12 April 2010

Cheap water for the rich means less water for the poor

(via LG) Professor Little asks an important question for those interested in human rights and water [pdf]:
If the private sector is better positioned to do this in a particular country or region, why should the poor be held hostage to what is essentially an ideological question of public vs. private provision?
He then answers it with sound logic: Use private OR public provision (whichever is cheaper) and increase access by direct subsidies to poor people.

Little also makes a critical observation:
Is the public interest well-served by a system where prices are kept artificially so low for everyone, including those who can well afford to pay, as to preclude the delivery of an adequate supply of safe, reliable water and where sufficient revenue cannot be generated to support routine maintenance, repair, and renovation?
No it isn't, of course. Although this appears to contradict my prescription -- "Some water for free, pay for more" -- comes from a different angle. Little wants to make sure that system costs are paid, as do I. He thinks that everyone should pay the full cost of service and that the poor should be supported through direct subsidies. Although I do not rule out income subsidies, I propose "some for free" without qualification in recognition of the human right that we all should receive, regardless of income. As I explain here, that block of cheap/free water is NOT incompatible with full cost recovery. So we can eat our cake and have it too, eh?

Bottom Line: The poor don't care who they get their water from, as long as it's clean and cheap.


The Outsider said...

Why is the water utility the right place to deal with the poor? Far better to run the utility in a rational way and leave the social justice to others.

Eric said...

@The Outsider

Good point.

If we balkanize social justice dealings then we tend to get multiple agencies all claiming to deal correctly with social justice turf and all fighting each other.