HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCIES

Transcription

1 HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCIES 1) Inadequate legal framework for the regulatory agencies to function properly Improve the existing framework, e.g., better mechanisms for conflict resolution, issue of independence, etc. Government needs to identify and address the problem. Can help Government via TA

2 HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCY (cont d) 2) Inadequately defined roles of the regulators and scope of regulation (incl. Internationally recognized rules of engagement) Manual/guidelines that better define the roles and scope of regulation. Strengthen Government s sector policy formulation capacity. Government needs to have a clear strategy upfront. Each country different. TA support to Government Toolkit/best practices notes on regulation

3 HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCY (cont d) 3) Need for benchmarking but asymmetry of information. Larger countries with multiple service providers may consider establishing benchmarking info system at the central level, be it by the government, association of regulators, or association of service providers. Better definition of data presentation by service providers Indicators Regulatory accounting system Government may take initiative on benchmarking. Provide information May promote benchmarking. International benchmarking TA support to regulators/gov.

4 HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCY (cont d) 4) Need establish legitimacy and accountability of regulators vis-à-vis general public. Clear communication by the Government re. role of the regulators at the time of establishment. Reporting to the public re. performance of the regulated companies and the agency itself. Establishment of an effective mechanism for user participation. (e.g. OFWAT customer consultative committee Government s commitment to regulation and promotion of awareness. Media engagement Toolkit

5 HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCY (cont d) 5) Lack of Capacity Training (incl. Some operators) visit to or training by other reg. agencies, etc. Manual, guidelines Adequate equipments/physical space Financial autonomy important. Financing of these activities. Consultants Universities WBI/WB TA Toolkit

6 HOW TO STRENGTHEN REGULATORY FRAMEWORK/AGENCY (cont d) 6) Lack of independence and autonomy Need political will Financial autonomy Decision making autonomy Commitment to regulation. Promote independence, or at least certain autonomy.

7 PUBLIC-PRIVATE PRIVATE PARTNERSHIPS - PPPs How can they ensure sustainability? A few big players (2-5) Most large operations already privatized National operators do not venture out Adapt pre-qualification criteria to circumstance Develop franchising arrangements with local operators Organize a round table for smaller operators Restructure local operators to allow regional bids

8 PUBLIC-PRIVATE PRIVATE PARTNERSHIPS PPPs (cont d) Access to public financing Limited exchange of regional experience Need to build client commitment-ownership to PSP Allow private operators access to public financing (longer terms) Cross regional learning events Develop partnership building skills Philippine model (learning from Spain) Training on public communication

9 IMPLEMENTING EFFECTIVE PRICING POLICIES What do we mean by full cost recovery? Affordability Low income groups/social tariffs Tariff structure: - 1part 2 part - IBT - Single Rate Who sets tariff? - Owner vs. Regulator - Social obligations Good practice guidelines IBTs - Reduce numbers - Limit first block (e.g. 6) - Limit range of unit rates - Uniform tariff in long term Transparency in Pricing and Subsidies

10 IMPLEMENTING EFFECTIVE PRICING POLICIES (cont d) Communication Advocacy Cross Subsidy - geographic - customer types Relevance of marginal cost pricing Types of subsidies - Investment - Demand Pricing Pricing and Incentives - Efficiency oriented - Investment oriented Advocacy/Education Tools (e.g. Water Game) Communication

11 IMPLEMENTING EFFECTIVE PRICING POLICIES (cont d) Stranded/over-sized/ Inherited assets Un-metered customers Separation of water and wastewater components Pricing philosophy replaced by pricing adjustments in PSP Encourage metering (where cost effective) Transition arrangements

12 PROVISION OF SERVICES THROUGH MULTI-UTILITY UTILITY PROVIDERS Is this a way for the future? Assumptions: 1. Decentralized model- Local/Regional 2. Similar customer base What are the driving forces 1. Lack of billing and collection 2. Unused saving potential 3. Better access to financial market

13 PROVISION OF SERVICES THROUGH MULTI-UTILITY UTILITY PROVIDERS Is this a way for the future? 1. Weak Municipal Utilities Structures Single Utilities Strengthen communication between single utilities to coordinate activities Advice to develop better communication () 2. Lack of Homogeneity Integration to what extent Structure integration of some activities, example client services, financial management, IT, outsourcing Help to identify the saving potential() Common framework(gv)

14 PROVISION OF SERVICES THROUGH MULTI-UTILITY UTILITY PROVIDERS (cont d) 3. Ownership of activities 4 Access service to poor 5. Weaken incentive to efficient saving in each activity Dialogue Identify obstacles Incentive to be more efficient Cross-subsidies, transparent process Separate accounting, budgeting To identify the mechanisms to bundled the structure(pu/b), outsource to third parties (Pv/Ps) Advice to develop decision-making process(b), control(gv) Control (Gv)

15 COMMUNICATION Is there a better way to communicate water sector reforms to the public? Communications is not just a way to convince people that people that your project is right Must realize that the process of reform is always political and that your project is not the only one shaping public opinion Must think about communications as a consultative process that feeds into project design More advocacy materials for task managers to promote the value-added of the cost and benefits of strategic communications, including empirical data on potential time, cost savings to clients Facilitate implementation Advocate communication programs in projects Global Advocacy: must present an argument

16 COMMUNICATION (cont d) Government takes a passive approach to communications Too little too late: capture or be captured Case studies which point out risks of not doing it, along with testimonials Global advocacy Must respond (not just to northern media) Include comm. in AAA work as part of CAS Work with media (not the enemy) Commit to capacity building Change of culture Advocate communication is done early so environment is conducive to change Must be global advocate and create dialogue with opposition

17 WASTEWATER TREATMENT OPTIONS Economic and Environmental Approaches Ms. Sheela Nair Safuil Ahmed Willem Ankersmit Rang Arulgnanendran Kanthan Shankar

18 WASTEWATER TREATMENT OPTIONS Economic and Environmental Approaches Is there a future for separate sanitary sewer systems in arid areas? Research the basic questions and develop rules of thumb Put this option into feasibility TOR Compile and disseminate existing studies Commission pilots NGOs Research Institutions /WSP

19 WASTEWATER TREATMENT OPTIONS Economic and Environmental Approaches How can we finance the wastewater system? Who should pay for what? Health externalities Income discrimination Capturing economies of scale Tariff complications - Volume - CIP CIP Financing /IFIs

20 WASTEWATER TREATMENT OPTIONS Economic and Environmental Approaches Waste-water reuse for agriforesting and related. Why doesn t it go forward faster? Urban Rural divide Cultural bias Awareness awareness Cost Lack of scientific knowledge and consistency of message Develop incentives EPA and Forestry Departments species research and extension make demands /IFIs

21 WASTEWATER TREATMENT OPTIONS Economic and Environmental Approaches Small decentralized collection and treatment vs. large centralized schemes. When do we use the former and when do we use the latter? Geography Bulk Buyers Re-sell Density Engineering/feasibility /IFIs