HE WBI PERPAMSI TWINNING PROGRAM APACITY BUILDING COMPONENTS FOR NRW REDUCTION

Transcription

1 PERPAMSI Persatuan Perusahaan Air Minum Seluruh Indonesia Indonesian Water Supply Association HE WBI PERPAMSI TWINNING PROGRAM APACITY BUILDING COMPONENTS FOR NRW REDUCTION World Bank Water Week 2005 Conference March 2005, Washington DC Drs. Ambarita GODMAN, Executive Director, PERPAMSI

2 Overview of Presentation Introducing PERPAMSI and the Indonesian water supply sector The WBI PERPAMSI twinning program and it s NRW reduction strategy Water utility performance improvement through NRW reduction 2

3 Introducing PERPAMSI Established in 1972 by the Indonesian Government Now: Independent water supply association Organization: Head quarter in Jakarta (30 employees) 27 PERPAMSI offices in all provinces Members: All 306 Indonesian water utilities with employees Around 100 extraordinary members (suppliers, investors, ) Services: Services to water utilities, governmental institutions, financing institutions, investors, donors and other stakeholder in the sector 3 Training foundation under PERPAMSI

4 Introducing the Indonesian Water Sector Water utilities are owned by local governments and controlled by local parliaments (tariffs) Coverage for piped water supply less than 35% for urban areas and less than 20% for all Indonesia (currently 220 mio. inhabitants; around 6 million household connections in total) Water supply is provided through 306 water utilities Utility structure: Only 5% of water utilities have more then 50,000 connections and around 60% have less than 10,000 connections Only around 2 % of all utilities operated on Full Cost Recovery level NRW-Rates exceed in many cases 50%! Overall coverage for public sewerage services less than 1% 4

5 he Indonesian Water Sector and the MDGs Population (1,5% growth) 220 mio. 255 mio. % of serviced population 20% 60% House Conn. (present) 6 million House Conn. (needed) Investment required 26 million 5 billion US$ (Average: US$250 per new House Connection) Around 20 million new house connections needed Urgent rehabilitation need of existing systems Need for private sector participation 5

6 Overview of Presentation Introducing PERPAMSI and the Indonesian wate supply sector The WBI PERPAMSI twinning program an it s NRW reduction strategy Water utility performance improvement through NRW reduction 6

7 Introducing the WBI PERPAMSI Twinning Program In 2004 the WBI launched a new initiative on pilot twinning partnerships with service delivery institution in order to shift from training individuals to building the capacity of institutions to be more effective Memorandum of Understanding between WBI and PERPAMSI signed in March Work program was developed in 2004 for 3 years Program to be financed through Dutch Trust Fund Budget (incl. contributions from partners) 1.4 mil. US$ 7

8 Objectives of the WBI PERPAMSI Twinning Program Component 1: Strengthen PERPAMSI communication and information services Component 2: Strengthen PERPAMSI benchmarking program Component 3: Strengthen PERPAMSI education and training foundation 8

9 NRW Reduction Strategy How is NRW reduction linked to utilities performance NRW reduction affects directly the operational efficiency and sustainable operation of a utility with Impacts on service continuity and water quality Impacts on utilization of assets Impacts on financial flows Why is NRW reduction so difficult to do? NRW reduction is a very complex issue: Multiple components and sources of losses What is the adequate target in Indonesia? 9

10 The Role of PERPAMSI in a NRW Reduction Strategy Implementation The PERPAMSI mission is to assist water utilities in the attempts to improve performance PERPAMSI has it s own training foundation for the implementation of capacity building programs PERPAMSI is running a water utility benchmarking program, which is a good tool to support the implementation of NRW reduction programs PERPAMSI as the umbrella organization can promote 10 NRW reduction programs in utilities nationwide

11 The Role of PERPAMSI in a NRW Reduction Strategy Implementation (cont.) PERPAMSI can share the results and disseminate best practices on NRW reduction with all water utilities in Indonesia and in the region PERPAMSI can facilitate between the mayor and city council - representing the owners - the water utility and other stakeholders to improve the dialogue Promote private sector participation (outsourcing to domestic private sector, BOT, BOOT,....) First training from WBI on NRW reduction will be implemented in April 2005 with 5 utilities 11

12 Overview of Presentation Introducing PERPAMSI and the Indonesian wate supply sector The WBI PERPAMSI twinning program and it s NRW reduction strategy Water utility performance improvement through NRW reduction 12

13 Reasons for Poor NRW Performance of Utilitie Vicious circle: Low (political) tariffs poor services Water supply sector is generally not considered as an attractive career opportunity (qualification of staff) Many water utilities are still managed by bureaucrats Poor installations (construction material, workmanship) with NRW rates exceeding many times 50% Poorly operated and maintained networks, metering systems and low collecting efficiency Weak sector policy is in place A small number of utilities (< 5%) is operated on Full Cost Recovery (FCR) level 13

14 Capacity Building - the Way Forward Capacity building in water utilities leads to better public services and better performance business focus Better services of water utilities create a climate where water tariff adjustments are easier to justify and achieve the decision on tariff adjustments stays with the local governments, which are controlled by local parliaments NRW reduction measures have direct impacts on the utilities cost and revenue structures and are considered a an efficient instrument to improve performance Water supply can be good business for investors 14

15 PERPAMSI Persatuan Perusahaan Air Minum Seluruh Indonesia Indonesian Water Supply Association Thank you for your attention! 15