Copyright © 2009 International Water Association Public-public partnerships: Potential and constraints of WOPs Tom Williams, Programme Manager, IWA

Copyright © 2009 International Water Association Overview Overview of WOPs approach Regional platforms Evidence base for WOPs Funding constraints Pro-poor focus

Copyright © 2009 International Water Association Classification of WOPs A WOP can be defined as any form of – simple partnership or – structured partnership between two (or more) water operators that: provides capacity building is based on not-for-profit principles is results-oriented and follows good governance principles

Copyright © 2009 International Water Association Classification of WOPs

Copyright © 2009 International Water Association Benefits Low-cost solution Sharing of practical experience between operators (usually consultant ---> utility) Higher level of trust between partners (not-for-profit principle) Multiplier / cascade effect In-line with ‘solidarity’ efforts between utilities and countries

Copyright © 2009 International Water Association Regional platforms Asia-Pacific (WaterLinks) IWA, USAID, ADB South Eastern Europe (SEE- WOP) IWA, UNHABITAT Latin America and Caribbean (LAC-WOP) IWA, UNHABITAT, IDB Africa (AWOPs) IWA, AfWA, UNHABITAT, AfDB

Copyright © 2009 International Water Association Regional characteristics South Eastern Europe Strong national associations, funding available, political will for intra- regional cooperation Latin America and Caribbean Difficult for utilities to work across borders (legal obstacles), greater focus on national platforms Africa Limited number of mentor utilities, ‘busy’ donor / development environment Asia Strong support and leadership from regional bank, WaterLinks is transitioning to independent entity

Copyright © 2009 International Water Association Regional platforms Important attributes –Strong national and regional associations –Support and leadership from regional banks –Political will (national and regional) –Incentivised utilities (recipients and mentors)

Copyright © 2009 International Water Association Are WOPs working? Evidence is patchy and unconvincing… Lack of clear and compelling evidence that WOPs work – specifically in regards to MDG & pro-poor Lack of understanding on what works in regards to inputs and activities Lack of consistent framework to plan, monitor and evaluate WOPs

Copyright © 2009 International Water Association Impact Outcomes Outputs Activities Inputs Staff Money Expertise Site visits Training Workshop Trained staff Production of manuals Establishment of NRW business unit Improved operation of system Reduced non-revenue water Increased revenue Expanded service Systemic way to catalogue WOPs Such a framework is good for planning, monitoring and assessment of WOPs Most case studies focus on reporting these aspects Need to better understand what is going on here

Copyright © 2009 International Water Association Funding constraints Funding of WOPs predominantly from donors, banks and utilities Level of available funds are relatively low (not seen as a core mechanism to support development & pro- poor) Not-for-profit also equals not-for-loss…someone has to pay

Copyright © 2009 International Water Association Time for performance based WOPs? Performance based WOPs with aim to: –Improve service levels –Improve Op Efficiency (reduce OPEX) –Increase revenue Pre-financing from mentor utility – full reimbursement upon meeting performance targets Reimbursement from recipient utility, from external funds or mixed

Copyright © 2009 International Water Association Time for performance based WOPs? Introduces greater incentive and accountability to develop and implement WOPs that work Gives greater assurances to donors and banks that funds will support performance improvements Develops a culture of trust and competence between operators and banks / donors Learn lessons from output-based aid…

Copyright © 2009 International Water Association Pro-poor focussed To be an effective mechanism for capacity development, WOPs should be orientated towards development goals and pro-poor Gives greater impetus for donor agencies and banks to make funds available

Copyright © 2009 International Water Association Pro-poor focussed Utility Efficiency Access to Finance and Investment Expanding Service Delivery Performance based WOP (NRW, customer billing, WSP etc) Sustaining service levels Post WOPs Bankable utilities Municipal Financial incentives WOPs on pro poor performance CAPEX investments released (could be Dev Credit Guarantees, loans OBA) Operation and Maintenance Enable CatalyseSustain

Copyright © 2009 International Water Association Summary WOPs provide are an attractive proposition –Low-cost –Best use of available knowledge Impact and benefits of WOPs in recent 5 years is patchy Need better understanding of inputs required for successful WOP Need to ensure WOPs are focussed on improving performance and pro-poor Lack of funding for WOPs is a significant barrier Performance based financing provides a potential model from equitable financing