Beneath the hype

BHAMBHEVA village in Jind district, Haryana, does not have much of a sewerage system. A report on “Financing Water and Sanitation: Public Realities”, authored by David Hall and Emanuele Lobina for the 6th World Water Forum held in Marseilles, France, in 2012, presented evidence to show that historically the great majority of investment in water and sanitation services in high-income regions of the world was made by the public sector using public finance through taxation. Central governments as a whole played a key role in financing investment in water systems and in managing water resources and floods.” The authors argue: “The advantages of public finance are that the state pays lower interest than the private sector, it avoids that poorer ‘consumers’ cannot afford to pay full costs, and the major benefits of universal water and sanitation connections are public health, not private gains. Municipalisation was seen as a way to overcome the systemic inefficiencies of the private contractors….” Giving examples of public financing of water and sanitation, the paper says: “In Hungary, despite privatisation of water in most major cities, tax revenues of central government continue to be the main source for financing investment in infrastructure.” Quoting a 2009 study, the authors say that in France, too, the funding for water services was largely public, with private funding accounting for only 12 per cent of the investment. The authors quote a World Bank research paper in 2006 that reviewed actual private investment in infrastructure in developing countries between 1983 and 2004: “PPI has disappointed —playing a far less significant role in financing infrastructure in cities than was hoped for, and which might be expected given the attention it has received and continues to receive in strategies to mobilise financing for infrastructure….” Reflecting on the shrinking role of the municipalities, Professor Amitabh Kundu, senior fellow at the Delhi Policy Group, a think tank based in the capital, told Frontline that the total piped water provided by urban local bodies had come down from 74 per cent in 2008-09 to 69 per cent.