Ghana: World Bank, AfDB initiative supports water sector

The World Bank and the African Development Bank (AfDB) has initiated discussions with the managements of Ghana Water Company Limited (GWCL) and Aqua Vitens Rand Limited (AVRL) on how to find a comprehensive and sustainable solution to problem facing urban water supply in Ghana.

Mr. Ishac Diwan, World Bank Country Director said that the World Bank has moved from the stage of exploring the possibility of supporting the sector to actually starting the process towards finding a lasting solution to the problems facing the sector.

“We began a brainstorming session today, during which we identified specific areas where support will be needed to bring a more comprehensive solution to bear on the urban water sector,” he said.

Mr. Diwan, however, pointed out that the AfDB’s involvement is only at the exploratory stage.

He said at the brainstorming session, it emerged that the main challenges facing the sector are those of inadequate water production, obsolete transmission and distribution systems and huge losses being made due to leakages and piracy.

The World Bank in 2006 provided a grant of $150 million to the Government of Ghana under which AVRL was competitively awarded a five-year management contract to help reduce loses in potable water and water revenue by 25 per cent.

The AVRL contract will end in 2011, but the World Bank, by this new development, has indicated its continuous interest in supporting the sector in a more comprehensive manner.

Mr. Diwan proposed that in order to deal effectively with the challenges, there is the need to map out a plan that will address them in parallel by working on the expansion of the production capacity, rehabilitation of the distribution networks and collecting of the revenue at the same time.

He said the expansion of the water supply system have not been able to catch up with the fast moving residential and industrial development in the country.

Mr. Diwan said part of the problem is because the water production and supply plan of the country was last updated in 1990 and has outlived its usefulness.

After the brainstorming session, the management of GWCL and AVRL took the officials of the WB and AfDB on a familiarisation and fact finding tour of the Kpong Water Works.

Mr. Charles Brobbey, the Production Manager at the Kpong Station, told the delegation that even though the plant takes 53 million gallons of raw water a day, it produces 36 million gallons for both urban and rural Accra.

Meanwhile the Chinese Exim Bank has expressed readiness to invest over $200 million into the expansion of Kpong headwork’s and raise its production capacity by at least 40 million gallons over the next five years.

Source: GNA / Ghana Government. 18 Dec 2009

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