TERMS OF REFERENCE AND INVITATION TO SUBMIT A FULL PROPOSAL FOR UNPACKING/ANALYSIS OF RWANDA SUSTAINABLE WASH FINANCING GAP

SUMMARY

BACKGROUND AND RATIONALE

In June 2022, the government of Rwanda, through the Ministry of Infrastructure (MININFRA), developed a Sustainable WASH Finance Strategy to support the Government of Rwanda (GoR) and all the stakeholders working in the Water Sanitation and Hygiene (WASH) sector to set out approaches on how the WASH sector will finance its overall programming and operations to meet the sector’s objectives of achieving sustainable Development Goal 6 (SDG 6) 2030 and the Rwanda Vision 2050 targets.

The strategy highlighted key barriers that hinder the full achievement of WASH targets, most focusing on barriers to achieving the national targets, and others looked beyond and were projected to 2030, the due period of SDG 6. Based on all available data, assumptions, and estimates, the life-cycle costs for providing WASH services were calculated at approximately RWF 3.6 trillion for 2022-2030. This study also highlighted that the current annual budget allocation to WASH priorities was estimated at RWF 80 billion. Comparing the required estimated budget allocation annually and the estimated allocated budget annually of the period under study, it was estimated that the financial gap was RWF 320 billion per year.

Regarding funding sources – income/revenue, the data show an annual variation in the relative weight of each of the three primary sources of finance to the sector. These are the three Ts: taxes, tariffs, and transfers. In 2016 and 2017, tariffs were the main contributors, followed by taxes, while in 2018 and 2019, taxes were the main contributors. On average over the analysis of 2016/17 – 2020/21, WASH sector financing came from a mix of GoR investments through taxes (38%), citizen/user investments through the payment of tariffs (37%), and from development partners through transfers (25%).

The Sustainable WASH Finance Strategy also highlights financial targets and the climate-sensitive and strategic policy actions to be taken by the GoR and other sector stakeholders, including the private sector, development partners, consumers, and other innovations, to increase resources allocated to the WASH sector and maximize the efficiency and the effective use of public and private investments. The proposed key strategies for mobilization of additional funds for the WASH sector to reduce the finance gap for the WASH sector in Rwanda are maximizing the amount from existing public funding sources, tariffs, and efficiencies, mobilizing additional funding, including climate funding, and increasing repayable domestic finance and innovation in WASH financing and explore the least explored WASH funding sources such as climate funding opportunities.

It is against this background that Water For People, in collaboration with other key WASH Partners in Rwanda (UNICEF, AfDB, Water Aid, World Vision, USAID, and JICA ), is committed to supporting the Ministry of Infrastructure and Ministry of Finance and Economic Planning to undertake a detailed analysis of the WASH financing sources and needs in the sector ever since the finance strategy was disseminated. This will include generating evidence on the sector's investment needs, revenue, and expenditure targets, understanding the challenges of WASH financing, and modeling the required resources. The consultant will also undertake a review of the enabling environment, policies and practices, institutional setup, and opportunities to maximize the value of existing and new WASH funding to accelerate the achievement of sustainable and resilient WASH services in Rwanda by 2030.

OBJECTIVES

The general objective of this assignment is to generate an evidence-based fact sheet of the potential for each of the WASH revenues and financing sources by modeling their trajectory of growth in response to the targets set in the following national strategic documents:

• Rwanda National Strategy for Transformation II (NST2).
• Water and Sanitation Sector Strategic Plan (SSP) 2024-2029.
• Integrated National Water Supply and Sanitation Master Plan and  
• SDG 6 targets.

This will be achieved by analyzing the Rwanda WASH Sector Financing Gap based on each revenue source/income stream and suggesting how these sources could grow to fill the gaps that need to be bridged in different expenditure streams to achieve the SDGs by 2030. The intention is to use these results to support the development of a strategic program/project for the WASH Sector aimed at achieving SDG6 by 2030.

The assignment has 5 specific objectives as follows:

Review and analyze each WASH revenue source separately against their micro and macro-economic assumptions/drivers 

• Review each WASH Sector revenue source against their micro and macro-economic assumptions/drivers and propose other funding windows that the WASH sector can exploit.
• Evaluate the WASH financing gap from each WASH revenue and financing source: Based on the Sustainable WASH Financing Strategy, analyze existing funding gaps for each WASH revenue and financing source separately.
• Review the non-revenue water reduction strategies in place and their current level of implementation, and measure their projected benefits in terms of revenue savings as both a supplementary and complemental mechanism to bridge the existing WASH finance gap in Rwanda.
• Review the expenditure assumptions underlying the Sustainable WASH Finance Strategy – to suggest whether the numbers still provide an appropriate ballpark.
• Analyze the contribution of WASH sector interventions to Rwanda's economic development, health, education, social protection, the environment, and natural resources.
• Produce a linkage between each WASH segment with its investment opportunities trajectory, e.g., urban and rural water supply infrastructures, drinking water quality control and monitoring, water treatment plants and systems, water distribution networks, and storage, while the investment opportunities may be water tariffs upgrading, public-private partnership models, water taxes reforms, non-revenue water reductions efforts as well as WASH climate finance.

Produce a forecast for each WASH revenue and financing source's growth potential for the 5 remaining fiscal years. 

• Produce a revenue growth trajectory for each WASH sector revenue source and each WASH financing source up to 2030(5 fiscal years) and the corresponding WASH targets to be achieved by these revenues. The WATSAN sector strategic plan and the NST2-approved and published documents reflect the targets. The consultant will need to produce a summary of projection for each WASH revenue source`s potential to generate more revenue/income annually after eliminating the existing barriers in a series of scenarios with max/min, and how this would meet different expenditure gaps and WASH targets.
• Produce a fact sheet on the WASH financing gap and a road map to securing additional resources and implementing other key actions to implement the Rwanda Sustainable WASH Finance Strategy.

Explore and package any untaped WASH funding opportunities

• Identify, document, and package existing opportunities and any hanging fruits for WASH resource mobilization by exploring the entry points for increasing domestic revenues and tapping into external WASH funds. The analysis may, and not be limited to:
• Private sector involvement status/landscape in Rwanda`s WASH investments
• Opportunities to mobilize WASH external grants and loans and the requirements.
• Existing WASH climate financing sources and their accessibility windows.  
• Mechanisms are in place to collaborate with financial institutions to accelerate WASH private investments.
• Explore opportunities to attract private sector investments in WASH and elaborate a strategy to engage financial institutions based on the Rwanda WASH Financing Landscape Study recommendations.
• Propose a revenue-leveraging strategy that creates room for savings and devise a mechanism to reallocate the savings to the WASH sector to fill the existing financial gap.

 Conduct a comprehensive review of existing WASH policies, strategies, and plans and assess implementation challenges and lessons learned.

• Consult Rwanda's existing WASH policies, laws, strategies, regulations, legislations, and guidelines and assess the progress of their implementation, challenges experienced, and lessons learned so far. Propose actionable remedies to overcome identified bottlenecks, optimize existing revenue and financing sources, and leverage opportunities to increase investments in WASH.
• Review the strategies proposed in the Sustainable WASH Finance Strategy to increase domestic funding and attract more external funding and private sector investments, assess their effectiveness, and propose new/additional strategies to decouple the WASH sector financing (in line with objective 2 above).  
• Map current and future donor commitments to understand the extent to which they may contribute to bridging Rwanda's existing WASH financial gap.

 Produce a benchmark on WASH resource mobilization strategies from other countries and key sectors in Rwanda to learn from their successes and/or challenges

• Document at least 3 countries with successful stories on WASH resource mobilization strategies and target achievements, and highlight the key success factors that may be contextually relevant for Rwanda to learn from.
• Review Rwanda Energy Group (REG) resource mobilization strategy and Institutional structure and propose how MININFRA and MINECOFIN can enable WASAC Group to replicate the best practices and lessons to mobilize required resources and accelerate the achievement of SDG 6.
• Review resource mobilization strategies/techniques of other key sectors in Rwanda, including transport, health, environment, natural resources, and social protection, and their structures and propose how the WASH sector can replicate them to mobilize required resources and accelerate the achievement of SDG 6.

EXPECTED DELIVERABLES

1. An inception report: An inception report that presents the approach and detailed methodology to be used by the Consultant, including a preliminary literature review that highlights issues, gaps, and bottlenecks, a preliminary review of existing revenue sources, the content of the report for the WASH financing gap in Rwanda, etc.
2. WASH sector assessment reportand evidence-based fact sheet indicating funding gaps per each section of the objectives above.
3. A revised and brief WASH finance resources mobilization strategy and implementation planindicating clearly recommended actions to address the financing gap.   
4. Assessment of existing WASH sector coordination and proposed enhanced collaboration mechanism among WASH partners and stakeholdersto ensure collaborative effort in resource mobilization for Rwanda’s WASH sector.  

 Timeline for deliverables

PAYMENT MECHANISM  

REQUIRED SKILLS AND EXPERIENCE 

1. Knowledge of Rwanda WASH policies and regulations
2. Knowledge of the WASH finance framework and institutional setup
3. Knowledge of resource mobilization approaches and strategies
4. Ability to analyze the WASH systemic barriers for efficiency and sustainability
5. Experience in WASH costing, projection, and scenario creation
6. Skills in WASH data analysis and modeling.
7. Knowledge of budget planning and monitoring processes
8. Knowledge of WASH sector stakeholders’ analysis and coordination  
9. Strong communications skills
10. High-level government and development partners' engagement skills

DESIRED PROFILES OF 2 JOINT VENTURE INDIVIDUAL CONSULTANTS

WASH Finance Modelling Expert (Team Leader)

Interested consultants should have the following, among others:

• An international consultant with proven international experience in Public Finance, especially in WASH sector financing.
• A demonstrable experience in developing financial sustainability strategies.
• Demonstrable institutional experience and expertise in finance, economics, business administration, tax administration, resource mobilization, and/or related fields.
• A proven track record in delivering high-level expert advice, technical support, and capacity development to governments and Civil Society Organizations (CSOs).
• Fluency in French which will be an added advantage
• Good analytical, negotiation, and advocacy skills.
• Strong reporting, presentation, and writing skills.
• Ability to work in a team.
• The capacity to develop synergies and establish effective working relations with government counterparts, donors, CSOs, and other development partners.
• Advanced University Degree from a reputable institution in finance, economics, business administration, or a related field.
• More than 10 years experience in WASH financing consultancy services
• A demonstrated international experience in resource mobilization.
• A demonstrated experience in high-level advocacy and establishing reports with Governments, policymakers, NGOs, Civil Society, and other stakeholders.
• A recommendation and a copy of contracts from at least 3 international clients supported by the consultant with similar assignments.
• A specific experience in WASH resource mobilization will be considered an asset.
• Fluency in English which is a requirement.

National WASH Expert

This is an institutional consultancy, and interested consultants should have the following:

• Academic Qualifications: A master’s degree or higher in the field of Finance, Economics, Business administration, engineering, or other relevant fields.

Experience:

• At least 15 years of experience in WASH, public finance, bilateral funding, investment analysis, and advisory services are required; experience in public finance is preferred.
• At least 10 years of experience in development WASH planning and public finance in Rwanda.
• Experience in working with WASH development partners and government agencies will be an added advantage
• Language Fluency: In English and Kinyarwanda, which is a requirement. Fluency in French will be an added advantage.
• Good analytical, negotiation, and advocacy skills.
• Strong reporting, presentation, and writing skills; ability to work in a team,
• Ability to develop synergies and establish effective working relations with government counterparts, donors, CSOs, and other development partners.

NOTE: The two consultants must form a legalized joint venture and apply as a team.

EVALUATION

Individual consultants will be evaluated based on the following methodologies:

Cumulative Analysis

The award of the contract will be made to the individual consultant whose offer has been evaluated and determined as follows:

• Responsive/compliant/acceptable, and
• Having received the highest score from a pre-determined set of weighted technical and financial criteria specific to the solicitation.
• Technical Criteria weight: [70%]
• General experience of a joint venture, similar assignments, understanding of the assignment and proposed methodology: 60%
• Profile of Experts: 40%
• Financial Criteria weight: [30%]
• Only candidates obtaining a minimum of 70% points will be considered for the Financial Evaluation

KEY TERMS AND CONDITIONS OF THE CONSULTANCY

Payment will be on daily rates in Rwandan Francs (RWF) and will be tax-inclusive

An individual international consultant should be able to stay in Rwanda for the first and last months of the assignment to get full support from key stakeholder institutions (MININFRA, WASAC, RWB, MINECOFIN, and RURA). If the consultant submits his/her bidding in foreign currency, the exchange rate by the Central Bank of Rwanda (The National Bank of Rwanda) will be considered for all payments as per the bid opening date.

The international consultant will cover housing accommodation for at least two months of stay in Rwanda. The consultant can quote them on a separate sheet for reimbursements.

The international consultant will cover the international travel costs to and from Rwanda for the first and last months of the assignment.

Domestic travel during the two months of stay in Rwanda, but only related to the assignment, will be arranged and covered by the client for the international consultant.

The consultants themselves will cover property and Life insurance-related costs.

REPORTING

The Consultants will report to the Director General`s Department of Water and Sanitation in the Ministry of Infrastructure with support from a technical team comprised of different WASH partners, including Water For People, WASAC, Ministry of Finance, and RURA. At the same time, non-state actors will provide strategic advisory guidance and will monitor and quality control the expected deliverables. The international and national consultants will prepare a work plan covering the assignment's duration and submit deliverables against the approved work plan. The key contact staff from Water For People will be the Senior WASH Advocacy and Finance Manager.

HOW TO APPLY

Qualified consultants are expected to provide the following:

• Cover letter (must indicate availability to start the assignment).
• Technical Proposal, clearly outlining the Consultant’s understanding of the ToRs. proposed methodology, timelines, and curriculum vitae.
• Financial Proposal/ offer in RWF or preferred foreign currency, outlining the assignment's costs. The financial proposal should include a breakdown of proposed costs (consultancy fee per number of anticipated working days, travel, and any other possible costs).
• Proof of at least 3 certificates of the previous similar accomplished works mut be attached to the CVs

APPLICATION DEADLINE

Interested qualified international and national consultants must submit their applications no later than 26 January 2025, after which no applications will be accepted.

APPLICATION PLATFORM/CHANNEL

Interested qualified consultants are requested to submit an application, including their profile, to the email: rwprocurement@waterforpeople.org. Please indicate your ability, availability, and financial proposal/quote to complete the terms of reference above. Applications submitted without a technical or financial proposal will not be considered.

LIST OF DOCUMENTS TO BE CONSULTED

The consultant will consult the existing documents related to water and sanitation planning and financing, including but not limited to the following:

• Rwanda Vision 2050
• Second National Strategy for Transformation (NST 2-2024-2029)
• WASH Sector Strategic Plan (2024-2029)
• WASAC Strategic Plan
• Rwanda`s Green Taxonomy
• Water and Sanitation Policy (2023)
• Rwanda National Integrated Water Supply and Sanitation master plans (2022)
• The Kigali Water Supply Masterplan 2050
• Sustainable WASH Finance Strategy (2022)
• Expanding Access to Commercial Finance for the WASH Sector in Rwanda: Financial Landscape Report (2024)
• WASH Investment Plans studies
• Water Resources Management Plans
• Non-Revenue Water Reduction Strategic Plans and Initiatives
• Organization for Economic Co-operation and Development: Diversifying sources of finance for water in Africa, 2024
• National Integrated Solid Waste Management Strategy