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Finance

All of the costs and how to meet them - to provide sustainable services

The essential fuel that makes the entire system work

Put simply, we won't achieve SDG 6 unless we secure sufficient money to pay for services. To do this, we need effective mechanisms to for bringing finance into the sector and efficient channels to get it to where it is needed.

We need to be able to accurately forecast and project all costs over the entire WASH service life-cycle - from investment through operation to replacement. This can be more than 20 years for some investments. We then need to match these costs with different sources of finance: user payments (tariffs), government investment (taxes), development assistance (transfers). Loans (from various sources) can also be a source of investment - but will need to be repaid from one of these three fundamental sources.

Effectively planning for cost-recovery for WASH services over their entire life-cycle calls for specialist knowledge and tools, which need to be able to adapt to changing demographic, economic and environmental conditions. Being able to hold financial decision makers to account and to regulate their activities is crucial.

Links with other building blocks: adequate financing underpins sustainability as much as it does first-time service delivery. Properly identifying need for and sources of funding is particularly crucial at the planning and budgetting stages of service delivery. Regulation has a crucial role to play, particularly in setting guidelines for tariff setting.