Tap talent to evolve a reform model

The other cities with clones of cash-strapped, inefficient DJB would be watching developments related to its reforms very carefully and there is no way DJB can afford to get this wrong.

Any experiments with private companies, with or without the World Bank have to begin with reform within the behemoth DJB itself. It cannot wish away or be allowed to relinquish its role completely. Without proper homework, DJB will never be able to ensure the smooth functioning of the private companies that run even a part of its operation.

One of the problems with the proposed 24X7 was DJB’s reliance on the World Bank to fix its problems when even by the Bank’s own admissions, they have had their share of failures in the water sector in various countries.

The World Bank has done extensive work on water borne out by their neatly packaged graphs and power point presentations on what is wrong with the Indian water sector. But their solutions are known, familiar templates that they apply to every third world city. In the recent past, they have replaced the world ‘‘privatisation’’ and say that it is ‘‘management’’ by a private company. For city-planners, it is tempting to buy this template considering it lets the public utility get by without doing any spade work of its own. The World model requires them to hire consultants who produce a voluminous report with a phase-wise implementation of a plan that involves the hand-over to private companies.

Since consultants do not go to the heart of the problem (in this case, the real reason behind water leakage), it is certain that the project will run into trouble. Is there any other way of going about reform or does it have to be the World bank model? Public hearings like the one held earlier this week needs to come up with answers to this question.

Infact, World Bank officials will admit that ironically the areas where it has succeeded is where the utility itself is vigilant, strong enough to regulate the private company. The Bank has also worked with public utilities of some countries to strengthen a utility and make it efficient rather than just handing out a portion of its operation to a private company.

The plan (see box) sounds sane considering the abysmal performance of DJB but the beginning was on a sticky wicket. The contracts and reports of the consultants were top secret and in spite of the World Bank telling the DJB to get the public on their side, no meetings or consultations with Resident Welfare Associations (RWAs) were held.

It blew up when an NGO, Parivartan, got all the documents under Right to Information Act and started their public consultations. Instead of DJB consulting the pool of talent in IIM and IITs, it was left to Parivartan to explain the implications of the new scheme.

Then came the questions for which DJB had no answers. No answers were found either in copious feasibility reports by Price Waterhouse Coopers done with borrowed money from the World Bank. Some of the defects were pointed out by the IIT and IIM professors who studied the papers made available by Parivartan. Most of the answers should be available with the executive engineer who heads a particular zone rather than fancy international consultants.

How much water is entering a particular zone, where is it going and where is the leaked water going? DJB says there is 180 lt per capita water per day for a Delhi citizen which is one of the highest in the world. According to DJB official figures, the leakage is 26%. The jj colonies is only responsible for 6%, so where is the missing 20%? Since it is not seen flowing on the streets on Delhi, where is it going?

This figure for each zone is not just important for academic interest but will be vital in judging and evaluating the performance of the private company. Without knowing how much water leaks, it will be difficult to for DJB to set a target for the company. The estimates of leakages range from 20-60 per cent from DJB to several consultants who have been hired. The target that was set was 34% in three years. So if the leakage is 26% according to DJB, what will the companies do in the three years? And if the company is not cutting down leakages, where will it get money for Operation and Maintenance (O&M)? How much tariff will have to be raised to meet costs?

A suggestion that has come from various quarters is why can’t the executive engineer of a zone be held accountable, with fixed targets and financial incentives tied to targets?

Why does the DJB not have the will to reform the tariff structure on its own? There are already low hanging fruits by just rationalising the tariff structure of companies using water for commercial purposes.

Will DJB have the money to invest in things like water treatment, sewerage treatment, transmission and disposal after meeting the demand of the private company? Since the revenue comes from bills and if that money will go to the private company, where will DJB get the money to run their other operation?

This is the World bank model that is coming at a price of Rs 120 crore. For a country of India’s size and a pool of talent, there should be a serious thought on developing a well-thought out model for ensuring 24X7 water.