There's a kind of "water apartheid" in many developing countries, with people in slums with no running water or toilets sometimes paying 10 times more for water than their richer neighbours just over the train tracks, according to the United Nations' 2006 Human Development Report.

Out today, Beyond scarcity: Power, poverty and the global water crisis says the problem isn't rooted in a physical shortage of water but in institutions and political policies that put the poor at a distinct disadvantage.

More than 1.1 billion of the world's people don't have regular access to clean water, and more than 2.6 billion live without proper toilets or drains.

"It's a crisis of governance of that resource, of competition, financing and delivery," the report's main author, Kevin Watkins, told journalists when he was presenting the report in London. "Water is not shared equally between all members of society and this is a crisis that affects the poor."

The Kenyan capital Nairobi, and its sprawling settlement of Kibera, is a prime example of unequal water access between rich and poor people in the same country.

Kibera's population - and we're talking between 500,000 and 1 million people - live in slum conditions that report describes as "a water and sanitation nightmare".

Some 80 percent of households purchase all or some of their water from kiosks run by private vendors, and in some areas up to 150 people share a single toilet.

That drives many Kibera residents to defecate in plastic bags, which they throw on the roadside or dump in ditches. These unsavoury parcels are known as "flying toilets".

Due to poor upkeep, water pipes in the slums are punctured with holes and suck in human waste, which makes it easy for diseases like diarrhoea, dysentery and typhoid to get a grip. The death rate among children in Kibera is three to four times higher than for the rest of the country, according to Watkins.

And yet you don't have to go very far from the slums to find the Kenyan president's home or the Royal Nairobi Golf Club. People in Kibera pay $3.50 per cubic metre for water - double that in the dry season - meaning that their water costs are about seven times higher than for residents of high-income neighbourhoods served by the Nairobi Water and Sewage Company.

"Those living in Kibera pay some of the world's highest prices for water, even though 70 percent live on less than a dollar a day," Watkins says.

The report points out that the poorest households in El Salvador, Nicaragua and Jamaica spend on average over 10 percent of their income on water, while in Britain, spending more than three percent of family income on water is seen as a measure of economic hardship.

The U.N. Development Programme says the the debate about whether water should come from public utility companies or privatised ones is "a false choice" that diverts attention away from finding ways to get drinking water to poor people.

"Most people don't get reliable water supplies from public or private providers," Watkins says. "The real challenge is how to make water providers - whether public or private - deliver to the poor."