Private sector involvement in urban water supply management, Ghana

The performance of public utilities in low-income countries with respect to service to all customers, and particularly lower-income urban consumers, is understood to be limited in many cases. The Government of Ghana chose to implement a private sector management contract in order to deliver significant change in service delivery and financial viability. The five year management contract with Aqua Vitens Rand Limited ran from 2006 to 2011 and was not renewed. This study investigates the public utility outcomes, both as a state owned corporation and a state owned limited liability Company, and compares those outcomes with the achievements of the private operator through a Management Contract. The latter two management models operated under the oversight of the newly formed economic regulator, the Public Utility Regulatory Commission in 1999 and any effect of that regulation is considered. The hypothesis of the study developed in 2008 was that “a management contract would not provide the necessary level of empowerment, incentives and commitment and access to resources for a private operator to adequately and efficiently perform even where there is an established economic regulator with a clear mandate”. The case study approach was employed for the study data was gathered on the operations, activities, regulation and management of the urban water utility through documentary review, key-informant interviews, household surveys, public hearing meetings and user observations. However, three major cities including Accra, Kumasi and Tamale were used for the household survey. These three cities were carefully picked out taking into account the political, economic, geographical, social and cultural significance that each of the them represents and commands in Ghana. ...[cont.]