1 public private partnerships – public awareness & stakeholder participation in a ppp...

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Public Private Partnerships – Public Private Partnerships – Public Awareness & Stakeholder Public Awareness & Stakeholder

Participation in a PPP Environment: Participation in a PPP Environment: A case Study for LWCA case Study for LWC

Paper presented by Paper presented by Ms Yemisi Ransome-KutiMs Yemisi Ransome-KutiCSO CONSULTANT LWCCSO CONSULTANT LWC

Previously presented Previously presented To AUPCTRE – 17 Dec. 2014To AUPCTRE – 17 Dec. 2014

Appendix 3Appendix 3

Yemisi Ransome-Kuti - CSO Consultant - LWC Yemisi Ransome-Kuti - CSO Consultant - LWC 24-03-1524-03-15

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ObjectivesObjectives Define the concept of partnershipDefine the concept of partnership

Identify ways of building effective partnershipsIdentify ways of building effective partnerships

PPP is a strategy for development and enhances PPP is a strategy for development and enhances economic growtheconomic growth

Discuss the key issues and challenges of building Discuss the key issues and challenges of building effective Stakeholder support for PPPs in the Water effective Stakeholder support for PPPs in the Water Resources SectorResources Sector

Discuss the LWC Policy on Stakeholder/CSO Discuss the LWC Policy on Stakeholder/CSO InteractionsInteractions

ConclusionsConclusions04/21/2304/21/23


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The Concept of PPPThe Concept of PPP

The combination of a public need with The combination of a public need with private capability and resources to create a private capability and resources to create a market opportunity through which market opportunity through which the the public need is met and a profit is madepublic need is met and a profit is made..

Reflects the Reflects the paradigm shiftparadigm shift that has that has occurred regarding the State and its occurred regarding the State and its relationships with the Market since the end relationships with the Market since the end of the cold war.of the cold war.

Over the past 20 years, the Private Sector Over the past 20 years, the Private Sector has increased its foothold in the economic has increased its foothold in the economic process in nearly every nation in the World.process in nearly every nation in the World.

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The Concept of PPP The Concept of PPP

PPPs bring together the complementary strengths PPPs bring together the complementary strengths of public and private sectors to enlarge the capacity of public and private sectors to enlarge the capacity for a more efficient provision of social services.for a more efficient provision of social services.

The concept has grown all over the world in the last The concept has grown all over the world in the last two decades.two decades.

Increasingly, PPP schemes are now used to deliver Increasingly, PPP schemes are now used to deliver services that were once exclusive responsibilities of services that were once exclusive responsibilities of the State the State Infrastructure services – electricity, roads, waterInfrastructure services – electricity, roads, water Social Services – healthcare, education, sanitationSocial Services – healthcare, education, sanitation

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Basic Requirements for Building Basic Requirements for Building Effective PartnershipsEffective Partnerships

Shared Vision & OwnershipShared Vision & Ownership commitment to partnerships will derive commitment to partnerships will derive

from a shared vision & ownership. Explicit from a shared vision & ownership. Explicit agreement on objectives, goals & rolesagreement on objectives, goals & roles

Value PropositionValue Proposition All parties derive benefits from the partnership All parties derive benefits from the partnership

agreementagreement Full Collaboration in ImplementationFull Collaboration in Implementation

Balanced commitment of all partiesBalanced commitment of all parties Transparency and AccountabilityTransparency and Accountability

In terms of role, performance and resources In terms of role, performance and resources Leadership Leadership

Leadership must be clearly definedLeadership must be clearly defined CommunicationCommunication

Partners must communicate roles and position Partners must communicate roles and position clearly and effectivelyclearly and effectively

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PUBLIC PRIVATE PUBLIC PRIVATE

PEOPLE PEOPLE PARTNERSHIPPARTNERSHIP

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Benefits of PPPBenefits of PPP

Efficiency & Anti-Corruption

Value for Money

Empowers

Public & Citizenr

y

Bridges FinancingGap

Reliability & availability of service

EnhancesSocio-Economic Devt.

SystemExpansion

Enhances Governanc

e

PPPBenefits

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Prerequisites of PPPPrerequisites of PPP

PoliticalSupport

Policy/Regulatory Environmen

t

PublicBuy-in

Corporate Governance

Institutional Capacity

EffectiveCommunicatio

n

ConduciveBusiness

Environment

Institutional

Framework

PPPPrerequisite

s

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Pre-Requisites for Successful PPP Pre-Requisites for Successful PPP SchemesSchemes

Balancing Balancing Investor Investor Interest and Interest and Public InterestPublic Interest

Need to ensure Need to ensure affordability of the affordability of the widest consuming widest consuming public must be public must be balanced with the balanced with the interest of the interest of the investor to derive investor to derive adequate ROI and adequate ROI and the capacity of the capacity of Government to Government to regulate and ensure regulate and ensure sustainability.sustainability.

Public Sector Facilities Regulates and where necessarySubsidizes to ensure affordability and sustainability

Private Sector Invest andOperates to ensure

Availability, Quality & Reliability

Consuming Public acceptsValue for money and willing to pay

To generate adequate cash flow

Sector for doablePPP Projects

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PPP in the Water Resources PPP in the Water Resources SectorSector

Access to water is central to achieving MDGs.Access to water is central to achieving MDGs. Dominance of public enterprises in the provision of waterDominance of public enterprises in the provision of water Absence of competition resulting in inefficiencyAbsence of competition resulting in inefficiency Lack of pricing mechanism based on consumer demand & Lack of pricing mechanism based on consumer demand &

service costservice cost Rapid growth in urbanization & growing poverty- Sub –Rapid growth in urbanization & growing poverty- Sub –

Saharan Africa would need to provide access to safe Saharan Africa would need to provide access to safe water for additional 210 m people over the next 15 yearswater for additional 210 m people over the next 15 years

Investments in water would require large amounts of Investments in water would require large amounts of capitalcapital

PPP helps to avoid pitfalls of full privatisation, utilize PPP helps to avoid pitfalls of full privatisation, utilize new technology and increase capitalnew technology and increase capital

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Key Issues and ChallengesKey Issues and Challenges

…….every new PPP project must scale through.every new PPP project must scale through three three critical challenges critical challenges before it can take-off and succeed, before it can take-off and succeed, and the PPP framework itself must consistently address a and the PPP framework itself must consistently address a

fourth strategic issuefourth strategic issue for it to remain viable….for it to remain viable….

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Key Issues and ChallengesKey Issues and Challenges1.1. Long-Term FinancingLong-Term Financing

Ensure community Ensure community involvement involvement

and buy-in. and buy-in. Design of PPP must recognize the poor and vulnerable class Design of PPP must recognize the poor and vulnerable class in the society and therefore build into tariff schemes subsidy in the society and therefore build into tariff schemes subsidy elements like: graduated tariffs, safety nets. However:elements like: graduated tariffs, safety nets. However: Properly target subsidies Properly target subsidies Quality of service must be the sameQuality of service must be the same The cost of delivering the subsidy must not exceed the subsidy The cost of delivering the subsidy must not exceed the subsidy

itselfitself (Don’t spend N2 to deliver N1 subsidy(Don’t spend N2 to deliver N1 subsidy

2.2. Risk ManagementRisk Management

3.3. AffordabilityAffordability4.4. Institutional CapacityInstitutional Capacity04/21/2304/21/23


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Key Issues and ChallengesKey Issues and Challenges

4.4. Design of PPP must recognize the poor Design of PPP must recognize the poor and vulnerable class in the society and and vulnerable class in the society and therefore build into tariff schemes subsidy therefore build into tariff schemes subsidy elements like: graduated tariffs, safety elements like: graduated tariffs, safety nets. However:nets. However: Properly target subsidies Properly target subsidies Quality of service must be the sameQuality of service must be the same The cost of delivering the subsidy must not The cost of delivering the subsidy must not

exceed the subsidy itselfexceed the subsidy itself (Don’t spend N2 to deliver N1 subsidy) (Don’t spend N2 to deliver N1 subsidy)

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Key Issues and Challenges of building Key Issues and Challenges of building effective Stakeholder support for PPPs in effective Stakeholder support for PPPs in

the Water Resources Sectorthe Water Resources Sector

Citizens ParticipationCitizens ParticipationWater regarded as a social dividend rather Water regarded as a social dividend rather

than an economic goodthan an economic goodAgitation and Negative Campaigns from Agitation and Negative Campaigns from

some CSOs supported by some some CSOs supported by some International Agencies who are 100% International Agencies who are 100% opposed to private sector intervention in opposed to private sector intervention in the Water Sectorthe Water Sector

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LWC – 2LWC – 2ndnd Urban Water Sector Reform Project Urban Water Sector Reform Project (World Bank supported)(World Bank supported)

Objective of LWC interaction with Objective of LWC interaction with Stakeholders.Stakeholders.

To gain a feedback on customer opinion of To gain a feedback on customer opinion of service delivery.service delivery.

To educate Consumers on water issues leading To educate Consumers on water issues leading to improved service, health, supply etc.to improved service, health, supply etc.

Raising awareness to Stakeholders of the Raising awareness to Stakeholders of the benefits of the benefits of the Lagos Water Supply Master Lagos Water Supply Master PlanPlan

Support to achievement of Support to achievement of Lagos Model PPP Lagos Model PPP strategies and the MDGsstrategies and the MDGs

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LWC Policy on Stakeholder/CSO LWC Policy on Stakeholder/CSO InteractionsInteractions

In support of this project, complementing the In support of this project, complementing the technical and operating improvements to be technical and operating improvements to be provided through the 2NUWRP, the World Bank provided through the 2NUWRP, the World Bank proposed that there will be a comprehensive proposed that there will be a comprehensive stakeholder outreach programstakeholder outreach program to re-build to re-build relations between the communities/stakeholders relations between the communities/stakeholders and the utility, thereby furthering the and the utility, thereby furthering the sustainability of the Project’s planned objectives. sustainability of the Project’s planned objectives. In this context, the Project supports LWC to In this context, the Project supports LWC to establish a establish a Citizen Participation SystemCitizen Participation System to to ensure that water service provision reflects ensure that water service provision reflects demands of all user groups demands of all user groups

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Citizens Participation (Customer Care) SystemCitizens Participation (Customer Care) System To promote citizen’s participation To promote citizen’s participation To promote and defend the interest and ensure water supply to vulnerable To promote and defend the interest and ensure water supply to vulnerable

and special needs groups i.e. schools hospitals, & prisons through and special needs groups i.e. schools hospitals, & prisons through community management systems which will be developed, where they do community management systems which will be developed, where they do not exist by CSOs organized at that level within the Local Government not exist by CSOs organized at that level within the Local Government systemsystem

To promote and defend the interest of private customers and communities To promote and defend the interest of private customers and communities in the Distribution Services Areas (DSAs) through continuous citizen’s in the Distribution Services Areas (DSAs) through continuous citizen’s participation on service, performance and future improvementsparticipation on service, performance and future improvements

To strengthen service-oriented relations between the customers and the To strengthen service-oriented relations between the customers and the water utilities.water utilities.

Ensure that LWC has appropriate knowledge on customers’ needs and Ensure that LWC has appropriate knowledge on customers’ needs and priorities, improve performance and transparency, and adapt to changing priorities, improve performance and transparency, and adapt to changing customer preferences customer preferences through its Customer Care Department officers through its Customer Care Department officers working in collaboration with Local Government Authorities at that working in collaboration with Local Government Authorities at that levellevel

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Build knowledge and capacity ofBuild knowledge and capacity ofCSO partners identified to monitor and evaluate CSO partners identified to monitor and evaluate

effectiveness - must have respected standing effectiveness - must have respected standing in the neighborhood and must work with CSOs in the neighborhood and must work with CSOs (CBOs/CDAs) at local and ward levels in order (CBOs/CDAs) at local and ward levels in order to build capacities across the boardto build capacities across the board

Customer representatives in key water Customer representatives in key water provision issuesprovision issues

Customer Care Officials at every levelCustomer Care Officials at every level

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Activities will include:Activities will include: Customer surveys, Consumer feedback systemsCustomer surveys, Consumer feedback systems Develop and synthesize ReportsDevelop and synthesize Reports Conduct Workshops, Training for Communities Conduct Workshops, Training for Communities

and CSOsand CSOs Monitoring and Evaluation indicators for Monitoring and Evaluation indicators for 1. Capacity building programmes and1. Capacity building programmes and 2. Overall Service delivery2. Overall Service delivery

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Consultation Dialogue Consultation & Consultation Dialogue Consultation & share Best Practicesshare Best Practices

Develop an Institutional framework that Develop an Institutional framework that expands the scope of the Customer expands the scope of the Customer Care Department (CDD), Equip & Fund.Care Department (CDD), Equip & Fund.

Capacity Building of Officials of the Capacity Building of Officials of the Customer Care Department Customer Care Department /Commercial staff/Commercial staff & CSOs/Communities & CSOs/Communities

Establish a Database of StakeholdersEstablish a Database of Stakeholders

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Occasional Opinion PollsOccasional Opinion Polls Establish a feedback mechanismEstablish a feedback mechanism

Effective communication with all parties which will include ICT and Effective communication with all parties which will include ICT and other relevant methodologiesother relevant methodologies

AdvertsAdverts Text messages for Customer Care Service Text messages for Customer Care Service Internet contacts (Listserves)Internet contacts (Listserves) Newsletter Newsletter LSWC websiteLSWC website Bill Boards at strategic placesBill Boards at strategic places Customer Forum at Zonal levelsCustomer Forum at Zonal levels Bi-annual fora with CSOsBi-annual fora with CSOs Opinion PollsOpinion Polls Focused public enlightenment programmes to address the most Focused public enlightenment programmes to address the most

pressing areas of public concern. pressing areas of public concern. This will be achieved through This will be achieved through research, studies and community interactions.research, studies and community interactions.

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Publication of vital handouts or Publication of vital handouts or promotional materials promotional materials

Regular updating and briefingRegular updating and briefing Focus AdvocacyFocus Advocacy around the issues with around the issues with

Consumers and other stakeholder Consumers and other stakeholder groups through various forms of public groups through various forms of public dialogue and enlightenment – adverts, dialogue and enlightenment – adverts, workshops, focus group discussions, workshops, focus group discussions, symposia, conferences etc. symposia, conferences etc.

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Work with ward and local government Work with ward and local government water management committeeswater management committees

Develop effective participatory Develop effective participatory Monitoring and Evaluation Monitoring and Evaluation mechanisms. Particularly Community mechanisms. Particularly Community Based Performance Monitoring (CBPM)Based Performance Monitoring (CBPM)

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Recent Activities include:Recent Activities include:• Road ShowsRoad Shows• Development of IEC Materials Development of IEC Materials

• Know your Area Managers' Contact Details etc. Know your Area Managers' Contact Details etc.

• Annual Consumer Workshop Annual Consumer Workshop • Mobile Telephony Tracking SystemMobile Telephony Tracking System• Internet Customer Complaints PlatformInternet Customer Complaints Platform• Capacity Building Programs Capacity Building Programs

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Case studies of PPP in Water Case studies of PPP in Water projectsprojects

SENEGALSENEGAL In 1994, the Government had created a steering committee of the In 1994, the Government had created a steering committee of the

ministers of each government agency concerned with water supplyministers of each government agency concerned with water supply In 1995, only 54% of Senegal’s urban population had access to safe In 1995, only 54% of Senegal’s urban population had access to safe

water water State asset holding company formed with 51% private ownershipState asset holding company formed with 51% private ownership Tariff structure aimed at cost recovery and financial sustainability Tariff structure aimed at cost recovery and financial sustainability

(Increasing Block Tariff)(Increasing Block Tariff) Ten year contract with the operator involving tariff adjustments, Ten year contract with the operator involving tariff adjustments,

productive capacity, maintenance & repair, and attainment of WHO productive capacity, maintenance & repair, and attainment of WHO standards of water qualitystandards of water quality

Subsidies to the poor – subsidized connections, construction of Subsidies to the poor – subsidized connections, construction of stand posts and cross subsidies for low levels of consumptionstand posts and cross subsidies for low levels of consumption

Outcome: 19% annual increase in water consumption btw 1997 and Outcome: 19% annual increase in water consumption btw 1997 and 2002.2002.

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Case studies of PPP in Water Case studies of PPP in Water projects cont. projects cont.

GHANAGHANA In 1990, the National Policy on rural water supply and In 1990, the National Policy on rural water supply and

sanitation was finalizedsanitation was finalized Community Water & Sanitation Agency, CWSA was Community Water & Sanitation Agency, CWSA was

created in stagescreated in stages Communities required to:Communities required to:

- Establish gender balanced committees to manage their systemsEstablish gender balanced committees to manage their systems- Pay 5% of capital cost; and pay all maintenance & capital costPay 5% of capital cost; and pay all maintenance & capital cost- Private provision of servicesPrivate provision of services

Outcomes:Outcomes:- Water supply extended to 200,000 people per yearWater supply extended to 200,000 people per year- Percentage of coverage of rural water increased from 30% in Percentage of coverage of rural water increased from 30% in

1980 to 41% in 2000 1980 to 41% in 2000

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The Nigerian PPP ExperienceThe Nigerian PPP Experience

In August 2005, President Obasanjo convened a In August 2005, President Obasanjo convened a PPP Retreat at which:PPP Retreat at which:

a.a. A clear Policy Statement was issued which included:A clear Policy Statement was issued which included: ““Our goal and priority should be to explore ways of working Our goal and priority should be to explore ways of working

together, sharing resources, opportunities, experiences and together, sharing resources, opportunities, experiences and dreams and reaching our national goal. It is possible to work dreams and reaching our national goal. It is possible to work in harmony and partnership once we commit to this Strategy in harmony and partnership once we commit to this Strategy and rededicate ourselves to building a strong, formidable, and rededicate ourselves to building a strong, formidable, unassailable, productive, progressive and growing economy. unassailable, productive, progressive and growing economy. I strongly believe that all sectors of the economy and society I strongly believe that all sectors of the economy and society need each other and for us to move forward we must remove need each other and for us to move forward we must remove those neo-colonial blinkers that hitherto blinded us from those neo-colonial blinkers that hitherto blinded us from seeing and appreciating the interconnectedness of the various seeing and appreciating the interconnectedness of the various sector of our political economy and society…sector of our political economy and society…

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In the past, our private sector saw some sectors of the In the past, our private sector saw some sectors of the economy as “no-go-areas” and they avoided it like a economy as “no-go-areas” and they avoided it like a plague or relied on foreign interests to lead them into plague or relied on foreign interests to lead them into such sectors. I stand here today, to say that such days such sectors. I stand here today, to say that such days are gone. Today, we have opened up all sectors of the are gone. Today, we have opened up all sectors of the economy to our private sectors. The government can economy to our private sectors. The government can only be an enabler, enhancer, facilitator, coordinator only be an enabler, enhancer, facilitator, coordinator and supervisor”.and supervisor”.

b.b. A new PPP law (ICRC Act) was proposed and A new PPP law (ICRC Act) was proposed and subsequently passed in November 2005subsequently passed in November 2005

c.c. A PPP Institutional Framework was proposed A PPP Institutional Framework was proposed and a joint PP Taskforce was set-up to ensure its and a joint PP Taskforce was set-up to ensure its full development & launch. full development & launch.

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PPP Framework in NigeriaPPP Framework in Nigeria

PPP Resource

Centre

National Infrastructure Development

Plan

State Cabinet Steering

Committee

Cabinet Steering Committee

PPP Nigeria Foundation

Budgetary, Legal & Regulatory Framework

Ministry

PPP Units

State PPP Resource

Centre

State PPP Panel

NIGERIA PPP IMPLEMENTATION

PLAN

NIGERIA PPP IMPLEMENTATION

PLAN

STATE GOVERNMENT PPP IMPLEMENTATION

PLAN

STATE GOVERNMENT PPP IMPLEMENTATION

PLAN

Collaborating Link between the Centres

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ConclusionConclusion Clearly, the value of PPP as a strategy for socio-Clearly, the value of PPP as a strategy for socio-

economic development and expansion of economic development and expansion of economic growth strategies has now been widely economic growth strategies has now been widely recognized and PPP projects are being recognized and PPP projects are being implemented in virtually every country of the world implemented in virtually every country of the world developed and developing, large and small.developed and developing, large and small.

The key consideration for effective PPP The key consideration for effective PPP implementation are: implementation are: Ensuring Value For MoneyEnsuring Value For Money Ensuring AffordabilityEnsuring Affordability Proper Risk Assessment & AllocationProper Risk Assessment & Allocation SustainabilitySustainability

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ConclusionConclusion Critical Success Factors for effective PPP Regime include:Critical Success Factors for effective PPP Regime include:

Strong Political Support & CommitmentStrong Political Support & Commitment Sustained Public Participation, Dialogue & CommunicationSustained Public Participation, Dialogue & Communication Effective Institutionalized FrameworkEffective Institutionalized Framework Effective Policy, Economic and Legal Environment that supports Effective Policy, Economic and Legal Environment that supports

Private Sector Investment which ensures transparency, Private Sector Investment which ensures transparency, accountability and zero-tolerance towards corruptionaccountability and zero-tolerance towards corruption

Institutional & Technical Capacity for all stages of PPP project Institutional & Technical Capacity for all stages of PPP project implementation implementation

Strong Leadership especially at the Policy Making and Strong Leadership especially at the Policy Making and Implementation LevelImplementation Level

Private Sector and Civil Society should recognize their role and Private Sector and Civil Society should recognize their role and responsibilities as partners in National Development and adopt responsibilities as partners in National Development and adopt principles & standards of CSR as an integral aspect of business principles & standards of CSR as an integral aspect of business life.life.

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Thank YouThank You

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1 public private partnerships – public awareness & stakeholder participation in a ppp...

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