WATER PRIVATISATION SCHEME UNDER FIRE

Dar es Salaam has always had problems in ensuring its water supply and the vast growth in the population of the city in recent years has exacerbated these problems. November last year was a particularly difficult month – most of the city was without water for days at a time.

water carrierWater carrier in DSM – Photo courtesy Birgit La Cour Madsen/ActionAid UK

The Government’s reaction to the recurring problems was to privatise the industry, but this process has now come under heavy fire even though it is less than year since it happened.
As for the immediate problem, Minister for Water Development Edward Lowassa explained: “The pipes are 30 years old; they have a lifespan of only 25 years so they are already out of date….they may not be able to withstand the intense pressure created by newly installed pumps.” The Minister announced that he had given the go ahead for a Shs13 billion two-year project to lay new pipes to cope with the increased pressure from the pumps. The African Development Bank, World Bank and the European Investment Bank were financing the project through a loan to the Government.

City Water, the Tanzanian firm created to manage the water supply and, in particular, the foreign firms engaged in assisting it, recently came under heavy fire in a report by British aid organisation ActionAid dated September 27th. This accused Biwater, a British water corporation (created originally in 1989 to participate in Margaret Thatcher’s controversial privatisation of the UK’s regional water authorities) of mismanaging the scheme.
The ActionAid report received widespread international publicity. The London Guardian, in a feature article headed ‘Pipes run dry in Tanzania’, (Thank you Fiona Scott and Elsbeth Court for sending us the extract – Editor) gave a fairly balanced view in which it first quoted critics as saying that the city’s water service remained patchy and tariffs had risen while Tanzania had been saddled with yet more foreign debt. It quoted the report as saying that poorer households were having to shift towards unsafe water sources with serious consequences for the health of their families. The paper added however that even critics of water privatisation accepted that the system had to change. Before privatisation only 98,000 homes in a city of 2.5 million had a direct water connection and 60% of the water was being lost through leaks.

Water SellerWater Seller Photo courtesy Birgit La Cour Madsen/ActionAid UK

The ActionAid Report

The Action Aid report is long and detailed. Extracts:
‘Water often only flows at night, or for a few hours a week. Tariff increases are arguably justified, as the Government previously provided large subsidies to those with connections – generally the middle and upper income households. However, evidence from interviews shows that consumers are angry. They resent the fact that they are being charged more for their water, even though there has been no public debate about the need for privatisation. They do not feel they are getting a better service, and believe that City Water is making excessive profits at their expense….according to one local NGO, water bill collectors are being chased away with dogs and knives. Households that refuse to pay higher water bills are threatened with disconnection. There is also public scepticism about the measures taken by City Water to reduce corruption. As part of the lease agreement, City Water agreed to take on all employees of the former water authority DAWASA, including many well known for their corrupt practices….. Several interviewees reported that households still had to pay bribes just to get water, or to avoid being disconnected.’

According to City Water, tariffs have increased by 11%, but WaterAid, in another report, said that they had increased by 40%. ‘From the beginning, it was clear that the poor, unconnected settlements of Dar es Salaam were marginal to whatever process was being considered and implemented.

The Technical Advisor to Britain’s DfID within the Parastatal Sector Reform Commission (PSRC) was quoted as admitting that the problem with the water supply system was so acute that “We didn’t actually talk about poverty alleviation.” No Poverty and Social Impact Analysis (PSIA) had been undertaken prior to the reforms, making it very difficult to assess the likely impact on the poor. One senior World Bank official noted that “All of Dar es Salaam is poor, so anything which helps to provide more water in Dar es Salaam will automatically help the poor. Unplanned settlements, where 80% of the population live, will be left to local NGOs under a ‘Community Water Supply and Sanitation Project’ subcomponent which will account for only 2% of the total expenditure…. In other words, donor resources, and the Tanzanian government’s current and future tax revenues, will be used to fund a project in which 98% of the money will be spent on the richest 20% of the population.”

Under a new Community Water Supply and Sanitation Project , NGOs, including WaterAid, Care and Plan International, will be subcontracted to carry out water projects in low income areas which are unlikely to be served by the piped network for some time.

Biwater’s Response

Responding to the criticisms in the ActionAid Report, Biwater told Tanzanian Affairs that over the year in which City Water had been running the operation, there had been a vast number of improvements:
* Water quality had improved; outbreaks of cholera were lower; water prices for the poorest customers had been reduced;
* The project had brought with it $164 million (over five years) to a system which had been neglected for over 30 years when it was in the public sector;
* The project would bring water to all areas of Dar es Salaam;
* The project had only been in operation for one year and the
investment programme was only just getting under way;
* The water supplied by City Water was less than 10% of the price of that bought by the bucket;
* Over 500,000 people were now receiving water who had not been receiving water in the past;
* 8,000 meters had been installed and new pumps were now
working at the treatment plants. Very real improvements would be noticed over the next 2 years.

A Government Response

Professor Gelase Mutahaba, Senior Advisor in President Mkapa’s Office, when he addressed the Annual Meeting of the Britain Tanzania Society in October, was highly critical of the ActionAid report. He pointed out that the expansion of the city and a prolonged lack of maintenance while the system was under government control, made a rapid overhaul of the whole system essential. His personal experience was that last year there had been hardly any supply to his house. Now he was getting water three times a week. The private sector was best equipped to undertake the major overhaul needed. He felt that ActionAid had failed to take account of the complexity of the issues. In response to a concern expressed at the meeting about the dominance of the major donors, particularly the World Bank, he said that the Government had taken the initiative in the past few years in defining Tanzania’s assistance strategy and this had not been subject to the perceived priorities of donors. A genuine partnership had been built up.

ActionAid report “Turning off the Taps” available at www.actionaid.org.uk
WaterAid report “Prospects for the Poor” avilable at www.wateraid.org.uk

RSS feed for comments on this post · TrackBack URL

Leave a Comment

You must be logged in to post a comment.