Evaluation of non-user benefits towards improvement of water and sanitation services in informal settlements

Abstract

Many municipalities in developing cities are faced with the challenge of providing water and sanitation to ever-growing populations that cannot afford to pay for the services. This challenge calls for solutions that link equity considerations to cost recovery, and may require society to re-evaluate its perspectives on the value of urban water services. This paper explores the potential of non-user benefits as drivers of value and measures the trade-offs that “non-poor” residents were willing to make for the reductions in public health, social and economic costs when levels of service in informal settlements are improved. The study finds that people are sensitive to the public health impacts, and when given the choice of location of settlement to improve, and the means through which to make payment, would be willing to pay 6500 UGX (approx. $2.83) per household per month to install yard facilities in an informal settlement located nearest to their neighbourhood and with payment made through a special purpose vehicle.

Keywords:

• valuation
• non-user benefits
• urban water services
• urban poor

Acknowledgements

The authors would like to thank the African Centre for Cities of the University of Cape Town and the National Water and Sewerage Corporation of Uganda for supporting this study. The assistance received from Prof David Hensher (Institute of Transport and Logistics Studies, University of Sydney), and the comments from the three anonymous reviewers is gratefully acknowledged.