Sector: 

Rural (village) water supply

Name of Agreement:

Operator’s Contracts for 51 Mini-Water Supply Systems (Contrats d’Exploitation de 51 Mini-AEP)

Type of Agreement:

Affermage/lease

Region (if known):

Africa (West Africa)

Year of Agreement/ Draft:

2007
18 (local) private operators to operate 51 rehabilitated mini rural water supply systems

Principal Author(s) (firm and contact person):

Prívate firm

Annotated by:

J Janssens

Purpose and Context:

To guarantee the appropriate and sustainable operation and management of mini water supply systems of 55 rural centers (of more than 2000 inh.), in view of improved quality of life and health of the population served.

Circumstances where this contract may be appropriate:

Rural and small town water supply in a decentralized environment

Drafted for common law/ civil law jurisdiction:

Civil law jurisdiction

Main Features:

Contract duration: 5 years

Contract signatories: (i) local government, municipality or village, (ii) local consumer association, on the one hand, and, the private operator on the other hand

Supported by the rural water supply investment component of the World Bank Water Sector Project (Projet Sectoriel Eau – PSE)

The establishment of an Audit Fund (Fonds d’Audit), to cover the costs of technical and accounting audits; monthly replenished by the Operator out of tariff revenues; jointly managed by the Operator and the Consumer Association, both signatories of the contract.

The establishment of a Renewal and Extension Fund (Fonds de Renouvellement et d’Extension), to cover the costs of renewal and extension of the infrastructure; monthly replenished by the Operator out of tariff revenues; jointly managed by the Operator and the Consumer Association, both signatories of the contract.

The Price of the Operator (price per m3 produced) has two components: 1. Part to cover the costs of operation and maintenance, and, 2. Part to be paid to the Consumer Association, destined to feed the two above funds, and to cover cost of management of the Consumer Association.

Local government is the owner of the fixed assets. The Ministry of Water (Ministere en charge de l’Hydraulique) coordinates.

The private operator collects the tariffs.

The Government decision to establish public-private partnerships in lieu of community management which had showed its limitations with regard to achieving the sector development objectives set by Government.

A beneficiary communication campaign was organized prior to the PPP at regional, subregional, and village level, on the development objectives and the key features of the PPP contract.

A prior capacity building and training program was organized for the local private operators and the newly formed consumers associations. This program was given by the urban water utility which is operating under an affermage contract.

Possible additional provisions that it might be appropriate to include:

Provided that the adequate baseline information would be available, the inclusion of a performance based incentive structure in the contracts. This may contribute to alleviate the perception by the population served of a lack of efficiency of the operators

The inclusion in the operator’s price of a contribution to the village community (redevance communal)

Provisions that may not be advisable to replicate/ may need further thought:

N/A

Provisions of wider general use:

Using a public-private partnership (delegated management contract) as a means to accelerate access to safe and reliable village or small town water systems.

A similar approach is being prepared for Niger and Senegal.  Other countries that are envisaging this include Malawi, Uganda (interstingly, common law jurisdictions).

Experience Since Coming Into Force (including any amendments)/ if draft form, whether it has been applied:

The establishment of a good and effective relationship between partners of the PPP is a continuing challenge:

·          between the village communities and the user associations;

·          between the private operators and the user associations

·          between the private operators and local government/municipalities

Capacity building of the local private operators in delegated management contracts (affermage) is on the critical path. This is also true with regard to local government and municipalities.

Acceptance by the village inhabitants of a cost recovering water tariff is key.

Tracking Number:

Affermagehybrid1