Abstract
For a long time, it was assumed that water and sanitation services should be provided by government. This assumption was based on the reasoning that since water and sanitation are public goods and may also be natural monopolies, they would not be widely supplied by free markets.1 Water systems – that is, the infrastructure and management mechanisms for the delivery of water and sanitation services – were therefore owned and operated by public entities, including state-owned enterprises and local authorities. In many developing countries, however, public water systems have been wanting in significant respects. In African countries, for instance, many water systems have been plagued by problems such as high leakage levels, aging and poorly maintained infrastructure, weak billing and revenue collection mechanisms, low productivity of staff, uneconomic tariff structures and heavy financial losses.2 These deficiencies of the public sector have formed the impetus for private sector participation in the management of water systems. It is hoped that private provision will “lead to greater efficiency in service provision through the private motive of the private sector, and ... provide utilities with clear objectives rather than the multiple, and often conflicting, goals imposed by government.”3 This paradigm shift has been dictated by the ideology of neoliberalism, which has had a profound influence on international development policy debates since the late 1970s. The new thinking is that “managing water as an economic good is an important way of achieving efficient and equitable use, and of encouraging conservation and protection of water resources
Publisher
Department of Commercial Law, University of Nairobi
