REFORM ALBANIA WATER SUPPLY AND SEWAGE SECTOR AFTER, THE TRANSFER PROCESS OF WATER SUPPLY AND SEWERAGE COMPANIES TO LOCAL GOVERNMENT AUTHORITIES. . Enkelejda PATOZI, Advisor to the Albanian Prime Minister on Water Policy and Issues TIRANA, 25 SEPTEMBER 2008. SELECTED PERFORMANCE INDICATORS.
REFORMALBANIAWATER SUPPLY AND SEWAGE SECTOR AFTER, THE TRANSFER PROCESS OF WATER SUPPLY AND SEWERAGE COMPANIESTO LOCAL GOVERNMENT AUTHORITIES.
Advisor to the Albanian Prime Minister on Water Policy and Issues
TIRANA, 25 SEPTEMBER 2008
TRANSFER OF PUBLIC IMMOVABLE PROPERTIES OF WATER SUPPLY UTILITIES
LOCAL GOVERNMENT UNITS
Albanian Central Government
LOCAL GOVERNMENT UNITS
(Utility Service Zone)
Ministry of Economy
Representative of central government = 100% shares
Representatives of local government units
3 members in Total,
(2 ministries and 1 municipality)
Members from utility service zone
Water Supply and Sewerage Utilities
Water Supply and Sewerage Utilities
WATER SUPPLY AND SEWERAGE UTILITIES
WATER SUPPLY AND SEWERAGE UTILITIESTRANSFER OF PUBLIC IMMOVABLE PROPERTIES OF WATER SUPPLY UTILITIES TO LOCAL GOVERNMENT
3 Decisions on:
Transfer, Statute, Nr Members of Supervisory Councils, and one
Order on the Guidelines for SH.A. and S.C.
The current verification role for the WRE is not appropriate for Albania:
NWC-National Water Council is a institution for integrating the activities of the different institutions toward supporting a common policy for the Water Sector as a whole.
Revise:Integrated management of water resources as an important requirement stated based on the EU Water Framework Directive of October 2000 WFD.
Objective:NWCwill implement fully the tariff structure to cause financially self-sustaining and to be able to finance and enable the functioning of the Water Basin Authorities.
Program on reduction / removal of subsidies,
Investment policy based on performance indicators,
Water Source Protection Zones,
Manual, Project preparation according to EU requirements.
Benchmarking Albanian Water Program,
Implementation of Training and Certification Program in Albania,
Create Conditions for Private Sector Participation in Water Service Delivery,
Project Priority System, Donor Coordination and Paris declaration,
Full cooperation with the Albanian Water Supply and Sewage Association,
Engineering Students Internship Program.ADMINISTRATIVE INITIATIVES
Past Experience: New capital investments and major management structural reforms in the water utility sector of Albania have been largely driven by the foreign donor/lender community. This because Albania had no coherent, rational, strategic project priority and capital investment plan for the water supply and sewerage utility sector.
Actually: The Central Government is moving carefully, but aggressively, to re-establish its role in defining the facility needs of the water utility sector, establishing a projects priority list, developing a sustainable capital investment plan, channeling donor/lender funds to their best use in meeting the strategic needs of the water utility sector of Albania, as well as effective monitoring of project implementation.
Water utilities must operate applying commercial practices that would cause them to become financially self-sustaining, and to achieve full cost recovery from the application of appropriate tariffs and fees for the services provided to their customers.
Full cost recovery will include all routine operations and maintenance costs, debt service, capital loan/credit repayment, and planned transfers to reserves for capital repair and replacement, and for new capital investment.
Water utilities will apply aggressive programs to reduce non-revenue water, eliminate illegal connections, enforce aggressive bill collection procedures, and implement service termination policies for non-payment of bills.
The Ministry is preparing a national study and recommendation for the aggregation (regionalization) of all water supply and sewerage systems across Albania, considering natural water basin boundaries, being not only the most logical criteria, applied throughout Western Europe, but also a requirement of the EU Water Framework Directive that implies that the integrated management of water resources must be realized on the basis of water basins.
Fact,a public service that is well functioning and cost effective is always a better option for the public .
Fact, Private sector participation is required when the public sector is not efficient, because of bad management and/or because the public sector can not raise the capital necessary for new infrastructure .
But, before considering PSP options, it is the task of the public institutions to improve the efficiency and performance of the water and sewerage sector.
And, The other reason for PSP that implies capital investment is clearly valid in Albania today. Albania today is in great need for new infrastructure for wastewater treatment plants. (Open Issue)
Fact, It is widely accepted in the developed world that only test-based certification will lead to professionalism and performance improvement in the water supply and wastewater utility sector.
Open: As a minimum, in a water utility, the lead operators (or Directors of Technical Operations) should be certified in their fields (water supply and wastewater). Ideally, in fully corporatized utilities, the overall Director of the utility should also be certified as to the ability to implement policies of the Supervisory Board of the utility, and manage the utility in a financially self-sustaining manner, while being in total compliance with the standard of the Republic of Albania.
As a team,
Ministry of Finance, is working closely with the Water Utility Regulatory Commission, the Ministry of Public Works, Transport and Telecommunications, and the Ministry of Interior, and with the final approval of the Parliament through the national budget process, to establish a multi-year, declining, operations and maintenance subsidy program for each water utility with such program to be captured in the transfer agreement signed at the time of ownership transfer of the each respective water utility.