FUTURE DEMAND FOR WATER SECTOR INFRASTRUCTURE is not the numbers or rate of urbanisation but rather rate of growth of institutional ability to manage the processes of urbanisation. The major challenges are affordability and revenue generation, the mobilisation of funds and how they are raised. The solution lies in economic growth that enables the required level of funding to be put in place to create the infrastructure and to enable the people to afford the services provided. Thus service level must be linked to affordability (Komives, Whittington and Wu, 2001) - the poorer the household, the less likely they are to access services. The impact of more rapid urbanisation in itself is not the issue; rather, it is how this relates to economic growth and the redistribution of income across society. More rapid urbanisation with commensurate economic growth could in fact be preferable to slower rates of urbanisation with piecemeal development of accompanying infrastructure. Urbanisation creates problems of water shortage, related to both quantity and quality, as lack of adequate wastewater collection and treatment leads to environmental pollution and deteriorating water quality, thus affecting availability. High levels of water poverty are often associated with poor health and go together with other problems such as poor housing. Evidence from Brazil and other countries suggests that INGOs can play a key role in working with communities in urban areas to extend water services provision (Novy and Leubolt, 2005; Water Aid, 2005; Media Analytics, 2002). In some instances local government has sought to improve coverage by making it a condition of granting leases or concessions to the private sector. Success, however, has been patchy (Bakker, 2005). In sub-Saharan Africa the impact of urbanisation on water infrastructure is problematic in the absence of substantial donor assistance, given the projected continuing economic weakness (World Bank, 2005). In the context of the developed economies and the OECD, the impact of urba