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Toolkit: Approaches to Private Participation in Water Services

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1 Toolkit: Approaches to Private Participation in Water Services
Module 3 Involving Stakeholders in the design of the Arrangement.

2 Introduction: Navigating through this E-Learning Module
E-learning design:

3 Elements of the Toolkit
1 ConsideringPrivate Participation 9 Selecting an Operator 2 Planning the Process TOOLKIT Appendix A Examples of PP Arrangements 8 Designing Legal Instruments 3 Involving Stakeholders Appendix B Policy Simulation Model Elements of the Toolkit: Toolkit is developed in ten main sections, two Appendices and Supplementary Material: Overview: Provides an overview of the approach taken in developing the Toolkit, discusses the key issues of providing water and sanitation services, the definition of basic principles and provides tools and options for planning and design of reforms to resolve the situation 1 Considering private participation: A review of the key issues that governments can resolve in order to introduce private participation, including resolution of policy problems, effects of privatization, making privatization work, the various private participation models, and how the Toolkit approach works. 2 Planning the process of introducing private participation: A four step process for developing policy, designing details of the arrangement, selecting the operator and managing the arrangements are reviewed. Key elements of the overall design such as stakeholder consultation, government institutions to manage the arrangement and key analytic and advisory work to support the arrangement are discussed. 3 Involving Stakeholders in the design of the arrangement: Discussion on ways of identifying and involving stakeholders in the design of the arrangements and of distributing the benefits and costs of private participation so as to increase support and long term sustainability. 4 Setting upstream policy: This considers some of the key reform choices for the water sector upstream of the design of the private participation arrangement, such as the allocation of responsibilities among different tiers of government, definition of the market structure for the water sector (including appropriate scale and scope for the water utilities) and establishing policies and rules governing competition. 5 Setting service standards, tariffs, subsidies, and financial arrangements: A section reviewing the key issues related to setting targets relating to coverage and quality; the implications of those targets for the cost of service; options for supplementing tariff revenue with subsidies; and some implications for design of the arrangement and its financing. 6 Allocating responsibilities and risks: Provides advice on the identification, assessment and allocation of risks and responsibilities among customers, the operator, and the government and how to design tariff-adjustment and other rules to achieve the desired allocation. 7 Developing institutions to manage the relationship: The choice and design of institutions—including courts, arbitration panels, independent experts, and regulatory agencies—that will interpret and apply the rules over the life of the arrangements. 8 Designing legal instruments for the arrangement: This section considers how the chosen arrangement can be embodied in legally effective documents (such as laws, contracts and licenses). It also describes how the government can retain legal power to implement the arrangement, how to check on potential constraints, and how to design legal mechanisms to enforce obligations and ensure successful provision of service. 9 Selecting the Operator: A review of the key issues to be addressed and steps involved in selecting an operator governments can use to select the operator. This includes detailed discussion on selection methods, selection criteria, managing the bidding process and some key bidding issues. Additional Toolkit material The Toolkit includes other supplementary material: Appendix A Examples of Private Participation Arrangements The Toolkit includes sixteen examples of arrangement designs in developed and developing countries. These highlight the specific design aspects following the sections in the Toolkit. Appendix B The Policy simulation model This is an Excel based policy simulation model. It illustrates issues discussed, suggests outputs that government’s modelers might produce and illustrates possible modeling approaches. It shows how the three key issues can be integrated: Stakeholder costs and benefits (Chapter 3) Setting tariffs, subsidies and coverage (Chapter 5) Allocating risk (Chapter 6) 7 Developing Institutions 4 Setting Upstream Policy 6 Responsibilities & Risks 5 Standards, Tariffs, Subsidy, Financials Additional Material CD-ROM

4 General Outline of Toolkit
Module 3 1 ConsideringPrivate Participation 9 Selecting an Operator 2 Planning the Process Module 3 Involving Stakeholders in the Design of the Arrangement TOOLKIT Appendix A Examples of PP Arrangements 8 Designing Legal Instruments 3 Involving Stakeholders Appendix B Policy Simulation Model This presentation reviews Module 3 of the Toolkit ‘Approaches to Water Privatization’. Module 6, one of 10 related sections of the Toolkit, covers issues of Involving Stakeholders in the Design of the Arrangement in a Private Participation Arrangement Elements of the Toolkit: Toolkit is developed in ten main sections, two Appendices and Supplementary Material: Overview: Provides an overview of the approach taken in developing the Toolkit, discusses the key issues of providing water and sanitation services, the definition of basic principles and provides tools and options for planning and design of reforms to resolve the situation 1 Considering private participation: A review of the key issues that governments can resolve in order to introduce private participation, including resolution of policy problems, effects of privatization, making privatization work, the various private participation models, and how the Toolkit approach works. 2 Planning the process of introducing private participation: A four step process for developing policy, designing details of the arrangement, selecting the operator and managing the arrangements are reviewed. Key elements of the overall design such as stakeholder consultation, government institutions to manage the arrangement and key analytic and advisory work to support the arrangement are discussed. 3 Involving Stakeholders in the design of the arrangement: Discussion on ways of identifying and involving stakeholders in the design of the arrangements and of distributing the benefits and costs of private participation so as to increase support and long term sustainability. 4 Setting upstream policy: This considers some of the key reform choices for the water sector upstream of the design of the private participation arrangement, such as the allocation of responsibilities among different tiers of government, definition of the market structure for the water sector (including appropriate scale and scope for the water utilities) and establishing policies and rules governing competition. 5 Setting service standards, tariffs, subsidies, and financial arrangements: A section reviewing the key issues related to setting targets relating to coverage and quality; the implications of those targets for the cost of service; options for supplementing tariff revenue with subsidies; and some implications for design of the arrangement and its financing. 6 Allocating responsibilities and risks: Provides advice on the identification, assessment and allocation of risks and responsibilities among customers, the operator, and the government and how to design tariff-adjustment and other rules to achieve the desired allocation. 7 Developing institutions to manage the relationship: The choice and design of institutions—including courts, arbitration panels, independent experts, and regulatory agencies—that will interpret and apply the rules over the life of the arrangements. 8 Designing legal instruments for the arrangement: This section considers how the chosen arrangement can be embodied in legally effective documents (such as laws, contracts and licenses). It also describes how the government can retain legal power to implement the arrangement, how to check on potential constraints, and how to design legal mechanisms to enforce obligations and ensure successful provision of service. 9 Selecting the Operator: A review of the key issues to be addressed and steps involved in selecting an operator governments can use to select the operator. This includes detailed discussion on selection methods, selection criteria, managing the bidding process and some key bidding issues. Additional Toolkit material The Toolkit includes other supplementary material: Appendix A Examples of Private Participation Arrangements The Toolkit includes sixteen examples of arrangement designs in developed and developing countries. These highlight the specific design aspects following the sections in the Toolkit. Appendix B The Policy simulation model This is an Excel based policy simulation model. It illustrates issues discussed, suggests outputs that government’s modelers might produce and illustrates possible modeling approaches. It shows how the three key issues can be integrated: Stakeholder costs and benefits (Chapter 3) Setting tariffs, subsidies and coverage (Chapter 5) Allocating risk (Chapter 6) 7 Developing Institutions 4 Setting Upstream Policy 6 Responsibilities & Risks 5 Setting Service Standards, Tariffs, Subsidies & Financial Arrangements Additional Material CD-ROM

5 Module 3 - What will we learn?
How will we identify important Stakeholders? What is the best strategy for involving Stakeholders? By the end of this presentation we should have achieved understanding of the following: How should we deal with different Stakeholder groups? Who will ‘win’ or ‘lose’ under the Arrangement?

6 Module 3 Involving Stakeholders in Design
In this Module we look at the issues that Governments need to address in order to involve Stakeholders in Private Particpation Arrangement design. Government needs to consider the interests of the different stakeholders Government will benefit from engaging with the Stakeholders: through better Arrangement design, through the fact that Stakeholders have participated in the design, and their views have been sought and understood. IDENTIFY Stakeholders DEVELOP Communication Strategy INTERACT with Stakeholders Satisfactory outcome THE ARRANGEMENT

7 Module 3 Involving Stakeholders in Design
“In designing the Arrangements the Government needs to consider the interests of different Stakeholders”

8 Module 3 Involving Stakeholders in Design
“In designing the Arrangements the Government needs to consider the interests of different Stakeholders” Some Examples: What level of service do people want? How much are people willing to pay for new connections? Given different costs, what type of connections do they want?

9 Module 3 Involving Stakeholders in Design
“Engaging with Stakeholders offers two additional advantages………” Analysis based on the consultation may show Government better ways to design, with a more equitable distribution of costs and benefits Perhaps too many costs imposed on poorer groups the Government wants to protect Perhaps too many costs imposed on groups that could block the reforms Not all groups will benefit as well as they hope for. Their support is more likely if they feel that the design and implementation of the Arrangement is ‘Legitimate’. One way is if they see through the consultation process that all is transparent and fair, and peole understand the objectives of the reform Note: Legitimacy is an issue covered in Modules 7 (Tariff resets) and 9 (Contractor selection) Key RISKS related to these Responsibilities, and how can they be defined? We look at ways of determining the best ALLOCATION of Responsibilities and Risks between the operator and the contracting authority. Next we look at how DESIGNING rules and mechanisms can ensure that the allocations of Responsibility and Risk are carried out effectively. Finally we consider EXAMPLES of how we can Allocate Risks and Responsibilities under different models of PP arrangements.

10 Module 3 Involving Stakeholders in Design
Identifying Stakeholders Module 3 Involving Stakeholders in Design “The first step is to identify important Stakeholders” Examples of some potential Stakeholders: Consumers NGO’s Workers Private Firms and Financiers Alternative Providers Opinion Leaders and other Politicians Media Any group that asserts an interest can be a Stakeholder, but only some groups will do so. Other groups that might be overlooked will need to be sought out, including: Unconnected poor, women, alternative providers ( such as standpipe operators) Women’s groups and community organizations may open the path to other consumers with special needs International specialist water operators are obvious contacts, but local financiers, firms and agencies should be considered A communications needs assessment may be required to further identify the stakeholders It may help to extend Government consideration beyond the obvious contacts It can help to identify prevailing concerns about privatization and water services, and possibly offer ideas on potential ways forward IDENTIFY Stakeholders IDENTIFY Stakeholders DEVELOP Communication Strategy DEVELOP Communication Strategy INTERACT with Stakeholders INTERACT with Stakeholders Satisfactory outcome THE ARRANGEMENT THE ARRANGEMENT

11 Module 3 Involving Stakeholders in Design
Identifying Stakeholders Module 3 Involving Stakeholders in Design “The first step is to identify important Stakeholders” Examples of some potential Stakeholders: Consumers NGO’s Workers Private Firms and Financiers Alternative Providers Opinion Leaders and other Politicians Media Any group that asserts an interest can be a Stakeholder, but only some groups will do so. Other groups that might be overlooked will need to be sought out, including: Unconnected poor, women, alternative providers ( such as standpipe operators) Women’s groups and community organizations may open the path to other consumers with special needs International specialist water operators are obvious contacts, but local financiers, firms and agencies should be considered A communications needs assessment may be required to further identify the stakeholders It may help to extend Government consideration beyond the obvious contacts It can help to identify prevailing concerns about privatization and water services, and possibly offer ideas on potential ways forward IDENTIFY Stakeholders IDENTIFY Stakeholders “Can more Consultation help?” DEVELOP Communication Strategy DEVELOP Communication Strategy Examples – more detail La Paz & Cochabamba INTERACT with Stakeholders Stakeholder Identification & Composition Satisfactory outcome THE ARRANGEMENT

12 Module 3 Involving Stakeholders in Design
Developing Strategy for Involving Stakeholders “Consultation may show better ways to design, and get support” IDENTIFY Stakeholders DEVELOP Communication Strategy DEVELOP Communication Strategy INTERACT with Stakeholders Satisfactory outcome THE ARRANGEMENT

13 Developing Strategy for Involving Stakeholders
“Governments need to think about the types of interaction, and expertize needed” Types of Interaction with Stakeholders Acquiring expertise for the engagement Many ways to involve stakeholders, depends on objectives, type of Arrangement and other factors 5 main types of interaction: Collecting and providing info, consulting, deciding and acting together Several different ways of communicating with shareholders, according to situation

14 Developing Strategy for Involving Stakeholders
“Governments need to think about the types of interaction, and expertize needed” Types of Interaction with Stakeholders Acquiring expertise for the engagement Many ways to involve stakeholders, depends on objectives, type of Arrangement and other factors 5 main types of interaction: Collecting and providing info, consulting, deciding and acting together Several different ways of communicating with shareholders, according to situation 5 Main Types of Interaction 4 Ways of Communicating

15 Developing Strategy for Involving Stakeholders
“Governments need to think about the ……………….. expertize needed” DIFFERENT SKILLS: Community Development Specialists can help engage poor communities Survey Experts gather facts in a quantifiable way Communications Experts help to publicize and explain proposals Depending on project size, several specialists may be employed COMMUNICATIONS MANAGER: Acts as focal point Needs to be well briefed by the Team Ensures effective communication about objectives and Government policy Alerts Team to potential problems or benefits of the proposed Arrangement Ensures sequence and method of communications Types of Interaction with Stakeholders Acquiring expertise for the engagement Specific skill sets needed, that may not exist within Government Different kinds of interaction needs depend on type and scale of the project Designating a communications manager as focal point is of advantage

16 Interacting with Stakeholders
IDENTIFY Stakeholders The appropriate approach with each group of Stakeholders depends on a number of variables, including: The Group’s capacity Understanding of Private Participation The ways that social, political and economic climate affect Group DEVELOP Communication Strategy DEVELOP Communication Strategy INTERACT with Stakeholders INTERACT with Stakeholders Satisfactory outcome THE ARRANGEMENT

17 Interacting with Stakeholders
“The appropriate approach with each group of Stakeholders must be varied” Some potential Stakeholder Interactions: Customers NGO’s Workers Private Firms and Financiers Alternative Providers Opinion Leaders and other Politicians Media

18 Interacting with Stakeholders
“The appropriate approach with each group of Stakeholders must be varied” Some potential Stakeholder Interactions: Customers NGO’s Workers Private Firms and Financiers Alternative Providers Opinion Leaders and other Politicians Media

19 Involving Stakeholders in Design
Government can use the information from Stakeholders to make estimates of the effects of Arrangements on the different groups. Whilst net benefits may be expected, it is necessary to review the effect on each of the different groups, and balance the interests of the ‘winners’ and ‘losers’ in the final design It is possible to establish a quantitative ‘policy model’ approach to help in this task. IDENTIFY Stakeholders DEVELOP Communication Strategy INTERACT with Stakeholders THE ARRANGEMENT Satisfactory outcome Satisfactory outcome THE ARRANGEMENT

20 Winners & Losers under different options
“Winners & losers can be identified and gains & losses estimated. If necessary the Arrangement can be redesigned to take account of this.” Introduction of Private Participation reform is on the basis that there will be net benefits to the community. This means that benefits for the ‘winners’ outweigh costs borne by the ‘losers’. In principle, it may be possible to distribute benefits so that no group loses. In practice, Governments may wish to support one or more groups such as the disadvantaged poor or politically influential groups (water workers, major water users etc.) Example: Unconnected poor expected to gain from service expansion. Existing customers might be expected to pay increased tariff and, unless services improve, they will ‘lose’. Government needs to quantify the situation, and use the information to adjust the design as necessary. In this case, the redesign could include a subsidy to the poor. “A quantitative approach may be used to evaluate the social and economic impact of the Arrangement, and help to simulate the potential effects ”

21 Winners & Losers - Policy Simulation
Step 1 - Identify current parameters for various Household/Stakeholder types. Might include: Middle class household / registered pipe connection Low income household / registered pipe connection Low income household / illegal connection Unconnected household / water standpipe Workers Taxpayers funding any subsidies Other important groups Winners & Losers - Policy Simulation Step 2 – Model Service and Tariff Scenarios. For each Scenario the model predicts net impact on the welfare of each typical Household or Stakeholder types Estimates additional value placed on each service Subtracts any increase in bills from the Scenario’s tariff increases “Social impact modeling can establish the different stakeholders. The Toolkit Policy Simulation Model quantifies the effects with different scenarios” Step 3 – Evaluate change in welfare across the different Groups The Toolkit Policy Simulation Model uses a simplified and stylized form of this analysis. It considers: The currently connected The currently unconnected Assumes: How much the unconnected have to pay for their water Willingness to pay for better services The model predicts the effects of reform on both Groups Household Survey Current Service Willingness to pay Income Service Scenarios Tariff Scenarios Typical households/stakeholders Predicted change in welfare

22 Reviewing Module 3 ‘The Module has looked at the whole range of Stakeholder communication issues in Arrangement design………….’ The Arrangement Identify Stakeholders Develop Communication Strategy Interact with Stakeholders Satisfactory outcome

23 More Information: Module 3
Finally, this Checklist gives a useful reminder of the detailed issues to be considered in this process, of involving stakeholders.

24 Supporting Material The Toolkit Financial Model
Toolkit Case Study material Toolkit Website: For comments or further details contact Cledan Mandri Perrott at There are some supplementary materials that will help you understand this further. The toolkit includes a spreadsheet based financial Policy Simulation model that will assist in balancing tariffs, subsidies and coverage targets as covered by Module 5 [ as well as integrating with some of the other key financial issues covered in other Modules] There are 16 case studies, and some of these have been referred to in this module. The full toolkit can be read or downloaded from the website, and questions or comments made to the task manager.

25 Toolkit: Module 3 End of Module END OF PRESENTATION

26 Toolkit: Module 3 Return to Start END OF PRESENTATION

27 Toolkit: Module 3 DO NOT MOVE or ERASE THE FOLLOWING SLIDES
END OF PRESENTATION

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29 Identifying Stakeholders
Back to Module “Could more consultation have helped ?” In several cases it has become apparent that more consultation would have resulted in a better and more effective Arrangement design. In some cases the lack of correct information or lack of stakeholder involvement results in the Arrangement not working at all: La Paz – El Alto Concession: Situation: Revenues for the increased expansion were too low, as demand in new areas was not as high as predicted. Result: Government requested cancellation Cochabamba Concession: Situation: In addition to technical problems, several groups with different, and important, concerns did not feel that their interests were being taken into account. There was serious civil unrest. Result: As a result of the political unrest the Arrangement was a failure, and unworkable IDENTIFY Stakeholders IDENTIFY Stakeholders DEVELOP Communication Strategy DEVELOP Communication Strategy INTERACT with Stakeholders INTERACT with Stakeholders Satisfactory outcome THE ARRANGEMENT THE ARRANGEMENT

30 Box 3.1 Could consultation have helped? EXAMPLES: La Paz & Cochabamba
Back to Module Source: Nickson and Vargas 2002.

31 STAKEHOLDER IDENTIFICATION & COMPOSITION
Back to Module

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33 5 types of Interaction with Stakeholders
Back to Module

34 4 ways of Communicating with Stakeholders
Back to Module

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36 Interacting with Stakeholders - Customers
Back to Module “The most important group are customers or potential customers” It is important to realize the diverse nature of this group, and the diversity of views. However, all groups are interested in levels of service and how much they pay. Basic information needed: Where customers are located, including informal settlements. How people get water and waste services (including connections) Typical household sizes and numbers using a connection Household incomes, and stability, including seasonal variation Volume and variations of water consumption What customers pay, as well as additional costs (pumps, tanks or time spent fetching water) Special concerns related to women's roles in water services WHAT IS WANTED? The main issue is to get an understanding of what customers and potential customers want and how much they are prepared to pay for it Which improvements have highest priority How important are different types of improvement? Which are critical and which can wait Which customers value new connections most? Customer surveys are useful to gather this information. Focus groups and community organizations can also be helpful

37 Interacting with Stakeholders - Customers
Back to Module WILLINGNESS TO PAY There are two commonly used techniques for estimating willingness to pay. Both involve conducting customer surveys. The Revealed Preference method is designed to estimate what customers currently pay for their existing service as an indicator of what they would be prepared to pay for improved services. Stated Preference methods use carefully designed questions to get consumers to reveal what they would be willing to pay for a service. “The most important group are customers or potential customers” It is important to realize the diverse nature of this group, and the diversity of views. However, all groups are interested in levels of service and how much they pay. Basic information needed: Where customers are located, including informal settlements. How people get water and waste services (including connections) Typical household sizes and numbers using a connection Household incomes, and stability, including seasonal variation Volume and variations of water consumption What customers pay, as well as additional costs (pumps, tanks or time spent fetching water) Special concerns related to women's roles in water services

38 Interacting with Stakeholders - Customers
Back to Module “The most important group are customers or potential customers” It is important to realize the diverse nature of this group, and the diversity of views. However, all groups are interested in levels of service and how much they pay. Basic information needed: Where customers are located, including informal settlements. How people get water and waste services (including connections) Typical household sizes and numbers using a connection Household incomes, and stability, including seasonal variation Volume and variations of water consumption What customers pay, as well as additional costs (pumps, tanks or time spent fetching water) Special concerns related to women's roles in water services Example: Kathmandu ‘Wrong Ideas of Customer Needs’ Willingness to Pay: 2 Techniques

39 Willingness to Pay: 2 Techniques
Back to Module “The most important group are customers or potential customers”

40 “Kathmandu - a case of wrong ideas about what customers wanted”
Involving customers Back to Module “Kathmandu - a case of wrong ideas about what customers wanted” The Module starts with a section ANALYZING key issues related to provision of water services: Key areas of RESPONSIBILITY and how can they be defined?

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42 Interacting with Stakeholders – NGO’s
Back to Module “NGO’s and other community based organizations should not be treated as a single group. They represent different stakeholders and interests, and should be treated accordingly ” NGO’s and community based associations can have various functions: Act as conduits for effective dialogue with customers Examples: neighborhood organizations; women’s rights groups Act as watchdog, or even provide services themselves Example: Cartagena Creation of NGO networks can help interaction between different groups and Government Represent issues, rather than customers. There is a need to show how these issues taken into account in Arrangement design Example: environmental groups. Some NGO’s are opposed to private firms. Need to communicate the likely benefits of the Arrangement

43 Interacting with Stakeholders – NGO’s
Back to Module “NGO’s and other community based organizations should not be treated as a single group. They represent different stakeholders and interests, and should be treated accordingly ” NGO’s and community based associations can have various functions: Act as conduits for effective dialogue with customers Examples: neighborhood organizations; women’s rights groups Act as watchdog, or even provide services themselves Example: Cartagena Creation of NGO networks can help interaction between different groups and Government Represent issues, rather than customers. There is a need to show how these issues taken into account in Arrangement design Example: environmental groups. Some NGO’s are opposed to private firms. Need to communicate the likely benefits of the Arrangement Example: NGOs in Cartagena, Colombia

44 Involving NGO’s Back to Module

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46 Interacting with Stakeholders – Workers
Back to Module Consulting, or making joint decisions, on issues affecting staff , including: Pension rights and other entitlements The operator’s flexibility to reduce staff numbers Ways of increasing labor productivity, such as the introduction of more flexible work practices and performance-based pay Additional training and other resources (such as safety equipment) for workers Help for workers who lose their job to find new jobs or start new businesses “Private participation is often seen as a threat to Workers since there is often overstaffing of utilities in developing countries, for reasons of patronage or job creation” Options for consulting with workers and unions include: Basic information needed: Sharing information and having frank discussions of the problems the utility is having and the areas in which it is falling short of its mandate to provide good quality services to all the Seeking views from staff and unions about ways in which the utility can be improved, particularly concerning corruption and patronage. Helping staff representatives visit other utilities with private participation and talk to their counterparts there. Consulting, or making joint decisions, on issues affecting staff

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48 Stakeholders: Private Firms & Financiers
Back to Module “Interaction with Private Operators needs to preserve transparency whilst eliciting their input on the attractiveness of the Arrangement design ” Private Operators: this is dealt with in more detail in Module 9 Example: Dar as Salaam affermage, Tanzania, illustrates the importance of this. Two out of three qualified bidders refused to bid, because of Government insistence on contract detail. This caused major delay to setting up an Arrangement. Lenders & Investors: Useful for Government to open dialogue to ensure financial institutions are involved at an early stage, to reduce later delays Local Consulting and Construction companies: It is desirable to give these firms a chance to participate, and to take account of their views in the design of the Arranements

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50 Stakeholders: Alternative Providers
Back to Module “Alternative providers need to be involved. They may feel that they will lose their livelihood under new arrangements” Alternative providers carry out services not provided by the formal utilities, and these can include water vendors and cesspit emptiers. These providers may fill a significant amount of the existing service needs: Generally demand for services is so extensive that alternative providers will still have to service unfulfilled demand, even after the Private Participation reforms introduced. Consultation with alternative providers can provide a compromise between them and the formal utility Although alternative providers may lose some business, they may benefit from legal recognition, and arrangements to receive wholesale water supplies (e.g. bulk water) on a more economic basis Alternative providers may be used to extend service to other poorly served areas

51 Stakeholders: Alternative Providers
Back to Module “Alternative providers need to be involved. They may feel that they will lose their livelihood under new arrangements” Alternative providers carry out services not provided by the formal utilities, and these can include water vendors and cesspit emptiers. These providers may fill a significant amount of the existing service needs. Generally demand for services is so extensive that alternative providers will still have to service unfulfilled demand, even after the Private Participation reforms introduced. Consultation with alternative providers can provide a compromise between them and the formal utility Although alternative providers may lose some business, they may benefit from legal recognition, and arrangements to receive wholesale water supplies (e.g. bulk water) on a more economic basis Alternative providers may be used to extend service to other poorly served areas Alternative Providers: Teschie Tankers, Ghana

52 Stakeholders: Alternative Providers
Back to Module “Accra, Ghana provides an example where involvement of alternative providers has provided benefits to customers, utilities and the providers themselves”

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54 Stakeholders: Other Politicians
Back to Module “Government may have to consult with other parts of Government ” An example of this is when consultation is needed at local Government level, when the Arrangement designed at State level An initial scoping exercise to determine key players (including those who may assume office later) is beneficial Awareness of the Arrangement, and stakeholder ‘buy-in’, may reduce potential political challenges to the legitimacy of the Arrangement

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56 Stakeholders: The Media
Back to Module “Often the media are the primary vehicle through which people obtain information about reform of water services ” Government information may be suitable for legal purposes, but may need help to present in a form suitable for consumers. The Media may have to work hard to understand, and may get it wrong! Lack of information is often seen as conspiracy or corruption An effective engagement with the Media will help to widen understanding, and Government needs to know: Do the majority of people have access to the Media? Do certain types of Media reach more people (Example: does television or radio have the bigger audience? Which Media are the most trusted and most influential? “The Media have little understanding of water services and Private Participation. The Reform Leader needs to ensure that they get adequate, understandable and updated information ”

57 Toolkit: Module 3 DO NOT MOVE or ERASE THE PREVIOUS SLIDES AFTER “END” OF MODULE END OF PRESENTATION


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