The governance of water regulators

Transcription

1 The governance of water regulators Preliminary results from an OECD survey to water regulators DWA/WRC/OECD Workshop Pretoria, 25 June 2014 Céline Kauffmann Regulatory Policy Division OECD Public Governance and Territorial Development

2 OECD regulatory tools and processes The Regulatory Policy Committee => Recommendation of the Council on Regulatory Policy and Governance The Network of Economic Regulators => Best Practice Principles for the Governance of Regulators => Regulator Performance Assessments Work with the water regulators of NER => Survey on the governance of water regulators 2

3 OECD work with water regulators Background Multiplicity of models and institutional arrangements Development of dedicated WWS regulatory bodies No international platform for water regulators Focus of OECD work The role of dedicated regulatory bodies for WWS: position in regulatory framework, governance arrangements, operational modalities and use of tools to ensure regulatory. Regulation of WWS economic regulation Work in progress! Finalisation by the end of the year moving towards performance assessment. 3

4 Regulatory functions for WWS Tariff regulation Quality standards for drinking water Quality standards for wastewater treatment Defining public service obligations / social regulation Defining technical / industry and service standards Setting incentives for efficient use of water resources Setting incentives for efficient investment Promoting innovative technologies Promoting demand management Analysing water utilities investment plans / business plans Information and data gathering Monitoring of service delivery performance Licensing of water operators Supervision of contracts with utilities / private actors Supervising utilities financing activities Carrying management audits on utilities Customer engagement Consumer protection and dispute resolution 4

5 Structure of the OECD Survey Water regulator survey 1. Institutional setting 2. s and roles 3. organisation 4. mechanisms 5. Tools and mechanisms to ensure regulatory a) Legislative framework a) Objectives, perimeter / activities and functions a) Governance models a) Consultation with operators and consumers b) Independence b) Powers of the regulator b) Personnel b) Dispute resolution c) Co-ordination with other relevant parts of government c) Financial resources c) Impact analysis of regulatory decision d) Decision making process d) Measurement and reduction of administrative 5 burdens

6 30 Respondents Institutional Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 6

7 The reasons for their establishment Institutional Note: Over 29 answers, Belgium/Flanders did not answer Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 7

8 The regulators in the institutional landscape Institutional 8

9 Coordination mechanisms Institutional Note: Over 28 answers, Brazil and Chile did not answer Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 9

10 Status of the regulatory agency Institutional Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 10

11 Ensuring independence Institutional Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 11

12 Water specific and multi-sector regulators Institutional Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 12

13 Huge disparities in the industry structure Institutional Note: Over 29 answers, Australia New South Wales did not interpret properly the question Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 13

14 Institutional Core regulatory functions 14

15 Institutional Core regulatory powers 15

16 Institutional Number of employees * - Multi-sector regulators Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 16

17 Term of office of the agency head/board members Institutional Duration Cumulated length Note: Duration of the term of office was averaged for Australia/WA, Australia/NSW and Scotland based on the range provided. Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 17

18 Albania NSW* Victoria Flanders Bulgaria Brazil* England & Wales Kosovo Latvia* Malaysia Mozambiq ue Portugal* Scotland Ukraine* Maine Tennessee* Uruguay* Institutional Financial ressources 0,73 0,15 0,07 0,02 1,66 0,17 0,18 1,32 5,77 0,71 2,00 0,38 0,38 0,40 0,38 1,71 0,08 Share of the regulator s average annual operating budget in the total turnover of the regulated industry * - Multi-sector regulators which provided annual budget for the multi-sector activities (no breakdown for water activities) More than 70% of the budget comes from the government, 6 More than 70% of the budget comes from services to the regulated industry (e.g. levies, fees), 24 18

19 eporting requirements on the regulator s activities Institutional 26 regulators are required to report to the Legislature on their performance All 30 regulators face a legislative requirement to produce an annual report on their activities Legal requirement for 27 regulators to publish information related to the decisions taken by the regulator, their key operational characteristics and policies and their governance arrangements Note: Over 27 answers (Belgium/Flanders, Italy and Malaysia did not answer). Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 19

20 Uptake of regulatory instruments Institutional Source: OECD Survey on Applying Better Regulation in the Water Service Sector (2014) 20

21 Institutional Consultation with consumers Forms of public consultation routinely used by the regulator Issues for public consultation 21

22 Impact analysis of regulatory decisions Institutional Cost/benefit analysis is routinely used to justify regulatory decisions. Elements required as part of the impact analysis of regulatory decision - 18 are required to prepare an economic assessment of the costs and benefits to justify a regulatory decision - 7 do it in some cases - 5 regulators do not The extent to which impacts of new WSS regulation are analysed before being adopted when the regulator has a rule making activity is less clear. 22

23 JORDAN: Reducing regulatory risk through developing a high- water regulatory framework 23

24 Three complementary areas of action 1. Embed more systematically the instruments of good regulatory policy in the water sector to improve the efficiency and accountability of the regulatory framework for water. 2. Continue the reforms of the PMU: improve clarity on its roles and functions, align its resources with its core work and establish appropriate accountability mechanisms to enhance the credibility of the regulatory framework. 3. Continue the corporatisation efforts and strengthen the capacity & autonomy of water providers as they constitute the key pillars upon which the regulatory framework rests. 24

25 Continue current reforms of the PMU Ensure adequate implementation of the Rules of Procedure: they foresee a role for the PMU in: tariff regulation, monitoring of service delivery performance, analysis of business plans of utilities, information and data gathering - ST Address the uncertainties regarding PMU s roles & responsibilities (from various sources). Clarify the roles of various authorities and the coordination mechanisms - ST Ultimately, if a regulatory body is established, a founding legislation is needed - LT 25

26 Potential gaps: function of transparency through the publication of information on water operators ST Ensure separation within PMU between the team in charge of regulatory activities and those in charge of project development and PSP - ST Ensure that the resources available to the PMU are clear, secured over time and evolve with its mandate and responsibilities - ST => Build on current efforts and initiatives such as ISSP, the TF project & other donors support, as well as existing platforms such as the NER 26

27 Thank you Contact: Céline Kauffmann

28 Better regulatory outcomes Well designed rules and regulations that are efficient and effective Appropriate institutional frameworks and related governance arrangements Effective, consistent and fair operational processes and practices High and empowered institutional capacity and resources 28