1 / 18

Sustainability of safe drinking water and the role of competition: The case of South Africa

Sustainability of safe drinking water and the role of competition: The case of South Africa. LIZA UECKERMANN Analyst: Competition Commission, South Africa. Introduction. South Africa is regarded as among the top 12 suppliers of drinking water in metropolitan areas.

indra
Download Presentation

Sustainability of safe drinking water and the role of competition: The case of South Africa

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Sustainability of safe drinking water and the role of competition: The case of South Africa LIZA UECKERMANN Analyst: Competition Commission, South Africa

  2. Introduction • South Africa is regarded as among the top 12 • suppliers of drinking water in metropolitan areas • 9.1 million without access, mostly in rural areas • Adverse effects on public health • How to introduce more • transparency and competition?

  3. Outline The characteristics of the SA water sector Review on the access of safe drinking water Possible role of competition Conclusion

  4. SA water sector Water stressed country Water use (12 871 million kiloliters p.a.) • Urban requirements- 23% • Rural requirements- 4% • Provision of basic human needs- • 25 liters/person/day Water supply • Capital intensive • Dominated by public sector monopolies • Limited competition

  5. Metropolitan areas Resource:Dam Mining DWAF 1 DWAF 1 Raw water tariff 4&5 Water Boards Consumers 4&5 2 Sanitation charge & waste discharge charge Bulk water tariff 3 Water Service Providers Retail water tariff Resource:River

  6. Non-Metropolitan areas DWAF & some public monopolies Mining DWAF Resource:River 1 4&5 "Our main problems in rural communities are the following: walking long distances about 2 to 3 kilometres daily to public tap; carrying heavy containers on our heads 20 to 25 litres per trips; long queues at the point of taps; should there be contamination at this common point the whole village is at risk." (DWAF, 2005b)

  7. SA water sector To date; • little attention has been given to competition • issues relating to water; and • limited in its understanding of competition. Limited Competition • high transport costs relative to value; • health and environmental objectives; • regulatory environment; • foreclosure issues; and • Highly concentrated market.

  8. Access From 1994 to date: • On track to obtain MDG by 2010 10 million additional people have been supplied with access to drinking water • Yet, enourmas backlog-9.1 million and • only 24% of rural people have access

  9. Access • Local Governments fail • -Quality unacceptable poor in • non-metropolitan areas • -Only 37% of metropolitan areas met • quality requirements (DWAF 2005) • Tremendous health effects • Water-borne diseases caused an annual estimated 101 000 deaths & over 6 million incidences of illness (DoH 2006)

  10. Competition The role of competition in this sector is not a question of principle, but one of practice. South African government view: • Improve the unemployment situation • Tremendous increase in water tariffs • Mandate cannot be delegated, outsourced or privatized. Theory suggests: Competition for the market is possible and desirable

  11. Competition Incentives for sustainability Coverage Invest Quality • Proportion of households • without access • Historical inequalities • Regimes limits adoption • of low-cost solutions • Need to make allowance • for competition • Concessions • Inadequate infrastructure and investment • Challenges to maintain best practice while ensuring improvement in poor performance • Limited competition • Subsidy schemes • Effective treatment facilities • Regimes lack competitive entry • Inability of consumers to choose provider • Information asymmetries • Quality signaling

  12. Competition Resource:Dam Mining DWAF 1 DWAF 1 Foreclosure 4&5 Water Boards Consumers 4&5 2 Bulk water tariff 3 Water Service Providers Resource:River

  13. Competition Benefits: • Alternative bulk suppliers- a more competitive environment • Accelerating the area of access • Improved quality • Access to skills, expertise & funding • Competitive tariffs

  14. Competition Some important notes: • Water supplied remains acceptable to consumers • Successful implementation will reinforce the other reforms and allow greater gains to be made by the whole community • Depends on the government’s willingness to change exclusivity

  15. Competition Non-metropolitan areas: • Remains-sole responsibility of the government • Competition will only provide prerequisites to access- might not alter the market environment • With the introduction of competition, the following is of concern: • Protection of the poor • Logistics of delivery • Quality of drinking water

  16. Competition Non-metropolitan areas Role of competition Community Management Technical • Can I drink the water? • What’s done about my compliant? • Assuring quality • Enabling budget • Optimising technical performance • Establishing treatment facilities interactions interactions interactions DWAF

  17. Conclusion • Potential role of competition has been neglected • Current system not reliable to assure the • sustainability of safe drinking water • Competition for the market is possible and desirable in metropolitan areas • Potential of competition still • limited in the non-metropolitan • areas-management contract a • possibility

  18. Questions

More Related