Business Development Services for Community-managed Small Water Enterprises

Abstract

Reform of the rural water supply sector in Kenya is expected to increase the autonomy of rural water service providers. The role played by water service providers engaged in developing, managing and operating schemes is separated from the regulatory role of the Water Services Regulatory Board, and oversight functions by seven autonomous regional water services boards. The rural water supply sector in Kenya has significant user investment. Rural communities often mobilize substantial contributions toward the investment costs of rural water supply schemes. Technical assistance is often provided by NGOs, the water service boards’ district water offices, and in a few cases, the private sector. It is estimated that community projects account for around 3,000 water supply schemes in Kenya. These often are operated as small enterprises and it is clearly the intention of the reform that this should become the norm, a sector served by small water enterprises with sufficient management skill to function autonomously within the regulatory framework. To ensure their long-term sustainability and health, these small enterprises require business development services (BDS) covering technical, financial and social skills. The support needs to be sustainable so that the enterprises can have access to quality, affordable, professional services throughout the lifetime of water projects. Considerable professional capacity to provide business support exists in Kenya and the new institutions have a major role in promoting such services. This paper examines the required business development services for rural water supply projects and institutional options for their delivery. It is based on analysis of the current situation and is informed by stakeholder consultation, including a national workshop of small water enterprise managers and operators. Kenya is overwhelmingly rural, with 80 percent of the total population living in rural areas. Of this population, only 46 percent have access to improved water supplies. Estimates suggest that the annual growth in community piped schemes required to meet the Millennium Development Goals (MDGs) is 40 new systems each year, reflecting a total investment of about US$ 8.5–9 million (including rehabilitation costs). Clearly the market for business development services is already significant and will grow