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Nairobi water set to go private

Benson Kathuri

May 4, 2004  - Financial Standard

The Nairobi City Council has ceded its water and sewerage department to a private firm. The company, which will operate as a subsidiary of the council is expected to take over provision of the service by the end of the year.

The move is expected to help solve the city massive water problems that include irregular and unreliable supply, poor quality and irregular billing of consumers.

Privatisation of the city's water services is being undertaken with the help of the World Bank, which has made a commitment to fund the initiative to the tune of Sh1.2 billion.

Sources at the Ministry of Water say negotiations for funding are complete and that what remains is approval from the deal by the World Bank board.

"We have agreed on virtually everything and the bank board is expected to approve the loan next month and start the project immediately," said a senior ministry official.

Information from City Hall indicate that a service regulator -- a Nairobi Water Services Board (NWSB) has already been established is expected to be operational by July this year.

The move comes in the wake of perennial water shortage in the city. A section of city residents have welcomed the move saying it does not matter how much they will pay so long as quality water is made available.

"We have gone without water sometimes for weeks yet the council continues to bill us. We would be glad to deal with a more friendly and reliable service provider," says Mr Mike Wandera a resident of Nairobi's Eastlands that is has been suffering perennial water shortage.

The ministry has over the years blamed the Nairobi City Council of mismanaging the water.

"The water service is caught in a cycle of declining investment, low quality of service and financial returns characterised by poor coverage, unreliable service and high levels of unaccounted for water and unpaid bills," says the project document.

The document by the ministry further contends that poor financial management, low capital and lack of maintenance costs have crippled the city water department.

"These factors have translated into inadequate service to the population, including informal settlements, where the vast majority of the urban poor reside."

Though the move is expected to improve water management in the city, residents of the informal settlements have expressed concern that the commodity may become too expensive for them.

"We hope the new board will have representative of informal settlement residents to work out a system that will ensure that the residents are not marginalised," says Mr G. K. Levitt, a communication officer with Maji na Ufanishi, a water and sanitation non-governmental organisation working in Kibera, Kiambiu and Kangemi slums.

He warns that the gains already made in the provision of water in the slums should not be compromised.

Levitt says those living in informal settlements have had limited access to basic services such as health, water and sanitation, and education and the organisation has been working to build the capacity of the slum communities to improve access to these services.

The ministry, however, says the project will involve extensive stakeholder consultations to develop a broadly supported long-term management solution for Nairobi water supply services.

The project development objective is to build strong governance, institutional and service delivery framework that will ensure efficient and sustainable delivery of water and sewage services in Nairobi.

Proposals have been put forward for the formation of separate and ring-fenced service delivery institutions, which will ensure autonomous operations, protect revenue and safeguard investments in the water delivery system.

The project, which is part of the implementation of the new Water Act (2002), supports the Government through the creation of a Nairobi Water Board that will be responsible for water supply in the city.

It is further expected to ensure the development and building of consensus among key stakeholders on the suitable long-term management option for the service provision in Nairobi.

"The implementation of the long-term management option under the new institution framework is expected to create a sustainable framework on which a major capital investment and rehabilitation program can take place", the document says.

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