Compacts should support implementing entities in developing and funding comprehensive operations and maintenance (O&M) plans as a critical part of their sustainability planning. The evaluation found that the O&M plans for the MCC-funded works were largely inadequate. In addition, WASCO lacks a comprehensive O&M plan, which means decisions are made for individual networks on an ad hoc basis and there is no mechanism to ensure compliance with O&M plans. Although the Lesotho Compact did not focus on filling likely gaps in post-compact O&M, around 2015, MCC began engaging on four different fronts related to asset management: (1) conducting a structured assessment of utilities during due diligence to inform institutional support we might provide in the form of technical assistance or a management contract; (2) partnering with other donors who can continue supporting the utility post-compact; (3) bringing in AquaRating, which assesses the performance improvement challenges water and sanitation utilities face in a systematic and comprehensive way, and identifies prioritized areas for rapid improvement; and (4) developing cost-recovery plans based on proper asset management practices, and pursuing a cost-recovery tariff, as informed by detailed financial analysis conducted during due diligence. These four areas of support are intended to ensure utilities have the capacity and financial resources needed to develop, implement, and modify O&M plans. However, comprehensive O&M planning takes time and often requires buy-in and behavior change from multiple stakeholders. To be effective, it must therefore start early in the implementation period rather than only being considered at the end of a program.
Lesson Learned