Financing Sanitation

To achieve sustainable sanitation, its financing arrangements must:

• Provide funds for all the elements of the sanitation program (hardware, promotion, institutions and, financing); and
• Be sustainable. Funds must always be available for the key elements of the sanitation program, and match funding to the responsibilities of different institutional partners.

In addition, sanitation finance should strive to:

• Advance agreed national sanitation policies and strategies: In fact, the financing arrangements are likely to be one of the most powerful instruments to drive the application of policy principles, so financing practice must be consistent with the declared spirit of national policies and strategies.

• Maximize public and private benefits: Sanitation and hygiene improvements have public and private costs and benefits. As a useful principle, public funds (government funds, external donor funds and so on) should maximize public benefits – thus they should be steered towards promoting hygienic practices, policy development and institutional strengthening, community hardware such as wastewater treatment plants and sewer collection systems and, in limited cases, providing incentives for increased household investment with public benefits. To the extent possible, private funds should be used for essentially private elements of the system (soap, individual latrines etc).

• Achieve equity: Financial instruments can be extremely powerful tools to secure access to services for identifiable, usually poor, segments of society.... but the experience of sanitation hardware subsidies is fraught. Equity concerns apply equally to the hygiene behavior elements of the program. People should not be excluded from the benefits of well designed hygiene promotion programs simply because they live in remote areas or congested slums; the health gains of working in such areas will almost certainly be high. It may however be more expensive to work in these locations, and adequate funds must be made available if health gains are to be achieved in areas where there has been little progress in the past