Region: Sub-Saharan Africa
Country: Benin
Sectors: Water and Sanitation
Keywords: Contractual Provisions, Affermage
Document(s):
Benin - Modele 3 - contrat d'affermage bytes
Document Summary:
This is a simple bullk supply arrangement for delivery by the service provider of water to the water user association in a village (AUE) which then operates the distribution and collects tariffs from users. The contract sets out simple service obligations for the provider for service of the pump and the facilities up to the water meter. The provider is paid a fixed fee for the water on a volumetric basis by the AUE. The monitoring of the contract is by the community and the tariff is revised with the approval of the Community Council. There are very few service requirements set in the contract but there is a requirement to meet the "normes techniques" (technical norms). It might be appropriate in replicating this arrangement to have some of those norms specified in a schedule to the contract.
Document Details:
There is no need to have any specific obligations in this contract regarding increases in connections as the provider takes the net revenues and so is incentivized naturally to increase connections. The provider is responsible for repair and maintenance but not major renewal and replacement and extension (which will be funded out of the rehabilitation fund that comes out of the licence fee). The provider implements/ oversees any major renewal or extension of the water facility and pump, as per the annual capital investment plan. While this contract is developed in a civil law context using the affermage model, it could be adapted to a common law context where it was possible to assume full cost recovery and where it is appropriate for the water user association to assume responsiblity for the distribution network.
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Parties |
The Community and the Service Provider (presumably the AUE would also need to be a party as it is to make the payment of the fee and has other obligations) |
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Date |
N/A |
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Duration |
3/4/5 years, renewable for a similar period (article 3.2) |
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Service being provided |
Operation, management and maintenance of the Village Water Source and Pump (article 1) in accordance with technical norms (article 5) |
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Investment obligations |
There are minimal investment obligations regarding operations and maintenance of the facilities. The facilities are existing and there is no major renewal or extension unless agreed and funded from the renewal fund. The provider is responsible for replacement and repair of damaged parts (article 5). The provider is not responsible for operation and maintenance of the distribution system beyond the bulk meter. |
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Funding source |
Fee charged to AUE for water supplied (article 13) |
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Maintenance and rehabilitation requirements |
The provider is to maintain the works and equipment in good working condition (article 5) |
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Service levels specified |
Articles 5 and 8 (in particular, service of [ ] hours per day, 7 days a week) |
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Performance targets |
None |
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New connections |
Not applicable - this is the responsiblity of the AUE. |
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Bonus/penalty system |
In case of interruption of water supply without justification from the superior service 24 hours in advance, the community has the right to penalize the provider of an amount up to 50% of the estimated revenue of water services for the period of interruption (article 18) |
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Tariff setting - who performs |
The tariffs for bulk supply are specified in the contract (article 11) as well as the charge for a new connection. Tariffs can be reviewed annually. The provider or the community (at the request of the AUE) may also request an increase or decrease respectively. The amount by which the license fee can also be revised annually in agreement with the Technical Service of the community to take into account renewals etc. The change of tariff should be approved by a decision of the Community Council (article 12) |
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Tariff collection |
The AUE collects the revenue and then pays provider for the bulk water supply. |
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Payment |
The provider keeps the bulk supply fee (other than licence fee (which is fixed in the contract) for rehabilitation, extension and auditing costs, as well as fee for community budget, to the designated bank account of the community (article 13)) (article 13) |
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Is any sum put aside for rehabilitation? |
Yes, a license fee for the rehabilitation, extension and auditing is established and is paid by the provider every month. (article 13) |
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Accounts and reporting |
The provider is to have accounts drawn up by accountants approved by the community (article 5). It is to make monthly reports and annual accounts to the community. |
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Proposals for capital expenditure and renewal |
The provider is to propose to the community a program of investments each year regarding the facilities and pump managed by it, to be financed from the rehabilitation fund (article 5) |
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Asset ownership |
The assets and any new assets are held by the community (article 7) |
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Regulator/monitoring body |
The AUE plays the role of monitor and supervisor and the commune also monitors performance regarding technical and financial aspects (article 15) |
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Customer complaints mechanism |
There is no provision specified - but the agreement is with the community and so it is likely that complaints would be addressed to the community |
Updated: October 25, 2021