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employment for unskilled labor. The Dar es Salaam Community Infrastructure Upgrading component would support efforts already underway through the Dar Sustainable Cities Project (GovernmentlHabitat) which focuses on community management for solutions to urban services and environmental problems in poor neighborhoods. Tertiary and secondary infrastructure rehabilitation and limited new construction feeding from/or into existing primary networks (standposts, simplified sewers, neighborhood drainage, etc.) are high-priority investments and depend heavily on community involvement and management.

4.41 Regarding the water and sewerage component, the Tanzania Social Sector Review showed that the highest subsidies from the Government to water consumers go to the relatively well off: about 60% of the subsidy for private connections goes to the 20% of the population on the top of the income distribution. Under the project financing of water supply in six towns, new standposts would be constructed under arrangements whereby the communities manage the standposts. A tariff revision to bring the UWSDs' finances in line and to address this issue would be undertaken under the project. It is anticipated that tariffs at public standpipes will remain at the current level so as not to affect the poorest strata of the population.

4;42 The project would have an overall positive impact on women. As women have primary responsibility for the health of their families and are often the drawers of water, improvements in water supply and sanitation facilities would have a beneficial impact on women. It is estimated that about 71% of households in urban centers other than Dar es Salaam collect water from outside the home spending an average of 2.5 hours per day (Source: Tanzania Social Sector Review). It is mostly women and children who perform this task. They would have more time to devote to other household activities, including those for income generation, as a result of improvements in water supply. Improved sewerage and sanitation at the household level would lead to better health for the entire family. Children especially would benefit since they are highly affected by water-borne and water-washed diseases. In terms of the recent institutional reforms in the water sector, the establishment of the Urban Water and Sewerage Boards in the first three pilot towns all have a composition that includes roughly one third women. The UWSBs are the management authority for the water supply and sewerage systems and those women on the Boards play a critical role in day to day management decisions effecting women - this is not a token representation.

# C. RISK AND SENSITIVITY ANALYSIS

4.43 **Overall:** The main risk associated with the project is that the Government may not be able to fully implement the _institutional andfiscal reforms_ required for project sustainability as identified in the Letter of Sector Policy. While a number of significant reforms have already been undertaken under the Urban Sector Engineering Project, (paras. 2.6 and 4. 10), the proposed project contains further assistance, performance incentives, and institutional strengthening to central and local agencies (project towns, UWSDs, PMO). The policy reforms contained in the implementation plan that is part of