Privatisation in WASH sector

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  • blevira
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  • WaSH researcher with background in environmental engineering and more than 11 years of designing and implementing WaSH projects in urban and rural Tanzania.
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Re: Privatisation in WASH sector

Hi Paresh, I appreciate you initiating this type of discussion.

Analyzing the privatization of the water sector in the United Kingdom, it's conceivable that the private sector might be inclined to invest in the Global South if governments promulgate and rigorously enforce regulations. The success of such investments, however, would depend on various factors including the stability of regulatory frameworks, political climate, economic conditions, and the potential for returns on investment in those regions.

Similarly, during my studies in the UK, I was eager to understand the challenges surrounding service provision and noticed that; In terms of water tariffs, different companies in different regions of the UK set their own pricing structures based on various factors such as operational costs, infrastructure investment needs, and regulatory requirements. Therefore, water tariffs varied between companies and regions. From my perspective, it is challenging to implement this scenario in the global south.

In summary, while water sector privatization has benefits, it must be adapted to local realities. The global south can learn from the UK experience but should tailor solutions to address unique challenges.
Beda Modest Levira
Environmental engineer and researcher
Ifakara Health Institute (IHI)
Tanzania, East Africa
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Working as the project leader for 2 projects 1) HDIF (DFID) and 2) LIRA 2030 here in Dar es Salaam, Tanzania

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  • Euphresia
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Re: Privatisation in WASH sector

Hello Paresh!

Disruptive question indeed. I attach my recent piece with Smart Water Magazine on the subject hope it provides some answers bottom line from so much evidence in the sector including OECD remains private sector cannot be the main financier they shall need to play with the sector rules especially on tariff setting and alos agreeing to remain Transparent and Accountable in their operations.

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  • paresh
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Re: Privatisation in WASH sector

Dear all,
Happy to share another piece  related to England's water system. Like the previous piece, this piece also highlights the focus on creating wealth for investors while paying inadequate attention to improving water and wastewater management. Importantly, the piece suggests:
  • Takeover of utilities by the public authority (Reminds me of a similar initiative posted here ) 
  • Establishing social regulatory system as the top-down command and control mechanisms seem to be highly inadequate 
  • Ensuring the reuse of treated wastewater to reduce the pressure on freshwater sources and ensure the sustainability of the water system. 
I think these pieces and movements towards remunicipalisation in Europe point towards the need to either keep services such as WASH with public utilities or promulgate and enforce stringent regulations. That is, Governments cannot shy away from their role in the provision of WASH services.

The question that arises in my mind is  - Will the private sector be willing to invest if governments in the Global South promulgate and enforce regulations? 

Regards
paresh
Paresh Chhajed-Picha
Researcher at Indian Institute of Technology - Bombay, India
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  • paresh
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Privatisation in WASH sector


Source: @paullewismoney via  twitter

There has been a widespread push towards privatisation of water supply especially in urban areas. In India, attempts to privatise haven't worked and I haven't heard of any plans in the recent past (fortunate or unfortunate - only time can tell).  But came across this a year old piece:  England's privatised water firms paid £57bn in dividends since 1991  while amassing almost an equal amount of debt - effectively taking loans to pay dividends. And this happened in the UK, a country that has a strong regulator.

In India, private sector participation is being encouraged in the FSM space and there is interest in providing emptying services and operating treatment plants. Lessons from regulating them will hopefully emerge gradually. Not sure however if it makes sense to push for privatisation in countries of the Global South where there are no regulators and certainly the culture of regulation is poor and often  regulatory institutions toothless. 

I'd like to learn about experiences (good and bad) about privatisation and regulation of services. Request to share your experiences and relevant references.

Regards
paresh
Paresh Chhajed-Picha
Researcher at Indian Institute of Technology - Bombay, India
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