Central Water Services Board (CWSB)

Tana Water Services Board (TWSB)

Revised

BUSINESS PLAN: 2006 – 2011

July, 2008

TABLE OF CONTENTS

Page No.

eXECUTIVE SUMMARY…………………………………………………………………..…………………………………2

CHAPTER 1 – INTORDUCTION AND BACKGROUND 4

1.1 Introduction 4

1.2 Water Resources and Systems Infrastructure 4

1.3 Water Supply and Sanitation Services 4

1.4 Business Challenges 5

Map 1.1: TWSB Coverage Area 5

1.5 The Vision and Mission of TWSB 6

1.5.1 The Vision 6

1.5.2 The Mission 6

1.6 Core Business of TWSB 6

1.7 Core Values of TWSB 7

1.8 Objectives of TWSB 7

1.9 The Structure of the Revised Business Plan of TWSB (2006 – 2011) 8

Chapter 2 - THE BUSINESS ENVIRONMENT 9

2.1 Importance of Water 9

2.2 Challenges in the Water Sector 9

2.3 Reforms in the Water Sector 9

2.3.1 Achievement of Reforms 10

2.5 National Water Services Strategy and Performance Parameters 12

2.6 Performance Contract 12

2.6.1 Performance Management 13

2.7 Stakeholders Analysis 13

2.7 Situational Analysis 16

Chapter 3 - MARKET ANALYSIS 17

3.1 National Economic Review 17

3.1.1 Kenya Vision 2030: Water and Sanitation 17

3.2 Water Supply System and Sewerage Service 18

3.3 Market Analysis 20

3.4 Water Demand and Supply Forecast 21

3.4.1 Water and Sanitation 22

3.4.2 Commercialization and Clustering 22

CHAPTER 4 - BUSINESS DEVELOPMENT STRATEGIES 28

4.1 Business Objectives 28

CHAPTER 5 - INVESTMENT PLan 32

5.1 Background 32

5.1.1 Urban Water Supply (UWS) 32

5.1.2 Large Scale Rural Water Supply (LSRWS) 33

5.1.3 Small Scale Rural Water Supply (SSRWS) 33

5.2 Future Water Resources Development Requirement 33

Chapter 6- FINANCIAL SUSTAINBILITY 39

6.1 Resource Management 39

6.2 Resource Allocation 39

6.1 Financial Resource Strategy 39

5.3 Notes on Revenue Projections 48

5.4 Total Investment Requirements (2008-2011) 49

5.5 Financial Projections Key Assumptions. 49

5.5.1 Recurrent Expenditure Projections. 49

Chapter 7 - IMPLEMENTATION PLAN 51

7.1 Human Resource Strategy 51

7.2 Manpower Deployment 51

7.2.1 Assumptions in Determining Staffing Levels 51

Table 6.1: TWSB Optimal Staffing Level. 52

Figure 6.1: TWSB Organizational Structure. 53

Figure 6.2: Organization Structure - Finance and Administration 54

Figure 6.3: Organisation Structure - Technical Services 0

EXECUTIVE SUMMARY

Tana Water Services Board (TWSB) was established through Kenya Gazette Notice NO. 1329 of 27th February, 2004. It is one of the eight (8) Water Services Boards under the Ministry of Water and Irrigation. In line with the Water Act 2002, the Tana Water Services Board (TWSB) has the legal responsibility of ensuring cost effective and sustainable provision of water and sanitation services in its area of jurisdiction.

The geographical mandate of the Tana Water Services Board extends to 15 administrative districts in Central and Eastern Provinces of the country. These are: Embu, Mbeere, Murang'a North, Murang'a South, Kirinyaga, Meru Central, Imenti North, Imenti South, Igembe, Tigania, Nithi, Mara, Nyeri North, Nyeri South and Tharaka

The total area covered by the Board is 19,401km2, with an estimated population of 4,259,000 (year 2007 estimates). Tharaka, Mbeere, and parts of Nyeri North, Igembe and Tigania districts, which are arid, and semi arid have coverage of 8,237 km2; 40 percent of the area covered by the Board is either arid or semi-arid.

Three years later, following its establishment, the Board has undertaken the following activities amongst others:

· Continued to rehabilitate and expand some of the water service infrastructure in the area

· Has established and contracted thirty-one (31) Water Service Providers (WSPs) and Community-based WSPs for efficient and effective delivery of water and sewerage/sanitation services

· Recruited and hired management and staff through competitive process.

· Has implemented a Financial Management Information System (FMIS)

· Continued to collaborate with Development Partners in order to raise more financial support for the improvement of the infrastructure.

· Operationalized the Board functions by having in place a Board of Directors whose members have a diverse mix of skills and expertise

· Continued to build the capacity of several Community Based Organizations (CBOs) and supported them to access funding from Water Services Trust Fund and other funding agencies;

This revised Business Plan takes cognizance of the fact that Tana Water Services Board has continued to comply with the requirements of the license issued by the Water Services Regulatory Board and achieved measurable milestones in the fulfillment of its mandate. It also identifies the gaps that the Board has to deal with in its overall desire to meet its strategic objectives by 2011

The revision of the Business Plan has been necessitated by the need to incorporate the emerging political, economic, social, technological, Environmental, and Legal factors, which were not anticipated in 2006 when the Board prepared the Business Plan. Such factors include but not limited to: the coming in operation of Vision 2030 as the guiding policy paper after the end of the implementation of the Economic Recovery Strategy (ERS), the enactment of the National Water Services Strategy (NWSS), the pro-poor implementation plans and the operationalization of the Water Resources Management Strategy and variation of the limits of supply of Tana Water Services Board as a result of constitution of the new Tanathi Water Services Board.

The revised Business Plan takes a critical assessment of the situational analysis; and re-examines the environment in which the Board operates with a view to redefining its Strengths, Weaknesses, Opportunities and Threats.

The revised Business Plan underscores the support the Government of Kenya and the Development Partners have given to the Board in the implementation of its mandate in achieving the milestones. It identifies the investments already committed and the impact expected. It appreciates the role the Board of Directors has played and continues to play in matters of strategic leadership, Corporate Governance and other cross-cutting issues involving Gender mainstreaming in water, HIV and AIDS and poverty.

In implementing the revised Business Plan, TWSB will be guided by a set of fundamental values. These are:

Ø Competence

Ø Teamwork

Ø Networking

Ø Innovativeness

Ø Integrity

Ø Quality Customer Service

The overall goal of the Board during the planning period is to deliver safe, clean, affordable, sustainable and quality water and sanitation services to all the people living within the Board’s area. This will be achieved through the successful implementation of the following key objectives:

(a) To enhance Stakeholder awareness on water sector reforms and emerging issues;

(b) To increase in access to sustainable and safe water from 20% to 70%;

(c) To increase in demand for available safe water;

(d) To increase in access to improved sanitation from 70% to 90%;

(e) To develop a strong and well managed WSB that achieves its mandate;

(f) To achieve operational financial sustainability in 7 years.

To implement the revised Business Plan, the Board will utilize a proper combination of available financial, human and physical assets. An appropriate organizational structure has been put in place that takes into consideration the competitive environment in which the Board operates and the need for efficient operations towards the implementation of the Business plan.

A Monitoring and Evaluation mechanism of the implementation of the revised Business Plan has been developed and will continue to objectively gauge the extent, impact, effectiveness and relevance of activities in terms of their strategic objectives.

The revised Business Plan has been developed in a participatory manner by the Board of Directors, the Senior Management staff and key Stakeholders whose views reflect the wishes and aspirations of Tana Water Services Board.

CHAPTER 1 – INTORDUCTION AND BACKGROUND

1.1 Introduction

In line with the Water Act 2002, the Tana Water Services Board (TWSB) has the legal responsibility of ensuring cost effective and sustainable provision of water and sanitation services in its area of jurisdiction.

1.2 Water Resources and Systems Infrastructure

The Board’s area of mandate is endowed with many rivers. These are within the Tana and Ewaso Nyiro North catchment areas. The lower parts of Mbeere, and most parts of Tharaka, Igembe, and Nyeri North districts are, however, water deficit areas. Different strategies are therefore required to address service access in different parts of the region.

The common characteristic of the existing water supply infrastructure is their dilapidated state. This leads to high unaccounted for water, low connections, and sub-optimal access to quality water; even in areas that are serviced by the existing systems. Other challenges include:

(a) Degraded catchment areas which affect the quality and adequacy of water supply;

(b) Numerous and un-economical community water schemes that are poorly managed;

(d) Polluted sources of water with the attendant risks to consumers.

Government is committed to the improvements in the water sector. The reforms in the sector are a proof of this commitment. The decentralization in water resources management will enhance accountability and transparency in the provision of water services. This will also lead to improvement in the protection and preservation of water catchment areas. The availability of resources through the Constituency Development Fund, Local Authorities Transfer Fund and the Road Maintenance Fund will all have a positive impact on the development of the water sector.

Existing Water Service Providers have, over time, developed expertise in the management of water supply systems. Improved technical and operational technologies are available for sector development. The achievement of Millennium Development Goals in water and sanitation services places a heavy responsibility on the Board. The challenge is therefore to mobilize the necessary resources to enhance access to quality water and sanitation services to the majority of the people.

1.3 Water Supply and Sanitation Services

The Board has so far contracted 31 Water Service Providers to operate the former Ministry and NWCPC schemes including a number of Community- based schemes.

A number of these WSPs are operating more than one scheme in response to the Board’s intended approach of clustering schemes to form viable entities. Efforts are being made towards clustering more schemes with the aim of reducing the number of WSPs rather than increasing them by emphasizing on clustering the community-based schemes with the already contracted WSPs.

Already Kirinyaga Water and Sanitation Company is making tremendous efforts towards this end by entering into MoUs with the Community-based schemes with the aim of taking charge of operation of all schemes in Kirinyaga district..

Six urban centres have a sewerage system. These are Meru, Nyeri, Embu,and Murang’a, Karatina and Kiganjo. One sewerage scheme (Nkubu) is under implementation while three (3) other schemes (Kerugoya, Kutus and Maragua) are in the planning stage. The challenge is to improve on the coverage in existing systems and expand coverage in other areas. In all areas, however, a form of sanitation system exists. In collaboration with public health services, the Board is expected to develop strategies of enhancing the standards of sanitation in its area of coverage.

1.4 Business Challenges

The key challenges facing TWSB; which also affect other Water Boards are:

(a) Making the most of the resources currently available and ensuring prudent investment within the framework of limited resources.

(b) Meeting the MDG target, which is supported by government policy of 58% of the population having access to clean water by 2015.

(c) Improving commitment and morale at the staff and Board levels and building WSP’s capacity for implementing change and ensuring desired performance; implementing the performance management system (PMS) approach.

(d) Improving old and dilapidated infrastructure; converting pumping systems to gravity systems,

(e) Changing the leadership and management style of WSPs from “business as usual” to provision of water and sewerage service with “business focus” as a strategy for ensuring sustainability in service delivery.

(f) Attracting the interest of the private sector organizations to invest in the water sector.

(g) Achieving the right balance between commercial and social goals of water and sewerage services.

(h) Educating the public on the dangers of using untreated and polluted water and health problems associated with poor sanitation.

Map 1.1: TWSB Coverage Area

1.5 The Vision and Mission of TWSB

1.5.1 The Vision

In developing its Business Plan, TWSB was guided by its vision, which is: “: “A future with consistently clean, safe and affordable water and improved sanitation that exceeds customers’ expectations in an environmentally friendly manner”

1.5.2 The Mission

The mission is the underlying purpose of TWSB; the reason why it exists. The mission of TWSB is: “To ensure provision of affordable, reliable, sustainable and safe water and sanitation services by developing facilities, contracting effective water services providers and monitoring them.”

1.6 Core Business of TWSB

In fulfilling its mandate, TWSB has a number of functions that are core to its activities and are geared to ensuring that TWSB fulfils its mission. The core functions of TWSB tie up with the Ministry of Water and Irrigation’s development goals and also contribute towards achievement of the Millennium Development Goals (MDGs) of making water accessible to all users. Therefore, the core functions of TWSB include:

a. Managing and developing water supply and sewerage assets;

b. Contracting and monitoring performance of Water Service Providers;

c. Supporting communities in the area of provision of water and sanitation services.

1.7 Core Values of TWSB

Core values are the fundamental beliefs that will shape TWSB culture as it seeks to achieve leadership in quality service delivery. Operational processes and systems will be rationalized to deliver value to the Stakeholder. Teamwork and effective communication will be the hallmarks of a highly performing organization. In implementing the Business Plan, TWSB will be guided by a set of fundamental values. These are stated hereunder: