Is Public Private Partnership on Urban Water a Panacea to be
replicated or a Blind-ally ?
Borama Case study
SHABA (Water Company)
Major Concepts of this presentation
• Examine whether it portrays a replicable success story.
• What factors have contributed to the success• To what extent it can be replicated to other
urban centers in Somaliland.• What are the challenges and the lessons
learned
Why PPP?
• In 2000 Borama experienced very serious shortage of water
• This crises drew the attention of various stakeholders (Community leaders. Business community, civil society organizations, local and regional authorities
• Pioneered by Amoud University Borama Citizens workshop was organized on August 2000
Workshop Objectives
• To identify Borama town water problemsTo identify Borama town water problems
• To find solutions for the problems To find solutions for the problems identifiedidentified
• To work out immediate and long-term plan To work out immediate and long-term plan of action to alleviate the chronic water of action to alleviate the chronic water shortage in Borama.shortage in Borama.
Outcome of the Citizens Outcome of the Citizens workshopworkshop
• Borama water system has infrastructural Borama water system has infrastructural limitation, there is a need for expansion.limitation, there is a need for expansion.
• lack of all stakeholders’ involvement and lack of all stakeholders’ involvement and ownership had a consequential result of ownership had a consequential result of poor management and sustainability poor management and sustainability problemsproblems..
Pre-PPP activities
• Responding to the workshop recommendations Responding to the workshop recommendations UNICEF with USAID fund made renovation and UNICEF with USAID fund made renovation and extension of the water system.extension of the water system.
• Efforts were made to improve management of water Efforts were made to improve management of water Agency ( Public Authority)Agency ( Public Authority)
• Borama water Board was established to oversee the Borama water Board was established to oversee the Water Agency.Water Agency.
• The board failed to make the required improvementThe board failed to make the required improvement
Factors that contributed to the PPP acceptance
• Failure of the community oversight trigged the PPP option• Ministry of Water and UNICEF was instrumental for the
sensitization of PPP.• Two workshops on the PPP funded by UINCEF and facilitated by
MOW&MR had a great influence on most of the stakeholders including community leaders in general and business community in particular
• Some of the business community showed their willingness to be involved and go to partnership with the public in the water sector
Establishment of the Private Company
• Participatory and transparent : All stakeholder were invited to a public meeting and acquainted them with the selection process
• Application of interest were requested• 73 members submitted their application of interest at
the given deadline.• 19 applicants responded timely and deposited the
required amount.• The new company SHABA was established.
Before PPP
Involving Partnership
Required Situation
Why consider success (Conti..)• Water availability, for 24 hours• Increased household connections from 250 to 6947
( Nov.2011)• Transparent management and financial system (BIMS
and AIMS with Support of Info Africa)• Sustainability in terms of operation ,repairs and
maintenance assured.• Additional revenue for Municipality 3% of sales.• Affordable prices for different levels
Why consider success
• Increased coverage and water borne diseases Increased coverage and water borne diseases drastically reduced ( Previously (2) outbreak of drastically reduced ( Previously (2) outbreak of Diarrhea per yearDiarrhea per year
• Improved services ( timely respond to complains, Improved services ( timely respond to complains, breakdowns. etc)breakdowns. etc)
• Concern for social responsibility ,support to Concern for social responsibility ,support to education(monthly contribution to Amoud education(monthly contribution to Amoud University)University)
Other major related Benefits• Increased access to water, especially to poor
communities.• More willingness from private sector to WATSAN( A
new PPP on slaughter management established in Dec.2009)
• There is also a local initiative to establish PPP in Electricity.
• Effective operation and maintenance of water supply Equipments
Before PPP
Indications of System Failure
What were the indicators of system failures?
Table: 1 Efficiency of the major towns in Somaliland and Somalia 2002 ( Source Study funded by EU-UNICEF by Hydroconseil)
Baidio Berbera Borama Burao Hargeisa Bossaso
Technical Efficiency
% NA 83% 40% 76% 67% 81%
Billing efficiency
% NA 83% 75% NA 100% 106%
Technical X billing
% NA 61% 30% 76% 67% 81%
Collection efficiency
% NA 56% 80% NA 80% 111%
Unaccounted for water
% NA 61% 76% NA 47% 5%
Number of staff
Nr 49 55 44 45 272 14
Number of staff per 1000 connections
Nr 153.1 71.2 338.5 75 37.6 12.7
Table : 2 System failure - Distribution and coverage( Source EU-UNICEF study by Hydroconseil) 2002
Coverage Berbera Borama Burao Hargeisa Bossaso Daidoa Total
Average
Monthly distribution
M3
30,000 6,000 14,364 120,000 19,430 ?
Per capital L/day. capital 40 2.4 1.9 11.4 6.5 ? 12
Kiosks No. 28 32 0 504 7 9 680
Kiosks Consumption
M3/month.
3,500 9,000 8,667 N/a 1,617 3,720 26,503
House Connections No. 773 130 600 7,241 1,100 320 10,164
HC/1,000 inhabitants No. 30.9 1.5 2.4 20.7 11.0 4.0 13
Figure1: System Failure : Connections per 1000 population
(Source EU-UNICEF study by Hydroconseil 2002)
Borama Water Distribution 2002 source hydroconseil
After PPP
Indicators of Success
Table: 5 Performance indicators of SHABA water company (Borama)Compared with Water Agency(before PPP)
2002 2008 2009 2010 Remarks
Technical efficiency 40% 90% 91.79% 90%
Billing Efficiency 75% 100% 100% 100%
Technical X Billing efficiency 30% 90% 91.72% 90%
Collection efficiency 80% 92% 92.3% 97%
Number of staff 44 42 42 45
House hold Connection 130 4320 5072 5998
Staff per 1000 house hold connections 338.5 9.7 8.2 7.5
Household connections per 1000 inhabitants
1.5 48 52.4 59.9 Assumption (100,000)
Yearly operational ration 0.769 0.83 0.83 Operation/ Revenue
Figure1: Connections per 1000 population (Source Hydroconseil 2002)
Sales and Loss 2003 and 2008
Motors of change• Aspiration for change: The desire to reverse the
negative situation of Public Management of water.• Partnership• Supportive National water policy• Committed District authorities( Social problems on
Borehole sites) • Supportive Water Agency Manager and staff • Donor support• Participatory approach• Leadership
What is to be replicated
• Participatory approach ( Stakeholders workshops)
• Sensitization workshops
• Company formation
What factors can support What factors can support replicationreplication
• Supportive national water policy in place.Supportive national water policy in place.
• Donor support is available.Donor support is available.
• Aspiration for change.Aspiration for change.
• Commitment of local and Regional Commitment of local and Regional authorities?authorities?
• Leadership ?Leadership ?
Will this success stalland end in Blind-ally?
• Inadequate investment of hardware by the public ( Boreholes, Water aquifer development) can hamper the success .
• Insufficient capacity building to the public partners.
• Lack of long term water resource plan.
Weaknesses and threats
• Dependence on external support ( Sustainability Issue)
• No risk sharing mechanism was put in place.• It has no pro-poor property(Lease agreement)• Political risks• Security gaps• Public ownership ?
Lessons learned• PPP improves service delivery (efficiently and
effectively)• Ensures the sustainability of the services and
facilities (operations, repairs, maintenance)• In the present situation donor support is required
and resources for future investment to be assured before starting PPP (lease)
• Tariff setting and adjustment formula to be specified in the contract.
Recommendations for future PPPs
• Policy and regulatory framework is to be developed.• Somaliland context should be kept in mind• Empowerment of planning and oversight capacity of
public partners• Lease contracts might not be the best option where
public has not the capacity for capital investment or external investment is not assured.
• Donor support will be crucial in promoting PPPs with pro-poor property particularly in rural water.
THANK YOU