More than 90% of urban water supply and sanitation services in developing countries
have been provided by public utilities. However public provision has been inherently
inefficient. Namibia undertook water sector reforms in search for efficiency in public
services delivery and created the Namibia Water Corporation (NamWater) for the
purpose of bulk water supply. However, the utility had been compounded by poor
financial performance. A case study that empirically examined the management
approaches of NamWater in relation to the New Public Management (NPM) was carried
out in Namibia in the period January to April 2006. The focus of the NPM approach is to
mirror private sector methods of organizing and managing so that public utilities would
accrue the benefits of effectiveness, efficiency and flexibility often associated with
private sector organizations. The study tools used were a combination of literature
review, interviews and questionnaires, held with key stakeholders.
The study established that NamWater had a high degree of autonomy, although its tariffs
and sourcing of external financing are approved by government. The utility is subject to
strong reporting framework including financial audits and annual performance reports to
the government owner. However, lack of statutory instrument (SI), performance contract
and customer charter hampered external accountability. NamWater showed greater
market-orientation and had outsourced non-core functions to cut costs, engaged in
market-testing exercises but only benchmarked its performance on an adhoc basis.
NamWater’s customer-orientation was less impressive compared to NPM-based utilities.
Although it had customer-friendly billing and collections systems, the utility lacked basic
customer service arrangements such as customer care centre, call centre, customer service
quality contracts and customer satisfaction surveys. It was established that NamWater
senior management had devolved operational authority to front-line managers.
Commensurate with the authority provided, managers are held accountable for
performance. NamWater performance indicators such as working ratio, water losses,
tariffs and service quality fell well within the yardstick of well-performing water utilities
for the past 5 years.
It was concluded that NamWater’s management practices generally adhered to the core
ideas of NPM, but these core ideas have not been fully implemented. Lack of
accountability mechanisms such as a performance contract, a customer charter and SI
resulted in difficulties for the stakeholders to hold the utility accountable. It was
recommended that NamWater comes up with a performance contract and a customer
charter to improve accountability. Government should formulate SI for drinking water.
NamWater needs to carry out benchmarking more regularly to improve its performance.
It was further recommended that NamWater shift more towards customer-orientation to
enhance better revenue collection.