Understanding Demand When Reforming Water Supply and Sanitation : A Case Study from Sri Lanka
Many countries are weighing urgent reforms to bring safe water supply and sanitation (WSS) services to hundreds of millions of poor city dwellers. Past reforms, unfortunately, have often ignored consumer preferences and perceptions, resulting in overly optimistic projections of the revenue potential of reform projects. When revenues fall short, private partners may seek to renegotiate their contract, resulting in tariff increases and other changes that increase project costs across the board. Such situations can undermine political commitment to reforms in general and to Private Sector Participation (PSP) in particular. Understanding consumers can help avoid such situations. Different groups of consumers have distinct preferences and perceptions that may influence their decisions about new water systems. Unfortunately, studies of consumers' water-related preferences are often deferred because collecting data takes time and costs money. Often there is pressure to complete reforms quickly sometimes to take advantage of a political opportunity so the necessary research is not done. In other cases, the challenge of increasing efficiency and improving governance may seem so daunting that the specific interventions required to make reform beneficial to the poor may be overlooked or consciously deferred.
| Summary: | Many countries are weighing urgent
reforms to bring safe water supply and sanitation (WSS)
services to hundreds of millions of poor city dwellers. Past
reforms, unfortunately, have often ignored consumer
preferences and perceptions, resulting in overly optimistic
projections of the revenue potential of reform projects.
When revenues fall short, private partners may seek to
renegotiate their contract, resulting in tariff increases
and other changes that increase project costs across the
board. Such situations can undermine political commitment to
reforms in general and to Private Sector Participation (PSP)
in particular. Understanding consumers can help avoid such
situations. Different groups of consumers have distinct
preferences and perceptions that may influence their
decisions about new water systems. Unfortunately, studies of
consumers' water-related preferences are often deferred
because collecting data takes time and costs money. Often
there is pressure to complete reforms quickly sometimes to
take advantage of a political opportunity so the necessary
research is not done. In other cases, the challenge of
increasing efficiency and improving governance may seem so
daunting that the specific interventions required to make
reform beneficial to the poor may be overlooked or
consciously deferred. |
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