Is the new 'Gavi for toilets' up to the challenge?

ALICANTE, Spain — Many in the water, sanitation, and hygiene sector were excited by the recent launch of a first-of-its-kind Sanitation and Hygiene Fund, meant to replicate the kind of multilateral funding platforms found in other sectors. But raising billions of dollars for a sector that has typically been underfunded, and amid the economic hardships of a pandemic, could pose a challenge. “Right now, everyone is going to be fighting tooth and nail for funding,” said Ranil Dissanayake, policy fellow at the Center for Global Development. Usually, that would be done in person; instead, the new fundraising team is “doing it all online, so we have to have realistic expectations for the coming year,” said Dominic O’Neill, the fund’s executive director. Born out of the Water Supply and Sanitation Collaborative Council, SHF is a new funding mechanism that aims to generate $2 billion for the 2021-2025 period from traditional and nontraditional donors, including Gulf donors, philanthropic funders, and impact and social investors. Following a model similar to that of Gavi, the Vaccine Alliance — which launched in 2000 with a $750 million five-year pledge from the Bill & Melinda Gates Foundation — the money will then be channeled through grants to low-income country governments to scale up successful, government-led, community-based solutions. Projects will focus on expanding household sanitation; ensuring menstrual health and hygiene; providing sanitation and hygiene in schools and health care facilities; and supporting innovative sanitation solutions. Governments will be expected to co-finance to ensure sustainability. SHF — which is housed within the United Nations Office for Project Services and has a core staff of 15 — plans to work with the countries with the heaviest burden and least ability to respond in bringing successful sanitation solutions to scale. Currently, 46 countries meet the eligibility criteria. As it stands, 4 billion people lack access to safely managed toilets and latrines, and 3 billion lack access to basic hand-washing facilities. Despite the high figures, support for the sector has historically been sporadic and on a case-by-case basis, said Hank Habicht, principal at Global Water 2020. According to the World Health Organization, less than 15% of countries have adequate financial and human resources to address sanitation gaps. That could be because, until now, there has not been a coordinated effort to demonstrate the value of WASH, Habicht said. “If you want vaccines to be successful, if you want to improve maternal and child health, WASH is ... a force multiplier that allows all those initiatives to work better.” --— Hank Habicht, principal, Global Water 2020 SHF emerged out of a strategic review conducted by WSSCC which identified that while there is plenty of technical and implementation support for the sector, financial resources remain the “missing ingredient.” While SHF’s starting point of $2 billion will not bridge this gap, the fund hopes to have a “catalytic impact” in target countries, paving the way for further investment, according to its investment case. Amid COVID-19, raising $2 billion is ambitious but attainable, O’Neill said, citing the fund’s focus on new and alternative forms of financing such as impact, social, and private sector investment. “If we weren't ambitious, there's a question of whether it would be worth it,” he said. With that $2 billion, the fund predicts that by 2025 an additional 93 million people will have access to basic sanitation, 38 million students will benefit from improved WASH services in schools, and 21 million more girls could have access to menstrual products. Additionally, many countries will have their national COVID-19 preparedness, prevention, and response plans rapidly scaled up. In the run-up to the first pledging conference next year, Hind Khatib-Othman — inaugural chair of SHF and a former managing director of Gavi — said SHF would be working hard to encourage donors to invest in hopes of raising the first $500 million by March or April, paving the way for the first round of funding proposals. Dissanayake said the Gavi model is attractive because of its ability to generate greater multiyear funding certainty and, by coordinating investments across multiple donors, to reduce duplication. He said he is not, however, convinced that the adoption of it by other sectors serves the needs of low-income countries and warned it could be detrimental to development overall. “It increases the tendency for single-issue organizations and funds to compete for more official development assistance or related funding, and in the context of a binding funding constraint, this comes at the expense of other sectors,” he said. “The end result could well be a system where some sectors get relatively too much funding and others get relatively too little, and the ability of the development system as a whole to rebalance is compromised.” Instead, allocation decisions should be made across sectors simultaneously, on the basis of a conscious consideration of trade-offs and not on the basis of which single-issue funds are most attractive or successful in raising money, Dissanayake said. Water advocates and others disagree. Dave Young, managing director and senior partner at Boston Consulting Group, said the idea of a focused fund is strategic in that it not only gathers money for a cause but also pools expertise and has a theory and method of implementation. The other funds’ successes can only be enhanced by sustainable WASH, Habicht argued. “If you want vaccines to be successful, if you want to improve maternal and child health, WASH is not the only answer, but it’s a force multiplier that allows all those initiatives to work better,” he said. Khatib-Othman said she is hopeful donors will see that investing in sanitation and hygiene protects their investments in other fields. SHF has had discussions with the Global Financing Facility and the Global Fund to Fight AIDS, Tuberculosis and Malaria, as well as Gavi, about how they could work together to complement one another, she said. But is there enough money to go around? While there is a risk that COVID-19 will lead donors to withdraw from global interests, both Khatib-Othman and Yael Velleman, director of policy and communications at the SCI Foundation, said there is an opportunity to highlight how important sanitation and hygiene are to avoiding another pandemic. And even in the grips of COVID-19, Gavi was able to surpass its replenishment target and raise $8.8 billion for the 2021-2025 period. Still, given that the $2 billion target was put together prior to the pandemic, O’Neill admits the fund may have to “re-calibrate their expectations” on when that figure might be reached. “There is a global squeeze on ODA, so we have to reflect that. But also the area where we’re least developed … [is] what you might describe as innovative financing through different types of investors,” he said, adding that SHF plans to work with partners, investors, and multilateral banks to scale successful innovative financing models. Since September, O’Neill has been reaching out to traditional donors — “the usual suspects” — and attempting to build relationships with new donors, but being desk-bound as a result of travel restrictions rather than visiting organizations in person poses another threat to the target. O’Neill said he is hopeful there will be an uptick in activity toward the end of 2021. For Velleman, success will depend on how well SHF can sell WASH as the catalytic factor for health and development initiatives globally. And Jasmine Burton — a “hybrid professional” with experience in multiple areas, including sanitation and health — said it is just a matter of framing. “This is the first-ever fund focused on sanitation and hygiene in this unprecedented COVID year, which is WASH-related,” she said. “There’s a lot of momentum around this fund and potential opportunity. But like a lot of new things, there’s probably going to be a lot of growth, learning, and pain points that we’ll have to pivot and work around to reach the large-scale impact it’s looking to have.”