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Water governance after the privatization era
Christopher A. Scotta and Bernard de Gouvellob
aUdall Center for Studies in Public Policy and School of Geography and Development, University of Arizona, Tucson, USA;
bCentre Scientifique et Technique due Bâtiment, and Laboratoire Eau Environnement et Systèmes Urbains, Université Paris-Est, Ecole Nationale des Ponts et Chaussées, Marne-la-Vallée, Frances.
The privatization of water supply and institutional restructuring of water management – through decentralization and the penetration of global firms in local and regional markets – have been promoted as solutions to increase economic efficiency and achieve universal water supply and sanitation coverage. Yet a significant share of service provision and water resources development remains the responsibility of public authorities. The chapters in this volume – with case evidence from Argentina, Chile, France, USA, Kenya, Jordan, and other countries – address critical questions that dominate the international agenda on public vs. private utilities, service provision, regulations, and resource development.
Background
This volume includes a series of articles previously published in Water International that address governance challenges for water supply and sanitation services globally. At the core are seven articles from a special issue of Water International, Volume 37 (Issue 2) published in March 2012, on private and public forms of water governance and their response to evolving policy, financial contexts, and public contestation. These seven articles are complemented by six additional contributions in the journal that bring further conceptual perspectives and case-study evidence to bear on the central question of the future of public water governance. We conclude with a prospective piece that briefly synthesizes findings of the original articles and outlines governance challenges that lie ahead.
Water International 37(2) emerged from an international research network on urban water studies. The Groupement de Recherche International (GDRI) Wat-Cit-Ter, created in 2008 and led by Graciela Schneier-Madanes, brought together researchers from France, the United States, Argentina, and Chile, with the aim of developing comparative research between France and the Americas. The network brought together numerous perspectives, drawing from economics, sociology, anthropology, politics, law, urban planning, and geography. GDRI’s focal concerns are access to drinking water and water governance.
Several international workshops were organized by the GDRI during 2009 and 2010. The first and most important one took place in February 2009 at the University of Arizona in Tucson, USA. The workshop theme was “water governance” with case studies from USA, Mexico, Argentina, Chile and France. Early discussions were held to propose a special issue of Water International, and as a result, the “public-private debate” became a unifying theme followed by GDRI researchers. The second workshop, held at the Ecole Nationale des Ponts et Chaussées in Paris in March 2010 dealt with the “paradigm shift in urban water management”. Draft versions of the papers by de Gouvello et al. and Valdovinos were presented and the decision finalized to propose a special issue of Water International. The third workshop took place in June 2010 at the Universidad Diego Portales in Santiago, Chile, on the topic of “governance and water conflicts in the Americas”, where preliminary versions of the papers by Guiloff and Prieto and Bauer were presented. These four papers were complemented by two contributions by researchers (Megdal and Scott) who presented at the first workshop in Tucson. Finally, the paper by Sojamo et al. did not result from the GDRI process, but due to its clear relevance, it was added based on discussions with the special issue co-editors. Additionally, we include here an unsolicited, but thematically pertinent, response to Sojama et al. by Kumar that appeared in Water International 37(3).
Subsequently, additional papers published in the journal were included based on their direct relevance to water governance. The contribution by Akhmouch and Kauffmann presents an emerging initiative of the Organisation for Economic Co-operation and Development (OECD). Further case evidence from the United States is presented by Cotta, complementing the piece by Megdal. Rounding out the geographical coverage of the material for this volume, we include work addressing water supply challenges in Africa (Crow and Odaba), Asia (Chiplunkar), and the Middle East (Rosenberg et al.).
The public-private debate within the water governance paradigm shift
The 1990s constituted a turning point in approaches to water management all over the world. The decade was characterized by the commodification, internationalization, and institutionalization of a “global vision of water”. Following the water decade of the 1980s, themes such as the administration of the resource itself, the management of public services, and the lack of access to such services on the part of billions of disenfranchised people, became issues of central importance.
From that vantage point, water was seen as an economic good, for which protection and use could be ensured through market mechanisms and improvements in governance. In the 1990s, the predominant paradigm, led by international organizations such as the World Bank, was that growing recourse to the private sector would enable the public sector to increase its efficiency while at the same time promoting a process of commodification of water. After the failure of numerous international contracts at the beginning of the 2000s, however, and the growing service provision gap for water and sanitation, this paradigm was seriously questioned (Bakker, 2010), including by many of the promoters themselves (Marin, 2009).
In this new context, water governance, defined as “a country’s capacity to organize the development of its water resources in a sustainable fashion” (Pena and Solanes, 2003), has raised the need to reconsider the relationship between public and private interests (Lobina and Hall, 2007). And, just as water for human use has “peaked” globally (Gleick and Palaniappan, 2010), the privatization model has peaked, although it may take other forms. It is thus time to consider the future of public governance of water, service provision, equitable access, and attendant health, livelihood, economic development, and ecological outcomes.
Overview of this volume
We aim to contribute to the public-private debate, especially reconsideration of its implications for water governance, by addressing the following framing questions:
(1) What have water and sewerage service privatization and resource commodification taught us? Are these processes now in decline?
(2) Can the market still be considered an efficient and effective mechanism to ensure the equitability of water governance?
Several articles seek to tackle the first question. The privatization and subsequent renationalization of water and sewerage services in the metropolitan region of Buenos Aires, Argentina is analyzed by de Gouvello et al. Following a long period of federal management, Buenos Aires’s water and sanitation services were put into private concession in 1993, which became a paradigmatic model within Argentina and internationally. However, this gave way to a new public organization after the 2001 Argentinean crisis. The authors show that what emerged followed the previous federal management model, but with some features inherited from the “private parenthesis”: institutionalized regulation, social control of the services, and clear distinction between the operation of services and investments in infrastructure. By comparison, Valdovinos’s analysis of the “remunicipalization” of Paris’s water services demonstrates that, beyond the specific political context of the process, a new political vision has arisen amongst local authorities concerning their own roles as key actors in water services management.
Akhmouch and Kauffmann describe the situation of the private participation in the water sector worldwide and note a great variability not only in geographical terms, but also in the forms of participation of the private actors. By analysing various private sector participation (PSP) projects of the 1990s, they consider that such projects act to reveal governance gaps due to the complexity of the water sector. Regardless of the ownership of water operators, seven kinds of gaps can be identified with four of them of major importance: policy, accountability, administrative, and capacity gaps. Strategies to address governance gaps include improving information and transparency, performance metrics, institutional coordination, capacity building, and participation of citizens and the public.
Cotta provides a brief overview of water supply utilities in the US, where public agencies supply over 90% of the water to an estimated 85% of the population. This paper reviews the challenges inherent in several forms of privatization that are being considered (in large measure to close the infrastructure deficit). The author defines a set of recommendations for any municipality projecting to privatize its water services. According to the author, two main principles have to be respected during the bidding process: transparency and choice of the company in accordance with its ability and accountability. The role of the citizen advisory committees in yearly service review has also to be fostered.
Based on the analysis of public-private partnership (PPP) projects carried out by the Asian Development Bank over the last 15 years, Chiplunkar focuses on how water supply needs to be considered as a business proposition. In that perspective, the full capital and operation and maintenance expenses must be recoverable. If full/sustainable cost recovery from users seems to be the ideal long-term goal, some transitional solutions using external financing can play an important demonstration role, in supporting reforms in governance (which the author holds is at the core of long-term sustainability of projects) and introducing good practices. Access to water, per se, is not indicative of quality of service. The PPP nature of projects advocated by the author relies on public finance and subsidies for private operators. However, what appears to be underplayed are the institutional and regulatory frameworks required for “sustainability” and quality of “service delivery” that the author considers important. For example, re-negotiation of concessions may be required not just for financial reasons, as in the Philippines case cited by the author, but also to ensure service delivery as outlined in the de Gouvello et al. paper.
Scott and Raschid-Sally highlight concerns over wastewater, which grows in tandem with water supply, as a resource subject to commodification. Drawing from experience in developing and developed countries alike, the authors find that public regulation and oversight of the (mostly private) use of wastewater is imperative, and increasingly practiced, for reasons of public health and environmental quality.
The paper by Megdal observes that the private sector has long had a role in water provision in the United States, although the function is largely one of the public sector. With reference to the state of Arizona, which has many similarities with other regions of the world experiencing population growth and water scarcity, Megdal concludes that, while the public sector dominates water supply provision and decision-making, the private sector will play an increasingly important role in accessing financial capital for infrastructure development.
Three papers in this volume – two case studies of Chile and an analysis of global agribusinesses – deal with the second framing question. Guiloff explores how to shift orientation of Chile’s water institutional system, characterized by neoliberal emphasis on water as property, towards inclusion of multiple water uses. The author points out that water rights transfers are prone to failure when multiple use coordination is required. In this context, it is demonstrated that administrative tools (specifically, environmental impact assessments) in conjunction with legal processes (the courts) may help solve this failure.
Prieto and Bauer present an institutional analysis of hydropower development in Chile, focusing on the main legal institutions involved and the record of relevant jurisprudence in the Chilean context characterized by a pro-market and private-sector orientation which included reforms in both the water and electricity sectors. The authors argue against the predominant orthodox view of the Chilean water and electrical model as neutral in terms of water allocations and electricity generating technologies.
The paper by Sojamo et al. addresses the role of international capital in driving land and water resource allocations. These are increasingly subject to capture and hegemonic control, thereby restricting equitable access to resources, decision-making, and outcomes. This paper has clear analogies with, but raises challenges for, the sequence of privatization to assertion of public control described in other papers in this issue. In a short response to this paper, Kumar identifies shortcomings of the conclusions of Sojamo et al., pointing out that the water richness of an area does not guarantee the ability to generate agricultural surpluses when land is scarce in relation to population. Therefore, it is not correct to translate the food demand of a country into an equivalent water demand, if there is insufficient arable land to produce food.
Crow and Obada emphasize the interlinkages among technology, utilities, and social practices in their analysis of three slums in Nairobi (Kenya), where the lack of services leads to severely high costs for the inhabitants in terms of money, time (especially for women) and health. Initiatives have been held by the Nairobi Water Company through its dedicated Informal Settlements Unit: creation of an association gathering the water vendors to limit corruption and illegal connections (Kibera); implementation of “water chambers”, technically efficient, but appropriated by cartels (Mukuru); and specific work of community organizing (Mathare). These projects show the challenges for building infrastructure while creating and empowering institutions to ensure equity in the context of social and political practices.
Addressing the challenge of intermittent water supply, Rosenberg et al. provide empirical evidence on coping strategies by households and utilities in Jordan, where the distribution network supplies water only 12 to 60 hours per week. Through interviews and a literature review, the authors identify numerous (short-term and long-term) actions aiming at water supply enhancement or water demand management: rainwater harvesting, cisterns to store network water, greywater reuse, leaks fitting, etc. By combining actions households get great flexibility to face service disruptions. Demand management entails changes to practices that directly or indirectly reduce the amount of water consumed. The authors place emphasis on adaptive practices by water users.
In sum, the thirteen papers in this volume present varied perspectives – largely complementary but at times contrasting – on public and private governance of water. Public authority in general is being reasserted over service provision, while resource development and investments in infrastructure continue as a mix of public and private initiatives. But more importantly, oversight and regulation of market-based initiatives that were until recently touted as panaceas for water supply and sanitation are increasingly being reconsidered based on social equity, environmental, and public health concerns.
References
Bakker, K. 2010. Privatizing water: governance failure and the world’s urban water crisis. Ithaca, New York: Cornell University Press.
Gleick, P. H. and M. Palaniappan. 2010. Peak water limits to freshwater withdrawal and use. Proceedings of the National Academy of Science doi/10.1073/pnas.1004812107.
Lobina, E. and D. Hall. 2007. Experience with private sector participation in Grenoble, France, and lessons on strengthening public water operations. Utilities Policy 15: 93–109.
Marin, P. 2009. Public-private partnerships for urban water utilities. Trends and Policy Options No. 8. Washington DC: The World Bank and Public Private Infrastructure Advisory Facility.
Pena, H. and M. Solanes. 2003. Effective water governance in the Americas: a key issue. Kyoto, Japan: Third World Water Forum, March 2003.
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Changing paradigms in water and sanitation services in Argentina: towards a sustainable model?
Bernard de Gouvelloa, Emilio J. Lentinib and Federica Brennerb
aLaboratoire Eau Environnement et Systèmes Urbains, Université Paris-Est, Ecole Nationale des Ponts et Chaussées, and Centre Scientifique et Technique du Bâtiment, Marne-la-Vallée, France; bCentro de Estudios Transdisciplinarios del Agua, Instituto de la Universidad de Buenos...
