WPS8388 Policy Research Working Paper 8388 Why Are So Many Water Points in Nigeria Non-Functional? An Empirical Analysis of Contributing Factors Luis Andres Gnanaraj Chellaraj Basab Das Gupta Jonathan Grabinsky George Joseph Water Global Practice March 2018 Policy Research Working Paper 8388 Abstract This paper utilizes information from the 2015 Nigeria location—the political region and underlying hydroge- National Water and Sanitation Survey to identify the extent, ology—has the greatest impact on functionality. Other timing, as well as reasons for the failure of water points. The factors—specifically, those that can be controlled in the paper finds that more than 38 percent of all improved water design, implementation, and operational stages—also con- points are nonfunctional. The results indicate that nearly 27 tribute significantly. As water points age, their likelihood of percent of the water points are likely to fail in the first year failure is best predicted by factors that cannot be modified, of construction, while nearly 40 percent are likely to fail as well as by the technology used. The paper concludes in the long run (after 8–10 years). The paper considers the that, to improve the sustainability of water points, much reasons behind these failures, looking at whether they can or can be done at the design, implementation, and opera- cannot be controlled. During the first year, a water point’s tional stages. Over time, technology upgrades are important. This paper is a product of the Water Global Practice. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at http://econ.worldbank.org. The authors may be contacted at Landres@worldbank.org. The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. Produced by the Research Support Team Why Are So Many Water Points in Nigeria Non-Functional? An Empirical Analysis of Contributing Factors1 Luis Andres, Gnanaraj Chellaraj, Basab Das Gupta, Jonathan Grabinsky, and George Joseph JEL Classification: D02, O18, Q25 Key words: Water schemes, Nigeria, Functionality 1   Luis A. Andres: World Bank Water Global Practice, landres@worldbank.org [Corresponding author]. Gnararaj Chellaraj: World  Bank  Water  Global  Practice,  gchellaraj@worldbank.org  .  Basab  Dasgupta:  Social  Impact,  Impact  Evaluation  Division,  bdasgupta@socialimpact.com  .  Jonathan  Grabinsky  Zabludovsky:  World  Bank  Water  Global  Practice,  jonathan.grabinsky@gmail.com . George Joseph: World Bank Water Global Practice, gjoseph@worldbank.org. Senior authorship  is not assigned.    The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily  represent the view of the World Bank, its executive directors, or the countries they represent. The findings, interpretations, and  any remaining errors in this paper are entirely those of the authors.  1. Background Evidence indicates that freshwater ecosystems are undergoing rapid change around the world. Due in part to urbanization and an overall increase in pollution, clean water will be increasingly unavailable, particularly in developing economies (Steele, forthcoming; Hoekstra et al., 2012). A lack of functional infrastructure, including for drinking water and sanitation, could constrain economic growth (Agenor, 2010; Barbier, 2004). Evidence also indicates that infrastructure—including water and sanitation—is likely to offset moderate macroeconomic shortcomings at the initial stages of economic development (Moller and Wacker, 2017; Gibson and Rioja, 2017). In many developing countries, the non-functionality of water points is a major problem, and this trend is particularly pronounced in Sub-Saharan Africa. Evidence of water points’ failure has been documented by a number of studies. In countries such as Tanzania (Gill and Flachenburg, 2015; Gill, 2014) and Ghana (Fisher et al., 2015), several water points, including hand pumps, fail frequently. The situation is similar in Mozambique (Jansz, 2011) and Uganda (Nekesa and Kulanyi, 2012). In this paper, we use locally weighted scatterplot smoothing (LWSS, “Lowess smoothing” of running-line least squares), logit regression analysis, and Shapley decomposition to analyze the extent, the timing, and the reasons for the failure of water points in Nigeria. Our analysis indicates that, in the first year, a water point’s location—both the political region and the underlying hydrogeology—has the greatest impact on functionality. Other factors that can be controlled in the design, implementation, and operational stages (maintenance, for example) also contribute significantly to failure rates. Furthermore, as water points age, the likelihood of their failure is best predicted by factors that cannot be modified, as well as the technology used, while repair and maintenance decline in importance. The paper proceeds as follows. First, we discuss the particular context of Nigeria, before offering an overview of the literature behind this study. In Section 4, we discuss the methodology and data used to analyze and predict the failure of water schemes. In Section 5, we present our results. In Section 6, we conclude. 2  2. Nigeria’s Context Access to water supply, sanitation, and hygiene (WASH) services in Sub-Saharan Africa is limited: 319 million people in the region did not have access to improved water, and 694 million lacked access to improved sanitation facilities in 2015. Evidence suggests that limited or no access to WASH services adversely impacts development outcomes such as health, limits access to educational and economic opportunities, and hampers work efficiency and labor productivity (World Bank, 2016). Nigeria, with a population of 182 million, is the largest country in Sub-Saharan Africa (World Bank, 2017). It has also been one of the fastest-growing economies in the region in recent years: the gross domestic product (GDP) quadrupled between 2005 and 2015. However, the country has had limited success in reducing poverty, most likely because of three factors: (1) economic growth has been negated by high rates of population growth, (2) there has been no large-scale creation of jobs and other opportunities for citizens, and (3) the inequality gap is widening rapidly. A number of other key indicators, such as measures of the accumulation of physical and human capital and households’ access to basic services, suggest that Nigeria is lagging behind other countries in the region, despite its impressive GDP growth (World Bank, 2017). In 2000, Nigeria had an estimated 224 trillion liters of surface water and 50 million trillion liters of groundwater for an estimated population of about 128 million. About 6 billion liters were consumed in 2001, which suggests an abundant water resource potential (Akujieze et al., 2003). But the country faces significant obstacles to utilizing its water potential: (1) available hydrogeological base maps are of poor quality, and hence not of much use in helping the government develop a water exploration and extraction plan, (2) knowledge of the Nigerian geological terrain is poor, (3) there is a lack of infrastructure facilities, and (4) there is no working legislature (Serrao-Neumann et al., 2017; Adekalu et al., 2002; Sene and Farquharson, 1998; Owolabi and Omotola, 1994). These problems significantly hinder the exploration, 3    exploitation, operation, control, and management of Nigeria’s abundant groundwater resources. As a result, there is increasing dependence on harvesting rainwater (Nnaji and Mama, 2014; Ishaku et al., 2012). Nigeria’s rates of access to WASH services are below those seen in many other Sub-Saharan African countries. Fifty-seven million people in Nigeria live without access to improved water. As many as 130 million do not meet the Millennium Development Goal (MDG) standards for sanitation. Poor sanitation costs the country 455 billion naira ($2 billion) per year. These problems persist although the country has achieved the MDGs for water (WHO/UNICEF, 2015). Nigeria’s urban areas have considerably better access to water and sanitation than its rural areas (World Bank, 2017). However, rapid rural-urban migration is placing significant strain on urban water infrastructure (Barbier and Chaudhry, 2014). For instance, the capital city of Abuja is a key destination for rural migrants seeking better employment and safety. The city is trying to provide water and sanitation services to a rapidly growing number of people, across disparate neighborhoods (Abubakar, 2014). A 2012 study indicated that the city’s water scheme would no longer be adequate to meet the total water requirements of the entire city in 2015, even operating at full capacity (Idowu et al., 2012). Hence, the scheme must be expanded to meet residents’ demand for potable water. Lagos, too, suffers a lack of potable water. (For a dynamic approach to modeling the future urban land-use scenario in Lagos, see Barredo and Demicheli, 2003.) Oyo State has suffered water contamination due to equipment failure (Sangodoyin, 1993). In the face of such problems, the impacts of community water and sanitation programs in Nigeria are limited. Many are abandoned prematurely because of numerous institutional and economic factors. In short, the delivery and maintenance of WASH services continues to be a major problem in the country (Ademiluyi and Odugbesan, 2008). As the global community moves toward achieving the Sustainable Development Goals (SDGs), it is vital to evaluate Nigeria’s current state of water and sanitation access to facilitate the development of effective policies and interventions to address present shortcomings. These efforts need to be targeted at the most vulnerable segments of the population, specifically those who live in poverty. The analysis and results presented here will therefore be of interest to policy makers and other key stakeholders in Nigeria. 4    3. Literature Review A review of relevant surveys (Wilson et al., forthcoming) indicates that: (1) there is no widely agreed upon definition for water point functionality, and hence it is difficult to compare the results of various surveys, and (2) most surveys use the binary definition of “working” or “not working”, although some do refer to “partial functionality.”2 A World Bank study (forthcoming) analyzes a range of indicator sets from countries and development partners, including 20 national monitoring systems and 20 monitoring frameworks from donors, and propose a shortlist of indicators and associated metrics as a global framework. This framework uses three broad sets of sustainability indicators relevant to (1) service levels (the characteristics of water that users receive); (2) functionality (the physical condition and functioning of a supply system); and (3) upkeep (those factors, including external backup support, that affect the performance of the service provider in its roles of operation, maintenance, and administration). Literature on water point functionality in Nigeria is virtually nonexistent. A recent study of the causes of water schemes’ non-functionality (Andres et al., 2018) shows that 30% of schemes failed within their first year of operation, and more than 55% were not operational after 10 or more years. To identify the relative importance of each driver of failure in the different phases of a scheme’s life span, the analysis considers three phases—short term (the first year after installation), medium term (between three to six years after installation), and long term (more than eight years after installation). This is to better understand how different factors—such as hydrogeology, technology, location, size, management, and maintenance— affect a scheme’s performance across its life span. During the first year of operation, factors that can be controlled in the design, implementation, and operation stages predict the failure of 61% of water schemes. As water schemes age, their likelihood of failure is best predicted by those factors that cannot be modified, as well as by those that can be controlled during the operational stage. Meanwhile, the share of failures linked to factors such as repairs and maintenance decreases slightly. Thus, if water schemes are more                                                              2  http://nora.nerc.ac.uk/514658/1/Handpump.pdf. 5    carefully attended to during the design, implementation, and operational stages, it is possible to drastically reduce their failure rates. While studies that analyze the causes of water scheme failure in Nigeria are virtually nonexistent, there are a few studies on sustainability. One study of community water and sanitation programs suggests involving all stakeholders in a collaborative process, with a view toward ensuring long-term sustainability (Ademiluyi and Odugbesan, 2008). For example, in the state of Akwa Ibom, a lack of maintenance, poor community participation, little or no coordination and cooperation among stakeholders, political factors, inefficient monitoring, and a lack of maintenance and oversight of public property were all responsible for the unsustainability of the rural water supply (Ibok and Daniel, 2014). A study of the Niger Delta (Ihuah and Kakulu, 2014) proposed a post-project management approach. This approach can effectively monitor, assess, link, and integrate the implementation and post-operational management of hand pumps along with community management. Outside Nigeria, a few studies of water point functionality have been undertaken over the past four decades. A summary of the literature, including the countries studied, year of study, and the rates of non- functionality, is presented in Table 1 (Annex). In the developing countries surveyed around the world in the 1970s and 1980s, over 50% of water points were non-functional. More recent studies and surveys indicate that the percentage of failing water points has declined. Between the 1980s and 2010s, failure rates were generally under 40%. The two exceptions are Tanzania (WaterAid, 2009), where this rate was 54%, and Ethiopia, where it was 43% (Table 1). But these results should be interpreted with caution since the number of studies involved is small and some cover only a small portion of each country. A few studies specifically focus on the causes of hand-pump failures in Sub-Saharan Africa. Hand pumps are generally of five types: suction, direct action, deep-well reciprocating, progressive cavity rotary, and displacement (Harvey and Reed, 2004). The critical issues that can undermine their sustainability are institutional, social, technical, environmental, and financial/economic in nature (Parry-Jones et al., 2001). One study finds that leaving rural water points to be managed by local communities is correlated with low functionality levels. Post-construction support—with complementary roles for communities, the private 6    sector, and all levels of government—is needed to improve the functionality of the rural water supply (SNV, 2013). In Ghana, only 21% of hand pumps were found to meet national norms and standards for the reliability, quality, and quantity of the water service provided (Adank et al., 2014). Service providers who operate and maintain these hand pumps also scored low on compliance with norms and guidelines related to governance, operations, and financial management. Ethiopia’s higher functionality rates are associated with good record-keeping, regular community meetings, financial audits, higher monthly fees, a paid caretaker, and water committees with the capacity to perform minor repairs (Alexander et al., 2015). The primary threats to the achievement of Tanzania’s water delivery targets include the inaccuracy of the baseline used for program design, difficulties faced by underserved districts trying to keep water points functional, and differences between the expected and real long-term functionality of water points, especially hand pumps (Jimenez and Perez-Foguet, 2011). In Chad (Thibert, 2016), an analysis of water and sanitation conducted in 28 villages in Bokoro District during October 2015 estimated that 61% of villages had access to a functional or semi-functional hand pump or borehole, and 39% of villages collected water from open wells or swamps at risk of contamination. Many of the remaining villages had reverted to contaminated surface water after their hand pumps had fallen into disrepair due to poor management of the water point. In the Democratic Republic of Congo, a lack of spare parts continues to be a major problem that adversely affects hand pump functionality (Koestler et al., 2014). Finally, a study of Rumphi District, Malawi, suggests that sustainability may be improved by giving communities a say in the type of hand pumps or water points to be installed (Holm et al., 2017). Foster (2013) employed logistic regression analysis to identify operational, technical, institutional, financial, and environmental predictors of functionality for over 25,000 community-managed hand pumps in Liberia, Sierra Leone, and Uganda. Risk factors significantly associated with non-functionality across all three countries were (1) system age, (2) distance from the district/county capital, and (3) absence of user fee collection. Other variables included in the model were well type, hand pump type, funding organization, implementing organization, proximity of spare parts, availability of a hand pump mechanic, regular 7    servicing, regular water committee meetings, women in key positions in the water committee, rainfall season, and perceived water quality. Carter and Ross (2016) demonstrate empirically that reducing the high rates of early post- construction abandonment as well as of total downtime would greatly improve the service performance of hand pumps. Around 85% of wells or boreholes equipped with hand pumps are expected to function. To generate a more nuanced understanding of service performance, going beyond functionality, it is recommended that monitoring include the collection of quantitative data on rates of abandonment and the frequency and duration of breakdowns, combined with descriptive narratives of actions taken to manage and repair water points. Cronk and Bartram (2017) show that fee collection in Nigeria and Tanzania is positively related to functionality; the authors recommend that for Tanzania fees should be collected monthly rather than when pumps break down. Furthermore, in Nigeria, systems managed by the private sector are likely to be more functional than those managed by communities. In Malawi, factors adversely affecting the functionality of hand pumps include the inefficiency of user committees, corruption, a lack of spare parts, a lack of community ownership, and the inadequate involvement of non-governmental organizations (NGOs) (Rural Water Supply Network, 2014). Ways to improve functionality include community involvement, skills training, private sector involvement, and technology upgrades (Walters and Javernick-Will, 2015). Baumann (2009) provides a comprehensive list of conditions needed for pumps to function. “Soft” conditions include community ownership; a perceived need for the water point; and user skills, behaviors, norms, and practices. “Hard” conditions include human resources and suitable technologies. Finally, there are financial conditions, such as the availability of finance for capital expenditure and the ability of users to pay for services. Without all these conditions being met simultaneously, pumps are bound to fail. The water point is the only visible and aging part of an expensive system. Finding water and drilling a borehole constitute the main part of the investment (Carter et al., 1996). Thus, although hand pumps are not expensive, when they fail, the entire system fails. Over the years, and particularly in remote areas, 8    governments have proven to be incapable and unwilling to provide the operation and maintenance services needed for water points to remain functional. The role of maintenance is important (Koestler et al., 2010; Morgan, 1993). This has been shown in the case of Zimbabwe (Mudege, 1993). In Mexico, studies reveal a bias favoring the development of new public infrastructure while neglecting the maintenance of existing infrastructure (Gibson and Rioja, 2017; McNeill, 1985). Lack of maintenance led to hand pump failures in Morocco in the early 1980s (Lynch, 1984). Maintenance is a problem in industrialized countries as well. In some parts of the United States, particularly in rural areas, water points are virtually nonexistent and many houses lack indoor plumbing (RCAP, 2010; Vance, 2016; Fetterman, 1967).3 The choice of technology is also important (Janke et al., 2017). The fixed costs associated with installing wells and pumps significantly impact their number and location (Hsiao and Chang, 2002). Furthermore, hand pump failures often result in extended service disruption leading to high but avoidable financial, health, and development costs. There are several innovative ways of addressing these problems. For example, one manually operated hand pump employs a gear drive in the power train to ease operations and at the same time increase efficiency (Nasir et al., 2004; McNeill, 1985). These studies suggest that even small increases in efficiency can have sweeping results, considering the critical nature of hand pumps. Finally, using data on hand pump usage in rural Kenya, Koehler et al. (2015) evaluated the impact of dramatic improvements in maintenance services on payment preferences. They suggest that it might be possible to improve the sustainability of rural water supply by pooling maintenance and financial risks and taking advantage of advances in monitoring and payment technologies. Evidence shows that aid disbursements make a strong, positive, and significant contribution to improving access to WASH services (Gopalan and Rajan, 2016) in lower-middle-income countries but not                                                              3 In rural areas where the population is dispersed, such as parts of Texas along the Mexico border, the chances of not having either indoor plumbing or any form of water scheme increases sharply. In six states—Alabama, New Mexico, Arizona, West Virginia, Kentucky, and Mississippi—half of the households without these services live below the poverty level. The dire situation in the U.S. Appalachia has not changed much in the past 50 years.   9    in low- or upper-middle-income countries. This contribution was found to be greater in rural than in urban areas. Another recent study suggests that donors need to increase aid allocation to WASH in Sub-Saharan Africa (Ndikumana and Pickbourn, 2017). Structural constraints that could limit access to WASH (and their alleviation through foreign assistance) need to be identified and addressed. 4. Methodology and Data (a) Methodology A locally weighted scatterplot smoothing (LWSS, “Lowess Smoothing” of running-line least squares) is used to undertake a locally weighted non-parametric regression of “non-functionality” (0,1) for 43,443 water points that are between 1 and 15 years old.4 To analyze the relative importance of a series of factors in explaining the probability of a water point failure, a logistic regression econometric model is estimated and the Shapley decomposition is used to analyze the relative shares of the factors in explaining the failure probabilities. Quantitative indices are used to measure poverty and inequality through the Shapley decomposition. For instance, in poverty reduction policies the decomposition of the observed variation must be measured to evaluate the contribution of each explanatory factor. The same is true when attempting to explain the failure of water points. Shorrocks (1984, 1982, 1980) reviews the Shapley (1953) decomposition, which is applicable to functionality. Let S be the aggregate indicator that measures water scheme outcomes, Xk , where k = 1, 2, . . . m is a set of factors contributing to the value of S. The following equation can thus be written: S = f(X1, X2,. . . Xm) Where f(.) is an appropriate aggregation function. The goal of all decomposition techniques is to attribute contributions, Ck, to each of the factors, Xk, so that the value of S becomes equal to the sum of m                                                              4 We define age as 2015, which is when the survey was conducted, minus the year when the water point was commissioned. So the formula is: age = 2015 – year of commission. 10    contributions to water point functionality outcomes. These X include the explanatory variables of functionality outcomes used in the linear probability regression. Water points that are only a year old, those between three and six years, and those older than eight years were grouped together and the reasons for early, mid-term, and long-term failures were analyzed. To explain the likelihood of failure in each of these three age groups, the relative shares of technology, location, promoters, management, maintenance, and operation are decomposed.5 Next, the factors affecting water point functionality are grouped together into three broader categories and analyzed. These are factors such as (1) political region and hydrogeology, which cannot be changed; (2) technology and how promoters operate and implement interventions, which are influential at the design and implementation stage (and can be taken into account when developing new points); and (3) management and maintenance (the availability of parts and repairing agents), which are influential at the operational stage (and can be addressed for existing points). (b) Data Sources and Descriptive Statistics In 2015, a National Water and Sanitation Survey (NWSS) of all water points and water schemes was conducted throughout Nigeria. This survey was commissioned by the Federal Ministry of Water Resources (FMWR), and data were collected across the country at the ward level. The survey consisted of four questionnaires—of households, water points, water schemes, and public sanitation practices (conducted in schools and health centers). The household survey was of more than 202,000 households, while the water points and schemes surveys provided information on 89,721 “improved”6 water points across states and local government areas (LGAs). In this study, we focus on water points. Figure 1 maps the distribution of water points across Nigeria. While it is evident that functional water points are distributed across the country, they are highly concentrated in the northern and western regions. The NWSS 2015 reveals that of 89,721 improved water                                                              5 A breakdown of the dependent variables by region is provided in Table 4. 6 For the purposes of this study, sources of improved water include tube wells and boreholes, infiltration galleries, protected springs and dug wells, rainwater harvesting sites, gravity flow systems, and pumped-piped systems (using either ground or surface water). 11    points, 89.5% are tube wells or boreholes. The rest are protected dug wells, springs, sites where rainwater is harvested, or infiltration galleries (Table 2).7 Around 79% of these water points have been constructed by government agencies over the years. Among those, the majority are built by state governments (29.8%), followed by federal governments (25.4%) and local governments (23.6%). The rest were built by donors (7.6%), NGOs (5.1%), and philanthropists and others (8.4%). In terms of functionality (Table 3), the NWSS 2015 shows that 48,628 (54.1%) water points are fully functional and 6,920 (7.7%) are in bad condition, while the remaining 34,325 (38.2%) are not functional. Altogether, the total share of “working” water points is 61.8%. Nationally, around 75% of these points are functional for most of the year; only one-third of states perform below the national average. The most striking finding is that more than one-third (38.2%) of all water points in Nigeria are not functioning at all. The main question is whether these water points fail because of age or other factors. In the results section, we plot the likelihood (probability) of failure against the respective age of these water points and categorize them by their location, technology, and promoter. A corresponding year of construction was reported for only 49,600 out of the 89,871 water points. Among water points with such data, we consider only those that are between 1 to 15 years old,8 of which there are 42,443 individual points. To understand whether differences in operation and management play a role in deciding the longevity of water points, we also categorize them by their maintenance and management arrangements. While the presence of a “management committee” is indicated by that of a WASHCOM9 in a given community, maintenance is indicated by the local availability of spare parts and of agents who conduct routine repairs. Table 4 provides a breakdown of the various factors that affect the performance of water                                                              3 In the functionality analysis we exclude rainwater harvesting and infiltration galleries because of their low incidence; these two sources, when combined, compose a share of less than 1%. This reduces the number of observations used in the rest of the analysis to 89,871. 8 The authors have used locally weighted scatterplot smoothing (“Lowess” of running-line least squares) to estimate a locally weighted regression of “non-functionality” (0,1) on age in years (1