(e) carrying out special studies of general interest to the sector, such as pollution and water

quality studies, review of tariff structures, fixed assets valuations and so forth.

- 2 -

AssessmentOverall, the design of the project components appears to have been adequate to address the objectives asstated in the SAR. A project design flaw has been noted, however, in the project's emphasis on upfrontreduction of unaccounted-for-water (ufw) without the appropriate level of funding, even though the Bankhad little detailed knowledge of the condition of the systems at appraisal. It now appears that while theearly emphasis on minimizing leakage is excellent in theory, many systems had so little water in them thatthere was no practicable way of identifying potential leaks early in the project without major expensivecondition surveys of the distribution systems. It was not until after rehabilitation of production systemswas completed that leaks could in fact be readily detected.

3.4 Revised Components:The project components were not revised, but there was a revision in the Allocation of the Proceeds of theLoan in March 1999, largely to distribute the unallocated funds in Category 5 of the Loan Agreement andto fund the appropriate Categories in line with the actual procurement packaging. As indicated in the tablebelow, much of the equipment and materials was procured as part of civil works' contracts and wastherefore re-classified as such.

Allocation of the Proceeds of Loan 3322Cat. Component OriH. Cost Revised Cost

1. EQUIPMENT & MATERIALS 134,000,000 27,600,0002. CIVIL & BLDG WORKS 61,000,000 158,900,0003. PROJ MGT, TRG, TECH STUDIES, & ENG 35,600,000 69,000,0004. PROJECT PREP FUND 400,000 500,0005. UNALLOCATED 25,000,000 0

Total 256,000,000 256,000,000

3.5 Quality at Entry:This project's appraisal preceded the QAG and Quality at Entry ratings.The project's objectives were consistent with the then articulated sector strategy. Lessons wereincorporated from the experience of five earlier projects, which influenced the mix of components. Theproject did not consider major reform, including Pravate Sector Participation (PSP), as the initial means tobring about sustainable sector improvements largely because of great variation in the evolution of theSWAs, and PSP in water had not, at the time of appraisal, become mainstream. Rather, it was consideredessential to focus on increasing the awareness of all SWAs of their weaknesses and possibilities throughgeneric technical studies, dissemination of findings at national level seminars and workshops, andpromotion of policy changes. This was intended to lay the foundation for further development, includingmajor policy reforms. Additionally, the political and institutional environment at the time was notconducive to introducing major and sustainable reforms.

With respect to the project's intemal design, it now appears that a few project features could have beendone differently. For example, project preparation could have been more advanced; pre-engineeringestimates were done for only four out of the then 22 SWAs followed by a quick assessment of theremaining. It took about 30 months from the date of project effectiveness to award the first physical workscontract due to delays in designs and preparation of bidding documents. Based on discussions with theproject team, it is noted that while advanced preparation would have been desirable, it could not have beendone due to lack of funds. At the time, the project unit saw no other recourse but to await withdrawalsfrom the project loan for the needed preparation.

-3 -

4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective.It is important to note the difficult macroeconomic, strategic and political sector setting in which the projectdeveloped. The project was conceived, prepared and appraised during the structural adjustment program(SAP, 1986 to 1993). In 1992, as a result of poor public resource management, the Bank and IMFwithdrew support to the SAP, and shortly thereafter, new lending was halted. The value of the Naira tooka precipitous decline during the project. Real wages of public employees, including those of the SWAsdecreased by a factor of about 10 (1986 to 1997), and the ratio of wages of SWA employees to those ofcomparable positions in the private sector stood at about 1:25 by end-1999. Political difficulties peakedfollowing the annulment of national elections in June 1993. Changes in government appeared to be thenorm then. There were frequent changes in all levels of government and undue interference in managementof the SWAs, including frequent and sudden changes in senior SWA management. The above factorsseverely affected employee morale and productivity, and consequently limited the impact of the project.

The project's overall outcome is currently judged as unsatisfactory. The objective to improve the level ofwater supply service in selected urban and semi-urban areas by meeting the highest priorityrehabilitation needs was partially met. Rehabilitation was done on production works in 150 schemes in 37states (as against 22 states at appraisal) increasing their potential output from about 43 to 87 percent oftotal installed capacity, or an increase in average daily production from 0.7Mm3 to 1.4Mm3 (comparedwith SAR expectations of I.7Mm3). The impact of this achievement is, however, limited by two factors:(i) the above figures indicate possible production quantities when there is adequate power supply and watertreatment chemicals; but this has not been the norm for most of the SWAs due to nationwide power supplyproblems; and (ii) no provision was made for rehabilitation of the delivery network, which remains in verypoor condition. In fact, only 0.8Mm3 per day production was actually achieved in 1999 because of thepower supply problem; improved power supply has long been expected and anticipated, leading to asatisfactory rating during project implementation, however given that the inadequate power supply persists,the overall outcome must be considered as unsatisfactory. The level of water supply service has also beenimproved marginally by the leak detection and repair program piloted under the project. Partial preventivemaintenance and passive methods of ufw control were introduced and institutionalized with leak detectionunits in a few of the SWAs.

The objective was met to begin to address the most significant institutional weaknesses of the SWAs inorder to improve their capability to efficiently operate and maintain water supply systems. Diagnosticstudies were done to expose SWAs to their technical and institutional areas of greatest need. As a result,improved edicts were designed and mostly implemented. The project put in place procedures to maintainthe rehabilitated assets, including manuals of practice for preventive maintenance, basic managementinformation systems, budget and accounting systems, customer registration, asset bases, and billing andcollection procedures. The types of procedures and their usage differ according to the specific level ofdevelopment of a particular SWA. Continued assistance would be required to further upgrade andstrengthen the systems and procedures reinforced by enabling policies of the state governments with respectto the tariff and autonomy.

An additional outcome of the project, not identified at appraisal, has been the raising of awareness amongall key stakeholders of the states in Nigeria of the need to run potable water supply operations as a businessand also of the need to attend to the larger water resources management issues. This was achieved throughregular national seminars with political support from the highest levels of government, regional seminarssupported by state govemors, local workshops and hands-on technical assistance when requested by the

- 4 -

SWAs. Sector professionals and policy makers also participated in a Governors' Seminar and Donors'Conference during February 2000, supported by the World Bank Institute, which exposed them toalternative modes to reform their institutional status quo to bring about sustainable sector development.These activities were a precursor to the development and adoption of the National Water Supply Policy(1999) and also brought the attention of donors to the water sector. As a result, the sector is more proactivetowards its future development, including active moves towards PSP in some states. This remarkablechange in awareness and attitude is considered to be a major success of the project.

It is important to note that the project dealt with emergency works averaging about US$6.0 million perstate. It is recognized that the networks are old, possibly prematurely so due to a history of neglect. Insome cases, additional bursts have occurred on the rehabilitated assets caused by the inability of thenetwork to withstand post-rehabilitation water pressures. Extensive leakages continue at serviceconnection pipes and within consumer premises due to past inferior plumbing standards. Some SWAs haveinitiated steps to replace service connections, install meters, enforce the plumbing standard codes that weredeveloped under the project and to continue the pilot leak detection and repair program. Clearly, theintermediate steps currently being taken by the cash-strapped SWAs are not sustainable without additionalfinancial and technical support to continue to make incremental improvements as a first step, andeventually major capital inflows to bring about comprehensive and sustainable change.

A thoroughly prepared strategy was implemented to train staff at all levels through the formation of aManpower and Training Committee (MTC) comprising the National Water Resources Institute (NWRI, theagency responsible for technical training), the Human Resources Development Unit (HRDU) of the PMO,and representatives of each SWA. The Bank's supervision team provided advice to the MTC. The basis ofthe strategy was the design of "hands-on" technical training nationwide. An outreach program ofon-the-job training emerged, which came to be known as the Nigeria Water Supply Training Network.Success of this outreach program led to its replication in other projects in Africa with large capacitybuilding components. Additionally, a satellite training unit was constructed and equipped in Enugu tosupport regional training. It is noted that while the SWAs participated in the training and institutionaldevelopment program, only a few were able to fully implement and sustain the improvements, largelybecause of lack of recurrent funds for spare parts and tools, all stemming from their weak operatingenvironment and incentive system.

The project's implicit financial objective required elimination of government subvention through regulartariff increases combined with cost containment, and a target was set for the SWAs to increase their cashoperating ratio from 15 to 100 percent. Only 3 SWAs were able to meet this target (and only for a shortperiod during implementation); 17 others showed some improvement in their own cash flows; while 9showed steady decline; the remainder did not provide data. Overall, the data indicate a reduction in thelevel of subvention and an increase in revenue from the sale of water, but the tariff policy remains weak.The incentive to improve financial efficiency was inadequate in light of frequent changes in SWAmanagement stemming from a prolonged period of government instability.

4.2 Outputs by components:Annex 8 provides a list of targeted and achieved outputs. The project successfully set up a mechanism forfinancing rehabilitation through subloans to each of the participating states through a Project ManagementOffice (PMO) at the FMWR. The PMO was staffed with project management consultants who designedand helped to implement the project's administration to ensure accountability. Regional consultants werethen engaged and located in zonal offices to provide closer supervision to groups of SWAs; they werereinforced by zonal engineers who gave grass-roots support; reporting was done on as quarterly basis.

- 5 -

Based on this experience, institutional capacity has been developed at the national level to manage futureprojects. Additionally, a very detailed monitoring system was set up to gauge performance of the SWAs.Even though the SWAs were involved in the design of the system and adapted it (state level) to help themcomply with the reporting needs of the project, many of them were not able to regularly submit the datarequirements because their own intemal data collection and reporting systems remained very weak despitethe technical help provided by the project.

Each SWA executed a sub-project focusing on rehabilitating some selected water supply schemes by repairor replacement of civil works, plant and equipment. About 150 priority urban and semi-urban schemes in36 states and Federal Capital Territory (FCT) were selected for rehabilitation, increasing their output toabout 1 .4Mm3/day or 77 percent of the targeted increase (see 4.1 section).

Leak detection programs were piloted as planned with the aim of teaching staff how to implement suchprograms so that they could continue incrementally to work on their entire systems. While the pilot wascarried out fairly well, many of the SWAs (80 percent) did not continue the program beyond the pilot. Thesix that did continue reported initial decreases in ufw through year 1997, but ufw increased again as aresult of the increased pressure in the distribution system brought about by the completed rehabilitation.Thus, the target to reduce ufw from 60 to 25 percent in five years was not reached. The ufw problemproved to be more difficult and beyond the capacity of the SWAs to implement because (i) the problem wasmuch greater than anticipated at appraisal; (ii) there was limited availability of project funds for ufwreduction; and (iii) the low initial water pressure making leak detection difficult (see 3.3 section).

Each SWA was to be assisted by technical operational consultants to implement a very detailed set ofguidelines for technical operational improvements, including Operation and Maintenance(O&M), staffingand stores management. About 33 percent of the SWAs were able to take advantage of this component,and they instituted preventive maintenance procedures. A similar arrangement was made for financialconsultants to help upgrade accounting and financial systems and improve billing and collectionprocedures. About 57 percent of the SWAs actually engaged and worked with local financial consultantswho helped to improve their budgeting and accounting systems and procedures and carried out relevanttraining. Support, both technical and financial, was provided during the last two years of the project, andonly SWAs who were capable of preparing and executing the bidding process within the given timeframewere able to take advantage of it.

A human resource development and training component was successfully carried out through the setting upof an MTC and a Training Network achieving success with "hands-on" technical training (see 4.2 section).A Manpower Audit and Training Needs Analysis was successfully carried out in each SWA, which formedthe basis for regularly held training courses. A total of 12,863 trainee weeks were achieved for 27 SWAs.

The project was instrumental in establishing a Nigerian Water Supply Association as a professional body,which is functioning well.

In line with the emerging needs of the project, the component to strengthen the DWSQC was redesigned,and emphasis was placed on the promotion of sector reformn, policy development and communicationswithin the sector.

Finally, several studies were conducted and effectively used during the course of the project, includingfeasibility studies for new sub-projects, safety assessment of dams, plumbing codes, design reviews,manpower, budgeting and accounting. A list of these studies is included in Annex 10.

-6 -

4.3 Net Present Value/Economic rate of return:Most rehabilitation works under the project have been carried out successfully, and the actual possibleproduction has been increased by 720,000m3/day to a level of 1,423,000m3/day. This is a large increase,in line with the indicative works appearing in the SAR and corresponds to 255 million m3/year. Currently,however, only a part of the possible capacity is utilized, mainly due to the lack of reliable power in thecountry. In 1999, out of a total production capacity of about 1.4 million m3/day, 0.8 million m3/day(58%) was actually produced. From an economic point of view, justifying an investment which hasconsistent low utilization ratios due to lack of power (or other reasons) is difficult, as the value of futurewater sales is lower than that of current sales.

The assumption used in the preparation of the SAR, stating that increased tariffs will be adequate to assureSWAs' autonomy was, in perspective, somehow overly ambitious. Average water tariffs currently rangefrom about US$0.05/m3 to about US$0.60/m3 with the majority of states at the lower end of the range.Indeed, there is a minority of states that is still grappling with the issue of whether or not to impose acharge for urban water supply. The fact that most states did not increase tariffs substantially, even inNaira terms, reflects a defacto large decrease in real prices of water. Further discussion of the economicex-post analysis is provided in Annex 3.

4.4 Financial rate of return:A financial rate of return on the project's investments was not calculated at appraisal. The SWAsfunctioned as government departments, they were weak in accounting, record keeping and financialmanagement in general. Annual audits were the exception; only nine were able to produce auditedconsolidated accounts in 1988 at the time of appraisal; recurrent subvention from state governments wasvery high -- averaging over 50 percent of the operating cash flows of the SWAs; the average tariff wasminimal as most state governors then considered potable water as a social service. The SAR examined thelimited financial data available and set targets for the SWAs to be monitored throughout projectimplementation.

As indicated in the performance indicators in Annex 1, while some level of improvement was achieved,most of the SWAs remain financially weak. Adequate and reliable accounting systems are in place in onlya small number of SWAs. Even among these the submission of annual financial reports is still slow anddelayed by up to 24 months. As the financial management competence is still weak in the SWAs, thiscomplicates the work of the external auditors. The water rate is only minimal in practically all of the statesranging from about US$0.05/m3 to US$0.60/m3. The ratio of average water rate to cash operating costincreased from 27 percent in 1992 to 47 percent in 1997. There remains an urgent need for comprehensivefinancial management reforms in the SWAs in line with larger reforms in the policy environment.

4.5 Institutional development impact:The project provided invaluable support for emerging SWAs through its training and institutionaldevelopment program organized largely through the MTC and NWRI (See 4.1 above). It succeeded inraising awareness with respect to the requirements for achieving technical, operating efficiency andfinancial management through external exposure to well-functioning utilities. It also helped raiseawareness on alternative modes of reform through detailed technical studies and wide dissemination offindings. As a result, some SWAs took the preparatory steps to request new projects to support majorpolicy reforms. This would be reflected in the National Urban Water Sector Reform Project planned forFY03. (See section 6.1).

5. Major Factors Affecting Implementation and Outcome

- 7 -

5.1 Factors outside the control of government or implementing agency:The factors include: (i) low level of interest by the business community once the tendering process started:The first set of tenders produced little response; there was scepticism from the business community withinNigeria, and the international community was not responsive to the tendering process (e.g. hesitance toopen letters of credit, and little response from foreign banks with respect to contract securities); (ii) veryhigh inflation; and (iii) banking industry distress, which occurred during the mid-1990s, and delayed theflow of counterpart funds; the PMO estimated that a total of N162 million in counterpart funds were lostduring the banking crisis.

5.2 Factors generally subject to government control:

The factors include:(i) Unreliable Electricity Supply A major production constraint was the unreliability of the national powersystem run by the Nigerian Electric Power Authority (NEPA). Power outages were very frequent,estimated well in excess of 50 percent of the operating time at many of the waterworks. This resulted in (a)SWAs having to use altemative power sources at higher cost; (b) accelerated deterioration of the assets andfailure of electrical equipment; and (c) reduction in water supply to consumers.(ii) Scarcity of Petroleum Products Most of the contracts suffered delays as a result of a national scarcityof petroleum products, which resulted in arbitrary increases in the price of petrol and diesel required by theSWAs to run their systems (the back-up generators) and by the contractors for their vehicles andequipment.(iii) Governance Problems There were frequent changes in all levels of govemnment and undue interferencein the management of SWAs, including frequent and sudden changes in senior SWA management. Therewas also constant interference by state governnments in the administration of contracts and on procurementissues which added to project delays. Additionally, early in the project, bureaucratic delays at the federallevel led to a late start in recruiting the project management consultants . This in turn triggered furtherdelays in recruiting the regional consultants and in having the subloan agreements signed between thefederal and state governments.(iv) Changes in Import Procedures at the port and changes in pre-shipment inspection agents resulted insignificant delays in goods clearance and doubling the delivery time.(v) Instability in Management at the state government levels made it difficult to introduce and sustainagreements on tariff policies and to improve the incentive environment of the SWAs.(vi) The Splitting up of States increased the task of monitoring and supervision and complicated matterssuch as submission of audit reports and achieving financial viability. Many of the new states required muchmore comprehensive support from the PMO than was provided by the project.

5.3 Factors generally subject to imnplemnenting agency control:The factors include:i. Start-up delay; many of the SWAs were overwhelmed by the project's administrative requirements,

which led to delays in fulfilling their conditions for participating in the project.ii. Time slippages on procurement decisions.

iii. Delays in procurement leading to 200 percent average time overrun to contract completion.iv. Performance monitoring was weak largely due to frequent changes in SWA management.

5.4 Costs and financing:At appraisal, total project costs were estimated at US$306.7 million to be financed by the Bank (84percent); Government of Japan (lpercent); Federal Governnent (2 percent); and State Governments (13percent). The final cost was US$294.5 million; the financing pattern was similar to the appraisal intent. As

- 8 -

indicated in Annex 2, there were shifts in order to fund the appropriate Loan Categories in line with theactual procurement packaging.

6. Sustainability

6.1 Rationale for sustainability rating:

Sustainability of the works financed under the project is rated as unlikely largely due to the continuedabsence of an enabling incentive and operating environment within the SWAs. An important key tosustainability of the operations of the SWAs is financial autonomy through full cost recovery. However,only 3 of the SWAs were able to attain a current ratio of 100 percent for any time at all. Maintenanceculture is still very limited. We note, however, that thanks to the project efforts in promoting studies andpolicy discussions among key stakeholders and also to the relative stability of key management staff at thefederal level, sector issues have now been brought to the national agenda. The sector is now supported byan improving policy environment as discussed below.

The recent transition to civilian rule has been marked by commitment of the new administration to bringabout necessary policy and institutional reforms to ensure sustainability among receptive states. TheFederal Government adopted and published a policy paper, and plans are underway to implement thereforms based on the new policy. At the state level, several states have initiated PSP studies with a view toreforming the institutional status quo for their operations.

A follow-on project, the National Urban Water Sector Reform Program (NUWSRP), has been designed toenable the government to establish the regulatory, policy and legal framework to attract private operators inwater utility management in states that have accepted the reforms. The NUWSRP is targeted for fiscalyear 2003.

6.2 Transition arrangement to regular operations:The project dealt with the agencies responsible for the regular operation of project assets, and institutionalstrengthening and operations efficiency measures were intended to allow the SWAs to improve on theiroperation and maintenance practices.

7. Bank and Borrower Performance

Bank7.1 Lending:

Project preparation was done by a team of experienced professionals and was consistent with the sectorstrategy in place at that time. Some of the lessons leamed from previous projects in the water supply sectorwere integrated into the design of the institutional support and training program. However, the followingdesign flaws have been noted: (i) the project failed to reflect and carry out risk assessment related tostart-up delays (based on experience of Bank projects in Nigeria); the need for this type of assessment wascritical given that preparation was not advanced at the start of the project; (ii) there was no apparentjustification for the project's emphasis on upfront ufw reduction without an appropriate level of funding forthis component and in the absence of detailed knowledge of the condition of the systems; and (iii) noattention was given to repair of the distribution network which constrained delivery of water. For thesereasons, Bank lending could be considered unsatisfactory.

7.2 Supervision:

-9-

The project unfolded during a very difficult political and economic period in Nigeria. The value of theNaira took a precipitous decline during the project. This was exacerbated by the banking distress in thecountry, all of which affected the timing and availability of counterpart funding and contributed to slowingthe pace of project execution. In FY95, the Bank's management considered cancellation of the project dueto the continued weak country situation. However, there was no support in the country for cancellation;moreover, terminating the large number of contracts then under execution would not have been an easyendeavor.

With respect to supervision, team composition was adequate as was the range of expertise. Continuity intask management, including regular supervision and participation in all of the annual project meetingscontributed enormously to keeping the project on track. The Borrower particularly commended the TaskManager for his perseverance in not only project supervision but in (a) raising the profile of the watersector through national and intemational seminars during a very difficult period in the country's economicand political transition; and (b) through this effort attracting external donors back to the sector. Theregularity and timeliness in handling procurement issues by the Resident Mission staff proved to beeffective; the presence of an engineer in the Resident Mission enabled the Bank to visit all of the numerousproject sites and provide timely advice. A total of 18 headquarters-led missions were completed with threemissions per year during the first two years and two missions each year thereafter.

7.3 Overall Bank performance:Overall Bank performance is considered satisfactory.

Borrower7.4 Preparation:Basically, there was a collaborative relationship throughout the project between the Bank and Borrower.Similar to the observation above related to Bank performance, the project was not sufficiently advancedwhen it became effective; the scope was too great to be efficiently executed; and the federal governmentimposed an implementation system that was too complex. For these reasons, preparation is consideredunsatisfactory.

7.5 Government implementation performance:Due to the factors subject to govemment control that caused difficulties during implementation as noted inSection 5, the Borrower's implementation performance is considered unsatisfactory.

7.6 Implementing Agency:The project was implemented at the Federal level by the FMWR and its coordinating unit, the PMO. Atfirst, federal officials and the PMO were overwhelmed by the complex administrative needs of the projectand unfamiliarity with Bank procurement procedures, and they experienced considerable delays inrecruiting the project management consultants and setting up the accounting system and procedures. Afterstart-up delays were ironed out with the help of foreign technical experts in the PMO, capacity was built atthe Federal level in project administration. It is noteworthy that after three years of foreign technicalassistance, a local project manager successfully headed the PMO. It is also noteworthy that despite majorstaffing shifts among high-level government officials in Nigeria during the project period, there wascontinuity at the senior policy level in the water sector at the federal level, which aided the effectiveknowledge transfer, relatively smooth project monitoring, sector capacity building, policy formulation anddissemination.

At the state level, the participating SWAs, were a diverse group of agencies with varied developmentchallenges. Overall, their performance was satisfactory. They were eager to participate in the project and

- 10-

cooperated with the project requirements, some of which turned out to be very demanding on theircapabilities. Many of the SWAs would have preferred to have consultants working solely with themindividually as opposed to having regional consultants in charge of five to seven states. The pace ofimplementation was slowed by (i) difficult logistics related to the wide geographical spread of the project;(ii) the mismatch between the weak capacity of many of the SWAs and the procedural demands of theproject; and (iii) the frequent changes in management at the senior level of the states and the SWAs.However, the SWAs were always ready to take the required steps within their control to respond (withintheir capacity) to the demands of the project.

During the project period, the implementing agencies gained considerable experience and became veryresponsive to the needs of the project, rating an overall performance grading of satisfactory.

7.7 Overall Borrowver performance:Overall Borrower performance is considered unsatisfactory.

8. Lessons Learned

The Reform Issue. While the project was limited in its scope to rehabilitation and institution buildingwithin the SWAs,and hence limited in its impact, the Bank rightly used the project as a vehicle to initiateand promote major policy reforms nationwide. This was done through engaging all SWAs in discussions atseminars held at the national, regional and local levels. Because of the Bank's steadfast focus on reformingthe policy environment of the SWAs supported by relevant project-financed studies, the sector was wellpositioned to be on the national agenda once the political environment stabilized. It is important to notethat this global engagement of SWA officials throughout the project could not have been effectively donewithout the emergence of a champion in the country interested in initiating reforms and carrying themthrough.

Smaller Projects In a federal country such as Nigeria, where logistics are often very difficult, it isimportant to keep projects relatively small and focussed on only a few states at a time. In spite of theadministrative set-up for the project, the management infrastructure turned out to be incapable ofeffectively and efficiently supervising the large number of sub-projects, particularly in the initial stages,which led to lengthy start-up delays. The lesson here is that while nationwide policy approaches,consensus-building seminars and marketing of policy reforms are necessary and still required, executing alarge number of sub-projects simultaneously dispersed throughout the states should be avoided. Inretrospect, the preferred and more viable approach for a national project might have been to focus on fullscope rehabilitation in a limited number of commercial capitals, for example, while raising awareness andbuilding capacity within all of the SWAs.

Additionally, because of the small scale of the detailed work items, and practical difficulties ofincorporating sub-projects in several states into a single contract, a large number of small contractsresulted. These could not attract international contractors; it overstretched the national capacity as thesmall contractors could not handle the cumulative value of works. Handling a large volume of smallcontracts is generally not an efficient way to do things in the water sector in Nigeria.

Distribution Networks In designing water supply works (rehabilitation and/or expansion), it is important tokeep in perspective the need to get water to the ultimate beneficiary. In many of the SWAs, while theproduction facilities were rehabilitated, the benefits from this rehabilitation were constrained by an agedand generally inadequate distribution network. Clearly, the project intended to focus only on highestpriority rehabilitation needs, which it did, but in the process, other "priority" needs evolved. One might

- 11 -

also add that the project was intended to jump start the momentum in the states. Additional works couldhave been financed by the SWAs themselves or the state and federal governments had there been politicalstability and continuity in the policy dialogue at the state level. In any event, projects need to take a moreholistic planning approach for water supply systems.

Advanced Preparation In the interest of efficient pace of implementation, it is recomnmended that projectpreparation be well advanced prior to project effectiveness. This would help minimize start-up delays andrealize project benefits sooner rather than later. Correspondingly, funds need to be secured for projectpreparation in advance of the expected loan effectiveness. It is noted that Nigeria, at the time of appraisal,was reluctant to fully utilize the Bank's Project Preparation Facility mechanism for detailed preparation.

Indicators and Targets Collection of reliable indicators was a continuing difficulty under the project,despite significant effort and resources having been spent on it. Considerable work needs to be donecommencing early in the project cycle to involve project agencies in the monitoring process, to tiemonitoring more closely to project implementation, and to demonstrate the use and maximize the value ofthese indicators. Additionally, projects need to focus on indicators that are easily measurable by the SWAswithout the need for additional investments in manpower or technology. With respect to the project targets,many of them were not achievable largely because they were globally set and did not reflect detailedknowledge of specific SWAs. If a nationwide project were to be implemented again, the targets need to becustomized to groups of like SWAs as opposed to one general set of targets, which turned out to beunachievable by many.

9. Partner Comments

(a) Borrower/implementing agency:The Borrower has received a copy of the draft ICR but has not to date commented.

(b) Cofinanciers:A copy of the draft ICR was sent to the Govermnent of Japan for review and comment.

(c) Other partners (NGOs/private sector):

10. Additional Information

- 12 -

Annex 1. Key Performance Indicators/Log Frame Matrix

Outcome I Impact Indicators:

Indicator/Matrix Projected in last PSR Actual/Latest Estimate

Production of potable water increased from 188,000 to 1,430,000 cubic capacity increased to 1,430,000 cubic metersmeters per day per day however actual delivery has only

reached about 800,000 cubic meters per daydue to persistent shortcomings in electricitysupply.

UfW reduced from 60% to 25% estimated at about 40 %

COR of SWAs increased from 15% to 100% 45%

Staff training in SWAs increased from 0.1% to 5% of staff time. 1.5%

Systems under preventive maintenance increased from zero to 100% 20%

Output Indicators:

Indicator/Matrix Projected in last PSR Actual/Latest Estimate

Refer Annex 8

End of projectNote: The above data needs to be read with caution for the following reasons:1. Not all of the SWAs reported2. Those reporting provided incomplete data for some years3. With respect to ufw, the majority of systems had neither production nor consumption meters4. The databases within the SWAs remain very weak.

- 13-

Annex 2. Project Costs and Financing

PROJECT COST BY COMPONENTS AS AT JUNE 2001

ITEM Appraisal Estimate (US$ Million) Actual (US$ Million)

Local Foreign Total Local Foreign Total

I Equipment and Material 23.00 70.60 93.60 .. .

C;..l r-d Building WIvrk- l 50 36 Tn ^ 20 46.20 162.97 209.17

3 - Operational Support 1.00 16.90 . 17.90 5.34 5.02 10.36

Project Management __.__ 0.90 5.20 6.10 6.72 13.80 ! 20.525 Engineering, Studies and 9.60 20.10 29.70 8.49 45.51 54.00

.. _ _ _~~~~~~.._ ?._._._._ .____.. .. ..... ......... .... _ ___... _.___._ _-___-

Technical Assistance

6 Refinancing of PPF Advance 0.40 0.40 0.50 0.50

7 Physical Contingencies 7.30 20.90 28.20

8 Price Contingencies 19.40 41.70 61.10

Duties 16.50 16.50 l

Total 94.20 212.50 306.70 66.75 227.80 294.55

Note: Under Component 2 equipment and materials were put together with civil and building work under

combined contracts.

Appraisal Estimate (US$ M) t Actual (US$ M) Disbursed

Local Foreign Total Local Foreign Total

World Bank - IBRD 47.50 208.50 256.00 24.46 225.63 250.09 98%Government of Japan 0.50 4.00 4.50 3.43 2.17 5.60 124%Federal Government of Nigeria 7.40 7.40 11.94 11.94 161%

State Govemments 38.80 38.80 26.92 26.92 69%

Total 94.20 212.50 306.70 66.75 227.80 294.55 96%

- 14 -

Annex 2a. Disbursement Summary by Fiscal Years

YEAR AMOUNT

$1,993 17,754,875

1,994 6,893,418

1,995 15,345,320

1,996 37,876,903

1,997 60,167,815

1,998 36,203,237

1,999 15,661,530

2,000 41,418,014

2,001 19,1 19,575

TOTAL 250,440,688UNDISBURSED 5,559,312

LOAN/CREDIT DISBURSEMENTS: CUMMULATIVE ESTIMATED and ACTUAL BY FISCAL YEAR 30 JUNE

- 1,993 1,994 1,995 1,996 1,997 1,998 1,999 2,000 2,001

APPRAISALESTIMATE 32,800,000 77,800,000 134,300,000 185,200,000 223,500,000 246,800,000 250,400,000 253,200,000 256,000,000

ACTUAL 17,754,875 24,648,293 39,993,613 77,870,516 138,038,332 174,241,569 189,903,099 231,321,113 250,440,688

ACIUAL AS % OFESTIMvATE 54% 32% 30% 42% 62% 71% 76% 91% 98%A

DATE OF FINALDISBURSEMENT JUNE'1993 JUNE1994 JUNE1995 JUNE'1996 JUNE1997 JUNE1998 JUNE'1999 JUNE'2000 JUNE2001

- 15-

Annex 2b. Disbursement Profile

IBRD DISBURSEMENT PROFILE

+ Actual -a--Target300 _ -

250

200

0 150

100

50

01992 1993 1994 1995 1996 1997 1998 1999 2000 2001

|_4-Actual 3.44 14.14 25.28 58.62 110.3 154.9 181.9 210 235.5 250

-Target 3.00 18.00 52.00 104.00 161.0C 205.10 237.10 253.80

STATE GOVERNMENTS' DISBURSENT PROFILE

| Actual -_- Target50 -

40

30.0

*-20-______

10_

1993 1994 1995 1996 1997 1998 1999 2000 2001

Actual 0.52 1.17 2.01 4.11 8.24 11.59 17.71 20.25 26.96

6.6 11.97 17.34 22.71 28.08 33.45 38.82

FEDERAL GOVERNMENT DISBURSENT PROFILE

--- Actual -_ -Target15

10

5

1993 1994 1995 196 1997 1998 19 00 20

Acul 1.62 3.3 3.85 4.77 6.62 8.54 10.48 11.57 11.94

1-6-Trget 1 06 2.11 13.17 14.23 15.29 16.34 17.4

- 16 -

Annex 3. Economic Costs and Benefits

The project's two main objectives as set in the SAR were to: (i) improve the level of water supply service inselected urban and semi-urban areas by meeting highest priority rehabilitation needs; and (ii) address themost significant institutional weaknesses of SWAs in order to improve their capability to efficiently operateand maintain water supply systems. As stated previously in the main text of the ICR, the first objective ofachieving physical improvements in the water supply production and delivery system has largely been met,and most of the indicative rehabilitation works have been executed. The second objective, addressing theinstitutional weakness of SWA to improve their efficiency and financial autonomy has experienced someproblems.

The project's performance is examined in the country's context. The implementation period has extendedover about nine years and experienced some delays. The period within which the works has been executedhas been extremely difficult. The country's macroeconomic situation has been consistently deterioratingduring most of the project's execution, and poverty in the country increased rapidly. During the militaryregimes, which govemed the country in the 1990s, Nigeria has had various impasses with the Bank. Thefact that the project teams have succeeded in pushing ahead with the some of the reforms, and continued toimplement the physical work program satisfactorily is remarkable by itself.

An additional factor which is important to take into consideration when addressing the project's economicperformance, is the dire state of the country's energy sector. Nigeria is going through a substantial energycrisis, which has severely impacted and curtailed the delivery of electricity to the country. As water supplyproduction and delivery are closely related to, and based on energy production, the situation has seriouslyimpacted the water supply sector. Thus, the benefits of the facilities rehabilitated by the project, can notbe accurately measured at this time. When a reliable power supply is restored, production will besubstantially larger.

Most rehabilitation works under the project have been carried out successfully and the national actualpossible production has been increased by 720,000m3/day to a level of 1,423,000m3/day. This is a largeincrease, in line with the indicative works appearing in the SAR and corresponds to 255 m3 million/year.Currently, however, only a part of the possible capacity is utilized, mainly due to the lack of reliable powerin the country. In 1999 out of a total production capacity of 1.4 million m3/year Nigeria produced, 0.8million m3/day (58%) was actually produced. From an economic point of view justifying an investmentwhich has consistent low utilization rations due to lack of power (or other reasons) is difficult, as the valueof future water sales is lower than that of current sales. However, it is important to isolate the issues whichare exogenous to the project, while addressing its execution.

The assumption used in the preparation of the SAR, stating that increased tariffs will be adequate to assureSWAs' autonomy was, in perspective, somehow overly ambitious. Average water tariffs range from aboutUSSO.05/m3 to about USSO.60/m3 with the majority of states at the lowest end of the range. Indeed, aminority of states are still grappling with the issue of whether or not to impose a charge for urban watersupply. The fact that most states did not increase tariffs substantially, even in Naira terms, reflects a defacto large decrease in real prices of water. The states participating in the project have not implementedthe conditionality appearing in the "criteria for state eligibility for sub-loans" (Annex 3.5, SAR) whichmentioned explicitly that states wanting to achieve a sub-loan agreement with the FGN "would undertake toimplement a program of phased tariff increases which would be based on annual tariff adjustmentssufficient to enable the SWA to meet all cash operating costs from internally generated revenue within afive year period."

- 17 -

Leak Detection Program: The estimation that the leak detection program will have a high economic rate ofreturn has been refuted as well. As explained in the body of the main text, most states (80%) did notreplicate the pilot program and those that did, did not implement it in a manner that enabled them to achievethe anticipated targets. As the ufw data emerging is unreliable it would not be useful to devote muchattention to the actual figures, but rather to conclude qualitatively that much more work is needed to reachthe SAR envisioned benchmarks.

Risks: From reading the SAR one observes that most risk factors related to the institutional and financialaspects of the project were taken into account and well addressed during project appraisal. The sensitivityanalysis presented in Annex 5 of the SAR pointed out that the economic benefits of the project were highlysensitive to (i) the incremental quantities of water produced and (ii) tariff increases which were to beimplemented. Additionally, the project risks which are not associated with the economic analysis but withthe overall risks (p. 19, SAR) include (i) unsatisfactory procurement practices and (ii) failure to provideadequate counterpart funding as the project's main risks. In retrospective we know that neither of theserisks has fully materialized, while other aspects related to macroeconomic adverse conditions and theautonomy of the SWA have been an obstacle in achieving the project's objectives.

- 18 -

Annex 4. Bank Inputs

(a) Missions:

Stage of Project Cycle No. of Persons and Specialty Performance Rating(e.g. 2 Economists, I FMS, etc.) Implementation Development

Month/Year Count Specialty Progress Objective

Identification/Preparation06/1990 Financial Analyst, Economist, 2

Engineers, Training

Appraisal/Negotiation03/1992 2 Eng. , Financial Analyst. S S

06/1992 2 2 Engineers S S12/1992 4 2 Eng., Resident Mission, S S

Financial Analyst

Supervision03/1993 2 Eng. , Financial Analyst S S

03/1993 2 Eng. , Financial Analyst. S S12/1993 4 2 Eng. , Training Consultant, S S

Engineering Consultant.06/1994 3 2 Eng. , Training Consultant. S S12/1994 3 2 Eng. Training Consultant. S S12/1994 4 2 Eng. , Consultant, Financial S S

Analyst07/1995 4 2 Eng. , Consultant, Financial S S

Analyst12/1995 2 2 Engineers S S06/1996 7 2 Eng. , 2 Facilitators, Training, S S

Management, Financial Analyst.11/1996 3 2 Engineer, Financial Analyst. S S

06/1997 5 Financial Analyst, Admin. Seer. S S2 Eng. F Economist.

12/1997 2 2 Engineer. S S09/1998 2 2 Engineer. S S

12/1998 3 Leader, Eng. , Economist S S

07/1999 4 Leader, 2 Eng. ,M&E S S11/1999 7 Leader, Eng, F.A, S S

Consultant,T.A

ICR07/2000 5 Leader, Eng. , Financial S S

Analyst, Economist,Facilitator.

- 19 -

(b) Staff:

Stage of Project Cycle Actual/Latest Estimate

No. Staff weeks US$ ('000)Identification/Preparation 151.50 303.90Appraisal/Negotiation 46.40 91.40Supervision 345.81 534.08ICR 3.00 3.43Total 546.71 932.81

- 20 -

Annex 5. Ratings for Achievement of Objectives/Outputs of Components

(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)

RatingZ Macro policies O H OSUOM O N * NA

O Sector Policies O H OSU*M O N O NAL Physical OH OSUOM ON ONA

O Financial O H O SU O M * N O NAO Institutional Development 0 H 0 SU 0 M 0 N 0 NAL Environmental O H OSUOM O N * NA

SocialLI Poverty Reduction O H OSUOM O N * NAII Gender OH OSUOM ON *NAOI Other (Please specify) O H O SU O M O N 0 NA

O Private sector development 0 H O SU O M 0 N 0 NAEl Public sector management 0 H 0 SU 0 M 0 N 0 NAEl Other (Please specify) O H OSUOM O N * NA

- 21 -

Annex 6. Ratings of Bank and Borrower Performance

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

6.1 Bankperformance Rating

El Lending OHS OS *U OHUEl Supervision OHS OS O U O HUEl Overall OHS OS O u O HU

6.2 Borrowerperformance Rating

L Preparation OHS OS * U O HUO Government implementation performance O HS O S * U 0 HULI Implementation agency performance O HS O S 0 U 0 HUEl Overall OHS OS * U O HU

- 22 -

Annex 7. List of Supporting Documents

1. Aide Memoire: Manpower Development and Training Component, prepared by Jack Cresswell,December 1999.

2. Assessment of Manpower Development and Training, prepared by Messrs. Bature and Aderonmu,July 2000.

3. Draft Communique and Recommendations, NWRP ICR Workshop, July 2000.4. List of Studies Included in the Project and Their Impact.5. Nigeria: Innovative Training for Improved Water Delivery, by Jack Cresswell, June 2000.6. Coordinating Coinsultancy Services for State Water Agencies' Intitutional Development Programme,

Final Report, Gauff Ingenieure, July 2000.

- 23 -

Additional Annex 8. Targeted and Achieved Outputs

Component Target at SAR (1991) Achieved at Project CommentCompletion

Physical Rehabilitation To restore the output of Nearly all the selectedPhysical rehabilitation of water supply systems to schemes werepriority selected urban and their original design rehabilitated and thesemi-urban water supply capacities wherever production increased tosystems (including water possible. (The number of about 1,420,000 m3/day orsource works, treatment and schemes and increase in 77% of the targeteddistribution covering civil production was increase.works, pumping/electrical/ determined during themechanical plants and project. Over 150 waterequipment, storage systems, supply schemes to beworkshops and leak rehabilitated to increaserepairs). water production in these

schemes from 630,000 to1,640,000 m3/day.)

Leak Detection & RepairProgram

Each participating Carry out pilot leak On the average:SWA to implement leak detection to teach utility Staff of most SWAs were (1) The targeted rate ofdetection and repair staff how to handle the trained on how to use leak reduction of the UFW was notprograms. ($20.1 million) equipment and how to detection equipment and achieved.comprising of: continue with the to carry out measurement (2) The trend of the actual

Carrying out full leak program to the whole of unaccounted for water unaccounted for water is thatdetection and repair in a systems under in pilot areas. it reduced from the projectselected pilot area. rehabilitation inception up to the year 1997

30 utilities (80%) did not and thereafter it started to

implementing leak carry out a full Leak increase. The increase inImpletetioang repair Detection and Repair losses matched the period ofdetection and repairprogram for all water Program. The remaining the completion of the

supply systems to be Reduce the UFW to 25% SWAs or (20%) rehabilitation of the systemsrehabilitated under the in five years implemented it partially. and the correspondingproject. increase in pressure in the

distribution system.6 utilities (16%) reported (3) With the increase into achieve UFW target; 2 pressure and without theutilities (5%) reported to implementation of leakhave achieved theUFW detection and repair program,target but later the losses increased . Thedeteriorated; 16 utilities system may deteriorate to its(43%) Teported decrease former status before thein losses but did not rehabilitation. Hence theachieve target, 12 (32%) system does not lookutilities reported increase sustainable.in losses. It is noted thatthe data are unreliablesince there are no meters

- 24 -

I for production andI I consumption.

- 25 -


Technical OperationalSupport to SWAs

Technical Operational Each SWA was required to: 12 SWAs (33%)support to assist the (a) To be assisted by the implemented theSWAs improve their PMC in collecting and analysing requirement to havecapacity to operate and data on performance indicators technical support from the

institutional developmentmaintain their water and reviewing performance cnsutants duringpthesupply systems in an against action plans consultants during theefficient and cost effective ongmal project periodmanner in such a way that (b) Develop guidelines for The assessment of thewill lead to financial self leak detection and preventive implementation wassufficient through revenue maintenance. excellent in 2 states, goodgeneration. The support in 3, satisfactory in 4 andincludes: (c) To be assisted by fair in 2.

Technical Operational(a) Management. consultant to implement (i) 7 SWAs (20%) signed the(b) Operation and customer enumeration for contract for technical

maintenance improved revenue generation support very late and most(improvement of (ii) Mapping for asset valuation of them started at the veryefficiency) and efficient operation and end of the project.

(c) Tariff Studies maintenance of the distribution

systems (iii) Water audit for 17 States (47%) did nottariff studies and hydraulic have the technical support.analysis and unaccounted forwater

Only 7 SWAs (20%)

(d) prepare action program reported that they fullyfor implementing tariff reviews implement preventiveand engage institutional maintenance, 11(30%)development consultants to reported they did itassist an implementing this partially, 7 (20%) did notcomponent so that: carry it out at all. Thei) Systems under preventive remaining (30%) have notmaintenance increased from 0 to reported doing so or100% otherwise.ii) Quality, safety, reliabilityand quantity of water producedimproved.iii) Water tariff are designedbased on annual tariffadjustments sufficient to enablethe SWA meet all its cashoperating costs from itsinternally generated revenue.

- 26 -


Financial OperationalSupportFinancial Management All the SWAs were expected Only 21 SWAs (57%)Support: This includes (a) to benefit from: actually engaged and workedupgrading financial systems i) Local consultants to with the local consultants.and (b) improving billing and study the billing and Implementation of thecollection. collection procedures with support is reported to be good

the objective of improving for 6 SWAs, satisfactory forrevenue collections and 2, fair for 8 and the other 5assist the SWAs in started late and as such couldimplementing the study not be assessed.recommendations. The remaining 16 SWAs

(43%) did not implement thecomponent

ii) Project management Budgeting and AccountingConsultants to assist in Procedures/Systems for thepreparing tariff review and SWAs were prepared by theachieving revenue and PMC. Workshops were heldexpenditure targets. to train the accounting staff of

the SWAs on the new system.

TORs and contracts were alsoprepared and tendersevaluated for the engagementof Financial ManagementConsultants. 21 utilitiesbenefited from the service ofthe Financial ManagementConsultants.

- 27 -


Establishment ofManpower &DevelopmentTraining: (Includes Establish Human Resources A very active HRDU wassetting up of Human Development Unit (HRDU) established at the Project This aspect has beenResources, within the FMWR and Management Office (PMO). implemented very well andDevelopment support to the Ministry to The office coordinated all successfully too.Training at FMWR help satisfy SWAs common HRD requirements of theand SWAs, training needs and help SWAs and liased withsupporting them and formulate national training training institutionsconducting training policies and manpower nationwide.to meet the manpower development targets of therequirement of the SWAs to provide HRDU was established atSWAs coordination for training each SWA headed by an

activities and staff officer and at least twodevelopment in each SWA. assistants. Training

equipments were supplied tothe SWAs. A car wasrefurbished and an imprestaccount was opened for eachHRDU to improve logisticsand financing. Courses wereheld to train the HRDUofficers.

a) Carry out Manpower Audit Manpower Audit and Implemented well and onand Training Needs Analysis Training Needs Analyses were time (during the first year ofof the SWAs. successfully carried out in the project).

each SWA by Consultants.The National Water ResourcesInstitute did a similar one too.Report containingrecommendations werehanded over to the SWAs forimplementation.

b) Staff Training /Courses to A total of 12,863 trainee There was a two-year delaybe given to staff in all levels weeks were achieved for 27 in establishing the HRDUfrom operators to managers. SWAs (6 new SWAs were and commencing the properApproximately 1,000 established for the 6 States training.trainee-weeks for each the created during the projectthen 21 SWAs (Total implementation).=27,000 trainee weeks)

A satellite training center wasestablished at Enugu.

-28 -


Support to theNational Water Make the institute able to (a) An assessment of the Target met.Resources Institute meet SWAs' need of institute and its potential for

(NWRI). training in practical skills at upgrading.

the low and middle level (b) The institute was providedpersonnel. with the following support:

Three vehicles, including abus for conveying courseparticipants.

Office equipment (standbyelectricity power generatingset, computers, printers,photocopier, fax machine etc)

Training tools, equipmentsand machines.

(c) Establishment of theNational Water SupplyTraining Network coordinatingtraining activities of the SWAsthrough the OutreachDepartment of the institute.

(d) Design and delivery ofsuitable curricula and coursesmanuals for 23 technical andnon-technical programs for theSWAs.

(e) Design of curricula formiddle level technicians andtechnologies to be delivered atthe Satellite Centres.

(f) Design and delivery of a42-week induction CourseProgram for SWA engineersand Scientist (included intraining weeks above).

- 29 -


Stores procedure manualOperational support prepared by PMO andfor strengthening distributed to the SWAsstores management for implementation.

Additional Studies 13 studies wereconducted whichincluded feasibilitystudies for new projects,safety assessment ofdams, WS designreviews, expansion ofsome WS schemes, PSP,manpower, budgetingand accounting, billingand collection,assessment of traininginstitutions, etc.

Institutionalstrengthening of theFederal Department of Develop guidelines forWater Supply andQuality Control (a) the design of policy Maintenance manual The thrust of(FDWSQC) guidelines for the design and completed this

maintenance of water supply componentsystems, was changed(b) water quality standards Not carried out to better(c) equipment standardization Not carried out support the(d) water treatment chemicals Not carried out policy reformstandards, agenda.(e) improved tariff structure and Completedcost recovery and(f) manpower development Partly implemented.

. ~~~~Established andEstablish and maintain a database to mitained btdmonitor key performance indicators mauntaned but data ISof the project SWAs.

Not impemented. Initial work toEstablish and maintain a waterresources and water quality database develop waterfor both surface and groundwater managementresources;

resource; Istrategy wassupported underthe project

Identify critical training needs in the Fully implemented.

- 30 -

water sector and assess the adequacyof the local training institutions tomeet such needs; and

Carry out special studies of generalinterest to the water sector, such as Partly implemented.pollution and water quality studies,review of tariff structures and fixedassets valuations, etc.

- 31 -

Additional Annex 9. Implementation Schedule

ColerY_ 19 0 i 1991 | 1992 1 1993 1 1994 1 1995 11 19 97 1 1998 1999 2000 2001

PROJECTMANAGEMbNT _ 'PPRAISAL

CONSULTANT I

ENGINEERING BY REGIONASL _PrEUSAL

ONSULTANTS _

EHA.ILITATION OF SYSTEMS -_ - - = - _ PRASAL

CONICAHLASSISTANCE A PP ISAL

_ _ ~~~~~~~~~~~~~Improvetd dr mnobaI marnapr en n hhouse erF-ji cosoIa yA

FINANClAL MANAGEMENT __ _ ~~~~~~~~~~~~esbre prose&resjpsoenhArt rnaeOedance hi Nouelo _onuAL

-TECHNICAL MANAGEMENT _EAL

LEAKAGEDETECTION _ _ =I I UAPPeAS SL

SNIREPAIR pIlot P R Ii _ _AL

NOTES. PLANN`ED ALTUAL L ED

PROIIECT EFFECTIVE AUG 1. I)"I ACGT .1912 j POpmOllode5&

SECOND ALLOCATION BEGINTS JANUARY 19S4 N A to C-l W.,rk C,pil SNupply =d I-od I -1od

SCOLOALCOMMITMENTTCUTOFF NA An ol olCeponmb

DATE JLNTE 11, ISS4M--- P-R,, Rh.,Eb-Id Ro,kI

WORKS COMPLLTEl DFC II. S-IS -SRTpk-loI

by L mcl d-R

LEAN CLOSES JUNE 10 ISrI E-R3R5, -2

- 32 -

Additional Annex 10. List of Studies

PURPOSE STATUS IMPASCT OF

1. ADAMAWA - STUDY Feasibility study for multistate water Completed Contains preliminary1. ADAMAWA- STUDY uply project omltddesign

2. KEBBI - STUDY Feasibility study for multistate water Completed Contains preliminary* KEBBI -STUDY suply projct omltdesign

3. KEBBI - STUDY (2) Study of water supply to 17 Completed3. KEBI -STUD (2) communities in Kebbi State opee

3. SOKOTO - STUDY Safety assessment of Gonronyo Dam Completed

4. SOKOTO - STUDY nspection of water supply to Sokoto Completed

Review, evaluation and updating ofxisting design and tender documents Final engineering and

5. BORNO - STUDY for a comprehensive water supply CmItd ender documents as wellsystem to Biu and surrounding villages ompaete s prequalification tendero meet the present and future water documents preparedneeds up to year 2020

Contains preliminaryv

Design of viable and sustainable water design of water supply

6. YOBE - STUDY supply system for Damatura and Substantially reatment and distributionnvirons to cope with increase demands Completed netw environmen

up to the year 2030 ~~~~network, environmentalup to the year 2030 imatassmnImpact assessmentcontract documentationContains findings of the

7 KANO-TIGA DAM Safety assessment of Tiga dam and studies withlNSPECTION Huwan Kanya reservoir Completed recommendations on

measures to be taken toensure safety of both dams

_ ............. . . ~~~~~Contains findings of theTo prepare a feasibility report involving studies witheview of existing design reports, scodies datixpansion of existing schemes, and revopmendotions,

8. KANO - STUDY rovision of new schemes to meet the Completed financing strategy andeeds of greater Kano in the year 2025 conomic analysis otheconomic analysis of thend options for Private Sector rojectarticipation in management.

- 33 -

World Bank Documentdocuments.worldbank.org/curated/en/459861468097200658/pdf/mul… ·...

Documents

Transcript of World Bank Documentdocuments.worldbank.org/curated/en/459861468097200658/pdf/mul… ·...