A Sourcebook - UN-Water

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PART II INCREASING PROBITY AND IMPROVING GOVERNANCE This part of the sourcebook presents information on approaches to reducing corruption by promoting probity and good governance. There are three sections, each of which corresponds to a different “level” of activity or governance: the project level (including both project planning and implementation), the provider level, and the sector level. This part begins by reviewing ways to increase probity in capital projects and planning. Capital projects are where governments and practitioners have traditionally focused most on corruption, and where they have correspondingly centered their efforts to improve probity. Capital projects are also a particular focus for many development agencies. Section 8 of the <strong>Sourcebook</strong> covers measures that practitioners can feasibly implement in the context of a traditional “project”. Section 9 covers provider level governance. The main corruption risks generally thought to occur in provider activities include: billing and collection, award of maintenance contracts, purchase of supplies and the like. Corruption-reducing reforms in providers typically involve well-understood improvements in management systems, and are within the professional domain of sector practitioners, making advice in this area more technical and less controversial than sector-wide governance reform attempts. Section 10 addresses sector governance. Governance is defined as the system of relations, accountabilities, and decision-making rights that make the development of water service provision responsive to citizens’ needs (in the case of good governance) or that lead water sector development in a different direction (in the case of poor governance). Governance comes last in the discussion because it is the most difficult, and because reforms in this area generally require the longest gestation period, and the most sustained effort. Ultimately, however, governance is the most important element to get right. Without an effective local demand for probity, and a political system that responds to that demand, reforms at the project or provider level are at best likely to remain static, or at worst be circumvented or rolled back. 72
8 INCREASING PROBITY IN CAPITAL PROJECTS Capital projects are major capital works commissioned by or for a water provider. As discussed in Section 6, most corruption in capital projects involves reduction in quality or inflation in price (or both), in part to cover the costs of bribes or kickbacks from a private contractor to a government official. In this way, capital projects create opportunities for contractors or officials to capture resources from taxpayers, donors, or customers (who ultimately pay for the works). This section first discusses steps that can be taken to promote probity project planning, selection and evaluation (Section 8.1), procurement (Section 8.2) and project supervision (Section 8.3). Section 9 sets out more general approaches for providers planning and implementing projects. This section ends by looking at a special type of procurement: procuring sanitation contracts for private finance for operation of water and sanitation in infrastructure. Increasing probity in a capital project often requires a multi-faceted, multi-stakeholder approach. Box 8.1 describes a comprehensive approach taken by a World Bank team working with the Government of Paraguay on a roads project. 8.1 Project Planning, Selection, and Evaluation This section sets out how good planning and project evaluation can reduce opportunities for corruption, by reducing bias and discretion. It describes a good planning processes, as well as the challenges in implementing such a process. It then provides a list of sources on effective sector investment planning. Sound planning and project evaluation helps to reduce opportunities for corruption Good practice in capital projects start with planning and project selection. This should involve: • Developing a masterplan that is technically, economically, financially and environmentally sound • Ensuring that projects that are part of the masterplan are implemented • Ensuring that projects identified in master plan are given highest priority • Evaluating projects to ensure that each project is cost-benefit justified in its own irght (see Box 8.2). Establishing and enforcing rules and processes to requiring good planning and project selection can reduce opportunities for public officials to steer projects to favored clientele and groups. For example, a project that involves supplying more water than demand requires (possibly in order to award a bigger contract to a favored party) will generally not be a least-cost project—especially if the system has high NRW. Such a project should be screened-out by least-cost-planning criteria. If the rule is set to be technology-neutral, it would also screen out a project that mandated particular technologies, rather than the outputs to be achieved. Similarly, expensive tertiary treatment of wastewater may not be cost-benefit justified compared to cheaper, primary treatment or to upgrade outstanding sewer networks. Applying the cost-benefit criterion consistently would help ensure the best value-for-money option is selected. Although many practitioners do conduct some form of basic economic and financial analysis for each water sector project, often this analysis is downplayed. Instead of being a thorough, neutral review, the analysis becomes a simple “tick the box” exercise in which practitioners aim to use the 73
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Public Disclosure Authorized 46829
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PREFACE In 1996, then World Bank Pr
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TABLE OF CONTENTS 1 INTRODUCTION ..
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Tables Table 1.1: How to Use the So
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Box 11.1: Five Key Elements of an A
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In each section, corruption and gov
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2 UNDERSTANDING CORRUPTION AND GOVE
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Box 2.2 Governance in the Literatur
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Corruption often involves a “mora
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When these conditions hold, a virtu
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This suggests that sector practitio
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spur increased local demand for acc
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Source List 2.1 Framework for Think
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• P rovider - Section 5 discusses
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That said, the interpretation of na
Page 32 and 33: Source List 3.1 Country Level Gover
Page 34 and 35: 4 SECTOR ASSESSMENT This section in
Page 36 and 37: 4.3 Informal Service Provision In m
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Page 40 and 41: Opportunities for corruption arise
Page 42 and 43: Table 4.2 Some Corruption and Poor
Page 44 and 45: Source List 4.1 Sector Assessment S
Page 46 and 47: Source List 4.1 Sector Assessment (
Page 48 and 49: Source List 4.1 Sector Assessment (
Page 50 and 51: Figure 5.1 Corruption in Procuring
Page 52 and 53: 5.1.3 Problems with quality As disc
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Page 56 and 57: 5.3.1 Detecting corruption in human
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Page 60 and 61: 6 PLANNING AND IMPLEMENTING CAPITAL
Page 62 and 63: transferred from the government or
Page 64 and 65: sector staff might schedule mainten
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Page 70 and 71: 7 IMPLICATIONS OF DIFFERENT SECTOR
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Page 74 and 75: Box 7.2 An Example of Related Party
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Page 78 and 79: Indicators of corruption risk in co
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Page 84 and 85: Box 8.1 Improving Probity in Capita
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Page 94 and 95: Source List 8.1 Improving Project P
Page 100 and 101: 9 INCREASING PROBITY AT THE PROVIDE
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Page 106 and 107: Box 9.5 Performance Evaluation in a
Page 108 and 109: Source List 9.1 Improving Provider
Page 110 and 111: 10 STRENGTHENING WATER SECTOR GOVER
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Page 114 and 115: Methods for increasing information
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Page 118 and 119: Box 10.3 Internally Delegated Manag
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Source List 10.1 Reforming Water Se
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technology in selected areas”, bu
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mission (the CRA) sets out rules fo
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surrounding area, to small schemes
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works and planning in public agenci
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11.2 Second Best Options for Improv
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Table 11.1 Summary of “Second-Bes
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good strategy. One way to identify
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Example of a simple, narrow approac
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lustration, a practitioner with som
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Source List 11.1 Improving Probity
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Source List 11.1 Improving Probity
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12 REVIEWING PROGRESS Monitoring an
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• Indicators chosen should relate
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Box 12.2 Using Objective Cost Measu
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on the program’s success had been
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Source List 12.1 Reviewing Progress
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threats). Competitive bidding proce
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Other Water Working Notes Water Wor
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A Sourcebook - UN-Water

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