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Water Companies and the UN Millennium Development Goals

Water Companies and the UN Millennium Development Goals. Richard Aylard CSR Director. The 21st Century Demographic Challenge. 12. Developing countries OECD countries. 10. 8. 6. 4. 2. 1750. 1800. 1850. 1900. 1950. 1995. 2050. 2100. 2150. World population billions. Forecasts.

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Water Companies and the UN Millennium Development Goals

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  1. Water Companies and the UN Millennium Development Goals Richard Aylard CSR Director

  2. The 21st Century Demographic Challenge 12 Developing countries OECD countries 10 8 6 4 2 1750 1800 1850 1900 1950 1995 2050 2100 2150 World population billions Forecasts Source: IMD Lausanne

  3. Crisis, What Crisis? • Water-related diseases are the single largest cause of human sickness and death in the world • About 6,000 children die every day from diarrhoea • One person in six (1 billion) has no access to clean drinking water • Two in five (2.4 billion) lack safe and hygienic sanitation • Up to one quarter of household time in rural Africa is spent on fetching water … stifling education and economic development

  4. The Scale of the Challenge • Halving the proportion of people without access to clean water by 2015 • Halving the proportion of people without access to safe sanitation by 2015 • No more than 20% of all countries and less than 10% of the lowest income countries appear to be on track to reach the goals as at March 2003 • World Bank estimate that annual investment will need to double from US$15 billion to US$30 billion to reach the goals

  5. How can we contribute to achieving the MDGs? • We operate mainly in the developed world • Risk and debt are major issues for our investors • The scale of the challenge is immense • Philanthropy won’t be sufficient • Two approaches • Aid funded Technical Assistance • A major partnership project

  6. Bangalore NRW Project • Population 5.5 million, 11 million projected by 2025 • 25% are urban poor; 400 slums; 20,000 standpipes • Water source is River Cauvary: 120Km away and 900m down • Water Supply currently 700MLD, but 50% + is UFW • Work programme: • Leakage detection & repairs • Replacement / Rehabilitation of pipe-work • Replacement of faulty meters • Tackle unauthorised connections • Installation of consumer meters

  7. Bangalore NRW Project

  8. Bangalore NRW Project

  9. Bangalore NRW Project

  10. Bangalore NRW Project

  11. Bangalore NRW Project

  12. Millennium Development Goals Project – Reducing risk • The biggest obstacle to working where the needs are greatest is BUSINESS RISK • If we can reduce risks, we can justify an affordable rate of margin(7-10%) • Investing expertise and human resources (not capital) – will reduce risk • Community partners to handle billing and collection – will reduce risk and improve perceptions • Working in partnership – with each partner doing what they do best – will reduce risk

  13. Water and Sanitation for the Urban Poor (WSUP) • WSUP is an International not-for-profit Alliance • Business and NGO members • Identifies potential projects in urban areas, where people will be without water and/or sanitation for the foreseeable future • Carries out pre-feasibility studies • Brokers funding and project partners (only some will be WSUP members) • Monitors progress, adherence to WSUP principles and captures learning

  14. WSUP Projects • A consortium for each project: • Mix of private and public sector and NGOs(local and international) • Management Contract of 3-5 years duration, covering needs assessment, system design, project management, establishment of sustainable arrangements for O&M and billing and hygiene education • Funding from international aid and local sources Local community involved in designing a system they can afford • Environmental aspects have high priority • Consortium staff work alongside local service authority to build capacity • Partners earn 7-10% margin on resources committed

  15. Advantages of the WSUP approach • Targets areas of greatest need, and will achieve scale • Ensures scarce donor funds are spent effectively • Partners do what they do best – no-one tries to do everything • Local communities actively involved – ‘bottom up’ design • Donor funds take communities ‘over the hump’ of infrastructure funding, after which they can be self-supporting • We earn our margin from the donors, not the community • We don’t try and establish a long-term local business – capacity building starts from Day One • Provides long-term opportunities for local private sector

  16. WSUP Progress Report • Six partners (3 businesses, 3 major international NGOs) ready to sign MOU establishing WSUP • Other partners interested in joining, including two other water companies (Germany and South Africa) • UNDP supportive andwill have ‘observer status’ • International donor body willing, in principle, to fund WSUP to end 2007 • Pilot project in Bangalore identified, funding available and community consultation in progress

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