UNDERSTANDING WATER SUPPLY REFORMS IN NIGERIA’S NIGER DELTA: A RESEARCH NOTEBy

Ukoha Ukiwo1

IntroductionSince the 1980s, most developing countries have embarked upon reform of the water supply and sanitation sectors. Although reforms of some sorts were necessary in many of the countries given the fiscal crises that confronted them from the late 1970s and shortfalls in meeting their targets for water and sanitation, the proactive role of multilateral organizations, principally the World Bank and the International Monetary Fund (IMF), in imposing reforms as conditionality for loans and debt service have been controversial (see Goldman 2005). The Bretton Woods institutions have been criticized for stage-managing the take-over of the developing world by making privatization of water supply a prerequisite for financial support (Finger and Allouche 2002, Amenga-Etego and Grusky 2005). Given the primacy attached to privatization, it is not surprising that commentaries on the reforms have revolved around debates on the pros and cons of privatization. A corollary of this concern is that the debates have largely revolved around countries in which foreign private companies have taken over the business of supplying potable water and sanitation services. For instance, South Africa, Cote d’Ivoire and Ghana have attracted most of the studies of water and sanitation reform in sub-Saharan Africa largely because of the incursion of Big Water companies from the global North. Such a focus, while important, leads to an underestimation of the extent of reforms that may be taking place elsewhere in the continent. The neglect of countries that have not embarked upon wholesale divestiture and privatization also obscures the roles of promoters of reform and their modus operandi, the reasons why privatization was either not attempted or failed in most countries and the impact of reforms on state and society relations in such countries. Moreover, the narrow focus on privatization case studies obscures the more fundamental transformations taking place in these countries, as a result of the hegemonic sway of the integrated water resources management (IWRM) framework. At the core of IWRM are three interrelated principles, namely: recognition and valuation of the whole gamut of the social, economic and ecological uses of water; adoption of integrated planning and management of agricultural, municipal, industrial and ecological demands for water; and institutionalization of partnerships between state institutions at various levels, the private sector and civil society in water management (Conca 2006:124). The present study proposes to assess these profound changes in the water supply sector in one such country, Nigeria.

1 Luce Fellow, Institute of International Studies, Berkeley, California and Research Fellow, Centre for Advanced Social Science (CASS), Port Harcourt, Nigeria (e-mail: uukiwo@hotmail.com). The paper has benefitted from interactions with my colleagues Beate Frank, Wijanto Hadipuro and Manuela Moreira for which I am grateful.

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Like other developing countries, multilateral financial institutions have been promoting reform of the water supply sector in Nigeria over the past three decades. The overriding objective of the reform has been outright replacement of the supply driven approach in which the state was held responsible for provision of potable water and sanitation services with a demand driven approach whereby the major decisions are taken by the private sector and the consumers of portable water. Thus, Bretton Woods in particular and the international development community in general have increasingly and rather overzealously promoted privatization and community participation as the panacea to the water crisis that threatens the attainment of the millennium development goals in Nigeria’s growing cities and pauperized rural areas. The proposed research will investigate the making, mainstreaming, and effects of this new orthodoxy on water provisioning in Nigeria. More pointedly, it will explore what Conca (2006) has rightly called the tension between metanorms of water marketization and water citizenship. It will examine the extent to which the objective of increased full-cost recovery through such strategies as public-private partnership is consistent with or contradicts the objective of greater community participation, and vice versa; and whether or not ultimately the poor that were undoubtedly marginalized in the outmoded statist regime and are ostensibly presented as the target beneficiaries of the new integrated model, are having better access to water in the emerging dispensation. It seeks to examine the ways in which the increased commodification of water associated with World Bank instigated market reforms might compromise or be compromised by the lofty objectives of universal access to water, community empowerment and sustainable resource management.

The investigation will be based on case studies from Nigeria’s Niger Delta region which is richly endowed with water resources but paradoxically is host to communities with poor human development status, partly as a result of perennial lack of potable water and basic sanitation services (UNDP 2006). This research note is divided into five broad sections. Following the introduction, section two reviews the literature on the global reform on water supply. The third section examines the introduction of the reform agenda under the aegis of multilateral institutions such as the World Bank, International Finance Corporation (IFC) and the UN agencies, OECD development agencies such as the European Union, the United States Agency for International Development (USAID), the UK Department of International Development (DFID) and the Japan International Development Corporation (JICA); and non-governmental organizations such as WaterAid. In section four, I focus on the emergent ‘shared vision’ on provision of potable water in Nigeria’s policy sector. The fifth and final section provides justification of the choice of the Niger Delta, puts the research questions in the context of wider debates in water supply reform and ends with a brief outline of the proposed research design.

The Global Agenda on Reforming water supplyThe water reform agenda is an integral aspect of the neoliberal revolution that began in the early 1980s. This revolution was characterized by the discrediting and toppling of neoclassical Keynesian orthodoxy that promoted an interventionist role for the state in the development process. The state was not only supposed to invest in areas deemed unattractive to capital interests but also to

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promote distributional policies that profit oriented private sector initiatives are not only innately insensitive to but also tend to undermine. In the developing world, where the private sector was either absent or nascent, state intervention was also to be attuned towards grooming a national bourgeoisie in a system Sayre Schatz (1977) aptly called ‘nurture capitalism’. For three decades, Bretton Woods’ lending was directed at enabling the state to invest in those sectors supposedly unattractive to the private sector. This liberal lending regime resulted, in the late 1970s, in a situation in which many of the states had over borrowed beyond repayment capacities, culminating in the debt crisis.

The debt crisis generated a new ‘consensus’ in economic thinking known as the Washington Consensus which canvassed downsizing of the state and the removal of all encumbrances to the reign of the market. The state was charged and convicted for profligacy, inefficiency, institutionalized rent seeking and irrationality. State intervention purportedly distorted ‘pure’ market mechanisms resulting in such undesirable outcomes as overvalued currencies, over-subsidized social services, bloated bureaucracies and malfunctioning public utilities. The punishment, or better put, the reform needed for the state was significant retrenchment. The state should be cut to size and restricted to its ‘traditional’ function as ‘regulator’. Against the backdrop of the ubiquity of the state as a multitask machine, the logical outcome of the reform which required the state to surrender its holdings is what Watts (1994) has called ‘the privatization of everything’. The reform programme was also expected to overhaul the architecture of state-society relations. Development was hitherto a top-down process in which the power, resources and responsibilities were over concentrated on the central government which was far removed from but exercised dominion over a largely ‘uncaptured’ peasant (rural) population (Hyden 1982). It was therefore necessary that decentralization – the devolution of governmental powers, functions and resources to local authorities should be implemented alongside privatization. The concurrent implementation of privatization and decentralization -and the fact that the latter is apparently more acceptable than the former - resulted in a situation in which privatization is either subsumed under decentralization or both are used interchangeably. The instrumental value of the conflation of privatization and decentralization manifests itself in the reform of the water and sanitation sector.

For instance, in the glossary of its major policy document on water reforms, the World Bank (1993:5) defines decentralization as:

The distribution of responsibilities for decision making and operations to lower levels of government, community organizations, the private sector and non-governmental organizations.

The glossary does not include privatization. However, the policy statement on the objectives of decentralization indicates that both terms are used interchangeably, to wit:

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The principle is that nothing should be done at a higher level of government that can be done at a lower level. Thus, where local or private capabilities exist and where an adequate regulatory mechanism can be established, the Bank will support central government efforts to decentralize responsibilities to local government and to transfer service delivery functions to the private sector, to financially autonomous public corporations and to community organizations such as water user associations. The privatization of public water service agencies or their transformation into financially autonomous entities, and the use of management contracts for service delivery will be encouraged (World Bank 1993: 15-16).

The World Bank blueprint for water resources needs to be understood within the context of emerging international understanding and consensus on the management of water resources. It is noteworthy that it followed on the heels of the International Conference on Water and Environment (ICWE) held in Dublin in January 1992. The major points in the Conference statement which became known as the Dublin Principles marked a paradigm shift from earlier concerns about availability and sustainability towards IWRM. These four principles are:

Freshwater is a finite and vulnerable resource, essential to sustaining life, development and the environment.

Water management should be based on a participatory approach, involving users, planners, and policy makers at all levels.

Women play a central role in the provision, management, and safeguarding of water.

Water has an economic value in all its competing uses and should be recognized as an economic good (cited in Conca 2006:141).

While principles one and three were generally well received despite their policy implications in terms of equity, principles two and four generated controversies. This is because they were construed as challenging the dominant role of state in water management and overturning earlier understandings of water as public goods and human right. It is not surprising therefore that commentaries have focused on the desirability or otherwise and compatibility of privatization, decentralization and community participation. After all, underpinning reforms were two principles, namely the instrument principle and the institutional principle (Nickson 1997). While the instrument principle revolved around the economic value and cost of water the institutional principle emphasized participation of all stakeholders in water management.

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Arguments in favor of reform of the water supply sector have been framed in negation of the original rationale for state intervention. Historically, the original effort to supply water to households from mid-nineteen century Europe and North America were undertaken by private business interests. However, by the first few decades of the twentieth century there was an emergent consensus that state intervention was necessary due the public health benefits anticipated from universal coverage and the sheer size of investment needed which was beyond the reach of private businesses at the time (See, Davis 2005, UNDP 2006). Consequently water was progressively conceptualized as a ‘public good’. Against this backdrop, the starting point of reform proponents has been the demystification of the ‘false assumption that it (water) is a public good’ (Nickson 1997:167). In contradistinction to popular parlance in which ‘public goods’ are seen as any good or service provided directly by the public sector, the neoliberal paradigm offers a more restrictive (economic) definition (see Hanemann 2006). In their opinion, to qualify as public good, a good or service should be non-excludable, non-rivalrous and non-rejectable. In other words, it would both be automatically available to everybody once provided to one person; the quantity available to one person does not diminish the quantity available to another person; and it is not possible for anyone to refrain from consuming it. Neoclassical economic theory suggests that goods and services with such qualities such as clean air, defense and street lights should be provided at no cost to the general public albeit with funding from taxes (see Hanemann 2006).

Moreover, reform proponents argue that, in its potable form, it is possible to exclude some people from access to water. Potable water does not qualify as a public good because it has seldom been provided free of charge (Malkin and Wildavsky 1991 cited in Nickson 1997). It is therefore a ‘private’ good, albeit, with certain features. These features are: (i) it is a natural monopoly, due to the economics of scale usually derived from a piped network; (ii) it has both positive and negative externalities which make its benefits not easily captured in market prices; and (iii) it is a merit good whose benefits outweigh the utility calculations of individual consumers. Proponents of the ‘private’ good perspective however argued that the possession of these features only ‘provide the justification for public-sector intervention in order to counter possible divergences between private and social costs and benefits … they do not provide any argument in favour of direct public provision’ (Nickson 1997:168). In other words, state intervention should strictly be devoted to regulation and facilitation, and not delivery.

The fulcrum of the preference for private sector delivery is also the belief that it is more efficient in service delivery given its overriding profit motive that engenders innovative cost-saving measures. This claim is buttressed by the failure or inefficiency of public sector utilities, especially in developing countries. The weakness of the state is depicted as having led to wastage of valuable water resources (through leaking pipes), and fiscal imbalances that foreclose new investments, especially in semi-urban and rural areas. Thus, state involvement is discredited for being injurious to sustainability in both economic and ecological aspects. State inefficiencies, ceteris paribus, paradoxically subvert the public interest that the public agency was supposed to protect. This is particularly poignant when the impact of state failure and inefficiency, according to reform proponents, on the poor are examined. The

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promise of free water ultimately translates to no water for the poor. The failure of public utilities consequently condemns the poor to exploitative water vendors. References are made to studies that show the exorbitant cost of water in informal markets, which are presented as conclusive proof that the poor can pay for water. The private sector should therefore be given the incentive to provide water in more efficient manner and at competitive prices. Consequently, private sector participation and demand management approaches are promoted for being pro-poor in the long run and therefore imperative for governments committed to alleviating poverty.

Opponents of the reforms criticize the ideological representation of water as an economic and private good. They couch their argument in the necessity of water for life, which in their opinion makes water a human right. The indispensability of water, the public health benefits of improved access to water and the cultural value of water makes the common resource too strategic to be left to capricious market forces. The anti-reform literature and movement debunk the idea that the public sector is inherently inefficient in managing public utilities as historically untenable. As one commentator puts it:

Throughout most of the past century, water management particularly but not exclusively in OECD countries was characterized by dominant role of the state as owner, manager and regulator of water supply infrastructure (Bakker 2003:329)

Other studies show that the private sector is not always efficient in service delivery and are also prone to corruption. Private sector investment tends to concentrate on high brow urban neighborhoods and seek quick returns to investments which results in price hikes. All these compromise the objective of improved access (see, Budds and McGranahan 2003, Davis 2005, McDonald and Ruiters 2005, for good summary of debates).More recently, commentators have attempted to go beyond the politicized and ideological debates on the inherent pros and cons of private sector participation in water delivery services; and polarized conceptions of water as economic or social good. The idea is that the positions are not mutually exclusive. In the words of Gutierrez et al (2003:10) for instance:

We believe that in the context of both service and resource management, water is an economic good, a social and environmental good, and a human rights. These different aspects should not be mutually exclusive, and need to be balanced with priority given to human and environmental requirements, and without cost recovery becoming a barrier to meeting basic human needs.

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The case is made for context specificity which the public – private dualism tends to ignore (Bakker 2003). Moreover, it is argued that it is simplistic to assume that the mere introduction of private operators will resolve fundamental economic and governance issues that the provision of water raises any more than they were resolved by state intervention in the past (Budds and McGranahan 2003). In this respect, the speed with which private sector operators are introduced without strengthening of capacities of both state institutions and civil society is shown to be counterproductive (see, Gutierrez et al 2003, Uiterweer et al 2006). Other critics of the debate have elected to focus on more fundamental changes thrown up by the reform, namely the commoditization or marketization of water and participatory approaches to management of water (McDonald and Ruiters 2005, Goldman 2005, Conca 2006). This perspective illuminates the various processes that culminated in the emergence of the new orthodoxy. The result is sometimes a view that presents an orderly manufacture of ideas and their transfer and mainstreaming through ‘transnational networks’. Although the principal elements of the reform appear contradictory, they are actually intended to achieve one purpose. As Jaglin (2002:236) puts it:

The resurgence (of participation) is in no way a random phenomenon: far from contradicting or tempering commercial principles, participation is a tool designed to regulate / stabilize new arrangements, and to conform them to the still rather vague notion of a right of access to drinking water for urban households.

However, while recognizing the hegemony of the transnational networks that manufacture and mainstream the reforms and the agendas that the reform of the water sector serve, it is important to avoid construing the arena as monolithic. Conca (2006) suggests that the transnational networks should be seen as arenas of contentious politics. Social movements with alternative positions to the IWRM framework have formed alternative transnational networks and infiltrated the transnational spaces created by states, supra-state institutions and their allied expert networks to govern water. This, and the fact that other supra-state and state actors in the networks especially those from the United Nations and developing countries are more sympathetic to the human rights discourse and social and ecological value of water, have generated tensions within the IWRM framework. These contentious politics have affected its coherence and made the prospects of its full scale implementation somewhat elusive. This study will explore the ways in which the framework has been adopted and adapted in Nigeria. The exploration is important in the context of the phenomenon of extroversive dependency (Bayart 1991). This is the tendency for developing countries to adopt policies not because they accept them and believe policies are feasible but because adoption is a pre-condition for extracting resources from the international system. Water reform is susceptible to strategies of extraversion because the World Bank has explicitly made financing conditional on it. As shall be seen in the next section, the reforms in Nigeria’s water supply sector have partly been based on expectation of loans from multilateral financial institutions and foreign investments.

Reforming water policy in Nigeria

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The World Bank has been providing assistance to Nigeria in the water supply sector since 1979. The first generation of assistance was directed at investments and strengthening institutions at the state level, especially since urban water supply is constitutionally a responsibility under Nigeria’s constitution.2 States that benefitted are Kaduna (1979), Anambra (1980), Bornu (1985) and Lagos (1989). The second generation of assistance was in the form of a loan of US$256 million for the National Water Rehabilitation Project (1991-2001), which targeted the entire country. Concurrently also, the World Bank supported the First Multi-State Water Supply Project (1992-2000) with a loan of US$101 million, which was targeted at Kaduna and Katsina States. The third generation of assistance (2000-2004) was the provision of US$5 Million under the Small Towns Water and Sanitation Pilot Project aimed at satisfying the needs of 16 towns. The Independent Evaluation Group (IEG) of the World Bank considers its intervention between 1979-2005 to have failed because the seven selected cases studies were ‘rated as unsatisfactory, with unlikely sustainability and with negligible or modest institutional development impact’ (World Bank 2006:vii).

The objectives of different generations of projects dovetailed with the prevailing conventional wisdom on water at the point they were proposed. For instance, the first generation projects were aimed at supporting the state to establish infrastructure to attain the UN Decade for Drinking Water and Sanitation. It was also launched at a point when the state role in the sector had not yet been comprehensively challenged. The second generation projects were conceived to facilitate rehabilitation in the 1990s when the understanding was that the state needed to withdraw. The objective of lending was thus to rehabilitate existing projects in order to render them sustainable through user charges. The third generation captures the era where private sector involvement was anticipated to support large scale projects in the urban areas and the objective of lending was to provide assistance to small towns. The scaling down of funding during this period reflects this also. In terms of involvement in promoting reforms in the sector, World Bank involvement coincides with the second generation of lending. International developments that facilitated this include the emergence of the IWRM as conventional wisdom.

During this period, the Bank no longer limited itself to providing loans but also promoting policy reform (see Goldman 2005). Reforms were promoted in three ways. First, loans were made conditional to reforms or reforms were worked into the loans. For instance, to kick start user-contribution, benefiting communities were expected to contribute towards the project. Thus, in the Pilot Small Town loans project, beneficiaries were supposed to contribute 5 per cent (US$ 0.5 million) while the federal government would contribute 25 per cent (US$ 2.5 million) towards the project. Second, reforms were pushed through the idea of pilot projects funded under a learning and innovation loan (LIL). As stated in the loan document of the Small Town Project:2 Nigeria has been a federal state since 1954 with responsibilities divided between the federal government and regional (now states) governments. With the recognition of local government as a third tier government in 1976, local councils were also assigned functions and responsibilities of government. The local government’s mandate is with rural water supply.

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The objectives of the pilot project are to test, develop and improve the draft policy framework and implementation guideline prior to embarking on a nationwide program. It will particularly test the ability and willingness of the local private sector to support communities in their water supply investment and operation (World Bank 1999:2).

Third, the World Bank promoted reforms through knowledge transfer in the form of direct policy advice, research, publications or organizing workshops and conferences or providing sponsorship to relevant public officers to attend such conferences. For instance, the Bank organized workshops in 1996 and 1997 with government officials in which notably the first suggestions of Private Sector participation were made. The World Bank Institute (WBI) organized a participatory workshop in June 1998 for ‘a wide spectrum of stakeholders including the Nigerian Water Supply Association (NSWA)’ (World Bank 2004:12). The NSWA collaborated with the World Bank to organize a workshop for the water sector managers in September 1999, and in February 2000 the Bank and WBI organized a workshop for state governors and decision makers. The Bank also sponsored research such as the Nigeria Water Private Sector Option study (1998), Kaduna State Water Board Vendor Study (1998), Katsina State study on vendors and subsidies (1999) among others. The studies were explicitly intended to facilitate the Bank’s dialogue with Nigerian government officials. They were also aimed at shaping wider public opinion through Bank’s publications. For instance, in a much-cited World Bank strategy paper for the Niger Delta, results of studies that show that consumers are willing to pay for improved water and sanitation services are conspicuously displayed in a box. The implication of the finding was that the poor ‘believe that the benefits of safe water supply outweigh the higher cost of privately supplied water’ (World Bank 1995:111).3 Significantly, the World Bank bemoaned the improper pricing of water that led to inappropriate use and argued that:

‘In the delta region, this under-pricing of water may become a problem in areas of future aquaculture and rice expansion: both involve water intensive technologies. In areas where water is provided freely these forms of production, are in effect, subsidized; where such production occurs in coastal mangrove ecosystems, there is an implicit subsidy to clear these ecosystems for other uses (World Bank 1995: 93)

This was a subtle way of pushing the idea of IWRM into the public domain. Although the World Bank considers its loans to have failed, it is more optimistic when it comes to its reform promotion agenda. Through its participation in the preparation of Nigeria’s water policy (see below), Bank documents now frequently refer to the ‘shared vision’ for water and sanitation reform it has with the

3 The studies were conducted in Nsukka and Onitsha (Anambra State) which benefitted from World Bank loans.

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Nigerian federal government. It is hardly surprising therefore that the goals of the Bank for the water supply sector in the 2005-2009 country partnership paper are to:

Concentrate on rehabilitation of infrastructure.

Establish financial sustainability of service delivery.

Perfect public/private sector partnerships (World Bank and DFID 2005:29).

The fact that the above paper was prepared for Nigeria by the Bank and DFID indicates the shared vision of multilateral and bilateral agencies in Nigeria on the water supply sector. The aim of DFID’s water supply projects in Nigeria is ‘to improve provision of potable water and adequate sanitation in an affordable and sustainable way through participatory investment’.4 The policy of the European Union is similar, to wit:

Improved governance in water and sanitation and integrated management of water resources at regional, trans-boundary, national and local levels, and increased access to safe, affordable and sustainable water services for the rural and urban poor through the provision of funding for infrastructure and services.5

The USAID also shares the same goals and has demonstrated this by its partnership with Coca-Cola and an NGO, the Global Environment and Technology Foundation (GETF). The program targeted at African countries, demonstrates in USAID’s view, ‘how government, business and the NGO community can engage to solve global water problems in innovative ways’.6 The JICA, which has also tried its hand in promoting reform in Nigeria (see below) actually involves private sector in delivery of water services. Its support in the sector has largely been delivered through Japanese business enterprises.7 The major international NGOs working in the water supply sector in Nigeria are also involved in furthering reform. This is not disconnected from the fact that the funding comes from the EU and DFID that have provided support for rural water supply through these NGOs. For instance, WaterAid with support from DFID has implemented projects aimed at fostering sustainable access to water in rural communities through partnerships between local governments, local businesses and water user associations. With the unprecedented agreement among the multilateral and bilateral

4 www.dfid.org.uk.mdgs5 See, C. Edumarise, ‘EU budgets N30bn for water projects in Nigeria, others’, ThisDay, 26 April 2006 (online version)6 www.getf.org/news7 See, M. Bashir ‘Nigeria Japan Sign N298 million Yobe water contract’, Daily Trust, 2nd November, 2007. (Online version). See also, ‘JICA Nigeria activities’ at www.jica.gov.jp/nigeria/activities/index

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partners on reform, it would not be surprisingly that the Nigerian government has moved in the desired direction as is shown in the next section.

The evolution of reform policy in Nigeria’s water supply sectorTo be sure, there were some voices in favour of the reform of water supply in Nigeria prior to the explicit demands of the multilateral and bilateral institutions. These voices, largely from hydrologists both in the field and in the academia (see Oyebande 1978) stemmed from concerns about declining government financial investments amidst rising populations particularly in urban areas. They were generally in favour of allowing the public utilities corporations charge higher water rates for supplies and the reduction of wastage through metering. However, the voices did not impact public policy. For instance, in the Third National Development Plan (1975-1980), the Federal Government stated its objective as follows:

To make potable water available to an increasing proportion of the population at a reasonable rate. Existing works which have become inadequate will be extended to all sizable communities…In particular, it is the objective of government to meet the minimum target of 110 litres per person per day in all major urban centres and to ensure that all communities with 20,000 people or more are supplied with pipe-borne water during this period (FRN 1975: ).

In that plan, the Federal Government also offered to provide 50 per cent of the total capital expenditure budgets of the state governments which also had ambitious water supply projects. For instance, the East Central State, which emerged from the civil war battered, noted in it is plan for the same period that:

Because of the magnitude of the urban water problem and its interrelationship with other requirements, it is proposed to treat urban water supply as part of a special package…The revolution of rising expectations in rural areas, defining their greater demand for improved living conditions, and the increased rural populations have in fact been the driving force behind increased demand for improved rural water supplies. It is therefore the intention of Government in this plan period to provide every community with a population of 20,000 or more with good water supplies (East Central State 1975:118).

The above was the rationale for the major decision of government to take over water supply in the 1970s. Under the first and the second development plans, government provided major facilities in both urban and rural areas. However, in rural areas communities contributed towards distribution. ‘Communities were also free to pay for the whole cost of the project in the absence of government approval or sponsorship’ (East Central State 1975:118). Thus buoyed by rising oil revenues and more sources of foreign loans and

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facing the revolution of rising expectations from Nigerians who expected redistribution of oil wealth, the Nigerian state took it as a moral responsibility of sorts to provide water to its citizens.

Policy shifts became discernible in the early 1990s after almost a decade of interaction with World Bank assessment missions. The gradual approach to reforms is evidenced in successive incremental adoption of neoliberal prescriptions, such as in the 1988 rolling plans which replaced the national development plans with the adoption of structural adjustment. For instance, in the second rolling plan (1991-1993) which was described as an extension of the first (1990-1992), federal government committed to increasing service level 32 LPCD in urban areas to 120 LPCD, from 20 LPCD to 90 LPCD in semi-urban areas, and from 6 LPCD to 60 LPCD in rural areas. The staggered targets reflected the global trend. More importantly, government committed to promoting decentralization of management of water supply schemes and introduction of user charges (FRN 1991:178). In the third rolling plan (1993-95), the federal government, which claimed its determination to achieve the goal of providing water for all by the year 2000 is shown by its willingness to contract loans to develop the water supply sector, retained the targets8 and objectives of the previous plans. It however added another (ninth) objective, namely, to ‘encourage community participation in rural water schemes’ (FRN 1993:259). No new targets and objectives were added in the fourth rolling plan (1995-1997). In the fifth rolling plan (1997-1999), the federal government moved closer towards the emergent consensus on water. First, it recognized water as ‘a basic human need’ (FRN 1997:240). Second, among the nine problems listed as affecting the water supply sector were:

(I) The present institutional framework is not responsive to prevailing and economic realities. It has no room for private sector involvement in the delivery of water supply;

(II) There is no articulated policy position of government on the provision of potable water to the public, which is still generally conceived of as a free, and public sanitation as distinct from environmental protection (FRN 1997:241)

The fact that this observation came barely a year after the first World Bank sponsored water reform policy conference in Nigeria that raised PSP is an important indication of this self-criticism. Government however did not include private sector involvement as part of its objectives. It did however add a tenth objective, namely, ‘involve non-governmental organizations in the water supply sector’ (FRN 1997:243). Although the government did not invite private participation in the sector, its concern over the absence of the private

8 Although the claim was that targets were retained, there was actually a reduction to 90LPCD, 60LCPD, and 40LCPD respectively for urban, semi-urban and rural areas.

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sector reflected an increasing desperation in government circles for private sector participation. For instance, according the Vision 2010 report which was adopted the same year in which the fifth rolling plan was issued:

In order to attain the Vision targets, the private sector should become more active, within a market-oriented, highly competitive, broad-based, private sector-driven development process. Consequently, privatization, liberalization and rapid technological advancement should be among the critical elements of Nigeria’s economic development strategy during the vision period (Vision 2010 Committee 1997: iii).

Given the international isolation of the Abacha regime (1993-1998) economic reforms envisaged in the Vision Plan did not effectively take-off. With the political crises in the country, it was inconceivable that a regime which was fighting for legitimacy could summon the political will to implement unpopular market reforms. In fact, the institutional developments in this period indicated that the state retained a central role and public interest was considered paramount in water governance. The public reaction to the adoption of structural adjustment in the mid-1980s forced successive military governments into investing in so-called SAP relief programs. Notable among these was the Directorate for Food Roads and Rural Infrastructure (DFFRI) which had a huge budget for water projects in rural areas. The military government also established the Utilities Charges Commission to monitor and regulate utility tariffs. This followed the drive towards cost recovery by state water agencies. The statist approach is also evident in the Water Resources Decree 101 of 1993 that vested ownership of both surface and ground water resources on the state and provided that people could freely take from such water sources for domestic and non domestic use. People retained the rights to construct boreholes over their lands and the Ministry of Water Resources only had regulatory powers to stop such construction if it conflicted with the public interest (see, Karuk n.d: 8-9). The ministry was also empowered to regulate abstraction and sale of water in commercial quantities. In 1995, a National Water Resources Master Plan, which had been in the making since 1985, 9 was completed with support from the Japan International Development Corporation (JICA). The Master Plan stressed the need for a leading role for the state in order to meet targets of providing water to meet basic human needs. It however called:

For a drastic change from the large-scale oriented projects to the direction of implementing a series of the proposed small and medium-scale multipurpose water resources projects to meet the water demand anticipated in various sectors with a particular emphasis upon the effective programs of decentralization, privatization and users participation to facilitate the greater participation and deeper involvement of local people concerned (FRN 1995).

9 Work stalled because the major backer, the UN Food and Agricultural organization backed out.

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This recommendation was incorporated into the National Water Supply and Sanitation Policy adopted in January 2000 by the civilian administration of Olusegun Obasanjo, which was elected into office in May 1999. It became the first major policy document that recognized water both as a human right and an economic good, in line with Dublin Principles and also explicitly stipulated a role for the private sector:

The centre piece of Nigeria’s water supply and sanitation policy shall be the provision of sufficient potable water and adequate sanitation to all Nigerians in an affordable and sustainable way through participatory investment by the three tiers of government, the private sector and the beneficiary (cited in Ariyo and Jerome 2004:16).

In order to achieve the Millennium Development Goals, the government increased the targets to 60 percent in 2003, 80 percent in 2007 and 100 percent in 2011. The policy went the furthest in dividing functions among tiers of government by stipulating a cost sharing formula as shown in Table 1.Table 1: Cost-sharing formula in water sectorAgency Rural Water Supply Small towns water supply Urban water supply

Capital (%) Operation and maintenance (%)

Capital (%) Operation and maintenance (%)

Capital (%) Operation and maintenance (%)

Federal Government

50 Nil 50 Nil 30 Nil

State government 25 10 30 Nil 60 100 (Tariffs)Local government

20 20 15 Nil 10 Nil

Community 5 70 5 100 Nil NilSource: WaterAid 2006:5The principle of the formula was that consumers should contribute towards costs of operation and maintenance while the state responsibility would be that of contributing towards costs of installation of facilities. The contribution at each level was graded depending on what was regarded as consumer ability to pay. Although the policy had gone the furthest in the introduction of demand management, the World Bank felt the changes were not far-reaching and had some contradictory and inconsistent provisions. While commending the fact that the Policy recognized ‘water as an economic good’, agreed with ‘the need to run water supplies as businesses’, promoted the need for reform and private sector privatization and also made special needs of the poor and women, the World Bank (2000:5) identified as the major weaknesses the fact that the policy ‘promotes unachievable targets for coverage, and recommends free water for the poor’. The Bank disagreed with the cost-sharing formula. For instance, it described the 5 percent allotted to community as ‘tokenist’ and ‘insufficient to establish community ownership and foster sustainability’ (World Bank 2005:26). It also disagreed with the implied intent of the federal government to continue to subsidize provision of peri-urban areas and

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suggested more flexibility in the cost-sharing formula against the backdrop of the roles envisaged for private sector participation and independent providers.

However, while the Federal Government continued to engage with the World Bank and adopted the idea of commercialization, it was swayed by political imperatives and international events such as the United Nations programme on water launched in 2003 to continue to recognize water as a public good. Politicians remained under pressure to deliver water as patronage to their constituencies. This was especially the case with respect to the federal government as federal legislators insisted on supervising allocation of projects to their constituencies. In such circumstances, communities without political patrons were marginalized in water distribution (WaterAid 2006:6). This fueled perceptions that water projects were influenced by political ethnicity.10 For instance, in 2003, the election year in which President Obasanjo faced severe challenges for his reelection, the government launched the Presidential Water Initiative which aimed at expanding access to water. Tagged ‘Water for people, water for life’ in line with the UN declaration, the aim of the programme was to provide universal access in state capitals, 75 per cent access in urban and peri-urban areas and 60 per cent in rural areas by 2007.

Achieving this target became increasingly hinged on the full participation of the private sector. This is evident in the National Economic Empowerment and Development Strategy (NEEDS) adopted in 2003. The NEEDS, Nigeria’s ‘homegrown’ poverty reduction strategy paper, recognized that ‘every Nigerian has a right to adequate water and sanitation, nutrition, clothing, shelter, basic education and health care, as well as physical security and the means of making a living’ (FRN 2003:xv). However, by listing water among other goods and services which the government has no responsibility in providing and that are often provided through open market mechanisms, NEEDS clearly shows that the right to water is non-justiciable. It is hardly surprising therefore that among NEEDS objectives in the water supply sector is: ‘involving all stakeholders particularly the private sector in the sustainable development of water resources through coordinated management and holistic utilization’ (FRN 2003: 63). The strategy for attaining objectives also included creating an ‘institutional framework and participatory approach encompassing all stakeholders in a public private partnership in the sustainable development of the nation’s water resources’ (FRN 2003: 63).

Part of this change towards harmonization with the World Bank position derived from the emergence of a group of pro-reform technocrats who became the ‘drivers of change’ in government after Obasanjo secured reelection in 2003. This team, which constituted Obasanjo’s kitchen cabinet and economic team, were insulated from politics and as members of the international network of experts had the mandate of moving the country further towards reforms. It is in this policy environment that the Nigeria National 10 See, communiqué of the Earth Watch Conference held in Port Harcourt from 13th to 14th December 2002. Accessed at http://www.earthwatchnigeria.org?waterforumn/report02to05.html in September 2007.

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Water Policy was formulated and adopted in July 2004. The Policy reflects the extent to which the Nigerian government had accepted criticisms of its own policies and its readiness to conform to the global consensus on integrated water resources management. In fact, the government situates the policy against the backdrop of international understandings and consensus on water. For instance, the Policy states:

Particular emphasis has been given to the sustainable management of water as a limited natural resource. This means that not everyone can have unlimited access to water. It has to be shared. There is also a growing recognition that greater emphasis must be placed on the management of demand for water as an economic resource to make sure that water use is as efficient as possible, both in terms of quantities of water used and the impacts on water quality without compromising environmental requirements (FRN 2004:8).

This emergent consensus is juxtaposed with the country’s previous and current water policy in a self-critical manner uncharacteristic of the Nigerian state, to wit:

Previous and current government programs in the water sector have been centered on water resources development, while proper management and conservation of the resource was not given adequate attention. The previous approach to water resources development and management involved treating water as a public social good. It is centralized and entails top-down and control mechanisms (FRN 2004:8)

A major fundamental shift promised by the policy which is in consonance with the new global consensus is the abandonment of supply management measures and adoption of demand management measures. The new approach is premised on the promise of promoting conservation, and efficient and equitable use of water resources to benefit the poor. In adopting the policy, the government proclaimed it was embarking on:

A new way on management and control of water resources in the vision of optimizing the use of Nigeria’s water resources at all times, for present generations to live in harmony with environmental requirements, without compromising the existence of the future generations (FRN 2004:8).

Consequently, the policy jettisons the idea of a human right to water but recognizes water as a ‘basic human need’ and a very ‘valuable commodity’. It proposes a new institutional framework called ‘cooperative governance’ in which the three tiers of government cooperate on functions of regulation and research and development. The role of the government is to change from the

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historical one of being ‘implementer’ to becoming ‘regulator’, ‘facilitator’ and ‘coordinator’. A principle component of this institutional change is legal reform. In this respect, the policy makes the case for a review of the Water Decree, with the objective of defining:

Access to water resources through permits, the establishment of water protection zones and the fees related to raw water abstraction and fines for water misuse and pollution. This is to respect the ‘user-pays’ principle. Access and the application of royalties for water abstraction will not be applied in a general manner but limited to the commercial use of water resources only (FRN 2004:15).

The reform should also be aimed at creating an enabling environment for private sector participation based on the recognition that the private sector involvement in ‘delivery of water services will improve efficiency and effectiveness and enhance development and sustainability of service delivery’. While providing for laws to prevent the emergence of monopoly and the incidence of ‘raisin-picking’ that will exploit the public, the legal reform should shield the private sector from corruption. The government undertook to take the following action to promote private sector participation:

To create regulations assuring conducive conditions, including incentives and legal recognition, of operation for local and foreign private companies in water services

Establish a regulatory framework for the activities of water services providers to guarantee adequate protection of consumers

To encourage various forms of participation through instruments such as BOOT Lease Contract, Financial Management Contracts, etc.

Assist all levels of government to cope with the requirement of managing contracts with the private sector

Promote the importance of private sector participation in the provision of rural water supply and sanitation services on community level

Set up an independent body for mediation and regulation purposes of contracts entered into between government and the private sector (FRN 2004: 18).

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The policy also emphasized the need for education and public awareness programs to reorient Nigerians towards sustainable use of water and acceptance of user charges. Against the backdrop of the controversy that surrounded the attempt to privatize water supply in Lagos State, this public relations was necessary and in line with the strategic approach of the transnational networks on water. A critical component of the public relations was to emphasize the fact that targets for universal access for water were unattainable without private sector participation. This is evident in the dramatic assertion of Hon. Abayomi Collin, the chair of the House of Representatives Committee on Water Resources, that privatization was necessary because universal access was unattainable without it even if the entire government budget for a year was sunk into the provision of water. 11 The context for this statement was the introduction of two bills which had implications for PSP. These are:

I. A Bill for an Act to Establish National Water Supply (Regulation) Commission, of the water supply industry, to encourage private sector participation in water supply, to provide for licensing and regulation of activities involved in the provision of water; and for related matters; listed as HB 143

II. A Bill for an Act to provide for the establishment of Build Operate Transfer (BOT) (Regulation) Commission for the Regulation of investments and services in Infrastructure on BOT model, and related purposes; listed as HB 147.12

Introduced in 2005, there has been no major progress on the bills. For instance, HB 143 is still awaiting the second reading. The slow speed reflects the misgivings of the federal legislators towards PSP. While progress is slow at the federal level, some milestones have been recorded in Lagos and Cross River, the two pilot states that have secured World Bank loans to introduce PSP. For instance, the Lagos State House of Assembly passed the Lagos water sector law in July 2004. The ease of passage of bills at state levels largely reflects the overbearing influence of state governors on their legislators.

However, although legal reforms are slow, there is discernible evidence of adjustment to (which has been interpreted as acceptance of) buying water in the open market across Nigeria. The informal sale of water is no longer restricted to vendors who formerly took water from public taps and resold to the public at exorbitant prices. It is now common, in several urban and peri-urban communities for house owners to construct boreholes intended to serve their households as well as supplement family incomes through sale to people in the neighborhood. The commodification of water is most manifest in the boom in the sale of packaged water, especially the ones in sachets popularly called ‘pure water’. The initial position of the government was to ignore the industry as part of the informal

11 See, ‘Nigeria bill on water policy underway’, (June 14, 2005), accessed at http://www.irc.nl/page/24202, October 2007.12 See, www.nassnig.org/bills/year%202005%20bills.htm accessed in November 2007.

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economy. However, after considerable concerns were raised on public health grounds that water merchants were selling ‘pure gutter’ instead of ‘pure water’, the government, through the National Agency for Food and Drugs Control (NAFDAC) intervened to regulate standards. Proprietors of packaged water are expected to apply for licenses which can only be issued after inspection of their facility by NAFDAC officials. Consumers are advised to patronize only packaged water with NAFDAC number, which is supposed to a certification of quality.13

This approach is based on government’s calculations of the potential economic benefits of the water packaging industry which is dominated by small and medium scale entrepreneurs. As evident in the following comments of the famous head of NAFDAC,14 the government has allowed the industry to flourish because it fits into its poverty alleviation program:

Packaged water especially the sachets (pure water) production is a good poverty alleviation program and should be encouraged. It is an industry that has immense potentials for job and income generation. With the number of pure water and bottled water outfits in the country (and judging by about 10,634 participants at NAFDAC water workshop) their retinue of staff should stand in the region of fifty thousand strong workforce. This number excludes the chain of wholesalers and retailers that generate income from selling packaged water products (Akwuyili 2003:57).

When the number of children hawking ‘pure water’ in the streets of major cities in Nigeria is added to the equation, the character of the poverty alleviation in question comes into bold relief. It would appear though that the concern of government and development agencies may soon change from minimizing the number of hours girl children spend fetching water to curtailing the number of hours they spend hawking ‘pure water’. However, beyond poverty alleviation, mass participation in sale of water serves an important function. It helps in the dissemination of the reality of water as an economic good. It helps in watering the grounds for full scale commercialization which would boost the national income. Again as Akwuyili (2003: 87) puts it:

The packaged water has enormous export potentials. Nigeria’s problem is not poor availability of water resources rather that of poor management of these resources. Well processed and properly packaged water can be exported to earn which needed foreign exchange. It is an embarrassment for Nigeria to import packaged

13 Public concern about safety of pure water persists as evident in opinion articles and letters to editor in Nigeria’s vibrant print media.. See for instance, O. Anthony, ‘NARDAC, check pure water’, The Punch, November 13, 2007.14 Prof. Dora Akwuyili has earned accolade for her largely successful campaign against fake drugs in the country.

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water in any form. Manufacturers therefore must improve their standards as well as output to recapture the present market share taken by smuggled water / water based products.

The process of commodification is virtually perfected as water is presented as an export commodity that might transform Nigeria’s mono-cultural oil dependent economy. The imagery of a real market -both export market and import market- for water makes commodification not just feasible but inevitable. The fact though is that like removal of subsidies on petroleum products, PSP remains a politically sensitive issue. Some Nigerian experts on water resources have thus argued that:

The government should demonstrate as a matter of urgency the political will to declassify water supply as a “free service” in the political manifestos but as a “user pay service”. The public should realize that qualitative water service is capital intensive and cannot be rendered as free service (Emoabino and Alayande 2007:158).

This is a call for the dismantling and reconfiguration of the architecture of state-society relations. A major objective of the proposed study is to explore the extent to which this might be taking place. The concluding section presents background information on the proposed area of focus of the study.

Water supply in the Niger Delta: What hope for reforms?

Located in southern Nigeria, the Niger Delta is better known as the country’s oil belt. It is however one of the world’s largest wetlands accounting for most of the major rivers and creeks in the country. This means that vast sections of the 32 million residents of the region virtually live on water, thus making water a valued socio-ecological resource. It is estimated that 80 percent of Niger Delta communities experience seasonal flooding. However, one of the ‘amazing paradoxes’ associated with this water rich region is that there is perennial lack of potable water and sanitation services (Omoweh 2005, UNDP 2006). According to the UNDP (2006: 28) less than 24 percent of rural dwellers and less than 50 percent of urban dwellers in the region have access to safe drinking water.

A comparison with the national average is not encouraging. For instance, although 43 per cent of Niger Delta residents against the national average of 52 per cent depend on unsafe sources of water, the national average (13.56%) for piped-borne water is double of the average in the region (6.4%) (UNDP 2006: 185). This explains why potable water has historically been a source of contentious politics in the region. For instance, Isaac Adaka Boro, the leader of the Niger Delta Volunteer Service that declared the botched Niger Delta Republic in 1966 included water in the list of grievances:

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Of all parts of the country, the Niger Delta is the richest in water and so the governments have not found it necessary to give the inhabitants pipe borne water, be it in the salt water, washed creeks or in muddy fresh water rivers. People drink from the most squalid wells and so dysentery and worm diseases are rife (Tebekaemi 1982:66).

The scarcity of potable water in the region has been a touchy issue because it is framed as part of a discourse of marginalization and deprivation. The Niger Delta is mostly made of ethnic minorities which have historically protested the dominance of Nigeria’s three major ethnic groups. Even before Nigeria became independent in 1960, delta minorities had justified their demand for autonomy through the creation of new states on the absence of public utilities, especially water, in their communities. Since the early 1990s, the region has witnessed a revival and proliferation of social movements seeking self-determination of various degrees and resource control. The agitations have arisen out of feelings of neglect and deprivation despite the fact that the bulk of Nigeria’s public finance since 1970 has accrued from oil drilled from the region. Without exception, the position papers of all ethnic and pan-delta groups have included demands for water. For instance, the Movement for the Survival of Ogoni People (MOSOP) claimed in the Ogoni Bill of Rights that that ‘the Ogoni people have no pipe-borne water’.15

Clearly, the government has come to recognize the centrality of water supply to agitations in the region. As Mr. Timi Alaibe, Managing Director of the Niger Delta Development Commission (NNDC), the federal development agency for the region, puts it:

We have discovered that lack of portable water is an issue in the region. Also epileptic nature of power supply makes it difficult to even enjoy the service, when we implement water projects. So at the moment, we are implementing solar powered water projects in several communities of the region, in line with Mr. President’s directive to make water more accessible to the people, and in response to the situation on the ground.16

Against this backdrop the Niger Delta is a good case to explore contestations over the reform policies on water supply. This is because the people of the region believe they have a right to water, not in the mere sense of its being a human right but because oil, which sustains the Nigerian state, is derived from their land and water. The right to potable water is also framed in the context of the devastating damage to the environment including water resources caused by oil exploration and exploitation activities. These have destroyed traditional sources of water such as ponds and rivers. In these circumstances, the people believe that the state, which receives royalties from oil, has a moral responsibility to provide free water to their communities. The study will therefore explore the tensions between the demands of resource control and the requirements of cost-recovery and PSPs.15 See, MOSOP, Ogoni Bill of Rights, 1990, Article 11, Sub-section II. 16 Interview with Newswatch magazine, accessible at http://www.timialaibe.com

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A related reason for the selection of the region for study of the application of globally constructed reforms in the locale is the presence of several stakeholders in community development and water delivery services. As a result of the agitations, there have been a mélange of interventions by government, corporate organizations, multilateral and bilateral organizations and international NGOs to pacify the region. Due to criticisms that past failures stemmed from non-participatory top down approaches to development, participatory development and cooperative governance envisaged in the IWRM framework have become the conventional wisdom for intervention. Not only is there cooperation among stakeholders, but governments, donors and corporate organizations have also elected to work in partnership with community based organizations. The study will explore what participation entails in these contexts and whether it is producing the desired access, sustainability and cost recovery of projects. It will also explore how the new paradigm of participation might be adding pressures to imploding social structures.

Finally, studies of reform have shown that it is not sufficient to promote or introduce PSP reforms. The task is to make the environment attractive for private investment. With experiences of pull-outs, contract renegotiations and scaling down of involvement, it has become apparent that the Big Water companies are becoming selective in choice of markets. In this context, ‘violent environments’ (Peluso and Watts 2001) have become no go areas. What would the Niger delta teach us about the preferred sites of investments? Apart from the socio-political context that would scare away capital, the ecological factors pose potential threats to profitable investments in water supply. The abundance of groundwater reduces the cost of constructing boreholes and hence the opportunity cost of not linking to a piped source. The result is that a considerable proportion of the targeted clientele can afford personal borehole facilities. Given the controversy over the Land Use Act which vests ownership of land in the state, it is unlikely that the government will prohibit borehole construction or tax owners of boreholes to serve as an incentive to investors. The ecological factor also poses a challenge to collective action. What are the incentives to elites who can afford boreholes which they can deploy as sources of revenue or means of cultivating clients in the community to participate in community water projects? The study will thus shed light on who is participating and how participation is evolving or unraveling in different contexts.

The Niger Delta is certainly not an undifferentiated space. It is made up of diverse ecological zones, ethnic groups and administrative units. To reflect this diversity, the study will be based on two sites in the region. These are Rivers State and Cross River State, which are respectively located at the core and periphery of the region in geographic, socio-economic and political senses. The Rivers study will focus on urban water supply in Port Harcourt, the state capital and corporate intervention in water supply in OBALGA. The Cross River study will examine water supply in Calabar, the state capital, which is a beneficiary of World Bank PSP loan and clusters of communities where international NGOs are involved in the delivery of water projects with support from the EU and DFID. The proposed survey methods are archival and desk research, interviews, participant observation and focus group discussions. Interviews

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will be conducted with persons from stakeholder groups and attendance will be made at selected national and local networks and spaces where reform is being propagated, adopted, adapted and resisted.

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