[13] A comprehensive expenditure framework was introduced to coordinate financial support by external donors, the national government, and non-governmental organizations.

[12] According to the European Union (EU), the number of people defecating in the open fell substantially between 2000 and 2008, even though the government provides no subsidies for the construction of latrines.

[22] According to the MWE, an analysis of municipal effluents carried out in July 2008 revealed that NWSC's wastewater treatment facilities mostly do not meet national standards.

[29] According to Daniel Kull, at the time a hydrologist with the UN's International Strategy for Disaster Reduction in Nairobi, the drought would have caused only half the water loss actually seen if two hydroelectric dams at the outlet of the lake into the White Nile had been operated according to the "agreed curve" determined in a 1953 agreement on the Nile flows between Uganda and Egypt.

[29] Sandy-Stevens Tickodri-Togboa, professor of engineering mathematics at Makerere University, disagreed and calculated that the drought caused 80 to 85 percent of the decline.

[31] According to the NWSC's annual report, the utility's total water production from July 2007 to June 2008 (fiscal year 2007/2008) for 23 towns was 63,600,000 cubic metres (2.25×109 cu ft), of which 79 percent were produced in Kampala.

Divided by the 1,944,741 people whom NWSC served at the end of June 2008, this corresponds to 15.3 cubic metres (540 cu ft) per person per year or 44 L/p/d.

[10]: page 78 Around the end of the 1980s, international donors began to invest substantial financial resources to rehabilitate and renew the water network in Kampala.

[33] The NWSC was created as a government-owned parastatal organization in 1972 under the national administration of Idi Amin Dada, serving only Entebbe, Jinja, and the capital city Kampala.[35]: p.

[37] Internal reforms at NWSC started in 1998, beginning with a "Strengths, Weaknesses, Opportunities, Threats" (SWOT) analysis initiated by a new management team.

To encourage management to achieve the targets, an incentive element of 25 percent of the annual basic salary depended on the fulfillment of the contract.

[44][35][45] One factor that partially explains the drastically improved collection rates is a government policy instituted in 1999 of paying the unpaid water bills of public entities.

[6] In 22 cities and large towns water supply and sewerage - where it exists - is provided by NWSC, a public utility working on a commercial basis.

The Boston Institute for Developing Economies, however, has claimed that the improvements were not due to private sector participation, but to overall reforms of NWSC initiated before the service contracts were signed and continued while they were being implemented.

[60] Due to low tariffs and lack of funding for investments the private operators largely failed to expand the water system to connect the poor.

Therefore, in 2005 the International Finance Corporation and the Global Partnership on Output-Based Aid (GPOBA) designed a pilot project to provide performance-based subsidies to private operators to expand access to the poor.

[61] Under the Uganda Water Small Towns and Rural Growth Centers project, private operators are eligible for output-based aid (OBA).

The grant financing per capita is lower than under traditional approaches, and in three towns the winning bidder did not even request any subsidy, relying entirely on the expected tariff revenues to recover its investment and operating costs.

In Kitgum, a town with 55,000 inhabitants, four bids were received and a contract was awarded in the summer of 2009 with a target to more than double the number of connections and water production, and to triple revenues collected without increasing tariffs in three years.

According to a 2003 published report, the second performance contract between the government of Uganda and NWSC provided for a tariff policy that in the long term covered operation, maintenance, and a part of the future investments.

According to the MWE, the total budget for Ugandan water supply and sanitation was USh 149 billion in fiscal year 2006–2007, of which US$73 million were actually spent.

[citation needed] Because water supply and sanitation are recognized as key elements of the PEAP, the plan provides for long-term investments in the sector with priority to rural areas.

A week later, the NWSC announced that it intended to borrow USh 30 billion more on the bond market to finance mitigation of the impact of Lake Victoria's receding levels on water supply.

[17] This compares unfavorably to a commitment by African Water Ministers made at the Africasan conference in 2008 in the eThekwini declaration in which they aspired that budget allocations for sanitation and hygiene "should be a minimum of 0.5% of GDP".

According to a 2006 report by UN-Water, the SWAp has led to the increased confidence of development partners and has proved to be the most appropriate mechanism for resources mobilization and program implementation.

[10]: pages 25–27 The Joint Water and Sanitation Sector Programme Support, which follows a Sector-Wide Approach, is aligned with Uganda's 2004 Poverty Eradication Action Plan.

Under the project, which was implemented between 2001 and 2007, water supply and sanitation facilities in the towns of Masindi, Hoima, and Mubende districts were rehabilitated and extended.

In Kampala, Jinja, Masaka, Mbarara, and Mbare, the project supported physical and institutional components to expand the system and strengthen the NWSC.

[84] Adela Barungi (writer), Josephine Kasaija and Paito Obote (editors), Amsalu Negussie (supervisor): New Rules, New Roles: Does PSP Benefit the Poor?

Contracts and Commerce in Water Services: The Impact of Private Sector Participation on the Rural Poor in Uganda, WaterAid and Tearfund, 2003