Solving a public health financing problem
A pilot project is building sustainable financing for urban sanitation in Mukono Municipality.
Ephraim Kaweesa always used to hide from the district health inspector.
The landlord of a commercial plot with four shops and three residential rooms at Wantoni Village, Central Division, Mukono Municipality, he had received a nuisance note that declared his sanitary facilities unfit for human use. The pit latrine was nearly full, flowing bathwater had created a stagnant pool of green-grey slime accompanied by a pungent smell and blue flies.
“I kept avoiding the inspector because I had neither the money nor the space to construct a new toilet, and I didn’t know what to do,” Ephraim says.
He wasn’t alone. A 2022 Ministry of Water and Environment Study funded by UNICEF established that seven in ten households in Mukono Municipality have unsafely managed toilet facilities, with a 1.4 per cent open defecation rate. This challenge has been compounded by the increasing rural urban migration, with Mukono estimated to have a day population of one million, half of whom are residents, yet the landmass remains the same.
Sanitation financing thus is one of the pillars of a two-year urban sanitation pilot project funded by the Finnish National Committee for UNICEF and implemented by UNICEF in partnership with Mukono Municipality. According to Cate Nimanya, a UNICEF Water, Sanitation and Hygiene Specialist, the goal is to contribute to the reduction in life-threatening WASH-related diseases and creation of a clean environment for communities and schools. By supporting local and central governments to plan, implement and monitor the hygiene and sanitation services, the project seeks to create demand for sanitation facilities and ensure that every home meets the minimum standards of sanitation and hygiene, including a safe and model pit latrine. However, as with Ephraim, many households cannot afford to finance the cost of new or upgraded sanitation facilities, which range from UGX3.1million (US$789) for a single stance to UGX7.8 million (US$2,000) for a three-stance latrine in a low-lying area.
Innovative self-sustaining sanitation services are particularly important as urban councils do not benefit from the government sanitation grant and yet have increasing sanitation needs. The Mukono Urban Sanitation Programme has developed one such facility. Through the Municipality, UNICEF identified four financial institutions to provide a unique sanitation loan; UNICEF covers the cost of credit assessment, surveillance visits and insurance such that a customer receives the net amount applied for with no deductions. This is unlike other loans whose processing fee averages 4.5 per cent of the total amount. Once approved, the sanitation loan is paid directly to the construction engineers in tranches for the construction of a municipality-approved latrine prototype. The financial institution and municipality monitor progress and enforce proper use of the finances.
“The demand is increasing, and we are only constrained by the financing gap which would be solved by a revolving fund specifically for sanitation loans,” Brenda Kawuma Nabulya, the Manager of Mukono Diocese SACCO notes, adding that, “We want to be part of the move to improve people’s lives as healthy people are more likely to effectively use financial services.” Some of the clients who received sanitation loans have since applied for other loan products.
Back in Wantoni Village, along with the nuisance note, the health inspector told Ephraim about the sanitation loan.
“I never knew such a thing existed,” Ephraim says.
He rushed to Post Bank, one of the four partner financial institutions, with a recommendation letter from the municipality, a national identification card and a letter from his local council. The Bank approved Ephraim’s loan request for 8.5million UGX for a three-stance model pit latrine with a washroom. Over a two-week period the masons refurbished the existing structure; they dug a pit, added hardcore, lined the pit, plastered the foundation, added slabs, a septic tank, soak pit, a super structure and plastic sato pan lids that keep away any odour and insects.
Ephraim no longer hides from the health inspector. “I am so glad that I have a model structure that my tenants can use as I repay the loan,” he says.
Within three months from the activation of the sanitation loan, 85 families have so far applied for the facility at the four financial institutions in Mukono and 21 loans have been disbursed at a total value of UGX 75 million.
“To change sanitation services we cannot just offer a product sold to customers but a solution that improves lives in a sustainable manner,” the UNICEF WASH Specialist notes, concluding “the continued success of the sanitation loan facility speaks to the collective action required by all stakeholders, including the private sector, in fulfilling the United Nations Sustainable Development Goal 6.2 on enhancing access to adequate and equitable sanitation and hygiene for all.”