Prior to the sector reforms of 1994, the Zambian water sector was characterized by lack of guiding policy, very low cost recovery, poor human resource both in terms of quality and quantity, and little or no investment for network expansion. Lack of clearly defined roles and jurisdictional responsibilities led to both policy gaps and duplication of efforts in the water sector system.
The Government has decided to reform and regulate water sector. To separate regulatory and executive functions within the water supply and sanitation sector, the National Water Supply and Sanitation Council (NWASCO) was established as an independent regulator to implement a new water policy and a new Water Supply and Sanitation Act (of 1997). Now, the NWASCO acts as agent for attaining the main water policy principles.
The case discusses institutional arrangements of the NWASCO, its inspectors, voluntary water watch group initiatives. It also summarizes tools used for regulation including licensing, information analysis, subsidies, benchmarking and standard setting. This case study documents the process, the major lessons and experiences which may be of interest to other countries considering an institutional reform.
- The reform process is inherently political and requires the full commitment of its policy makers to correctly balance financial and political objectives.
- Success is often unattainable without reforming the external environment, with emphasis on the role of the owner.
- Fundamental reforms are not a quick fix and cannot be substituted by private sector participation.
- There must be an adherence to financial sustainability objectives.
- Other external stakeholders may be important to balance potentially conflicting objectives of politicians.
- Certain decisions must be left to utility managers.
- Separating functions and arm’s length transactions are important elements of the institutional setup.
- Customers can be an important voice for improving performance.
Importance of case
Many developing countries have yet to face the reality of translating the principles of IWRM into workable solutions that can be applied in real-life situations. Much can be learned from the successes, the failures and the ongoing challenges that Zambia is experiencing in trying to address the water and sanitation service needs of its citizens.