- 1. Page 1 of 15 Emerging Experiences with Sanitation Financing
Models & Approaches, in Lao PDR. Declan OLeary, January 2013, 1
This paper emerges from a research initiative commissioned by SNV
the Netherlands Development Organization in 2011 and is linked to
the first phase of the regional Sustainable Sanitation and Hygiene
for All-SSH4A programme component in the Lao Peoples Democratic
Republic (Lao PDR), then funded by the Australian Government via
the Australian Agency for International Development AusAID and the
Directorate- General for International Cooperation (DGIS) of the
Dutch Ministry of Foreign Affairs through SNV. The paper is
intended to provide a snapshot of and insight into some of the
sanitation financing models/approaches and results obtained (up to
the end of 2011) in Lao PDR. The research field work was undertaken
by an independent expert (Mr Khanthaly Seanvilayvong) with
expertise in credit and saving programmes, supported by the SSH4A
Project Manager under the guidance of the Water Sanitation and
Hygiene (WASH) Sector Leader and other advisers in country2. The
objective of the 2011 research was to gain a better understanding
of, and into the mechanisms that had or were being used to finance
and/or subsidise sanitation interventions and investments in
country by identifying, documenting and focusing on some of the
initiatives3 in Savannakhet province as representative examples of
the country. Background & Context Setting Savannakhet province
is the largest province in Lao PDR by area, covering 21,774 square
kilometres as well as the most populated province, with over
916,984 4 people distributed across ~1,0155 Bans (villages) in 15
districts making it up. The province is traversed by a number of
designated regional highways running both north south (Asian
Highway 11) and east west connecting Northern Thailand and Myanmar
with Vietnam and the sea, this highway has also been designated
part of the Greater Mekong Sub-Region, East West Economic Corridor.
Issues Statement Improved sanitation coverage for Lao PDR in 2005
was reported at 48%, significantly below the regional average for
South East Asian countries at 67%. Considerable progress has been
made toward the national sanitation target of 70% in 2015 for the
countrys commitments to the Millennium Development Declaration and
it goals (MDGs) increasing sanitation coverage from 11% in 1990 to
48% in 2005. Nationally the economic impacts from the lack of
sanitation have been calculated by the World Banks Water &
Sanitation Programs (WSP) supported Economics of Sanitation
Initiative (ESI), which calculated in 2009, that the overall
economic costs of poor sanitation in Lao PDR to be equivalent to
US$193 million per year, with per capita (monetised) economic loss
from the adverse impacts from sanitation equal to 345,653 Kip
(~US$34) per person year7, equivalent to 2,073,918 Kip (US$204 per
household (of six persons) per year! Thus showing a clear
justification and economic benefit for households to have and
invest in sanitation. Access to sanitation in Savannakhet province
has been identified as continuing to lag behind other provinces in
the country even though the majority of the provinces population
(concentrated in the western part of the province) are more
affluent that many provinces in the country. In fact, Savannakhet
province was reported to have the third worst levels of sanitation
coverage in the country (National Census Data 2005)8. Figure 2.
District Distribution of Water Supply and Sanitation Coverage,
Savannakhet Province (% of households WITHOUT Water and Sanitation
2010) 3% 0% 0% 2% 19% 45% 29% 5% 0% 0% 4% 40% 0% 4% 0% 7% 44% 67%
68% 78% 86% 86% 50% 56% 81% 44% 79% 69% 46% 86% 0% 10% 20% 30% 40%
50% 60% 70% 80% 90% 100% Kaysonphomvihane Outhoumphone
Atasaphanhthong Phine Sepone Nong Thapangthong Songkhone Champhone
Xonabouly Xaybouly Vilabouly Atasaphone Xayphouthong Phalanxay % of
HH Without Sanitation & Water Supplies (Data source PDOH/Nam
Saat 2010) Total HH % W/OWater Supply TotalHH % W/OSanitation
Source: Provincial Department of Health Environmental Health &
Water Supply (Nam Saat) section data. Overall sanitation coverage
across the 15 districts in Savannakhet province was reported at 45%
of households having a toilet in 2011, (with 83% in urban areas and
37% of rural areas). Provincial progress has been made over the
previous five years where access to sanitation is reported to
Figure 1 Districts of Savannakhet province, indicating the %s of
the population living below the national poverty line, red areas
>60% poor6, with inset national map.
2. Page 2 of 15 have doubled, from just 22% of households in
2005 to ~45% in 2011, though considerable challenges exist to
continue to increase coverage across the province. Table 1 Overall
Water Supply and Sanitation coverage Savannakhet Province (2011)
2005 2006 2007 2008 2009 2010 2011* Sanitation 22% 23% 27% 33% 36%
43% 45% Water Supply 92% 98% 99% Source: Provincial Department of
Health Environmental Health & Water Supply (Nam Saat) section
data. From an international development perspective supporting and
universally subsidising improving access to sanitation for the
majority of households in Savannakhet was and is not a viable or
recommended option and would be wasteful of the limited development
resources available in country. As many households without
sanitation are not poor and vulnerable and would appear to be
unwilling and or reluctant to make the necessary investments
required to obtain improved sanitation, possibly due to a number of
reasons, including but not limited to: Poor or limited awareness
and understanding of the adverse impacts and costs from the lack of
sanitation as mentioned above, Limited access to information on
cost effective sanitation and construction materials and
approaches, and The demand for sanitation is simply not a priority
for many households who often have other competing demands for the
financial resources available to them. Or put another way, the
opportunity cost forgone in not choosing to invest in sanitation or
its impacts was perceived as low. Additional research initiatives
undertaken on sanitation demand and other issues in Laos9
identified a need for this research to gaining a better
understanding into what types of projects etc. had been undertaken
to contribute to closing the sanitation gap in the province and
country, and what financing mechanisms were used to support these
and how effective they had been. Research Approach The research
approach was based on discussions with responsible provincial
government offices and non- governmental organisation (NGO)
development actors. This identified projects, gather available
information and documented feedback on their experiences on
sanitation financing approaches. Those consulted included the
Environmental Health and Water Supply Office (commonly referred to
as Nam Saat) of the Provincial Department of Health which is
responsible for rural sanitation as well as its district offices,
the provincial Urban Water Supply State Enterprise (Nam Papa) of
the Provincial Department of Public Works and Transport, with the
department which is now often taking the lead for urban sanitation
as well as the Lao Red Cross. NGOs consulted included FIDA
International, SNV, World Vision, NORMAI (Non- profit Association
for Rural Mobilisation and Improvement) which is one of the
localised entity of the CIDSE programme, and a number of emerging
private sector actors, namely the owners of a number of involved
private sector enterprises (construction material
retailers/suppliers, and/or material fabricators) currently or in
the recent past involved in sanitation provision and support in the
province. 17 different programmes, projects and businesses were
identified by interviewed stakeholders either being undertaken in
different locations and or over different phases and available
information was collected on these, namely on: Table 2 Sanitation
Financing Actor/ Stakeholders and the Locations of Reported Project
Interventions Involved Implementers, (may not mention all partners)
#ofProjects Reportedon Reported Locations of Projects (district)
(Note likely duplication as activities reported by project
partners, Government & NGOs whose reviews have been combined in
the analysis) Leading State Actors/ Stakeholders Nam Papa
Provincial Urban Water Supply State Enterprise, of the Department
of Public Works & Transport and its district offices. Support
provided by UN-Habitat and ADB. Urban 5 Projects and or phases
initiated or undertaken in (i) Outhoumphone, (ii) Phine, (iii)
Atsaphangthong & (iv) Villabouly, Districts Centres. With the
first project (i) reported on 2004, and the latest initiated in
2011. Nam Saat (NS) Environmental Health and Water Supply Section,
Provincial Department of Health or its district offices (multiple
donors and partners) As the responsible government agency for rural
sanitation, Nam Saat is frequently the lead implementing partner in
many of the reviewed projects. Rural 5 Districts where supported
project were reported were; (i) Phine, (ii) Villabouly, (iii)
Atsaphangthong, (iv) Phalanxai (v) Xaibouly, (vi) Nong, (vii)
Sepone (viii) Xonabouly, (ix) Songkhong (x) Outhoumphone (xi)
Atsaphone, and (xii) Thapangthong districts. Some districts had or
have a number of projects implemented with different partners (see
below). Provincial Government Rural Development & Poverty
Reduction Office, SNV Rural 1 Phine, Atsaphone, Xonabuly, and
Phalanxai Lao Red Cross (Netherlands Red Cross) Rural 1 Phalanxai
and Xaibouly Private Sector Private Sector/ Entrepreneurial
Initiatives (The Nang Chouk Material Shop -NCMS, Southchay
Construction Company -SCC) Pakorb Construction Materials Shop PCMS)
Urban/ Rural 3 Atsaphongthong District Outhoumphone District
Xonabuly District (in order respectively) Birla-Lao Farm and
Plantation Company Rural 1 Phalanxai district Multilateral Agencies
and Non-Governmental Organisations UNICEF Rural Nong, Sepone,
Villabouly and Xonabouly districts UN-Habitat Urban Outhoumphone,
Phine, Atsaphangthong & Villabouly Districts Centres Oxfam
(Belgium) Rural 1 Xonabuly District World Vision International
Rural 6 Outhoumphone, Nong, Atsaphone, Phalanxai, Atsaphone,
Thapangthong (mainly through integrated areas development
programs-ADPs) SNV Netherlands Development Organisation Rural 2
Sepone & Villabouly districts (Pro-Poor WASH), Atsaphone,
Phalanxai Xonabouly, Phine (SSH4A) 3. Page 3 of 15 Fida
International Organisation Rural 1 Songkhong District CIDSE project
now localised to the Non-profit association NORMAI. Rural 1 Phine
District Christian Broadcasting Network-CBN Rural 1 Atsaphangthong
district CIDA Rural 1 Phine District The consultations allowed for
the identification of a number of variants of financing models/
approaches, though different names were sometimes use by
organisations and agencies, those identified have been group
together as the approaches in general were similar, and the
reporting scale, performance and progress (table 4) is up to the
end of 2011. The models/ approaches identified included: Table 3
Identified Sanitation Financing Models & Implementing/ Support
Organisations Model Reported Implementers & involved partners/
funders Direct Grants or Subsidies to cover all or parts of the
cost of sanitation/toilet materials and super structures. Commonly
providing either as cash or more frequently materials, namely o
Differing numbers and sizes concrete rings for single pit or dual
pits o Ceramic pans/bowls, o Piping (usually PVC) o Cement (bags or
set weight/volumes) o Other materials (bricks, sand etc....). Nam
Saat/Fida International Organisation Nam Saat/ UNICEF. Birla Lao
Pulp and Plantation Co. (Corporate Social Responsibility model).
Nam Saat/ CIDSE, (Coopration Internationale pour le Dveloppement et
la Solidarit) Nam Saat/ SNV with European Commission support. Nam
Saat/ CIDA-Canadian International Development Agency Nam Saat/
Christian Broadcasting Network CBN. In some instances full
subsidies were provided for poor and vulnerable targeted households
and groups. Enabling those households to gain access to sanitation,
Revolving Fund Models, loans or credits to cover the costs of
materials and or construction services which are repayable either
with or without interest within a specified timeframe Nam Papa
Urban Projects with UN-Habitat and ADB-the Asian Development Bank,
focusing on emerging Urban Areas/ District Centres. World Visions
through its Area Development Programs-ADPs Oxfam Belgium
Established Village Development Funds There are well established
village development funds in some villages across Emerging Private
Sector/ Entrepreneurial Innovative Credit Approaches Though similar
in manner to credit models it was considered best to document these
separately Three companies/ businesses in different districts, some
now working through MoUs with state actors (Nam Saat, Nam Papas).
Indirect Subsidies for the likes of Community Led Total Sanitation
(CLTS)/ Sanitation Marketing (Sanimart) Models, CLTS, and Sanimart
was being piloted in a number of districts (6) and villages (~105)
by projects. Led by the Provincial Rural Development & Poverty
Reduction Office (PRD0) in one project with SNV, with AusAID/DGIS
support. Nam Saat/SNV in another project with European Commission
support Overall Findings The following table summarises the
estimated hardware investments made and reported unit costs for
sanitation materials, as well as the reported delinquency rates in
repayments on credit based approaches (revolving funds and credits)
though noting that many of the projects are reported as ongoing.
Additional findings were (following table) Table 4. Reported
Impacts, Investment and Hardware Unit Costs of Supported Models #
Model/ Approaches applied Households benefiting Villages Districts
Estimated Investment (Only hardware /material costs usually
reported ) Cost per Units (median values) Reported DelinquencyRate
Reported Timeframe Lao Kip US$ Lao Kip US$ 1. Revolving Fund Model
1.1 World Vision 894 48 6 536,400,000 $ 67,050 600,000 $ 75 40%
2007- (ongoing end of 2011) 1.2 Nam Papa 587 39 5 864,000,000 $
108,000 1,471,891 $ 184 65% 2005-(ongoing end of 2011)) 1.3 Nam
Saat /Oxfam Belgium 23 3 1 14,996,000 $1,875 652,000 $ 82 100% 2004
2 Grants/Direct Subsidies Model 2.1 Nam Saat / FIDA International
1,190 39 1 1,792,900,000 $224,113 1,506,639 $ 188 1998-2010 2.2 Lao
Red Cross 379 7 2 n/d 2000-2005 2.3 Nam Saat /CIDA 724 13 1
579,200,000 $72,400 800,000 $ 100 2002-2006 2.4 Nam Saat /CIDSE 121
8 1 n/a 2000-2005 4. Page 4 of 15 2.5 Nam Saat / SNV 296 8 2
74,000,000 $ 9,250 250,000 $ 31 2010- 2.6 Nam Saat/ UNICEF 990 14 4
n/a 2000-2009 2.7 Birla Lao Co. 238 2 1 n/a 2010- 2.8 Nam Saat /
CBN- 304 6 1 109,440,000 $13,680 360,000 $45 2004- 3. Private
Sector/ Entrepreneurial Model 3.1 NCMS 373 7 1 111,900,000 $13,988
300,000 $ 38 2009- 3.2 PCMS 300 14 1 203,000,000 $ 25,375 620,000 $
78 9% 2007- 3.3 SCC 419 27 1 209,500,000 $ 26,188 500,000 $ 63 29%
2007- 6,838 235 4,495,336,000 $ 561,919 n/a = Not available or n/d
=no reported data. 1. Sanitation intervention investments were
reported to have been undertaken in a total of 235 of the ~1,015
villages in the province (23%) dispersed across 12 of the 15
districts of Savannakhet province by interviewed implementers.
Though it should be noted that this does not exclude activities in
the other three districts, just that they were not reported upon by
interviewed implementers. 2. The timeframe covered by the reported
projects stretched back over a decade to 1998, with associated
sanitation investments by one organisation (FIDA International) in
one district (Songkhong) which was reported as continuing up to
2009. The sanitation component of this evolving programme/ project
enabled over 1,090 households to benefit with a reported investment
in excess of US$220,000. Some of the units costs reported for early
phases by this organisation where some of the most expensive quoted
at 2,500,000 (US$250) per unit!10 3. Overall at least 6,838
households gained access to some form of improved sanitation,
though a considerable number of sanitation options were provided
and or supported by implementing partners and enterprises, in
general allow would have allowed to the construction of an improved
sanitation option11 . It is likely that a greater number benefited
as some supported activities were ongoing at the time of the field
work in late 2011, so the research and this paper only provide a
snapshot of what was and is going on. 4. Over the ~13 year period
which were reported upon by interviewed stakeholders (1998-2011),
at least 4,495,336,000/4.5 Billion Lao Kip (equivalent to at least
US$ 561,919) was reported invested by some though not all
implemented projects with no investment costing from UNICEFs
supported interventions between 2002-2009, Lao Red Crosss, the NGO
CIDSE or the Corporate Social Responsibility (CSR) approach of the
Birla Lao company. 4.1. Averaged supported investments across those
implementers both grant and credit based reporting, were 744,503
Kip (~US$93) per household investment, and ranged from 250,000 Kip
(~US$25) for one project (by Nam Saat/SNV in 2011) to a reported
averaged high of 1,506,639 Kip (~US$188), across the various
investments made by Fida International, between the late 1990s-
2009 with significant high investment costs reported in the early
2,000s. 4.2. The investment figures generally only report the costs
of the supporting hardware/sanitation materials and not the process
or support cost involved? It is reasonable to speculate that at
least the same amount of 4,000,000,000 Kip (~US$500,000) was
investment by beneficiary households in additional materials and
efforts to construct or improve on the sanitation supported by
development partners. As most of the reported investments/ credits
only supported sanitation related components (ceramic pans,
concrete rings, covers, some cement and associated pipe-work) but
not the necessary investments for superstructure. 5. One of the
most interesting findings was the reported scale of private sector
sanitation financing initiatives reported in some (3) of the
provinces districts. Those private enterprises interviewed, usually
initially got involved through supplying development projects but
in a number of instances have scaled up their own support, now
often working in/ through cooperation agreements with responsible
local authorities in the districts (possible examples of public
private partnerships). The three enterprises consulted with in
three districts provided nearly a fifth (17%) of the supported
toilets, most reported operating credit base systems for materials
with flexible payment often aligned (but not always) with
households ability to make repayments usually post-harvest. 5.1.
The sanitation material set options provided by the private sector
enterprises were usually more flexible in nature and appeared to be
more cost effective, averaging at 472,000 Kip (US$53), in general
ranging between 300,000 Kip (US$38) 620,000 (US$78) though one did
mention willing to provided financing for full latrine kits
including all sanitation and superstructure materials which was
costed at 1,230,000 Kip (US$154) per set. 5.2. As a credit model,
the private enterprises did have some difficulties with an averaged
reported repayment delinquency rate of 19% across two of the three
enterprises interviewed. This appears to be significantly lower
than the urban and rural development partner (Nam Papa, World
Vision, Oxfam) revolving fund models where delayed repayment rates
(the preferred terms used by interviewed responsible respondents)
was 68%. 5.2.1. In many instances development partner (Aid)
provided funds were either (i) not repaid, (ii) were significantly
behind the agreed/ contracted repayment plans, (i.e. three -12
months behind)m or (iii) were paid into an existing village
development (credit) fund (i.e. as reported in World Vision
supported areas) and then never reallocated for sanitation
financing again. As it appears that the village development fund
(VDF) manuals used and their committees did not allow for or
consider sanitation loans as being a listed option for loans from
the fund. 5. Page 5 of 15 6. Grant subsidy models were the most
commonly implemented approach reported for the period 1998-2010 in
the province. This conventional approach has been found deficient
in delivering significant improvements and progress in improving
sanitation coverage, in that; 6.1. Rarely did grant/ subsidy models
provide significant increased village sanitation coverage in term
of the number of households in villages gaining access to
sanitation. The most frequently reported level of sanitation
increase was 12% of village households gaining access to improved
sanitation through subsidy based approaches. Reported increases
ranged from 3% of households in 2 villages to 100% in three
villages where such information was made available 6.1.1. Limited
data, apart from overall outputs figures (the total number of
sanitation material sets provided and the number of villages
covered) was frequently all that was available, making it difficult
to qualify the actual sanitation coverage percentage increased in
villages. 6.1.2. It had also been observed that what was reported
were outputs, in terms of the number of sanitation sets delivered
to a villages and may not actually reflect on the actual number of
toilets constructed as in some case provided materials were horded
till households had the financial resources to build proper though
costly toilets structures with brick, plaster and tiling. 6.1.3.
The researcher was informed that available data sets by village, of
sanitation coverage may have been available at district levels (at
the District Health Offices), as the provincial level only received
consolidated figures. The researcher then found (from the district
offices) that village data sets were often only available for
villages where district Nam Saat personnel were directly involved,
indicating a deficiency in the current monitoring system which did
not provide adequate resources for minimal monitoring levels in
terms of being able to visit/or obtain information from every
villages in a district at least once per year. 6.1.4. Quantities of
sanitation material sets distributed was also difficult to qualify
ranging from six sets in a couple of villages, to 230 sets for a
village in Xonabouly (Ban Kongpathoumvan) with UNICEF support
through Nam Saat, which reportedly increased sanitation coverage by
73%. The annexed table attempts to summarise and document the
reported processes, approaches, achievements and challenges as seen
from the implementers perspectives. It should be noted that a
number of the projects/ approaches were reported completed/ended
(e.g. UNICEF 12 , Oxfam, CIDSEs, Lao Red Cross, FIDA, and CIDA,)
while other projects and marketing initiatives were reported as
ongoing at the end of 2011. Levels of and quality of information
provided varied considerable Discussions on the Findings The
research found that a wide range of organisations and the private
sector actors were or had been active in the sanitation sector and
had utilised a variety sanitation financing models and approaches
with varying degrees of success and impacts. By far the most
commonly practiced approach were grants and subsidies, followed by
the revolving funds and credits though it was interesting to find
that this was found to be an emerging area for private sector
participation and initiatives. Most recently (2010/2011), indirect
subsidy approaches through community led total sanitation-CLTS and
sanitation marketing have been tried, encouraging and increasing
sanitation demand, and getting households onto the sanitation
ladder as well as developing the sanitation supply chain and local
governance, and all be look at briefly in turn below. In general
what was being financed (through grants and or credits) were
usually sets of sanitation materials, though this varied
considerable in terms of the type and quantities of materials
supported as there appeared to be little or no guidance and or a
lack of consensus on what the basic requirements for improvement
sanitation were. Even though national materials on this had been
developed over a decade ago (by the National Centre for
Environmental Health and Water Supply- Nam Saat Central); these
materials appeared to be poorly disseminated and or not available
to current or involved sanitation actors. The varied sets also
appeared to have resulted in significant cost variations for their
provision, though one would rather not advocate for compulsory
standardised sanitation packages. Subsidy/ Grant Funds These are
commonly considered the most conventional approach for contributing
to making improvements in and across the water and sanitation
sector. Decades of experience have been gained in providing
sanitation with questionable results often been obtained
particularly in relation to the coverage of and sustainability of
sanitation interventions. In a few instances complete toilet units
were reported provided including superstructures (in the early days
of FIDA, and some demonstration models in targeted villages
(usually at poor household who might not be able to afford to
sanitation investments.) for SSH4A as part of the construction
training. By far the majority of sanitation interventions supported
the provision of some materials, usually for the sanitation
components with the households and community provided the
additional materials and labour inputs to construct the latrines
and superstructures. Reporting on performance of this approach was
in some instances questionable, as what was reported (e.g. Nam Saat
/UNICEF) was the distribution of material sets (as the output) and
not the actual number of latrines constructed. Further in the
majority of cases the quantities of material sets provided at
village levels usually only covered a percentage of the households
in need of sanitation. In some cases materials were provided for
shared latrines which may not contribute to the national
Commitments to the Millennium Development Goals (MDGs) or were
captured by elite/powerful social and economic groups in villages
who obtained the materials first often leaving the most vulnerable
households without sanitation, though in later years actors stated
that they were making better efforts to target the sanitation
materials at poor and vulnerable communities and households.
Regardless of this, the overall improvements in sanitation coverage
by providing a limited number of sanitation units in villages,
generally did not contribute significantly to reducing 6. Page 6 of
15 incidence of sanitation related illnesses in villages as the
residents were still being exposed to faecal contaminants because
of ongoing open defection by the unserved population. The grant
subsidy approach often makes reasonable project rationale and
justification; in that projects and programmes could claim to be
contributing to making improvements in (access to) sanitation, by
provided X number of sanitation units to Y numbers of villages in a
project area. Rarely was overall / universal coverage in or for
villages or projects being considered, usually because of the lower
prioritisation of sanitation in general against water supplies,
also because of the likely significant cost implications of such as
approach. Regardless of this evident exists that simply providing
access to sanitation may not result in reducing adverse health
impacts if sanitation usage and hygiene behaviours dont change or
increase, as numerous actors globally have often observed and found
that supported and supplied sanitation materials inputs often
uninstalled and or unused, because of a lack of improved knowledge
and or changing behaviours It is partly because of these
limitations of grant / subsidy approaches that alternative models
have developed to encourage and seek greater commitment from
beneficiary groups and households being targeted for sanitation.
One of the more increasingly advocated approaches is revolving
funds and credits. Revolving Funds Global experience with
Sanitation Revolving Funds has been ongoing since at least the
1990s if not before where they have been increasingly used to
encourage sanitation improvements more frequently in urban areas
often through upgrading of existing sanitation facilities. There
are cases where funds have encouraged and expanded sanitation
coverage by deferring the investment cost thus making it a more
encouraging option for some households. However there are risks
that credit based approaches have of excluding the poor, vulnerable
groups and those on low incomes (below or near national poverty
lines) in that they can create or contribute to increasing the debt
burden on such households. In the urban case in Savannakhet the
district water and sanitation schemes which have been progressively
implemented since 2005 developed their own poverty targeting
approach based on three categories (which does not appear to be
aligned with the national poverty criteria) to identify what they
considered eligible households, who were targeted with sanitation
loans, these were generally taken up. Community management
committees (community based organisations-CBOs) were then given the
responsibility to collect the loans for re-issuing and the
performance of which has been marginal to date, with an average of
37% of the provided loans being repaid by the end of 2011, as
report by DPWT, ranging from 31%-50% of loans made. It is worth
noting that many of these schemes were reported as ongoing at the
end of 2011. Those projects reporting on were initially started in
Outhoumphone District Centre 2004 (with 31% of loans reportedly
repaid), Phine DC 2007 (50%) and Atsaphongthong, Villabouly &
Xepone DCs 2010 (30%) respectively. Two other project phases for
Atsaphonthong and Villabouly also reported underway, but no
sanitation loans reported on, which had started in 2010 and 2011.
In recent years the application of sanitation funds have followed a
mixed approach in that some households the very poor receive free
materials while some others are also partly subsidised, so some
aspects of these projects could be considered as subsidy model as
well In rural areas, the World Vision International (WVI) supported
revolving fund approach covered one now ended project and four
ongoing areas development programmes (ADPs) in the province. WVI
initially provides village sanitation funds which were likely used
by better off households in targeted villages to construct
sanitation with responsibilities given to local community
management groups (CBOs_ to recoup the funds invested. Overall
reported revolving rates by WVI were just 13% ranged from 10%-18%
across the project and ADP though there were reported to be
villages with up to 60% of sanitation fund rolling over. One of the
identified deficiencies was collected repayment funds were
generally not reissued for sanitation loans again in most villages,
simply bundled into existing Village Development Funds and used for
other purposes. While the third small example reported upon
initiated by Oxfam in the mid 2,000s at the end of a programme was
not reported to have revolved at all. All the supported revolving
funds reported confronting similar challenges in that (a) the
repayment plans and contracts were not adhered to by households, or
(b) the repayment periods were reported either not sufficient to
make the repayments, (c) households and communities were aware that
other development organisations provided (some) free sanitation in
certain villages and felt that they should have free sanitation as
well, and the organisations, local government and established
community structure made little or no effort to encourage or compel
repayments to be made, which likely deprived other households in
targeted villages from benefiting. Most of the projects provided at
least 12 months or more for the repayments to be made, which
equated to monthly repayments ranging between 50,000-90,000 Kip per
month (US$6.25-11.20). However even if repayments were being made
they were frequently reported as not being completed in a
consecutive manner, or with delays and deferments often being asked
for, to enable borrowing households to either; (i) Pay off their
sanitation loans during period of financial surplus usually
post-harvest (December-February), or (ii) Utilise the households
available financial resources for other purposes, possibly
indicating the low prioritisation of sanitation in general, and
(iii) There were also reported (a limited number) of instances of
households simply refusing to make repayment, with little the local
community/village collectors could do. Likely reasons for some of
these challenges were, poor explanation and understanding by client
households and established CBOs of the, revolving funds mechanisms
(requirements and conditions), poor capacities and governance of
the CBOs. Through the reviewed Lao language loan documentation,
usually a single or double page document was considered reasonably
clear though it may be difficult to understand in communities with
higher rates of adult literacy exist. Most communities were
familiar with micro-financing/ credit provisions through village
development funds and other saving 7. Page 7 of 15 and credit
approaches as these have been an ever expanding concept across the
districts in the province over the last decade. This also raises
questions about the existing capacities of the support
organisations (frequently state agencies) that provided the
training and support to facilitate the establishment of revolving
funds. In that once established they appear to do little to ensure
the overall performance of the funds, with limited inputs or
support to follow up on repayments possibly indicating a low
prioritisation of sanitation revolving funds. This is likely as
usually, there were often limited resources available either
committed by the state or through the projects for following up on
the performance of the established revolving funds. The performance
of revolving funds is debatable in that even though the repayment
terms were reasonable with repayment periods averaging at least 12
months and reported ranging from three-18 months, often with little
or no interest (just repaying the capital). Most if not all only
achieve partial repayments of the amounts invested to varying
degrees. A resulting impact from the delayed and deferred
repayments is that the number of additional sanitation loans is
hindered in either being delayed further or not taking place at
all. Additionally there is little or no information available on
the rolling over of revolving funds for sanitation, as project have
often end or the funds continuation is not adequately monitored. In
some instances, the transfer of repayment responsibilities to
community based groups and or to existing village funds Village
Development Funds has resulted in the sanitation funds never being
reused for additional sanitation loans or not being adequately
followed up on for repayments. This appear to be due to the lack of
(official) instructions/ guidance to village committees to consider
loans request and or make available funds specifically for
sanitation improvements... Private Sector Credit Provision One of
the interested findings from the study was the expansion of credit
services being provided by the emerging private sector in Lao PDR
to enable households and communities to access sanitation
materials. These initiatives were initially highlighted by the
provincial Nam Saat Office who made reference to the credit
activities in Atsaphone district, but which on later inquiry were
found to be replicated or in existence in other districts as well.
Those enterprises making credit available usually got involved
through providing supplies and materials to previous projects and
saw potential business opportunities. In some cases in what could
be considered as public private partnership model was involved,
based upon an agreed and signed Memorandum of Understanding (MoU)
between the supplier and the District Health Office. Whereby (a) a
supplier provided credit for materials to villages/ or groups of
households, (b) based on household lists generated by district Nam
Saat, (c) household loan contracts would then be generate detailing
conditions and terms etc.. Which when signed and witnessed (by the
village authorities and the district) would (d) allow for the
delivery of materials. This model was identified by the Provincial
Health Department for follow up and possible replication across
other districts as it was seen as a potential win win for those
involved. The private sector enterprises saw some advantages with
the approach in that for those interviewed, it appeared to give
them favoured position in supplying sanitation materials, though
they carried the investment risks. They did report having some
difficulties in that up to a fifth (19%) of sanitation credits
provided were reported in arrears, though this reported averaged
rate across two of the three enterprises was three to four time
better than the reported repayment rates of revolving funds
supported by development projects and NGOs consulted with. In some
cases the owners knew there were delays, as the household contracts
terms generally had a (too) short three to four month repayment
period and if issued mid-year most households could not build
toilets at that time as it was monsoon season. In many instances
the owners said they were flexible to this but one also mentioned
that they had experience of taking back some material sets from
some households who had not made an effort to pay for the
materials. This independent initiative has great potential and
could be seen as the model that could contribute to picking up the
pace for delivering on increasing sanitation coverage in the
province. Indirect Subsidies In this type of approach efforts are
made to not directly subsidise materials for sanitation
interventions, but rather to look at the overall sanitation supply
chain identifying barriers and opportunities to increase the pace
of sanitation provision. Working at creating sanitation demand from
households and communities and also addressing supply side issues,
enhancing supply actors with sanitation marketing support,
improving products quality and options, reduce production costs
etc... As well as facilitating other actors and stakeholders to
provide better support. The experience with this type of approach
is relatively new in Laos, with just one example the Sustainable
Sanitation and Hygiene for All project so far, which was still
being piloted at the end of 2011. And the project supported the
research initiative upon which this paper is based. This approaches
initially applied a variant of community led total sanitation CLTS
to encourage households and communities in 80 villages across four
districts to build toilets and strive to achieve open defecation
free (ODF) status, with an expectation of getting households and
communities onto the sanitation ladders. The project also engaged
with other sanitation actors and stakeholders (construction
material retailers, materials fabricators, micro and small scale
construction contractors) involved in the sanitation supply chain.
Actual field implementation of the project was just over 12 months,
and had resulted in 729 household toilets being constructed by the
end of 2011, with 457 others toilets reported as still under
construction, with post December being identified as being the main
construction period. 17 private sector enterprises across the four
districts (mainly retailers and material fabricators) were involved
with the project and benefiting from a target revolving fund for
fabrication moulds (for a pan stand and rings) to reduce production
costs. To date (December 2011) just three of the 80 villages had
declared ODF status with sanitation coverage between 90- 100% with
three other villages closing on ODF status with over 80% sanitation
coverage. 8. Page 8 of 15 The project reported significant
challenges during its implementation in that apart from confronting
flooding (reportedly the worst flooding since 1962) which resulted
in 25% of the target villages being listed by the government as
disaster affect villages, while the majority of other villages
suffered varying degrees of damage and destruction of economic
infrastructure and food supplies. The approaches (CLTS and
sanitation Marketing) and implementation structures were based upon
a multistakeholders approach involving a range of six diverse
government institutions (including two mass organisations the Lao
Womens Union and the Lao Youth Union)13 were also completely new,
so took longer to sensitise and train to deliver the project inputs
to communities and other stakeholders. Further a number of the
participatory identified target villages were later found not to be
compliant with the agreed selection criteria in having previous
subsidise approaches which make CLTS difficult to implement. The
scale of the project and wide dispersion of the target villages did
not contribute to frequent and effective following up in the
beginning, though progress was being made by the end of December
2011. Conclusions So what can we concluded from the research? As
mentioned it only provided a snapshot of what was and is going on
in the country up to the end of 2011. It is felt that it is
reasonably representative of the range of sanitation financing
models and approaches being utilised in the country at that time.
Some of the approaches are embryonic in nature, namely experiences
with indirect subsidies through either stand-alone interventions or
blended approaches involving CLTS and/or sanitation marketing. As
are the experiences with the corporate social responsibility
(subsidy) model being implemented by the Birla Lao Company. The
research was considered challenging in that it endeavoured to
obtain information on a range of sanitation financing models and
approaches and primarily relied on a mix of key informants from
involved, responsible and implementing agencies and organisations
as well as limited fact finding and validation from on the ground
from direct beneficiaries in villages where approaches had been
applied. Other potential stakeholders were also consulted,
including a number of the emerging micro financing institutions and
banks operating in the province and districts to see if they had
provided or were aware of providing loans and credits for
sanitation, to which all responded none of aware of loans being
provided specifically for sanitation. Information from key
informants was often inconsistent, and incomplete, evident by some
of the projects informants made reference to, with some being quiet
small in nature, or undertake and or initiated nearly a decade
previously for example the referencing of the Oxfam, CIDSE and Lao
Red Cross supported projects, though this may have come about
because they were some of the few projects in a district that had
sanitation components. Additionally it was observed that one of the
biggest WASH projects undertaken in the province and some of the
visited districts with a Belgian supported project between
2004-2008 through Nam Saat, which was not referred to though this
project sanitation approach was a grant subsidy model? All the
projects approaches and models have contributed to increasing the
overall sanitation coverage in the province to some degree with
6,838 households (~41,000 people) in 235 villages likely benefiting
from improved sanitation, through an investment of at least 4.5
billion Lao Kip, ~US$562,000, with roughly the same amount again
likely being investment by households in additionally building
materials and labour. In terms of the three broad grouping of
models, direct subsidies, revolving funds/credit based approaches
and indirect subsidies. All are likely useful though their
application needs to be better targeted. Direct Subsidies There is
likely a continued need for some direct subsidies for sanitation,
but these needs to be better focused and effectively applied,
targeting only poor and vulnerable households and remote
communities with limited access to district centres, as sufficient
information is now available through the Department of Planning and
Investments information system to better target interventions. It
was reported that some approaches were poorly targeted resulting in
some of the supported project activities being implemented in
predominately none-poor villages; even after a participatory
multistakeholders consultation process on targeting using a
reasonable set of criteria. So supporting organisations may need to
consider independently verifying proposed locations where projects
and interventions are suggested for to go before proceeding.
Additionally because of the limited financial resources being made
available, which is also likely to decrease in the coming years as
grant/subsidy based approaches are increasingly being called into
question, because of their limited results and sadly all too
frequently being poorly targeted and generally benefitting non-poor
and needy households, who could actually afford the necessary
investments if they prioritised and valued the benefits that
improved sanitation provide more. Subsidies should possibly only
come into use after households and communities have committed to
making sanitation improvements through either developing and
implementing hygiene and sanitation plans (possibly developed
through the use of Participatory Hygiene and Sanitation
Transformation- PHAST approach14) or getting onto the sanitation
ladder and communities making progress to being and maintaining
open defecation free (ODF) status villages. This is likely to have
time factor implications for projects in terms of a number of years
rather than the reported experience from the Pro-Poor WASH project
which appear to have telescoped this approach into a far too
shorten timeframe, with little evidence or opportunity for CLTS to
succeed or make progress. Revolving Funds Revolving funds are
increasingly becoming a prevalent and favoured approach because
they cater to households willing and wanting to making sanitation
improvements but lacking the immediately available financial
resources. They can also leverage additional financing from
households, and because funds are theoretically revolved they have
the potential to increase coverage through multiple applications.
Reported experiences in the province indicate some complications
with the current application of the revolving funds models across
both urban and rural areas. In that there are difficulties in
recoup repayments to the central fund in targeted areas. In urban
areas an average of 37% of the provided funds for sanitation loans
between 2005-2010 had been repaid. While in rural areas the
district averaged repayments/ revolving was just 10% though it was
noted that 9. Page 9 of 15 there were some exceptional villages in
the 51 villages where it was applied between 2005-2010, where a
high percentage of the provided funds had been repaid and revolved.
The average value of loans in urban areas across all phases was
950,000 Kip/~US$119 and ranged from 700,000-1,070,000 Kip
(US$88-US$134), while in rural areas, revolving fund loan averages
were 538,000 Kip/US$67 and ranged from 400,000 to 652,000 Kip
(US$50-US$82) areas. Across both urban and rural areas, reported
repayment terms generally appear to have no interest or penalty
clauses applied for their operation or late and the repayment terms
ranged from four months to 18 month across different organisations
or projects, with longer terms now being applied in response to
delayed repayments. It appears that repayment plans associated with
the household contracts/ agreements are frequently reneged upon, or
delayed even through reported average month repayment were
reasonable. Sometimes this deficiency was compounded by the
agencies and organisation providing and supporting the model in
establishing weak local/ community based structures with limited
ability to recoup the funds to revolve, while the implementing
agencies may have issued the loans in the first place. Credit Based
Approaches It was evident that private sector sanitation provision
and financing is increasing across the province with a number of
innovative entrepreneurs/businesses taking the lead in some of the
districts which needs to be encouraged and supported. They have
some challenges. The repayment rates for credit funds were
significantly higher with 81% of used funds (the reported combined
amount of 524 million Kip (~US$65,500) across three enterprises)
being repaid. It repayments are made within the agree timeframe no
interest or penalty is charged if delayed or beyond the fixed term
an average of a 10% monthly charge is applied. Overall revolving
funds are not optimally implemented, even though repayment terms
were reasonable. While credit based approaches appear to be working
reasonably well. There is little or no incentive or motivate for
locally involved community stakeholders to ensure that funds are
repaid on time and made available for further sanitation loans.
Indirect Subsidies Experience with these approaches, namely
Community Led Total Sanitation-CLTS and Sanitation Marketing was
very new with only about a years worth of experience gained by the
end of 2011. Being a wholly new set up, involving a diverse multi
stakeholder approach, the set up and training of provincial and
district teams took longer than expected and resulting capacities
were still quite limited. The applied CLTS approach ran into
difficulties in that the timing and follow up of triggering was
limited due to the dispersed nature of the villages and the actual
targeting of 80 the villages, in that, in some of the districts the
targeted villages, already had some sanitation interventions
(usually subsidy based approaches) from other actors even though
the selection criteria had asked for these to be avoid, targeted
villages were also often widely dispersed across the districts,
requiring far long travelling times. Further the province and some
of the targeted districts suffered their worst flooding in forty
years and 25 were design disaster affected villages and the
resulting economic impacts set back the progress as sanitation
slipped down household priority list. The sanitation supply chain
component was also innovative and identified supply issues in that
the supply of sanitation materials was partly limited because of
the lack of ring moulds both in number and quality due to wear and
tear, as well as transportation issues. The indirect subsidy
approach financed a revolving fund to enable suppliers to purchase
additional quality moulds. It also developed and rolled out an
innovative sanitation pan stand which reduced the overall
sanitation construction costs, as the pan stand replaced the need
for larger structures to hold the ceramic pan. The approach also
piloted the use of cast in situ moulds for use in more remote
villages which enabled the communities to install and case rings in
place rather than transporting them. Lastly the approach support a
marketing initiative, training the suppliers and piloting the joint
development and usage of simply sanitation communication materials
(leaflets) which could communicate material needs and costs
directly to households which was starting to have an effect at the
end of 2011 with demands starting to pick up. The innovative
sanitation pan stand, prior to and after installation (photos RD)
The cast-in-situ mould three panel version, (photos RD. Overall,
all the models have some strengths and weaknesses, and it is clear
that how and where they are applied and how they are followed up on
is critical for them to have an impact. The private sector credit
model probably has greater potential as it is a commercial model,
with the interviewed owners feeling it provides opportunities for
them. It should be noted that most of the other development
assistance models have additional (hidden) support costs which are
not evident, and on which little or no comparative information was
made available. There is also a need to better understand where
progress is being made or not, regardless of how, as self-supply is
and will increasingly be an important but as yet unmonitored driver
of sanitation progress in the province and country. About the
Author D. OLeary holds a M.Sc. in Rural Regional Resources Planning
with over 20 years of professional experience, including extensive
involvement in the water sanitation and hygiene sector across both
urban and rural areas in South East Asia. A proven innovator and
facilitator in targeting basic services, as well as a practiced
capacity development professional across a range of sectors.
Contact details though LinkedIn:
https://www.linkedin.com/profile/view?id=17623360&trk=nav_responsive_ta
b_profile 10. Page 10 of 15 Annex 1 Process Summaries, Achievements
and Identified Challenges by Implementers Locations and
Implementers Provided supported Reported Process Performance and
Identified Challenges & Issues REVOLVING FUNDs
NamPapa,UrbanWaterSupplyStateEnterprise Outhoumphone, Phine,
Atsaphangthong & Villabouly Districts Centres Revolving funds
for villages making up Districts Centres, progressively covering at
least four District Centres (DCs) by 2011 Latrine revolving funds
stated in 2004 under the Community Access Water Supply and
Sanitation Programme for small town development and later Small
Towns water and Sanitation Projects Reported average cost of
sanitation material sets 1,070,000 Kip (US$ 134). Reported to
follow a six step process: i. Undertaking hygiene education to
increase awareness and create demand. ii. Conducting needs
assessment and choosing /agreeing on three toilet
designs/options15. iii. Assess household potential and generate
project name list based on the (projects agreed) poverty
criteria16. iv. Household and community contracting (materials to
be provided, repayment terms varying from 1-2 years. v. Provision
of materials sets17 vi. Provide village fund committees with
repayment lists for follow ups Achievements 587 Households latrines
provided across 39 urban villages making up five district centre by
late 2011 Note activities reported as still in progress. 1st batch,
Outhoumphone DC (2004) 19 villages 164 households 2nd batch, Phine
DC (2007), 5 villages 46 households 3rd, batch, Atsaphangthong
& Villabouly DC (2010), 5 villages 146 households through two
cycles 4th batch Atsaphangthong (2011) five villages 176 HHs so far
, as started in 2011 Total reported investment (to date end of
2011) for sanitation in the province was 864,000,000 Kip
(~US$108,000) over six years through various urban projects and
phases of projects. Reported Challenges i. Repayment rates of
sanitation loans across all project villages running at an average
of 35% (end of 2011) due to a. The reported inability of households
to repay due to being poor? b. Households consider the loans as
free money from development aid projects ii. Limited or no
revolving of funds due to high levels of repayment delinquency iii.
No resources for local village fund committees to functions so
limited follow up iv. Inadequate training to village fund committee
WorldVision Savannakhet Peoples Livelihood Improvement Project
(SPLIP) 2005- 2008 (with sanitation revolving funding (SRFs)
started in 2007) ADPs, in four districts, namely Nong (1 village),
Phalanxai (5), Atsaphone (17) Thapangthong (4) Ongoing and recent
Integrated rural development model Area Development Programmes
(ADPs) since 2008- ongoing SRFs since the beginning For household
toilets an allocation of between 400,-600,000 Kip (US$50- 75) per
set for supported materials. Currently Following a seven-step
process: i. Awareness raising on sanitation ii. Assessing village
sanitation needs, and informing on improved Sanitation iii.
Establishing Community Structure (1-2 person committee +
Maiban-Village Leader) iv. Community Contracting involving all
parties (village representative , District offices, Kumbaans) with
provision of a. 100% grants for Government identified Poor Families
18 b. Other (non-poor) households, loans from fund for 100% of
material cost repayable over 12 months with payment of
33-50,000Kip/ per month (~US$4-6/p.m.), upon complete repayment
funds transfers to Village Development Fund (VDF) v. The provision
of a set of sanitation and construction materials19 . vi. Following
up on constructions vii. Monitoring of repayment collection and
submission of borrower accounts to management committee
Achievements Based on five years of implementation 894 households
toilets constructed across 48 villages, in five districts Total
reported investment (to date end of 2011) ~536,400,000 Kip
(~US$67,050) over five years. Reported Challenges i. Elevated
delinquency (non-repayment) rate, with an average of 40% of
investments not being repaid per village fund, due to : a.
Competing demand for household funds (sanitation not a priority),
resulting in extended repayment periods. b. Awareness of other
villages who had received free toilets, so reluctance to repay.
Identified Issues i. No interest/ penalty provisions for delayed or
prolonged repayments. ii. No remuneration/motivation for management
committees to follow up on repayment delinquency. iii. Even though
sanitation material sets were provided or purchased for some
households, units remained uninstalled or materials provided used
for other purposes. iv. Once repayments made, limited or no
reissuing/revolving (by the villages development funds) for
sanitation purposes. Though VDF representative stated that were no
demands for sanitation loans? Xonabuly District 2004-2006 Oxfam
Belgium (OxB) support funds The district Nam Saat reported a
revolving fund initiative supported by OxB, in the mid 2000s
Conducted technical training on toilet construction. Provided
toilet construction material sets20 cost ~652,000 kip, (~US$82)
Repayment period was within 12 months, no interest Achievement 23
HH toilets were constructed across three village as the first round
of the fund 11. Page 11 of 15 Locations and Implementers Provided
supported Reported Process Performance and Identified Challenges
& Issues but depended on market value, Reported Challenges The
funds were reported to have never revolved, so just 23 HH
benefiting. VillageDevelopmentFunds-VDF Atsaphon District Phine
District (Interviews with specific village development funds in
these district, but existing in all districts in the province )
Department of Industry and Commerce supports the establishment of
VDFs as do some of development organisation such as World Vision,
who mentioned that repayments from revolving were paid to the VDF
Many villages have been supported by the Department of Industry and
Commerce and others in districts to establish village development
funds utilising saving and credit based approaches. These funds
collect monies from members and (DIC officials met with listed some
of the standard requirement they promoted through their model A
Minimum of monthly savings, usually 10,000 kip / member /month
Initial loan sizes limited 100,000 - 5,000,000 kip, with a maximum
period of 6 months, Variable interest rates: (i) For Member for
agricultural activities 2% per month (p.m.); and (ii) for small
business activities 3%; and a flat 6% p.m. for non-members, All
loans require collateral and based on income calculations All the
village development funds met by the researcher with stated that
they had not provided any credit and loans for sanitation to their
knowledge. Reported capital funds potentially available were
significant. The lack of reported sanitation financing from this
sources was due to the lack of official guidance to VDFs to allow
for the issuing of loans for sanitation and other purposes. As
available manuals only listed three purposes for (i) agricultural,
(ii) business and (iii) Emergency purposes and management committee
were reluctant to go outside what they felt were the permitted
boundaries. PRIVATE SECTOR CREDIT INITIATIVES A number of emerging
private sector entrepreneurs were identified as being active in
different districts in the province. Often operating through Public
Private Partnerships Memorandums of Understanding (MoUs) The
following are examples of those reviewed. Atsaphongthong District,
2009- The Nang Chouk Material Shop (NCMS) NCMS provided two
sanitation packages (mid 2011) which were being promoted one
costing 265,000 Kip (~US$33 )(but no transportation and the other
costing between 290,000- 310,000 Kip (~US$36-39) with the supplier
transporting the materials to the village depending on the distance
/ accessibility The NCMS stated that they developed their approach
by working closely with the district health and its Nam Saat
offices with whom they have a Memorandum of Understanding (MoU).
They collaborated with the DHO/Nam Saat who are responsible for
promoting sanitation in rural villages and disseminate information
about the model to villagers and village authorities. The owner
summarised the process as follows i. Following the signing of the
MoU the DHO/Nam Saat staff identified villages where households
were interested in obtaining sanitation. ii. Based on a simple
household contract drawn up by NCMS in consultation with the DHO
and other district offices. iii. The households contracts is signed
and endorsed/ witnessed by village leader and DHO, iv. Once enough
households have agree a consignment of material set21s is prepared
and either collected by villagers or delivered. The terms of the
contract were described as followed, a) All credit paid within
three months b) If late an interest charge of 10% per additional
month, and possible loss of collateral, c) Al household contracts
witnessed and agreed to by village leaders and DHO and each has a
copy of the contract Achievements to date by CNMS Activities in
seven villages with 373 household obtaining material sets across
the seven villages by mid-2011. Ongoing activities and expansion
plans as per the MoU to be active in 22 villages with good road
access and 26 villages with difficult or in remote locations in the
district to cover 48 villages in all. Reported Challenges i.
Differences in the list of households who agreed to borrow for
sanitation. ii. Delinquency and delays in repayments and or
construction of toilets, and the reasons given were: a. Borrowers
did not have enough money to make repayments on time, asked for
(and usually given) extensions in repayment period. b. The
quantities of materials delivered/received were less than the
quantities described in the contract. c. The construction has not
yet started due to ongoing livelihood demands on households,
farmers waiting for post-harvest period. d. Borrowers have other
debt commitment which they prioritise before the sanitation loan
and so have not made repayments. iii. When sanitation materials are
deliver to a village only to one location so can be difficult to
distribute throughout dispersed villages. iv. No
remuneration/motivation for village/ district personnel to
effectively monitor or resolve issues v. The field researcher felt
that the approach lacked an effective assessment of household
ability to pay which contributed to repayment issues. The business
has taken back some unused and unpaid for materials due to being
unable to find suitable solutions with some households because of a
refusal to pay. This calls into question how the borrower agreed
lists were facilitated and generated in the first place.
Outhoumphone District, 2007- SCC provides support for Sanitation
credit explained as, Achievements 12. Page 12 of 15 Locations and
Implementers Provided supported Reported Process Performance and
Identified Challenges & Issues Southchay Construction Company
(SCC) Initially gained credit/ sanitation funding experience
through cooperating with World Vision in 2007 a sanitation
package22 priced at 500,000 Kip (~US$62.5) i. All household
sanitation credit contracts signed by village leaders and witnessed
district planning and investment office, and district health office
before being passed to the business, ii. The materials are
delivered to the households based on this contract which usually
has the following conditions a. A repayment period of up to four
months with no interest b. Late repayments charged 20% interest per
month or risk having collateral taken. iii. Interested communities
should develop a sanitation plan for multiple houses to obtain
materials, which according to the owners the facilitation and
development of the plan is through the district health office / Nam
Saat unit. A total of 419 sanitation loans provided across 27
villages. Initially provided credit for 300 toilets distributed
across 21 villages between 2007/8 linked to the activities of World
Vision. This was followed up with additional credit in 2009 for 50
toilets. In 2011 currently had a portfolio of sanitation loans
valued at 48,560,000 (~US$6,090) of which has been ~ 29% were
significantly delayed loans as well as the 69 recent sanitation
loans across six villages. Reported Challenges i. The owner
indicated ongoing difficulties in ~29% of loans made which were
considered difficult. ii. Mentioned a lack of support from local
authorities in resolving difficult loans, as no support for local
officials. Xonabuly District Pakorb Construction Materials Shop
(PCMS) Stated has been providing sanitation credits since 2007 also
has and is also involve in some development projects such as SSH4A
PCMS provide a wide range of tailored options, sanitation pack
price ranged between 400,00023-1,230,000 (~US$50-154) The credit
process described by the business owner was i. The owner and
district health office signed agreement together ii. Owner develops
a simple household contract to be backed by the village leader
Maiban and the DHO/Nam Saat. a. Repayment period 3-5 months b. No
interest if repayment within time but up to 20% per month if
delayed c. Also has an option for the use of collateral to
guarantee loan. iii. Following dissemination of information to
villages and the generation of signed contracts iv. The business
delivers sets of materials to villages which it is received and
checked by the village leader Achievement by PCMS 300 households
across 14 villages have benefits from sanitation credits from the
business. Total reported investment of 203,000,000 Kip (~US$25,375)
of which 19,000,000 Kip (US$2,375) roughly nine per cent (9%) is
still outstanding (at the end of 2011). Reported Challenges Similar
issues with other models such as delays in repayments etc... DIRECT
GRANTS/ SUBSIDIES Nam Saat Phine District CIDSE (Coopration
Internationale pour le Dveloppement et la Solidarit- Project,
1990-2005 Sanitation component of an integrated rural development
program undertaken with CIDSE coordinated(CARITAS) support Grant
subsidy funds with 50% contributed by the program sanitary/
construction materials for selected households with 50% contributed
by beneficiaries (labour and local materials, sand gravel wood
etc). Sanitation material sets24 supported Achievement 122
households toilet constructed in 8 of 17 villages where activities
were targeted, On average the project increased village sanitation
coverage by 26% ranging from 3%-85% HH coverage. Phalanxai district
2010 Birla-Lao Farm and Plantation Company A Corporate Social
Responsibilities (CSR) component of a large agro/ industrial
forestry projects Because the land concessions provided to the
company, these may result in exclusion from certain areas and
access to previous natural resources for some villages. The company
is providing some mitigation through improved access to basic
services, including sanitation. Identified and agreed households
and village will be provided with a set of sanitation materials 25
Achievement Reported to be providing 238 sanitation materials kits
to households in two villages in Nalai (210) and Nalainoy (20)
villages. Reported Challenges i. Inability to obtain sufficient
quantities of sanitation materials in one go to support the
intention, so phased delivery required. ii. Once material delivered
household dont always install the toilet, many HHs waiting for
opportune time while others are waiting till they have additional
resources to provide the superstructure. 13. Page 13 of 15
Locations and Implementers Provided supported Reported Process
Performance and Identified Challenges & Issues NamSaat Sepone
and Villabouly districts 2010-2012 Pro-Poor WASH Project supported
by SNV Netherlands Development Organisation The intended approaches
encouraged and sought an equal contribution from targeted
households across 25 villages in the two districts. Nam Saat
covered the cost of 250,000 Kip ($US31.5) Awareness raising on
sanitation and hygiene in villages and schools. Including community
led total sanitation CLTS to sensitise people to the priority need
for sanitation and hygiene and training on toilet construction.
Followed up by promotion of cost sharing approach and toilet
construction training to move households up the sanitation ladder.
Households and the project each providing 250,000 Kip (~US$31.5)
for the sanitation components combined to 500,000Kip (~US$64).
Achievements to date By the end of 2011, 296 toilets reported
constructed in eight out of the 25 target villages Reported
Challenges i. The DHO/Nam Saat faced significant difficulties in
sourcing adequate quantities of materials in the target districts,
as local (district) producers either did not have the capacities to
produce the materials or demand higher prices. ii. In the end
materials were sourced in the provincial capital some 200km to the
west of the districts and transported to the districts! Resulting
in higher (20%) sanitation set costs borne by the project. iii. The
sanitation approach was partially build on a variant of community
led total sanitation-CLTS, in enabling following up and support to
move up the sanitation ladder. iv. However the ability of
provincial and district Nam Saat personnel to facilitate community
dialogue post CLTS process in a timely manner and later follow up
was weak, in that the activities were often telescoped together
with limited discernable separation, indicating a need for further
capacity building. NamSaat Atsaphangthong district Supported by the
Christian Broadcasting Network-CBN Activities ongoing since 2004
but sanitation component initiated since (2009) Providing water and
sanitation interventions on a household member pro-rata basis at
60,000 Kip for sanitation per person per households. So ~360,000
Kip per HH. The objective of the approach is to contribute to
advancing villages to be Model Healthy Villages- MHVs in line with
the Government of Laos Ministry of Health criteria26. The financial
contributions were used to bulk purchase materials for distribution
to target households with households providing labour and other
materials inputs usually for superstructure construction.
Achievements 304 household toilets constructed in three village
completed and three villages ongoing (Nov. 2011) Reported
Challenges i. Obtain sufficient quantities of sanitation materials
in a timely manner. ii. Construction of toilets after material
deliver is often delayed, as families do not prioritise sanitation
issues LaoRed Cross(LRC) Phalanxai and Xaibouly district 2000-2005
Netherlands Red Cross The LRC in cooperation with other red cross
affiliates had undertaken some sanitation activities in the
province in the past. On recollection they provided sanitation
materials to households in targeted villages Achievement 79
household toilets constructed in seven villages across two district
Phalanxai district: 75 toilets constructed in two villages
Xayabouly district 304 toilets were constructed NamSaat Phine
District, 2002-2006 Canadian International Development Agency CIDA)
As part of an integrated district development project of which
sanitation became one component. the project provided sanitation
material sets27 to households with an average cost of 800,000Kip
(~US$100) Achievement 724 households toilets constructed covered
37% of total number households across 13 villages. NamSaat Nong,
Sepone Villabouly and Xonabouly districts 2000-2009 A rolling water
and sanitation program with UNICEF support The program provided
sanitation material sets to selected villages increasingly
integrating poverty based/ equity approaches This rolling program
with UNICEF support, saw the end of the then conventional approach
of providing a (limited) number of material sets for toilets per
village. In the latter years it was being considered for phasing
out due observed limited impacts in villages. Household selection
was reported based on village authority information, households
readiness and beneficiary contribution. Achievement 990 toilets
(sanitation sets for) provided to households, across 14 villages in
4 districts. Nong (3 villages-58 HHs), Sepone (2villages, 124 HHs)
Villabouly (2 villages, 75HH) and Xonabouly (7 villages, 690 HHs)
Reported challenges Material sets provided were not always
installed, and were often kept for years till families had
sufficient surplus resources to build the superstructures 14. Page
14 of 15 Locations and Implementers Provided supported Reported
Process Performance and Identified Challenges &
IssuesFIDAInternational Songkhong District Ongoing District
Development Approach focused mainly on one district, where
sanitation supported activities were implemented between 1998-2010
through various phases of the programme. Reported average
investment cost varied by phase since staring in the late 1990s
ranged between Reported to have followed a seven step process in
later years up to 2010, namely: i. Provided community training to
increase basic knowledge on hygiene and sanitation. ii. Conducted
village assessments (PRA) with village authority and promoted two
sanitation options28 iii. Provided construction training to village
volunteers iv. Poverty and vulnerability assessment of targeted
households to assess ability to pay.29 a. For identified poor and
vulnerable households 100% support for sanitation. b. Other
household supported up to 50% of set amount of materials. v.
Prepare Project Agreement/ Contract for village authorities vi.
Monitored the delivery of supplied materials. vii. Construction and
usage monitoring Achievements Over the 12 years of sanitation
support (predominately in one district) 1,190 households were
reported to have gained access to sanitation. Total reported
accumulative Investment was an astonishing 1,792,900,000 Kip,
(~US$224,113) Report Challenges i. The organisation used partial
coverage approaches provided a limited number of toilets to some
households in villages, but were unable to provide for others
households in targeted villages (may have created unrealistic
expectations for free latrines). ii. There was a reported lack of
ownership of the provided latrines to ensure they were well used
and maintained. So the approach was found to be unsustainable by
the organisation. iii. Not all the sanitation material sets
provided were effectively use, reasons given were a. Households too
busy to construct latrines b. Never used a toilet before so did not
know how to use one c. Waiting on other households to build and use
one first, before starting. INDIRECT SUBSIDISE Atsaphone, Phine
Phalanxai and Xonabuly districts Sustainable Sanitation&
Hygiene for All (SSH44A) Project Led by the Provincial Rural
Development & Poverty Reduction Office (PRDO) leading a
provincial and district multistakeholder process, with SNV
Netherlands Development Organisation (Financed by AusAID and the
Dutch Government 2010-2011) Piloting between mid- 2010 and the end
of 2011. Providing a Community Led Total Sanitation approach
targeting 80 villages across four districts Subsidies for a limited
number (3) of demonstration models targeted at identified poor
households built as part of the technical training i. Sanitation
demand creation using a variant of Community Led Total Sanitation
(CLTS) approaches ii. Support and capacity building to sanitation
supply chains actors and stakeholders including; micro, small or
medium sized enterprises (MSMEs), material fabricators, retailers
and building contractors iii. Establishing a sanitation materials
equipment revolving fund managed by the provincial/district
authorities for the private sector. iv. Targeted hygiene behaviour
change on washing hands with soap, toilet using, improving local
development approaches (Governance- pro- poor and business friendly
approaches). Achievements 729 additional toilets built during one
year, January to December 2011, (and ongoing at the time of the
research) which benefited an addition 839 households (110 families)
decided to share sanitation usually with extended family members in
separate households in their villages. Approach attempted to target
20 villages per districts, Reported Challenges i. CLTS triggering
was required to be undertaken on a number of occasions as levels of
participation at events varied. ii. Later identified reluctance of
facilitators and teams to use some of the CLTS tools walk of shame
and faecal transmission route demonstration because of a lack of
confidence. a. Performance varied significant across villages and
districts and range from zero improvement to 100% iii. Many of the
targeted villages were adversely impacted by monsoon flooding in
2011 which affected households and community commitments to
sanitation. iv. The scale of the pilot at 80 villages was beyond
the capacities of the provincial and district team to take on, when
starting from scratch within the timeframe, as provincial and
district teams needed to be trained up first. v. Originally agreed
village targeting criteria was not adhered to by district teams
with some activities in villages where other sanitation approaches
had also being applied. 15. Page 15 of 15 References and End Notes
1 Photograph sourced from Deutsch, R., and OLeary, D. 2 Deutsch,
R., (SSH4A project manager) OLeary, D., (WASH Sector Leader) with
additional inputs and support from Siliphong, P., (provincial WASH
Adviser) then at SNV-Netherlands Development Organisation. 3 The
list of projects is not considered complete, as it was based on
reported projects by responsible officials from involved government
agencies and other development actors in the province. It was
observed that some sanitation projects undertaken in the province
were not mentioned by interviewed agencies and partners which may
have related to the focus districts identified and nominated for
the fieldwork. However the approaches covered by the research are
likely to be representative of all the approaches being applied in
the province up to 2011. 4 Updated figures from the Provincial
Department of Planning and Investment, Statistical office, previous
figure of 825,879 from National Statistics Centre, Ministry of
Planning and Investment (2005) National Population Census,
http://www.nsc.gov.la/PopulationCensus2005.htm 5 This is an
indicative number of villages in the province, as the provinces was
going through a process of village consolidations in the mid to
late 2000s that saw the number of villages reduced through mergers
6 Source, Poverty Reduction Fund
2012-http://www.prflaos.org/sites/default/files/Map/Savannakhet_Poverty-
incidence-map-cover.jpg , based on the Ministry of Planning and
Investments Decree on Poverty and Development Standard 2010 to
2015- # 285/PO (13/10/2009) for rural populations. 7 Hutton G,
Larsen B, Leebouapao L, Voladet S., 2009, Economic Impacts of
Sanitation in Lao PDR, the World Bank, Water and Sanitation Program
(WSP).
http://www.wsp.org/sites/wsp.org/files/publications/ESI_Laos_english.pdf
8 Behind Phongsaly and Saravane provinces, source data on Access to
Sanitation", National Census Data 2005, National Statistic Centre,
Ministry of Planning and Investments. 9 Ryan, P., (2009) Research
on Innovative Policies, Practices and Approaches for Improved Basic
Sanitation and Hygiene in Laos PDR, IRC- the International Water
and Sanitation Centre for SNV. 10 It should be borne in mind the
exchanges rates between the Lao Kip and the US dollar varied during
the reporting period of projects starting in the late 1990s till
2011, efforts have been made to ensure that reasonable correct
exchange rates have been used 11 Various sanitation and water
options, that are considered improved can be found at
http://www.wssinfo.org/definitions-methods/watsan- categories/ 12
UNICEFs supported approach was reported as ended as it was as
transitioning from a grant/ direct subsidies model for limited
number of sanitation sets, to supporting more indirect subsidy
model, that allowed for a more equity targeting and holistic
approaches (Community Applied Total Sanitation) for future funding
and support. 13 The decentralized implementing structure involved
the Provincial Government through the Provincial and district
offices of (i) Rural Development and Poverty Reduction, (ii) Nam
Saat/Health, (iii) Lao Women's Union, (iv) Lao Youth Union, (v)
Education Offices, (vi) Planning and Investment Offices 14 PHAST
based approach manual can be found at
http://www.who.int/water_sanitation_health/hygiene/envsan/phastep/en/
and a review of the approach at
http://water.worldbank.org/shw-resource-guide/promotion/hygiene-promotion-approaches/phast
15 The three options available were (i) pour flush with single pit
(direct drop), (ii) Pour flush with two pits, (iii) Pour flush with
three pits. 16 The urban projects utilised their criteria which do
not appear to have followed the official poverty criteria set out
in various Government Poverty Decrees, as below. 17 (i) Pan, (ii) 5
concrete rings, (iii) PVC pipes (iv) Roof sheeting (v) bag of
cement. 18 Based on the official criteria in the Decree on Poverty
and Development Standard 2010 to 2015- # 285/PO (13/10/2009) for
rural populations. 19 Each sanitation set was reported to contain
(i) Ceramic toilet pan (squat plate) (ii) 3 Concrete rings (iii)
Concrete ring cover (iv) PVC pipes (v) 1 bag of cement (vi) gravel
& sand (vii) 100 blocks. 20 The material sets were reported to
comprised of (i) 3 rings, (ii) 1 concrete covers, (iii) 1 Ceramic
toilet pan (squat plate), (iv) PVC18 mm, (v) 2 cement bags 21 Each
set in 2011 was described as (i) three 80cm concrete rings, (ii) a
ring cover, (iii) a squat plate, and (v)a bag of cement 22 The SCC
sanitation kit composes of (i) squat pan (ii) three concrete rings,
(iii) cover, (iv) PVC piping 23 The generic PCMS sanitation package
consisted of (i) ceramic squat pan, (ii) 3-6 80cm concrete ring,
(iii) ring cover, (iv) sections of PVC pipes (v) bag(s) of cement.
With additional quantities of blocks and brick for superstructure
added. 24 Sanitation material set were reported to be made up of
(i) squat plate, (ii) rings (iii) ring cover (iv) 3 cement bags,
(iv) 26 meters rebar steel 6mm, (v) 2 meters PVC20mm 25 Providing
toilet construction materials included (i) 3 rings 100 cm, (ii) 1
Concrete ring cover, (iii) 1 Ceramic toilet pan (squat plate), (iv)
3 cement bags and (v) PVC piping 20 mm while the with beneficiary
households contributing labour, 26 GoL/ MoH Model Healthy Village
Primary Health Care requirement criteria; (a) 3 cleans (personal
hygiene behaviours) villages with water supply, (b) village health
volunteer, (c) village drug kit, (d) sleeping under impregnated bed
net, (e) fully immunized, (f) having latrine and use, (g) Birth and
infant child care (birth spacing, breast feeding, ante natal care),
(h) risk case referral and decease or birth reporting 27 The
sanitation material set comprised of (i) 1 Ceramic toilet pan
(squat plate), (ii) 4 rings100cm, (iii) 1 Concrete ring cover,
(iv)1.3 meters PVC100 mm and 2 meters PVC20mm, (v) 2 cement bag and
30 concrete blocks) 28 Options promoted in later years 2009-2010
were pour flush with single pit and pour flush with double pits 29
Two sets of sanitation materials made available: A for 100%
subsidised households they received (i) squat pan (ii) concrete
rings, (iii) ring cover, (iv)PVC piping (v) Concrete blocks (vi)
bag(s) of cement, (vii) reinforcing bars (viii) gravel and sand. B
, while other received (i) pan, (ii)concrete rings (iii) Ring cover
(iv) bag of cement. The view expressed in this paper are those of
the author only and are not intended to reflect on or be attributed
to any of the actors, organisations or institutions mentioned in
the paper.