SWIFT

SWIFT is a spreadsheet-based tool developed by the Water and Sanitation Program (WSP) in 2007 (Virjee, 2007). Its main purpose is to assist governments in analysing the financial status of their water sectors. This financial monitoring tool can be used to gain an improved understanding of resource flows and relationships between financing and outcomes (Fonseca et. al, 2011).

The primary function of a SWIFT analysis is to understand the financial balances in the water sector of a given country and to allow strategic analysis of options available to close those gaps. The model analysis can help sector decision makers to understand the strengths and weaknesses of their existing sector information and monitoring systems. Given that the data inputted to SWIFT is provided by the users of SWIFT, data gaps that exist, and sensitivity analysis around those gaps, facilitates an understanding of the planning implications and costs linked to poor information (Virjee, 2007).

The tool comprises of five modules (EUWI Finance Working Group, 2007):

1) Sector definition and target setting

2) Public finance; allows user to specify (and follow) financial flows between institutions as well as to specify budgets for different mandates within a certain institution. It also specifies regional allocations of funds for capital expenditure and operation and maintenance expenditure.

3) Sector development; details the costs of set water development targets and compares these to available finance.

4) Service delivery; estimates costs and revenues associated with meeting user defined coverage targets.

5) Policy scenarios outcomes

The tool relies on user input expenditure (unit costs) for both for capital expenditure and operation and maintenance expenditure. The appropriate expenditure may be generated based on a detailed costing methodology developed by PEM consult for WSP.

The model innovatively includes expenditures with indirect support (called sector management activities), going as far as allocating mandates – and corresponding percentages for expenditures - to different institutions (policy setting, regulation and sector information and monitoring systems) (Fonseca et.al, 2011).

SWIFT has been tested at different stages in Zambia, Mozambique and Kenya with the objective of developing a tool for a sector-wide application in African countries.

The outputs of SWİFT are financing requirements and financing availability - and hence financing gaps - shown along a large number of variables (institutions, regions, investment expenditure, current expenditure, etc.). The Public Finance Module specifies terms and conditions and projects loan service. In this way the tool facilitates an iterative process of matching the expenditures required to meet given targets with available finance and also the incorporation of the financing strategy into public budgets during strategy implementation (EUWI Finance Working Group, 2007).

Key documents

EUWI Finance Working Group, 2007. Developing financing strategies in water supply and sanitation. Information note prepared by COWI consultants and shortened by the FWG Secretariat.

Fonseca C., Dubé A. and Verhoeven J., 2011. Cost-based decision support tools for water and sanitation. (WASHCost working paper 4). The Hague, The Netherlands: IRC International Water and Sanitation Centre.

Virjee, K., 2007. The sector wide investment and financing tool (SWIFT): model overview: working paper draft . Nairobi, Kenya: Water and Sanitation Program - African Region.