Urban sanitation: services, costs and subsidies

Cities need sanitation services to thrive. In East and Southern Africa pit latrines are the most common
sanitation system in cities, particularly amongst low-income households. These systems need emptying and formal services are emerging in cities which safely empty and transport sludge to treatment or disposal. City authorities are responsible for sanitation as a public good but lack information about increasing formal service coverage. This thesis uses empirical data shared by service providers from Malawi, Rwanda and Uganda to analyse how formal services have been developed, their costs, and funding mechanisms.

This thesis highlights the limitations of open market service delivery by extending understanding of
how it produces inequity between households and does not efficiently provide services for low-income
households. Despite efforts to develop semi-mechanical emptying methods to improve services, manual
methods are required to empty systems in hard-to-reach areas. At the same time some households are unable to use formal emptying methods and are excluded from using formal services. Cities should collaborate with and support informal service providers to formalise. Costs for low-income households are generally higher because they prefer low-volume emptying, to manage household budgets, which is inefficient and increases costs; most use manual and semi-mechanical emptying methods which are higher cost than mechanical emptying using an exhauster truck; and service providers working in informal settlements are not operating efficiently which further increases costs. Revenue from gross profitable high-volume emptying services provided to institutions and high-income households could be used to cross-subsidise services that are not commercially viable.

Cities should regulate to remove direct payment for household emptying and implement an alternative
equitable funding mechanism for citywide services using monthly tariffs and/or taxes. This could enable
efficient service delivery to minimise the total cost, attenuate payment to help households manage budgets, and align financial contributions to service quality.