analysis
Roger Bate
South Africa and other arid countries are running out of water. The result will be wars and the poor will suffer most. For the past decade these concerns have been shouted from the world’s largest newspapers, reporting alarming forecasts periodically issued by groups ranging from the World Watch Institute to the United Nations Environment Programme.
Much media attention has been focused on geopolitical hotspots such as Israel and Palestine, Turkey and Iraq, and governments have been urged and have pledged to deal with the problem. But governments have been able to offer few practical solutions, and that is because they are the primary cause of water misallocation. By trying to solve a problem of their own making they have centralised water control and made things worse.
The best solution for water misallocation is to get the government out of the day-to-day allocation decision-making process. The government must have a role in making the initial allocation of water and create the legal framework to allow for water quotas to be traded, but then it must do something that all politicians and bureaucrats find hard to do stay out of the way.
The poor in South Africa often have no access to clean water, with disastrous consequences such as the cholera outbreak in KwaZuluNatal. Many have dangerously poor quality water supplies, and what’s more, they pay more for the water. According to the World Bank, buying water from street vendors and tank trucks is often more expensive than paying for pumped supplies.
One country that has led the way in reorganising the allocation of water to the poor is Chile, a country with many similarities to South Africa. Its economy was built on mining, and like South Africa, it has sophisticated farming techniques to rival anything in the Southern Hemisphere. Chile nationalised water in 1966 (as South Africa did in 1998). It subsequently allocated rights to individual farmers, businesses and municipalities, and allowed each group to trade its quotas.
In effect, the Chilean government allocated rights and then got out of the way to ensure that the higher valued uses (which usually are domestic requirements) received adequate water.
In 1970 just 27% of rural and 63% of urban dwellers received potable water. By the mid-1990s the respective percentages were 94% and 99%. These figures are better than any other mid-income developing country in the world.
The reason for Chile’s success is simple water markets do not ensure equitable allocation, but they do ensure efficient use of the resource. This means that the government is left free to do what it should do, make the initial allocation decision (and subsequent minor alterations based on climatic changes such as rainfall levels and aquifer recharge) and regulate the market.
The result in Chile was that municipalities had more water available with greater security and hence could connect more people to supply. Previously, agricultural interests had hogged nearly all the water, denying the poor the access that was their right under the law.
Unfortunately, South Africa is today where Chile was in 1981: it still has too much water going to mostly white agricultural interests. Since 1994 there has been little redress for the urban and rural poor and black farming interests, even though by law the poor should receive adequate supplies.
If the government allowed existing users to sell their water use licences to municipalities and simultaneously removed all subsidies to farming (as occurred in Chile), some farmers would inevitably sell their rights and quit farming, opening up possibilities for black farmers, whose efforts should be subsidised for a period, and the poor.
Chile is now the world’s largest exporter of winter fruit to the Northern Hemisphere. South African farmers could out-compete it, but not while their industry is heavily protected and they grow water-intensive but low-value crops such as sugar.
The Department of Water Affairs and Forestry must take up the challenge and devolve power to the water catchments and water users by allocating the rights the government nationalised in 1998. The department simply doesn’t have the capacity to work out how water should be allocated among all users over time. That should be left to markets to decide.
Furthermore, regardless of rhetoric to the contrary, the department inevitably favours the status quo which means white farmers. The department must allocate rights, provide an overt system of redress for apartheid, and then step back, and regulate private transactions to ensure minimum environmental harm and fair play. Without doing so the well-known aspiration of “lifeline” access by the poor is nothing but a pipe dream. A pipe dream without water.
Dr Roger Bate is a director of the International Policy Network in Washington, and co-author of the recently published book The Cost of Free Water: The Global Problem of Water Misallocation and the Case of South Africa
We can work together
Right of reply
Mike Muller
It might not be apparent from the February 15 articles by Edward Cottle, Hameda Dedat and Bryan Rostron, but the Department of Water Affairs and Forestry is on the same side as the Rural Development Services Network and its associates. We are both trying to ensure that poor South Africans have access to the basic water supplies and sanitation facilities they need to stay healthy.
The government is doing this by providing grants to local governments to build the pumps, reservoirs, pipes and purification works needed to give access to safe water to all our citizens, including the poorest. From R23-million in 1994, the amount allocated has gone up to R1,2-billion in the coming financial year, albeit not always as smoothly as we might have wished. Once infrastructure is in place, we help to build local government’s financial and organisational capacity to operate it.
Cottle and his associates lobby ostensibly to achieve the same broad goals. What is not clear to us is what they are lobbying for. We know they are against privatisation but where is this on the agenda in the rural areas where the bulk of the poor and unserved live? They are against cost-recovery because they say it excludes the poor from services but the free basic water policy has been in place for nearly a year, and is it not dependent on cost recovery from those who use more? They are against tedious bureaucratic approaches from national departments to get communities to buy in to service provision yet the new system of local government planning is being implemented to address community priorities at local level to achieve just that goal.
Negative lobbying can usefully highlight problem areas. A good example is that which Cottle and Dedat cite of the problems that arose in 1999 when responsibility for water services in the rural Madlebe area was transferred from the relatively well-off local council of Empangeni to the relatively poor district municipality.
It subsequently turned out that this was part of a bigger issue. National subsidies for local government had been allocated to the local (category “B”) municipalities rather than district (Category “C”) municipalities. This apparently minor administrative detail meant that even where a “C” municipality was providing services, it received no subsidy for its work. The local municipalities should theoretically have passed on the funds but they had little incentive to do so and many reasons not to.
This funding issue, a major obstacle to the implementation of free basic water in some areas, was partly resolved by a recent high court decision. Lobbying would have been helpful here, yet the NGO community was largely silent. Were they not aware of the issue?
The debate over the roles and functions of “B” and “C” municipalities continues, essentially a policy issue about poverty and how to address it. One view is that assigning functions such as water delivery (and funding) to local “B” municipalities will enable those that start with greater capacity, serving richer communities, to stay richer at the expense of their poorer neighbours. A strong case is being made to give the functions and finance to the “Cs” which will be able to spread the resources more equitably across both town and rural areas. Equally strong are voices advocating the need to maintain service standards in our towns and smaller cities.
This is a critical debate for local government and for the poor, yet again where is civil society? Who is ensuring that the poor have a voice in the debate? The silence is deafening and surprising. It suggests that for certain elements of civil society, attacking the government is more important than working with the government to help meet the needs of the poor. Yet we know we can work together.
Mike Muller is director general of Water Affairs and Forestry
ENDS