Multi financing

In its activities and interventions at events, INBO, a non-profit association, is keen to point out the colossal cost of inaction on the effects of climate change on populations, economies, and the environment.

It can happen that the resources run out and are no longer available in sufficient quantity and quality for all uses, or on the contrary, that it flows freely and destroys everything in its path.

To provide institutional, technical, operational and strategic responses to these disastrous effects, the financial resources required for water management at a basin level are particulary significant.

According on the geographical context, examples include support for the governance of basin organizations, the implementation of networks to monitor surface and groundwater resources, of hydrometeorologicical forecasting, modelling and simulation tools and water information systems to improve knowledge of the basin, support for the process of drawing up, implementing and monitoring river basin planning, including for specific actions (Citywide planning, reforestation, erosion control, river restoration, sediment management).

Major investment programs adapted to different realites are also essential if we are to succeed in implementing projects such as the development of reservoirs or multi-purpose dams, dykes, or hydraulic infrastructures to protect against floods and droughts; pollution prevention (sanitation and wastewater treatment) and environmental protection; the provision of services (hydropower, irrigation, domestic and industrial water supply, river transport) and, finally, nature-based solutions to restore water and ecological security.

Since the aim of IWRM is to manage a common natural heritage, sustainable funding mechanisms are mainly public and involve the three “T”:

• Taxes : general taxtes, collected from citizens and companies by the public authorities, which decide how they are distributed and allocate part of them to basin management, as well as taxes earmarked specifically for water management (or “fees”).
• Rates (“Tarifs in French”) :  paiements pour services rendus (factures d’eau potable, assainissement, irrigation) payments for services rendered (drinking water, wastewater and irrigation bills).
• Transferts : loans through bi/multilateral financing, such as Official Development Assistance – ODA; grants and charitable and voluntary contributions.

When it comes to public funding mechanisms, two key issues emerge.

How can these mechanisms contribute to more efficient management of water resources?

The key to their sustainability is economic incentive!

It is therefore advisable to apply the “polluter pays/user pays” principle, which sanctions resource degradation and subsidises virtuous water management behaviour.

How can we make them sustainable and viable?

Efforts must be made to strengthen national tax systems by gradually incorporating progressively the informal economy.

Alternative mechanisms such as public-private partnerships, payments for environmental services or community funding can also be considered, as long as they are in line with the objectives set collectively by basin governance. They are a useful complement to these to meet the challenges of adapting to climate change, preserving biodiversity and cross-border cooperation.