Empowering water utilities revisiting capacitybuilding

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Empowering water utilities revisiting
capacity-building
Water Operators Partnerships in Europe Den Haag,
November 2007 Richard FranceysWater Management
Group, Sustainable Systems, Cranfield University
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Empowering water utilities revisiting
capacity-building
Goats, Wildebeest, Giraffes? Heart
transplants, heart pacemakers exercise ?
Den Haag, November 2007 Richard FranceysWater
Management Group, Sustainable Systems, Cranfield
University
3
Revisiting capacity-building

• Recognising that utilities (however defined) are
  the entity for sustainable delivery of
  capital/technology intensive (networked?) watsan
  (CP and NGO/CS cannot substitute for long,
  without either failing or becoming utilities)
• Recognising the need for (and the time taken in)
  the development of effective Institutional
  Capital as well as Professional Capital, both in
  addition to education training for traditional
  KSA
• Also necessarily ensuring Institutional and
  Professional Capital Maintenance if they are to
  continue to deliver effectively (aka fixed asset
  capital maintenance)
• Noting the weaknesses of many utilities,
  exploring the difference between Demand driven
  and Supply driven capacity-building for these
  utilities

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A typical utility - South Asia

• 22,051 connections of which 9,416 metered, 1.32
  functional meters
• Total sanctioned staff 359 (16/1,000)
• Total revenue is less than 20 of direct
  operations and minor maintenance expenditure
• Average household payments 9 per year
• On average water supply duration is 45 to 90
  minutes per day
• NRW is approximately 50
• Large number of households are unserved

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Revisiting capacity-building

• Of 231 municipalities in South Africa, Africas
  richest nation, 79 had no civil engineers,
  technologists or technicians and only 45 have any
  civil engineers
• Quoted in Spark, EAP, No 7, April 2006 quoting
  www.civils.org.za/n_and_n

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Revisiting capacity-building

• Delft Capacity Building Symposium (1991)
• i) the enabling environment with appropriate
  policy and legal frameworks
• ii) institutional development including community
  participation
• iii) human resources development and
  strengthening of managerial systems
• What have we learnt in the past one and a half
  decades?
• And was Delft referring to demand driven or
  supply driven capacity building?

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iii) human resources development and
strengthening of managerial systems
Many of the donors learnt to give up on
traditional Masters Programmes too little
evidence to show that they made a difference ??
Except for the Dutch who not only continued to
provide significant numbers of water scholarships
to the Netherlands but also invested
significantly in national Masters programmes
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iii) human resources development and
strengthening of managerial systems
Many of the donors learnt to give up on
traditional Masters Programmes too little
evidence to show that they made a difference
Except for the Dutch who not only continued to
provide significant numbers of water scholarships
to the Netherlands but also invested
significantly in national Masters programmes in
target countries eg Ghana
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iii) human resources development and
strengthening of managerial systems

• Some tried to be more utility management and
  policy oriented
• But the demand responsive Water MBA programme
  failed
• WEDCs Distance Learning courses have been well
  received . .
• Perhaps the new Dundee Lausanne and Cranfield
  MScs will do better

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iii) human resources development and
strengthening of managerial systems

• National Water and Sewerage Corporation, Uganda
• A reforming public utility which has taken
  advantage of World Bank funded training
  programmes (international MScs and two senior
  middle level management workshops per year for
  five years plus ongoing technicians training)
  plus GTZ technical assistance for many years plus
  learning from two major outsourcing contracts
• With ongoing consultants investigating many
  aspects of the institutional framework
• With two extremely capable Managing Directors
• With excellent staff who had been encouraged
  (expected) to undertake postgraduate degrees
  (initially international, subsequently national)
  requiring that all research theses (approx 65?)
  should be linked to the needs of the utility with
  researched recommendations subsequently
  implemented
• Now seen as a significant success story . . .. .
  after 15 years

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Management Development for Senior Public Health
Officials, India
iii) human resources development and
strengthening of managerial systems
A ten year process .
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Management Development for Senior Public Health
Officials, India
iii) human resources development and
strengthening of managerial systems
A ten year process .
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i) the enabling environment with appropriate
policy and legal frameworks
Mr Bandaru Dattatreya, Deputy Minister, MUDPA
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Change Management Forum MUDPA, India
The 24/7 Challenge 2002
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WATER SUPPLY - RAMAGUNDAM
Gangtok CMF Meeting - India

• Population 250,000 70 living in slums
• Mayors Target to provide 24 hours water supply
  for all the 7 days (24/7)
• first for a public provider in India?
• No public stand posts Group taps are encouraged
• Collected deposits for providing meters to all
  house connections.
• Meter reading and issue of bills to be privatized.

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The Mayor leading the way.. Supported by CMF
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i) the enabling environment with appropriate
policy and legal frameworks
How long to establish an effective regulator with
good customer involvement?
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i) the enabling environment with appropriate
policy and legal frameworks

• Some of the new economic water regulators
• England Wales (Ofwat/WSRA CCWater 1989)
• Chile (SISS, 1990)
• Argentina (ETOSS, 1993)
• Ghana (PURC, 1997)
• Philippines (MWSS-RO, 1997)
• Bolivia (SISAB, 1999)
• Jordan (PMU, 1999)
• Zambia  (NWASCO WaterWatch, 2000)
• Indonesia (JWSRB Customer Committees, 2001)
• How long a process to become effective?

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ii) institutional development including community
participation

• Water Utilities Partnerships
• WSUP Water and Sanitation for the Urban Poor
• PAWS
• Water Dialogues
• Water Operator Partnerships
• amongst many others .. . . . . .

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Full spectrum advocacy, education and training,
to varying degrees, to
in

• Government
• Local Government
• Regulatory agencies (Economic, water quality,
  environmental, asset holding)
• Utilities/ Local Service Providers
• Civil society
• Customers

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Revisiting capacity-building

• Learning that it takes time, significant time and
  ongoing commitment, to develop capacity,
  knowledge, skills and attitudes
• Also learning the need for (and time taken) to
  develop the necessary
• Institutional Capital the knowledge of and
  connections among organisations
  intra-institutional networks and the norms of
  reciprocity and trustworthiness that arise from
  them - institutional capital being as much about
  trust expectation of performance
• as well as Professional Capital, the common body
  of knowledge and connections among sectoral
  professionals inter-professional networks and
  the norms of reciprocity and trustworthiness that
  arise from them - professional capital being an
  understanding of the service and commercial
  oriented nature of utility service provision and
  the socio-political networks required to make
  that work as much as the technology
• Social capital the connections among
  individuals-social networks and the norms of
  reciprocity and trustworthiness that arise from
  them (Putnam, 2000 in Beinhocker 2006)
• Ensuring Institutional and Professional Capital
  Maintenance (as for fixed asset capital
  maintenance) - not a one off investment but a
  need for ongoing support until ..?
• But is even all this enough? However
  sophisticated and complex?

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The (conceptual) challenge of empowering
utilities ?
Performance
Development
Utility Performance
Time
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The (conceptual) challenge of empowering
utilities ?
Performance
Development
Utility Performance
Political Economic Socio-cultural Technological En
vironment
Actual Societal Development
Time
25
The (conceptual) challenge of empowering
utilities ?
International Goals
Performance
Development
Utility Performance
Political Economic Socio-cultural Technological En
vironment
Actual Societal Development
Time
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The (conceptual) challenge of empowering
utilities ?
International Goals
Performance
Development
The Societal Demand Gap
Political Economic Socio-cultural Technological En
vironment
Time
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The societal demand gap

• By its very nature capacity in the entity/utility
  is roughly matched with societal demand
• To meet a significantly different (enhanced, more
  coverage, quantity) quality of service requires
  not only capital investment but also matching
  capacity-building investment and institutional
  capital investment .
• But really it needs demand, societal and
  consumer
• Let me illustrate an example of demand driven
  utility supply .

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Piped water 'too expensive' in slums Water
vendors ratio 41 times
Economic development
Years
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Piped water 'too expensive too slums Water
vendors ratio 41 times One
third of city pit latrines
Converting to bucket latrines

Economic development
Years
30
Piped water 'too expensivein slums Water
vendors ratio 41 times One
third of city pit latrines
Converting to bucket latrines
Two thirds houses
bucket latrines, one
quarter pit latrines
Some slum houses still on well water


Economic development
Years
31
Piped water 'too expensive in slums Water
vendors ratio 41 times One
third of city pit latrines
Converting to bucket latrines
Two thirds houses
bucket latrines, one
quarter pit latrines
Some slum houses still on well water

Over half houses achieve WCs - most still
outside



Economic development
Years
32
Piped water 'too expensive in slums Water
vendors ratio 41 times One
third of city pit latrines
Converting to bucket latrines
Two thirds houses bucket
latrines, one
quarter pit latrines
Some slum houses still on well water

Over half houses achieve WCs - most still
outside
Bucket latrines to
WCs
'Most of the poor of capcity still
standposts'
One in 20 houses still no
mains water,
one in five lacking a
WC


Economic development
Years
33
Piped water 'too expensive in slums Water
vendors ratio 41 times One
third of city pit latrines
Converting to bucket latrines
Two thirds houses
bucket latrines, one
quarter pit latrines
Some slum houses still on well water

Over half houses achieve WCs - most still
outside
Bucket latrines to
WCs
'Most of the poorest area of capcity
still standposts'
One in 20 houses
still without mains water,
one in
five lacking a WC

Slums now with piped water
but
still shared toilets

Economic development
Years
34
Piped water 'too expensive in slums Water
vendors ratio 41 times One
third of city pit latrines
Converting to bucket latrines
Two thirds houses bucket latrines,
one quarter pit latrines
Some slum houses
still on well water
Over half houses
achieve WCs - most still outside

Bucket latrines to WCs
'Most of the
poorest area of capcity still standposts'

One in 20 houses still without mains
water,
one in five lacking a WC


Slums now with piped water
but
still shared toilets


Household toilets achieved



Cost reflective
tariffs required
Economic development
Years
35
Piped water 'too expensive in slums
Water vendors ratio 41 times
One third of city pit latrines
Converting to bucket latrines
Two thirds houses bucket latrines,
one quarter pit latrines
Some slum houses
still on well water
Over half houses
achieve WCs - most still outside

Bucket latrines to WCs
'Most of the
poorest area of capcity still standposts'

One in 20 houses still without mains water,

one in five lacking a WC

Slums now
with piped water
but still shared
toilets


Household toilets achieved



Cost reflective tariffs
required
Economic development
?- Two Hundred Years at 1.33 GDP pc
growth pa -?
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Piped water 'too expensive in slums
Water vendors ratio 41 times
One third of city pit latrines
Converting to bucket latrines
Two thirds houses bucket latrines,
one quarter pit latrines
Some slum houses
still on well water
Over half houses
achieve WCs - most still outside

Bucket latrines to WCs
'Most of the
poorest area of capcity still standposts'

One in 20 houses still without mains water,

one in five lacking a WC

Slums now
with piped water
but still shared
toilets


Household toilets achieved



Cost reflective tariffs
required
GDP pc real 30,000 25,000 20,000 15,000
10,000 5,000
?- Two Hundred Years at 1.33 GDP pc
growth pa -?
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the coevolution of economic institutions,
social developments and technological
innovation (Kay, 2004)
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? Upper mid-inc countries
?Lower middle-income countries GNI pc _at_PPP
?Low-income countries
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Water services are more dependent upon economic
wealth than we usually want to accept
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Accelerated path?
Demand responsive 1.6 pa path?
MDG Goals?
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The (conceptual) challenge of empowering
utilities ?
International Goals
Performance
The Societal Demand Gap
Development
Political Economic Socio-cultural Technological En
vironment
Time
42
The (conceptual) challenge of empowering
utilities ?
International Goals
Necessarily Supply driven solutions To bridge
the Societal Demand Gap
Performance
?
Development
Political Economic Socio-cultural Technological En
vironment
Time
43
The (conceptual) challenge of empowering
utilities ?
International Goals
Necessarily Supply driven solutions To bridge
the Societal Demand Gap
Performance
?
Development
Political Economic Socio-cultural Technological En
vironment
Time
44
Supply driven solutions
International Goals
Performance
Utility Performance
Technical Assistance Programmes
Development
Political Economic Socio-cultural Technological En
vironment
Actual Societal Development
Time
45
Revisiting capacity-building

• An MSc in Water Management at WEDC,
  Loughborough Unviersity in the 1980s
• Now Managing Director of a significant water
  utility
• Having accessed remarkably little technical and
  professional support since leaving WEDC
• And no international (above trend line)
  education and training for the next generation of
  engineers coming up behind

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Supply driven solutions
International Goals
Performance
The PPPs Pricing Economic Regulation
Utility Performance
Technical Assistance Programmes
Development
Political Economic Socio-cultural Technological En
vironment
Actual Societal Development
Time
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The capacity heart transplant?
1992 Before .. San Martin Water Treatment
Plant, Buenos Aires
1994 Afterand capacity increased by 20
Control room, Aguas Andinas, Santiago

• New management (same labour much the same
  sources of money)
• Addressing new assets capital maintenance
  requirements
• Focusing upon commercialisation and customers..
• Investing in training for fewer but more
  incentivised staff

Aguas Argentinas Aguas Andinas photos
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Supply driven solutions
International Goals
Performance
The PPPs Pricing Economic Regulation
Utility Performance
Technical Assistance Programmes
Development
Political Economic Socio-cultural Technological En
vironment
Actual Societal Development
Time
49
The supply driven capacity-building solution,
TINAAccelerating co-evolutionary
development Long-term commitment to
full-spectrum capacity-building
International Goals
The Institutional Instability Area
Performance
Technical Professional Organisational Institutiona
l Capacity-building
Development
Political Economic Socio-cultural Technological En
vironment
Time
50
The supply driven capacity-building solution,
TINAAccelerating co-evolutionary
development Long-term commitment to
full-spectrum capacity-building
International Goals
The Institutional Instability Area
Performance
Technical Professional Organisational Institutiona
l Capacity-building
Development
Political Economic Socio-cultural Technological En
vironment
Institutional Capital Development
Time
51
The supply driven capacity-building solution,
TINAAccelerating co-evolutionary
development Long-term commitment to
full-spectrum capacity-building
International Goals
The Institutional Instability Area
Performance
Technical Professional Organisational Institutiona
l Capacity-building
Development
Political Economic Socio-cultural Technological En
vironment
Actual Societal Development
Institutional Development
Time
52
Back to reality . . . . . . .
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Revisiting capacity-building

• Choices
• Join the Public Health Engineering Department as
  Junior Engineer on Rs 15,000 per month (4,400pa)
  with the hope of getting one promotion to
  Assistant Executive Engineer on Rs 18,000 per
  month 5,300pa) in ten to fifteen years time,
  7,500pa age 50 if 1/50 lucky
• Join Wipro or Infosys or other IT companies on Rs
  60,000 11,700pa 2.5x the lecturer who has been
  teaching them) with anticipation of doubling
  that within ten to fifteen years

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Home for the next ten years?
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Revisiting capacity-building

• In India 100 of civil engineering graduates from
  the IITs and NITs choose to go into Information
  Technology

A more attractive home ?
Wipro Campus, Bangalore Photo Feenstra, 2005,
ucdavis
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The (conceptual) challenge of empowering
utilities ?
International Goals
Demand pull rather than Supply push?
Performance
Development
The Societal Demand Gap
Political Economic Socio-cultural Technological En
vironment
Time
57
4 million mobiles in Ghana
9 million mobiles in Kenya
100 million mobiles in India
58
Empowering utilities through enhanced consumer
demand ?
International Goals
Performance
Consumer demand pull
Development
Political Economic Socio-cultural Technological En
vironment
Time
59
Accelerated path?
Demand responsive 1.6 pa path?
MDG Goals?
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Revisiting capacity-building, empowering water
utilities

• Recognising that utilities (however defined) are
  the entity for sustainable delivery of
  capital/technology intensive (networked?) watsan
  (CP and NGO/CS cannot substitute for long)
• Recognising the need for (and time taken in)
  developing effective Institutional Capital as
  well as Professional Capital, both in addition to
  traditional KSA
• Ensuring Institutional and Professional Capital
  Maintenance (aka fixed asset capital maintenance)
• Exploring the difference between Demand driven
  and Supply driven Capacity-building for these
  utilities
• Understanding the Demand Gap and the implications
  for complexity, sophistication and duration of
  capacity-building support to bridge the demand
  gap
• Exploring how to enhance the demand side,
  particularly from lower-income consumers, for
  whom utilities were invented (higher-income
  groups can afford the inefficiency of non-utility
  and/or non-networked supply)

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the demand gap challenge AND the commitment to
supply side full spectrum capacity capital
building
India
Tanzania
Indonesia
Congo DR
Bangladesh
Angola, Togo Mozambique, Mauritania, Comoros etc
Nigeria