Table 3.16 The Policy, Legislative, and Regulatory Framework Aff ecting the Water Sector

Table 3.16 The Policy, Legislative, and Regulatory Framework Affecting the Water Sector

LEVEL POLICIES, LEGISLATION, AND REGULATIONS FRAMEWORK

National • Water laws

• Allocation of water resources to the domestic sector and the share with provinces and cities • Drinking water quality standards • Wastewater treatment and disposal standards • Water works and systems standards • Tariff structure and pricing policy Local • Physical planning and spatial distribution • Metering and usage charges • Billing and collection • Equity and access • Affordability • Effi ciency of operations • Local environmental impacts such as noise, appearance, and odor • Participation and community empowerment

Source: Author compilation (Khairy Al-Jamal).

The Institutional Context

A strong and appropriate institutional setup ensures smooth and successful compliance with sector policies, legislation, and regulations. Institutions ideally execute interventions to optimize gains despite sectoral constraints and boundary conditions. Institutions should prioritize the achievement of sectoral targets, but also interface with other sectors to ensure optimal development on a larger scale. The key institutional entities include policy makers, regulators, service providers, and customers (fi gure 3.41). Regardless of the institutional arrangements, the integrity of water sector systems must be preserved (see table 3.15). An institutional setup should show integrity, comprehensiveness, a sound division of roles and responsibilities, and representation in other developmental forums, as follows:

• Policy maker: The policy-making function resides mainly at the central level, and national policies are normally imposed on cities.

• Regulator: The regulatory system is responsible for enforcing rules to guarantee compliance with service standards and other sector policies to ensure sustainability. This requires providing adequate services at aff ordable prices. The three subsystems under the regulatory function are the environmental regulation subsystem (issuing licenses for abstraction and disposal), the quality regulation subsystem (ensuring compliance with standards for drinking water, wastewater treatment, and the quality of works), and the economic regulation subsystem (reviewing prices to ensure tariff s are proportionate to real costs, promoting effi ciency and conservation, and enabling sustainability and aff ordability among the poor).

In some cases, municipalities may propose and implement regulations. However, it is important to ensure separation between regulators and service providers to avoid confl icts of interest. The regulator ensures that customers receive services up to agreed standards to mitigate the risk that service providers underperform. Both bodies should not be under the jurisdiction of the same entity. It is equally important that the policy-making body and regulator be separate institutions.