Mon, Jul 31, 2006 page11

• Water providers seek creative solutions at workshop

  • THE OBSERVER
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  When Syahril Japarin took over as director of the Pontianak city water company in West Kalimantan, Indonesia, in November 2004, the public utility was running at an annual loss of tens of thousands of dollars. In just over two months he had turned the deficit into a surplus of tens of thousands of dollars; a year later, that had more than tripled to £120,000 (US$224,000).

  "The secret was simple," the diminutive, cheerful Japarin said. "We changed the company's rules and, with the workers' permission, set targets. Everyone now has a target as a breakdown from the company target."

  Bonuses for the very best performers, including free trips to Mecca for Muslims and equivalent cash for people of other faiths, were introduced, along with compulsory early retirement for employees who failed their appraisals.

  

  A woman and her son fetch drinking water from a submerged hand pump at Dumral village, about 56km south of Ahmadabad, India, on Saturday. Torrential rain in the region has caused widespread flooding in recent days. UN data indicate almost 1.2 billion people have no sustainable water supply and twice that number have no access to a sanitation system.

  PHOTO: AP

  Last week Japarin shared his experiences with other members of the world water community at a UN workshop in Bangkok, hoping to reinvigorate a global industry that has failed to deliver to the world's poorest people. UN data indicate almost 1.2 billion people have no sustainable water supply and twice that number have no access to a sanitation system.

  In the past four months, policymakers have started to concur with activists who have argued for more than a decade that privatization is not the answer.

  "The experience of privatization has been rather discredited, rather pathetic for the welfare of the poorest in the world," said Kwame Jomo, the UN assistant secretary-general for economic development.

  But that does not automatically mean public services are the answer, said Antonio Miranda of the Brazilian Association of Municipal and Sanitation Public Operators, a member of the UN secretary-general's advisory board on water and sanitation.

  "More than 90 percent of the world's water utilities are in public hands and 1.2 billion people don't have access to water," Miranda said. "It's clear the public sector has failed too."

  The dilemma, Miranda believes, is simple.

  "We need to provide water and sanitation to the poor, and the poor will never make you a profit. But public utilities cannot run at a loss. So if you will never recover your costs through tariffs, you have to do so through other means," he said.

  At the World Water Forum in Mexico in March, two reports were published that turned conventional thinking on its head. One, the Gurria report, said financing had to be restructured from being supplier-driven to being demand-driven, particularly in the international financial institutions such as the World Bank, regional development banks and governments' international development departments.

  The other, written by the UNsecretary-general's advisory board, said that if the world is to meet its Millennium Development Goal target (of halving the number of people without sustainable access to safe drinking water and basic sanitation by 2015), "radical change and swift, resolute action" would be needed.

  Its primary recommendation was the creation of Water Operators Partnerships (WOPS), to bring together operators from around the world to share experiences for mutual benefit. The theory is that the less efficient can learn from the more competent on a not-for-profit basis on any issues of concern.

  "Water provision is a natural monopoly since people don't usually have a choice about who supplies their water," Miranda said. "Therefore, there should not be competition issues."

  Last week's workshop, aimed at Asian providers, was the first practical attempt to get the WOPS up and running.

  "It's not even a work in progress yet, it's still embryonic," said Manuel Dengo, head of the water section at the UN's department for economic and social affairs. "But we have to start somewhere."

  Crucial political players are starting to see the light, Miranda said, citing a meeting he had with Britain's development secretary, Hilary Benn, this month.

  "Benn said: `Let's move from these incentives to privatization to look at other incentives.' That's very new. Let's hope it leads to something tangible." Miranda said.
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