3 EU development for drinking water and
basic sanitation
(34296)
14531/12
| Court of Auditors' Special Report: "European Union Development Assistance for Drinking-Water Supply and Basic Sanitation in Sub-Saharan Countries"
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Legal base |
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Document originated | 3 October 2012
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Deposited in Parliament | 5 October 2012
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Department | International Development
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Basis of consideration | EM of 18 October 2012
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Previous Committee Report | None
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Discussion in Council | To be determined
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Committee's assessment | Politically important
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Committee's decision | For debate in European Committee B along with (34335) SWD(12) 277: Commission Staff Working Document: Meeting the challenge of rapidly increasing humanitarian needs in Water, Sanitation and Hygiene (WASH)[5]
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Background
3.1 The European Court of Auditors carries out audits, through
which it assesses the collection and spending of EU funds. It
examines whether financial operations have been properly recorded
and disclosed, legally and regularly executed.
3.2 It also, via its Special Reports, carries out
audits designed to assess how well EU funds have been managed
so as to ensure economy, efficiency and effectiveness.[6]
The Court of Auditors' Special Report No 13/2012
3.3 This Court of Auditors Special Report looks at
the European Commission's management of development assistance
for drinking water and basic sanitation in Angola, Benin, Burkina
Faso, Ghana, Nigeria and Tanzania six sub-Saharan countries
selected for their financial significance amongst the ten most
important recipients. The audit assessed whether EU development
assistance in this field is leading to sustainable results. It
focused on two questions:
were
the planned results achieved, and are they sustainable?
did the Commission take appropriate steps
to ensure sustainable results?
3.4 The audit work was carried out between February
and December 2011. Detailed examination of EU-funded water and
sanitation projects in the six beneficiary countries included
visits to Burkina Faso, Nigeria and Tanzania. The audit examined
a sample of 23 projects and programmes, under contracts financed
through the 7th, 8th and 9th European Development Funds, including
the first ACP-EU Water Facility (funded by the 9th EDF), and from
the EU general budget. The total cost of these contracts was over
400 million, 49% of which was funded by the EU. The total
EU contribution to the 23 selected projects amounted to 219
million; as the Commission contracted more than 1 billion
for water and sanitation projects in 46 sub-Saharan African countries
from 2001 to 2010, the Court's audit thus covered 22% of the amount
contracted.
3.5 The report explains how EU development assistance
for water and sanitation is guided by the 2002 Commission Communication
on Water Management and is funded through both thematic and geographical
(national and regional) programmes, as well as in the context
of humanitarian aid operations.
3.6 The report found that equipment had been installed
as planned, the technology used was appropriate, and it was in
working order. However, fewer than half the projects delivered
results that were meeting the beneficiaries' needs. For a majority,
medium and long term results and benefits would not continue to
arise unless non-tariff revenue was ensured. Water tariffs had
been set on the basis of the ability to pay, or a lack of willingness
to pay; or there was ineffective billing and collection. Although
project management procedures covered sustainability comprehensively,
the Commission failed to tackle important matters regarding the
sustainability of results. Monitoring, verification and evaluation
reports were not fully used, limiting the Commission's capacity
to introduce corrective measures. Moreover, in most of the completed
projects, the absence of ex-post monitoring or evaluation
did not allow assessment of the sustainability of results. EU
support had thus increased access to drinking water and basic
sanitation in the six sub-Saharan countries audited, using standard
technology and locally available materials, but had met beneficiaries'
needs in fewer than half of the projects examined. For a majority
of projects, medium and long term results and benefits would not
continue unless non-tariff revenue could be ensured. Despite comprehensive
management procedures, the Commission did not tackle important
matters regarding sustainability.
3.7 The Court of Auditors recommends that the Commission
should:
"(a) Ensure that its procedures are properly
applied, especially concerning the following points at project
appraisal stage:
"(i) the definition of explicit project objectives
(quantities, type of equipment, location, direct and indirect
beneficiaries);
"(ii) the description of and justification for
the technological solutions proposed (wherever applicable, with
reference to alternative options); and
"(iii) establishment of objective verifiable
progress indicators, as well as baseline values and quantified
targets for project results.
"(b) Carry out sufficient economic and financial
analysis to allow easy identification of the expected sources
of project funding in the future (including estimated contribution
amounts and timing).
"(c) Explicitly consider before project approval
whether the conditions for success, including partner country
commitments, are likely to be met.
"(d) Ensure that full use is made of the results
of monitoring, verification and evaluation work, and that recommendations
made in the reports are considered and carried out."
3.8 In its response, the Commission says that it
"is of the view that care must be taken in drawing any general
conclusions from the results of the Court's examination of these
23 diverse projects." In most projects, it says, several
needs were identified of which at least one or more were met;
a lot were very ambitious and some needs, mainly secondary ones,
were not fulfilled. Moreover, the Commission argues that most
of the audited projects were approved before the establishment
of Quality Support Groups (QSG) in 2005, since when "greatly
improved rules are now applied during the identification and the
formulation phases." While capacity development is "one
of the most critical dimensions
its success depends on
social and political factors which are often out of the scope
of the project." The Commission "takes note of the recommendation
of the Court and will continue to improve the quality of development
cooperation practices and operations and ensure that the existing
procedures are fully implemented."
The Government's view
3.9 In her Explanatory Memorandum of 18 October
2012, Parliamentary Under-Secretary of State at the Department
for International Development (Ms Lynne Featherstone) says that
there are four main policy implications from this report. These,
she says, are not new; rather they call for better implementation
of existing policies and procedures.
3.10 She then says that the Commission needs to do
the following:
"Make
effective use of existing procedures in its programmes to be much
clearer on setting objectives and how these are best achieved,
and improved monitoring of progress using robust baseline data;
"Undertake thorough economic and
financial analysis to allow easy identification of the expected
sources of finance to secure future operation of services provided;
"Undertake a thorough assessment
of whether the conditions necessary for success of projects, including
partner country commitments, are likely to be met before embarking
on the projects; and,
"Improve and make better use of
monitoring, verification and evaluation ensuring that recommendations
are acted upon."
3.11 The Minister then says that she regards the
Report as a constructive contribution to the ongoing process of
improving the effectiveness and results of EU support to drinking
water supplies and basic sanitation in sub-Saharan countries;
and then continues as follows:
"However,
in terms of the delivery of Commission funded projects, there
are significant areas for improvement. These include the need
for projects to be more closely demand-led to ensure they meet
the needs and expectations of their beneficiaries. At the design
stage of projects, the Commission should secure sufficient long-term
funding so that water supplies remain functional over time. The
Commission should also consider all potential technical options
in the design of projects, so they can be confident that the selected
option is best suited to the local context. The failure to adequately
address these factors has undermined the sustainability of Commission
projects.
"We recognise the value of the Commission
as a partner in the delivery of water, sanitation and hygiene
projects and are encouraged that the auditors find that the processes
are adequate. However, we are concerned that despite having good
processes and procedures in place, the Commission's proper use
and implementation of them is variable. Results show numerous
examples where Commission projects are not sustainable, or where
they have failed to meet beneficiaries' expectations. We are concerned
that the Commission's response is that they have put in place
further processes, rather than outlining their commitment to use
their existing systems more effectively. We are also concerned
that the Commission has not focused on the delivery of results,
which represents a lack of accountability and transparency."
3.12 With regard to what the Minister proposes to
do about the findings, she says:
"We plan to work with the Commission to improve
their performance in two ways. We will ensure that the WASH sector
features prominently in their wider work on transparency and accountability.
We will also continue to participate in the EU Water Experts Group
and use this to press the Commission to improve their performance
on sustainability, and to fund projects that meet beneficiaries'
expectations. We will also use this group to share our experiences
from UK funded programmes and highlight new evidence on ways to
improve sustainability and value for money."
Conclusion
3.13 Elsewhere in this Report we consider a related
document, this time from the Commission itself, on WASH
"Meeting the challenge of rapidly increasing humanitarian
needs in Water, Sanitation and Hygiene." Though centred on
three main sectors of humanitarian operations (the others being
food and health), the Commission says that humanitarian aid alone
will not be able to continue to address the rapidly growing needs;
and that improving resilience and Linking Relief, Rehabilitation
and Development (LRRD) is "vital to helping meet these needs
before they become humanitarian emergencies".
3.14 Nothing can do more to improve resilience
in this (or any other such area) than projects that work over
the medium and long term. However, it is plain from this Court
of Auditors' Report that the Commission still has much to do (notwithstanding
its special pleading; see paragraph 2.08 above). The Minister
says, rightly, that she is concerned that:
despite having good processes and procedures in place, the Commission's
proper use and implementation of them is variable;
results show numerous examples where
Commission projects are not sustainable, or where they have failed
to meet beneficiaries' expectations;
the Commission's response is that
they have put in place further processes, rather than outlining
their commitment to use their existing systems more effectively;
the Commission has not focused on
the delivery of results, which represents a lack of accountability
and transparency.
3.15 We are likewise concerned. Yet, when commenting
(very briefly) on the Commission Staff Working Document on the
WASH issues, she says that it has no policy implications. Since
that document sets out how EU assistance is meeting humanitarian
water, sanitation and hygiene needs at a time when the Commission's
auditors have demonstrated its failings in managing water and
sanitation projects effectively, we are bound to disagree. Moreover,
when the Commission is so dismissive in its responses to the Court
of Auditors' analysis and recommendations, we are not optimistic
about the Minister's ability to be able to persuade the Commission
to improve its performance in the ways that she, and we, would
wish.
3.16 We accordingly recommend that this document
and the Commission Staff Working Document on WASH should be debated
in European Committee B, so that the Minister can outline her
approach more fully and interested Members can satisfy themselves
that the Government will be able to achieve its objectives and
improve the Commission's future management of water and sanitation
projects.
3.17 We are also drawing this chapter of our Report
to the attention of the International Development Committee.
5 See chapter 4 of this Report. Back
6
See http://eca.europa.eu/portal/page/portal/eca_main_pages/home
for full details of the ECA's work. Back
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