Ghana: Ghana Water Company under fire

The Ghana Water Company Limited (GWCL) is under fire from both the government and anti-privatisation activists for poor service delivery and corruption. In the wake of this criticism, Aqua Vitens Rand Limited (AVRL), the private operator which supports GWCL since 2006 as part of a World Bank-supported project, has launched an effort to collect unpaid bills. The World Bank maintains that the project is making significant progress.

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The Ministry of Water Resources, Works and Housing has constituted a committee to review the management contract between Ghana Water Company Limited (GWCL) and Aqua Vitens Rand Limited (AVRL).

The review exercise was prompted by the problems hindering water delivery, especially in urban areas, and the implementation of the US$ 80 million World Bank sponsored Urban Water Project between GWCL and AVRL. (See also Wikipedia – Water privatization in Ghana).

Water minister Albert Abongo said the misunderstanding between the AVRL and the GWCL about their respective responsibilities in regard to water operations, revenue management and maintenance of systems was having a debilitating effect on water.

Mr Abongo said government was not pleased with the performance of the expatriate management operator, AVRL, which was contracted by the previous government to improve management practices at GWCL.

He said it was too early at this stage to recommend termination of the contract.

Mr Abongo said a steering committee to be chaired by him, would help to address inefficiencies that would be identified by the review committee.

Answering a question as to whether the public should expect a shake-up in the management of GWCL, Mr Abongo said a change in attitude rather than a massive clean-up of personnel would reverse problems facing the company.

He asked the GWCL to tackle the diversion of company property by personnel for their personal use, which he said remained a major drawback on the operations of the company.

Mr Abongo said some staff of GWCL also connived with the public to engage in illegal water connections, depriving the company of revenue.

The National Coalition against Privatisation of Water (NCAP) is considering dragging GWCL and AVRL to court for what it describes as poor service delivery, if all the petitions and interventions it has brought against the two companies fail to yield the desired results.

The group has already petitioned the Serious Fraud Office (SFO), and was in the process of sending another petition to the Commission on Human Rights and Administrative Justice (CHRAJ), to investigate AVRL’s inability to meet their performance targets, as well as the claim that they made about GH¢30million [US$ 21 million] profit, which has been denied by the GCWL.

One of the key issues NCAP has raised about the management contract between the GWCL and AVRL is the reduction of Non-Revenue Water (NRW) by 5% each year.

Per the contract estimation, this should have been 40% in 2008, but the NCAP claims that it is 51.7%, that is 11.7% higher than the target.

According to the NCAP there has been only a 2% increase in production, mainly due to expansion works at Dalum (Tamale), Sekyere Hemang and Bafiakrom in the Central Region, with only a 1% increase in installed capacity.

The AVRL appears to be taking the criticism to heart by announcing that debtors will be disconnected and prosecuted if they don’t settle their arrears. It is offering a GH¢20 [US$ 14] reward for all “who divulge [via a Toll Free number] information on unscrupulous and anti-social citizens who indulge in malpractices like illegal connections, self reconnection, the use of in-line suction pumps.”

The World Bank remains upbeat about the Ghana Urban Water Project. In the FY09 status of report of projects in Ghana, published in October 2009, the Bank says:

“Significant progress has been made towards achieving the objective of restoring long-term financial stability, viability and sustainability of the Ghana Water Company Limited by: (a) having already reached the target of recovering 100% of the operation and maintenance costs from the utility revenues; (b) having surpassed the efficiency target of less than 10 employees per 1,000 connections; and (c) having promulgated the National Water Policy.”

Source : Accra Daily Mail / allAfrica.com, 19 Oct 2009 ; Ghanaian Chronicle / allAfrica.com, 16 Oct 2009 ; Peace FM Online, 02 Nov 2009