Today s session. Week 1 Week 2. Week 3 Week 4 Week 5. Theme A Service providers. Theme B governments. Theme C consumers. Theme D Reform process RECAP

Transcription

1 1 Today s session Week 1 Week 2 Week 3 Week 4 Week 5 Theme A Service providers Theme B governments Theme C consumers Theme D Reform process RECAP

2 2 Theme Four Process of Reform

3 3 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

4 4 Planning reforms Identify what the problems are Inefficient planning and project implementation Water availability, water quality, energy supply Staff motivation, capacity, efficiency Tariff level and structure Corruption Commercial operation

5 5 Key steps for successful reforms Planning the process of introducing reform Involving stakeholders Setting upstream policy Setting service standards, tariffs, subsidies, and financial arrangement Developing institutional model Utility: public or PSP Non-utility services: small scale providers Environment : policy maker; asset holder; regulator Legal instruments for the arrangement

6 6 Involving stakeholders Politicians: local and national levels Management and staff of public utility Consumer associations NGO: national and int l (service to the poor, environment, governance ) Financiers: multi and bi-lateral Alternative suppliers (tankers, drilling companies ) Media: national and int l Private sector: local and int l

7 7 Sustainable utility reform and reform of the environment have to go hand-in-hand good Our goal environment poor Typical reform path Possible combinations environment status/utility provider status poor utility good

8 8 How Uganda combisequenced the reforms of NWSC, its national utility Reform of the environment 98 new MD 97 new Board 97 corporate plan 95 new statute end 80s & 90s Major rehab mid 80s new government 70s political turmoil Utility reform 03 staff performance contracts 02 automatic tariff indexation 00 ext & int performance contracts service & revenue enhancement programs

9 9 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

10 10 South Africa Mike Muller Former Director General, South African Department of Water Affairs &Forestry

11 11 South Africa Total pop Million (2005) Urban pop (% of total) 59% Surface area - 1,221,037 sq miles Life expectancy 45 years GDP (US$ billions) Access to water supply 88% Access to sanitation 65% Trigger: the end of apartheid Vertical unbundling: bulk utilities and end providers Most utilities are corporatized Subisidies: Free basic water 25 l/p/d Basic water supplies to nearly 15 million people in 10 years; Sanitation much slower applying good old-fashioned public finance principles Ongoing decentralization process after establishment of democratic municipalities in 2001

12 12 Uganda Dr. William Muhairwe Managing Director, National Water and Sewerage Corporation, Uganda

13 13 Uganda Total pop Million (2005) Urban pop (% of total) 13% Surface area - 241,038 sq miles Life expectancy 49 years GDP (US$ billions) 8.7 Access to water 60% Access to sanitation 43% Reform of the environment Utility reform

14 14 Russia Alexander Bazhenov Vice-Chairman, Eurasian Water Partnership

15 15 Russia Total pop Million (2005) Urban pop (% of total) 73% Surface area - 17,075,200 sq miles Life expectancy 65 years GDP (US$ billions) Access to water 97% Access to sanitation 87% Trigger: the end of communism Subsidies: l goti and maximum % expenditure WSS part of broader Housing and Communal Services sector centralized billing and collection Mostly municipal departments with little autonomy History of focus on infra: low efficiency Regulation is regional oblast responsibility Boom & bust of PSP in 03/04; now 2 nd generation PSP

16 16 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

17 17 The first challenge: how to trigger reform Droughts, floods & epidemics Political shifts & pressures Unacceptable levels of service financial crises

18 18 The constant challenge to maintain progress. performance Maintain progress 4 1 Pressure to improve 2 Broad sector reform 3 Utility reform time

19 19 Triggers and obstacles to reform Video clip Muller and Bazhenov 5 min

20 20 Maintaining progress: Balancing external accountabilities Policy makers Owners The unserved? Regulators Financiers Customers

21 21 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

22 22 Key success factors in reform Video clip Muhairwe 5 min

23 23 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

24 24 Taking care of the poor in reforms Video clip Muller, Muhairwe and Bazhenov 10 min

25 25 Existing quantity-targeted subsidies are regressive % of poor hhs receiving subsidy vs. benefit targeting performance 100.0% Hungary (S), 0.98 Share of poor hhs receiving subsidy 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% India, State IBTs, 0.56 Guatemala, 0.20 Kathmandu, 0.56 Ho nduras, 0.49 Peru, 0.82 Bangalore, 0.66 Cape Verde, 0.48 Sri Lanka, 0.83 Sao Tome, 0.41 Cape Verde, 0.24 Rwanda (S), Benefit targeting performance indicator Electricity Water Source: Water, Electricity, and the Poor: Who Benefits from Utility Subsidies? Komives et al.

26 26 Who are the urban poor? Typically use multiple sources and differentiate drinking from other uses - purchase small quantities if a free source is available: May share a house or yard tap with multiple families design standards underestimate number of users May purchase from a neighbor poor households are often heterogeneous; differentiate demand as slums may have mixed densities, income levels May use a public standpipe/standpost/kiosk the level of consumption is constrained by distance traveled, time spent collecting water May rely on small-scale private sector when services do not meet their needs choose to have water delivered to house rather than walking to and queuing at the standpipe BUT: poor households do pay for water often at higher rate (per cubic meter) than wealthy households

27 27 How to improve services for the poor? The long term utility solution: a private - house/yard -connection for all Standpipes from free to paid service Augmenting small-scale service providers How to deal with self provisioning?

28 28 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

29 29 The role of the central government Video clip Muller 4 minutes

30 30 Overview Introduction by Meike van Ginneken Key steps in reforms Balancing progress in utility and environment Video interviews with three speakers Triggers and obstacles to reform Key success factors in reform Taking care of the poor in reforms Role of central government in reforms Leadership

31 31 The political economy of reform Reforms must provide returns for the political decision makers who are willing to make the changes. Initiate reform where there is a powerful need, and demonstrated demand, for change Nothing succeeds like success Best fit rather than best practice Realistic goals and timeline Develop a sequenced, prioritized list of reforms Match available human, financial and knowledge resources Take one step at a time, but lock in progress

32 32 The importance of leadership Video clip Muhairwe 3 minutes

33 33 In-country Discussion Who would gain and who would loose from change in the WSS sector? Politicians: local and national levels Utility management Utility staff Existing consumer served by utility The unserved Alternative suppliers (tankers, drilling companies ) Financiers: multi and bi-lateral Private sector: local and international