77822 Overview and Key Findings Engaging with Citizens to Improve Services The Water and Sanitation Program is an international partnership for improving water and sanitation sector policies, practices, and capacities to serve poor people Acknowledgments In 2004-05, the Water and Sanitation Program-South Asia commissioned research to identify citizen engagement and social accountability mechanisms that could be adapted to the Indian urban water and sanitation sector to improve service and customer responsiveness. This ‘Overview and Key Findings’ volume briefly introduces this research, as also the defining features of accountable service provision. The accompanying volume contains 10 case studies that discuss some of these mechanisms in more detail. Badal Malick initiated and guided this program of research. Premila Nazareth Satyanand prepared this overview paper and abridged the original case studies for publication. WSP-SA is grateful to Janaagraha in Bangalore, Lok Satta in Hyderabad, and CUTS in Jaipur for lending their experience to the ‘Voice and Client Power’ program, as also to Robin Simpson (Consumers’ International) and Parth Shah (Centre for Civil Society) for peer reviewing this document. Thanks are also due to Benjamin Simpson (World Bank), Catherine Revels (WSP-SA), Chris Heymans (WSP-SA), David Savage (World Bank), Deepak Sanan (WSP-SA), J.V.R. Murty (WSP-SA), Junaid Ahmad (World Bank), Lant Pritchett (World Bank), Mark Ellery (World Bank), Salman Zaheer (World Bank), Shekhar Shah (World Bank), Vandana Mehra (WSP-SA) and Yamini Iyer (WSP-SA), all of whom have provided guidance and support to the development of the program, and of this publication over the past two years. The publication was task managed by Anup Wadhawan and Geeta Sharma (WSP-SA). Overview and Key Findings Engaging with Citizens to Improve Services Contents Executive Summary vi Section 1: Introduction – India’s Water Supply and Sanitation Service Challenge 1 Section 2: Accountability Relationships in the Indian Urban Water Supply and Sanitation Services Sector 5 Section 3: Augmenting Citizen ‘Voice’ and ‘Client Power’: Some Models 15 Section 4: Key Findings and Lessons 27 Section 5: Conclusions: Some Practical Steps to Enhance Accountability 49 Glossary and Acronyms Glossary Adalat court of law Chawls slum tenements Gram swaraj village self-rule Jal suvidha kendras water sale centers Kutcha semi-finished construction Lokayukta People's Ombudsman Mandals sub-districts Panchayat village council Parivartan transformation Pucca fully complete construction Sabhas public meetings Sadak, bijli, paani roads, electricity, water Vidyut adalats public electricity courts iv Overview and Key Findings Engaging with Citizens to Improve Services Acronyms AEC Ahmedabad Electricity Company KSEB Kerala State Electricity Board AMC Ahmedabad Municipal Corporation KWA Kerala Water Authority ARR annual revenue requirement lpcd liters per capita per day AusAID Australian Aid Agency MGD million gallons a day BMC Brihan-Mumbai Municipal Corporation MLA Member of Legislative Assembly BMP Bangalore Mahanagar Palike MP Member of Parliament BPL below poverty line mlm million liters per month BWSSB Bangalore Water Supply and MSW municipal solid waste Sewerage Board MW megawatt CBO community-based organization MU million units CCC centralized call center NDMC New Delhi Municipal Council CCCGRM Consumer Courts and Consumer Grievance NGO nongovernmental organization Redressal Mechanisms NHG neighborhood group CEO chief executive officer OCMS online complaint monitoring system CERC Central Electricity Regulatory Commission O&M operation and maintenance CNG compressed natural gas PAC Public Affairs Centre CPA Consumer Protection Act PHED Public Health and Engineering Department CRC citizen report card PIL public interest litigation CUTS Consumer Unity and Trust Society PPC people’s plan campaign DERC Delhi Electricity Regulatory Commission RWA residents’ welfare association DJB Delhi Jal Board SAC State Advisory Committee Discom Commonly used term for private electricity SDU social development unit distribution companies SEB State Electricity Board DWAF Department of Water and Forestry SEP Slum Electrification Programme EA 2003 National Electricity Act 2003 SERC State Electricity Regulatory Commission FES Friedrich Ebert Stiftung SEWA Self Employed Women's Association GoI Government of India T&D transmission and distribution IAS Indian Administrative Service UFW unaccounted for water IBNET International Benchmarking Initiative ULB urban local body JNNURM Jawaharlal Nehru National Urban WDR World Development Report Renewal Mission WSP-SA Water and Sanitation Program-South Asia kL kiloliter XIBM Xavier Institute of Business Management v Executive Summary This study explains why and how the creation of institutionalized citizen engagement will enhance public accountability, performance, and customer responsiveness in the Indian urban water and sanitation sector. It draws on 10 practical case studies of citizen engagement in India to derive lessons for civil society groups, policy makers and service providers pertinent to different points in the ‘service delivery chain’ – including policy-making, planning and budgeting; standard-setting and enforcement; and performance monitoring. Citizens’ Participation Must Underpin deliver services. They thus have few incentives to Service Reform consult with end users, who have no meaningful space to engage with service providers and the government on Citizens’ participation must necessarily be an integral service-related issues, and investment and reform part of reform in the Indian urban water supply and decisions. In the few states where some degree of sanitation sector. Only end users can determine the type decentralization has been introduced, significant of services they find most relevant, convenient and shortcomings remain in the empowerment of municipal affordable, and only if citizens complement and oversee governments, in such aspects as staffing, expenditure their elected representatives’ efforts to ensure optimal and revenue authority, and so on. performance by water utilities will the sector shift toward ‘better service for all’ rather than preferential Since service providers have neither the operational nor treatment for a few. Decentralizing control and delivery financial autonomy to run their departments viably, they to the local level could also enhance citizens’ ability to remain open to persistent political interference. The roles influence and enforce service standards, by of regulator, policy maker and service provider are compelling service providers to pursue service fused, so that politicians become involved in day-to-day outcomes and consumer satisfaction, rather than operational decisions, rather than setting service and expenditure and construction targets. performance targets and sector policy against which utilities should be measured and held to account. Institutional arrangements and associated incentives Citizens lose the most from this situation, characterized need to change. Although the 74th Amendment to India’s as it is by short-term political opportunism and the Constitution has made municipal governments absence of mechanisms by which they can initiate responsible for water supply and sanitation service, sanctions against poorly-performing utilities. municipal water departments continue to depend almost completely on government grants, and draw technical The sheer scale of the urban water supply and sanitation and operational direction from state and central service challenge urgently demands new approaches. government agencies. In most states monolithic Although one-third of India’s population already lives in her parastatals, with little role separation across policy cities,1 water supply and sanitation provision has not making, regulation and service provision, continue to adequately kept pace with this development. Urban water 1 India’s cities also generate over a half of the country’s gross national product and attract a continuing flow of poor migrants from rural areas. vi Overview and Key Findings Engaging with Citizens to Improve Services Drawing on Practical Experience The 10 forms of citizen engagement examined by this study were intended to strengthen citizen voice – direct influence over service design and the making of rules by which public service agencies must operate; and client power – the ability to enforce performance standards upon service providers and penalize those who fail to meet them. They also sought to strengthen the institutional factors that mark successful public service provision, identified in the World Development Report 2004 as: • Delegation (setting of performance standards) – the One-third of India’s population already customer asks for a service and defines the terms on lives in her cities. Water supply and sanitation provision has not adequately which it should be delivered; kept pace with this development. • Performance (service delivery measured against these performance standards); • Finance – the customer pays for the service; • Information on performance – the customer (and policy maker) assess service quality; and and sanitation utilities — already struggling to serve some 300 million people2 — will have to find the resources, • Enforcement – dissatisfied customers and policy managerial expertise and technical infrastructure to serve makers penalize poorly-performing providers. twice this population within the next two decades. With an estimated 285 million poor urban residents by 2025,3 the This study also examines the relevance — in different challenges become even more severe, particularly as contexts — of what the WDR 2004 calls the ‘long route’ many municipal governments currently do not allow water to accountability (where elected representatives hold supply and sanitation service providers to run individual public service providers to account on behalf of the connections to the large numbers of ‘unauthorized’ slum public) and the ‘short route’ (where citizens/customers households. The alternatives — communal taps, engage directly with providers to do so). handpumps and water tankers — often compromise service quality and pose major difficulties for monitoring, Section 1 briefly discusses the service challenge in the cost recovery, and demand management. Indian water supply and sanitation services sector. 2 2001 Indian National Census. 3 Urbanisation and migration in India: a different scene, S. Mukherji, in International Handbook of Urban Systems: studies of urbanization and migration in advanced and developing countries, H.S. Geyer (Edited) Edward Elgar Publishing Ltd., Cheltenham, 2002. vii End users are key in determining which services they find relevant, convenient, and affordable. Clear and publicly agreed standards for service delivery are crucial. Section 2 defines the elements of accountable service consumers, who are by and large not taken seriously provision and explains why the sector currently falls due to their limited social and economic power. Such short in India. Section 3 provides a brief overview of the staff may require training and new incentives, while 10 ‘voice’ and ‘client power’ mechanisms profiled in detail citizens need effective mechanisms to provide their in an accompanying volume titled Engaging with feedback to management and policy makers on Citizens to Improve Services, and describes the efficacy and responsiveness. theoretical framework through which they are analyzed. Section 4 presents the key findings and lessons from • The poor should be treated as full-blown customers: the case studies and Section 5 suggests how civil The water and sanitation needs of poor citizens will society groups, policy makers and utilities can help require specific service packages and policy measures, designed and monitored in partnership improve the performance, public accountability and with them. The case studies demonstrate that it is customer responsiveness of water and sanitation possible to institute services that the poor can afford services. to pay for, and this makes them far more audible and relevant in the decision-making and operational Strengthening Accountability: processes of service providers. Key Findings • The need for system information: The virtual absence The case studies underscore that service outcomes and of information on utility performance and service access will improve when water and sanitation utilities outcomes makes it difficult for citizens and policy are compelled to engage directly with consumers in makers to pressure for the most necessary service designing services and meeting certain performance improvements and investments and hinders utility targets. A few key factors stand out: managements’ ability to administer operations efficiently and respond quickly to public demands. • Institutional frameworks and feedback systems: The studies show the practical value to both citizens Water supply and sanitation service will improve only and utilities of such information, and highlight that through systematic reforms to ensure that the improvements are possible. relationship between politics and utility management produces clear policies for universal service and the • Benchmarking, performance management and public monitoring of providers against agreed standards. reporting: Performance benchmarking and public Moreover, a shift is needed toward service outcomes reporting would exert natural pressures on utilities to that reflect customer satisfaction. Currently become more accountable to consumers, and further expenditure and construction targets take research is needed to improve the robustness of precedence. These policies can be robust and benchmarks and reporting modes. regulation independent, if citizens are provided with ‘voice’ and ‘client power’ at all points of the service In conclusion, the study presents a preliminary delivery chain. framework for gauging whether citizen participation platforms make providers more accountable and • Enhancing staff capacity: The common shortcoming in responsive to citizens. It also proposes more all the innovations profiled was the poor responsiveness research to develop qualitative and quantitative criteria of frontline staff to consumers, especially poor for such measurement. viii Section 1 Introduction – India’s Water Supply and Sanitation Service Challenge 1 Over the past few years, “sadak, bijli, paani� (roads, electricity, water) has become the powerful new demand of the urban Indian electorate and, so, naturally the key promise of the Indian government and politician. Aggravated by the poor state (or nonavailability) of water supply and sanitation services, the urban Indian has begun to exert concerted pressure on the government to dramatically improve service access, quality, and delivery. Yet, according to the Indian National Census of 2001, while 90 percent of urban India now has access to a safe source Box 1.1: Health Costs of Poor Water Services of water, only 74 percent is covered by piped water networks. Much of urban India is perennially water-short, The Voluntary Health Association of India (VHAI) especially in summer. Millions of households struggle on estimates that the country loses 73 million a daily basis to cope with problems that include working-person days because of illnesses caused inadequate and interrupted supply, and poor water quality.4 by water-borne diseases, while UNICEF puts the same estimate at 1,800 million workdays. The Most poor households are not even nominally connected impact is particularly marked with respect to to piped systems, since they often live in informal and children. UNICEF estimates that India loses an unauthorized settlements that utilities are not permitted estimated 2,500 children every day — that is, to service officially, due to existing municipal and urban close to 1 million annually — due to diarrhea and tenure laws in India.5 The costs are high — whether in other intestinal diseases caused by polluted the form of health risks and the coping costs of drinking water and lack of sanitation. Diarrhea accessing alternative modes of water provision. and related diseases are responsible for over 25 percent of all deaths among children in the Across income classes, consumers are also supplied 0-5 age group. with far less water than they require for fulfilling basic daily requirements. While India’s urban water delivery infrastructure is built to supply legally connected households with at least 130-150 liters per capita per through public sources receive an average of just day (lpcd),6 estimates are that consumers receive just 16-25 lpcd. Moreover, as Figure 1.1 shows, the system’s 100 lpcd at best and slum households that access water capacity to effectively service urban Indian consumers 4 Two recent studies of water supply in India’s larger cities show that urban households are provided with water for an average of just five to seven hours a day. These are, firstly, a 2006 Water and Sanitation Program–South Asia (WSP-SA) study of 18 Indian urban water and sanitation utilities, entitled Benchmarking Urban Water Utilities, and, secondly, a joint Institute of Hydraulic Engineering-Delft University and Loughborough University (Water, Engineering and Development Center) of 35 Indian utilities, entitled India: Urban Water Supply. In smaller Indian towns, the frequency of supply drops to just a few hours a week. 5 According to the National Census, 65 percent of India’s slums have access to water only through communal taps, 25 percent rely on wells and handpumps, and 10 percent on tankers, many of which supply water at prices considerably higher than that charged by the local water utility. It is important to note that all the statistics cited in this paragraph refer only to those sections of the urban poor population living in ‘authorized’ slums; a significant number lives in ‘unauthorized’ settlements not counted by the census. 6 The Central Public Health and Environmental Engineering Organization has set technical guidelines for the per capita quantity that utilities are supposed to provide customers. These are 70 lpcd in areas with no sewerage, 130 lpcd in areas with sewerage, 150 lpcd for cities with over 1 million in population, and 40 lpcd for public standposts. 2 Overview and Key Findings Engaging with Citizens to Improve Services appears to be deteriorating. Bangalore, which had Figure 1.1: maintained an average of 20 hours of supply per day in Average Water Supply in Selected Indian and Comparator Cities the 1980s, is now able to sustain an average of just 80 Jakarta 24 2.5 hours. Chennai, which had supplied consumers an 90 Dakar 24 119 Colombo 22 average of 10-15 hours of water a day, can now provide 132 Kuala Lumpur 24 an average of just 1.5 hours. This is far short of the 156 France 24 226 Durban 24 24-hour supply that is now common in other developing 244 Penang 24 32 Chennai 1.5 country cities. Figure 1.1 compares the average hours of 80 Udaipur 2.5 Hrs/day supply achieved by larger Indian cities against that of lpcd 123 Bangalore 2.5 133 Bikaner 2.5 similar developing country cities. While Jakarta, Dakar, 145 Ahmedabad 2 Kuala Lumpur, and Penang can now provide water 149 Jaipur 3 190 Jodhpur 2.5 around the clock (average hours of supply are indicated 220 Ludhiana 10 223 Delhi 4 in the column on the right), Indian cities lag far behind 240 Mumbai 5 although they have a larger amount of water per capita 332 Chandigarh 10 341 Goa 8 flowing into the delivery system (average lpcd is Source: Ministry of Urban Development and Water and Sanitation Program–South Asia indicated in the column on the left). Benchmarking Study, and ADB Utilities Book, verified with relevant utilities. 3 The rapid and unplanned growth of urban slums, combined with the poor’s lack of tenure and recognition by urban authorities, has made it difficult for water and sanitation utilities to service these populations effectively. Table 1.1: Accelerating Urbanization and Slum Population of Million-Plus Cities Urban Poverty (2001, in millions) Burgeoning population growth, exacerbated by rapid and City Total Slum % unplanned urbanization, poses an immense challenge to population population municipal governments charged with delivering water Mumbai 17.07 5.86 34.30 and sanitation services to India’s cities. According to the Kolkata 13.11 4.31 32.90 2001 census, some 28 percent of Indians — or some 300 million people — now live in urban areas; a figure Delhi 12.22 3.26 26.70 that is expected to double to 634 million people — or Chennai 6.98 1.96 28.10 46 percent of the national population — by 2030. Hyderabad 6.30 1.25 19.80 One-fifth of all Indians with no access to drinking water (that is, some 23 million people7), and over a 10th of all Bangalore 6.36 0.79 12.50 Indians without sanitation facilities (some 77 million Ahmedabad 4.36 0.89 20.31 people) now live in India’s towns and cities.8 Pune 3.53 0.58 16.30 Moreover, for sometime into the future a significant Kanpur 2.49 0.51 20.60 portion of the urban population will be poor. Already Lucknow 2.26 0.37 16.60 25 percent of India’s poor lives in urban areas Nagpur 2.32 0.74 31.90 (Table 1.1) – and 31 percent of this urban population is poor.9 This slum population will continue to expand, Surat 2.29 0.58 25.40 according to some experts, by as much as four times by Jaipur 2.21 0.64 29.10 202010 (totaling some 285 million people). Kochi 1.54 0.38 24.80 The rapid and unplanned growth of urban slums, Vadodara 1.71 0.31 18.30 combined with the poor’s lack of tenure and recognition Indore 1.54 0.23 15.20 by urban authorities, makes it difficult for water and Coimbatore 1.33 0.12 8.70 sanitation utilities to service these populations effectively. Addressing these challenges requires a Patna 1.53 0.97 63.50 range of measures, including improved citizen Madurai 1.31 0.24 18.00 participation in the planning and monitoring of services. Bhopal 1.53 0.21 13.99 This study analyzes trends, issues, and experiences in Visakhapatnam 1.67 0.42 25.20 India as far as such participation is concerned, and draws out key lessons for wider application. Ludhiana 1.63 0.58 35.40 Varanasi 1.33 0.27 20.10 7 USAID analysis, based on 2001 National Census. Total 96.63 25.48 26.37 8 USAID. 9 2001 National Census. Source: Central Statistical Organisation 10 Urbanisation and migration in India: a different scene, S. Mukherji, in International Handbook of Urban Systems: studies of urbanization and migration in advanced and developing countries, H.S. Geyer (Edited) Edward Elgar Publishing Ltd., Cheltenham, 2002. 4 Section 2 Accountability Relationships in the Indian Urban Water Supply and Sanitation Services Sector 5 The institutional arrangements and associated incentives that characterize the Indian Urban Water and Sanitation Sector (UWSS) hamper utilities’ ability to achieve safe, reliable, affordable, and sustainable services for all citizens. This is largely because utilities are structured and governed to draw their direction and validation from higher tiers of government, and not from citizens or customers. Customers have little power over their water and sanitation service providers. 6 Overview and Key Findings Engaging with Citizens to Improve Services No Direct Accountability to Citizens In an effort to make service providers more accountable municipal governments continue to rely heavily on state to citizens, the 74th Amendment to India’s Constitution11 and central financing, not only for capital investments but decentralized responsibility for key areas of service also for a significant part of operational expenditures. delivery (including water supply and sanitation) to the They therefore do not feel fully empowered and local level. However, devolution has not occurred in the responsible for service delivery, and continue to ‘look up’ manner envisaged. In many states, state-level to state governments for financial and technical support, parastatals continue to deliver services even at the local feeling little need to involve, consult or inform end users level. Since effective public accountability mechanisms about proposed schemes. have not been instituted at either the state or local level, decision-making related to key service delivery issues At best, the Indian water and sanitation sector is tends to be far removed from communities, who have characterized by the ‘long route to accountability’,14 little knowledge or understanding of how the sector with elected representatives conveying citizen needs works, how they might effectively articulate community and concerns to service providers and attempting to voice, and by what means they can hold water and translate these into operational standards, terms, sanitation utilities to account. and processes for service delivery through ‘compacts’ with service providers. Citizens then have The sector relies on ‘horizontal accountability’12 a publicly instituted framework within which to exert mechanisms, in which service providers only report to ‘client power’ on utilities to ensure optimal service higher tiers of government and elected representatives delivery. The short route to accountability — where and provider performance is measured only on the basis customers and service providers engage directly with of construction and expenditure targets set by higher each other rarely exists. In its purest form, the short tiers. Mostly, no provision exists for ‘vertical route is the sort of relationship that exists between accountability’13 – in which citizens monitor performance customers and service providers in a free-market and help enforce service standards. Customer needs situation of competition among them. and satisfaction tend to be overlooked in deciding on new investments and service projects. Visually, the Word Development Report 2004 illustrates the ‘short’ and ‘long’ routes to accountability in the In states where some degree of decentralization has following manner. been introduced in accordance with the 74th Amendment, significant shortcomings remain in the For a public service delivery system to function empowerment of municipal bodies in aspects such as successfully, each of the three elements of voice, staffing, expenditure, and revenue authority. Most compact, and client power is necessary. In other words, 11 The Amendment was passed in 1992. 12 Hybrid Forms of Accountability: Citizen Engagement in Institutions of Public-Sector Oversight in India, Anne-Marie Goetz and Rob Jenkins, Public Management Review, 2001. 13 Ibid. 14 Making Services Work for the Poor, World Development Report 2004, World Bank. 7 The channels of political representation and accountability that characterize a democracy such as India fail to translate into pressures for universal and quality service in the urban water and sanitation sector. Figure 2.1: Framework for Public Service Provision Box 2.1: The Enabling Policy Environment The state Politicians Policy India’s national policy framework on urban water makers Co and sanitation15 has begun to emphasize m pa community participation, demand ct ice Long route of accountability Vo responsiveness, decentralization, and financial Citizens/clients Providers responsibility as basic principles for sectoral Short route reform. The Jawaharlal Nehru National Urban Coalitions/inclusion Management Client power Renewal Mission (JNNURM),16 which will invest Nonpoor Poor Frontline Organizations US$12 billion17 in leading Indian cities by 2012, emphasizes the development of urban water and sanitation service together with governance reform centering on a formal role for citizen participation in investment decisions and the Services monitoring of service delivery. Source: World Development Report 2004: Making Services Work for the Poor the triangle of relationships — that is, citizen-policy little understanding of the ‘compacts’ that their elected maker (voice), policy maker-utility (compact), and representatives reach with utilities, much less the ability citizen-utility (client power) — must be complete, and to influence them. each side equally balanced in vitality and strength. Should any of these relationships be weak, it distorts For this reason, the channels of political representation the system’s ability to sustainably produce quality and accountability that should characterize a democracy services over the long term. such as India fail to translate into pressures for universal and quality service in the urban water and sanitation Politicians and Accountability in sector. A key reason is the administrative and financing the Indian Urban Water and arrangements in the sector that make water and Sanitation Sector sanitation utilities operationally dependent on elected representatives and higher tiers of government, rather In the Indian urban water supply and sanitation sector, than citizens, for their survival. (These arrangements and the absence of formal mechanisms to enable citizens to their specific outcomes on accountability flows in the participate in policy-making, financing and investment sector are discussed in detail in the next subsection.) decisions, utility monitoring and performance For these reasons, the operational decisions taken within enforcement has seriously weakened the ‘voice’ and the sector tend to be influenced more by the political ‘client power’ relationships. As a result, citizens have visibility and support they will bring the incumbent 15 The National Water Policy (2002), and the 8th-11th Five Year Plans (1992-1997, 1997-2002, 2002-2007, 2007-2012). 16 The program was launched in December 2005. 17 Conversion rate is US$1 = Rs 45 (as per September 2006) 8 Overview and Key Findings Engaging with Citizens to Improve Services government, individual elected representatives, or senior government officials, rather than the degree to which Box 2.2: Patronage at Work in Water and Sanitation they result in enhanced service for all citizens. Moreover, since elected representatives and bureaucrats allocate The ruling party’s MLAs and councilors today finances to individual utilities, decide how these are to be came down heavily on the water department for its spent, and post and promote senior utility staff, utility failure to cater and live up to the expectations of management and staff endeavor to satisfy them — rather the people. Accusing the bureaucrats in the Board than citizens — to ensure their continued survival and of behaving in an “indifferent manner,’’ the citizens’ professional success. elected representatives let loose their ire on the field staff including engineers for turning a deaf ear In other words, the current relationship between to the needs and demands of their areas. The MLAs politicians and utilities has acquired an orientation that were particularly harsh on their area engineers for undermines the ‘long route to accountability’, at the heart cold-shouldering the elected representatives on the of which is the setting of clear and publicly agreed excuse that they were answerable only to the CEO. standards of performance for utilities that both compel The MLAs were sore that despite repeated and enable them to benefit all customers equally. reminders the engineers do not listen to their pleas to resolve the problem in their respective areas. Given the absence of both publicly-understood and In fact, some of the MLAs informed the Chief clearly-defined standards of utility performance and Minister that the engineers rarely responded to enforcement mechanisms in the country, patronage their calls even after being called up and reminded flourishes as it seems to many the only way of several times. Their complaint was that engineers accessing services or influencing service decisions. did not give an ear to the issues raised by them and nothing was being done to resolve the situation that had been continuing for the past so The following press extract (Box 2.2), and scores of many years. A large number of MLAs complained others like it from other parts of India, capture very of supply of poor quality water that had made life pithily the patronage relationships that characterize miserable for the residents. There were complaints India’s urban water and sanitation sector. galore about the failure to carry out repairs and implementation of the planned projects in many Further undermining the effective functioning of the ‘long constituencies. In fact, the majority opinion was route’ is that citizens’ dependence on alternative means that the bureaucrats were not bothered about the of delivering water, such as tankers and informal water image of the government or the local vendors, has expanded in step with utilities’ mounting representative and they continued to adopt a inability to service growing urban populations. This callous attitude. development has weakened political interest in Extracted from The Hindu, May 28, 2005 improving delivery through the piped system, since 9 Tankers and informal water vending arrangements appear to offer an easy-to-deliver solution to a pressing problem, and are logistically easier to administer than network expansions. municipal councilors and Members of Parliament are utilities to account by participating in the standard-setting, able to earn political capital by arranging tanker supplies performance-monitoring and enforcement process. At the for their electoral constituencies. Similar ‘disincentives’ same time, binding penalties need to be instituted in a are also apparent among utility officials. Tankers and transparent manner for nonperforming utilities that are informal water vending arrangements appear to offer an administered by entities or institutions especially charged easy-to-deliver solution to a pressing problem, and are with doing so. Thus, citizens — armed with a detailed logistically easier to administer than network understanding of what they should expect from their expansions. Local water officials are able to manage this utilities and how they may penalize them for nondelivery — avenue of delivery fairly autonomously – without having are also able to hold their elected representatives to to rely on the technical expertise or financial clearances account for enforcing these standards. But how can civil of higher tiers of government. society groups and policy makers achieve this? While these developments are understandable, such The World Bank’s World Development Report 2004: alternative arrangements are inherently deficient in Making Services Work for the Poor helps to answer this service terms. Moreover, they often emerge without any question. Based on a study of public and private sector due process and so are not accompanied by formal service provision systems around the world, it finds that mechanisms by which customers might hold providers successful relationships between providers and to account. customers involves the following elements: For frontline officials, particularly, these alternative • Delegation (or the setting of performance standards) – methods of delivery present opportunities for rent- the customer demands a service and reaches an seeking. Although user payments for tanker are agreement with the provider on the parameters18 by supposed to go to the municipal water department (and which it will be delivered; tanker supply to slum communities is free), there have been cases where water-starved consumers are charged • Performance (or service delivery) – the provider 'facilitation' fees for expediting services to them. delivers the service, as per the parameters agreed with the customer; Modifying Sectoral Incentives to Restore Accountability • Finance – the customer pays for the service; Given these emerging trends, how might accountability • Information – the customer assesses the quality of be restored to the Indian water and sanitation sector? the service and decides whether to buy more of it or not; and Most importantly, incentives within the sector have to put citizens at the heart of the service delivery process. • Enforceability – dissatisfied customers are able to ‘Vertical accountability’ would enable citizens to hold penalize providers that provide poor service. 18 Including service structure, price, delivery mechanism, and payment arrangements, etc. 10 Box 2.3: Water Tankers: A Profitable Business Tankers are now a common sight in most Indian cities. Initially, they were used by municipal water departments as a stop-gap measure to overcome supply shortages in summer. Now, a growing number of water departments have begun to rely on tankers as the primary means to supply unconnected households, using private contractors or investing in their own fleet to do so. Delhi’s water tanker industry, for instance, has grown rapidly since the 1980s, and the city now hosts some 1,200 private tankers. Tanker operators began as landowners with access to underground water, or transport operations. While the city’s water utility, the Delhi Jal Board, supplies tankers free of cost to connected or eligible households, the city’s private tankers charge at least US$2.2 for 1,000 liters. Richer consumers pay a higher rate than poorer ones, and prices rise substantially for both groups in summer. Although industrial areas in Delhi are supposed to be provided with reliable water and power supply, a recent survey of 70 companies19 found that 25 percent of respondents relied on private water tankers on a more or less regular basis. A study by a policy think-tank in Delhi20 provides an insight into the economics of private tanker operators. The tankers that supply Sangam Vihar, a South Delhi colony, tank up at Faridabad on the city’s outskirts at a cost of US$2.2-5.5. This water is then sold for US$12.2-13.3, making the profit per tanker US$2.2-3.3, after all costs have been recovered. 19 The Urban Water Sector: Formal versus Informal Suppliers in India, Marie Llorente and Marie Helene Zerah in Urban India, Vol. XXII, No.1, National Institute of Urban Affairs, January-June 2003. 20 Private Provision of Public Services in Unauthorized Colonies: A Case Study of Sangam Vihar, Prateep Das Gupta and Swati Puri (Working Paper), Centre for Civil Society, 2005. 11 Water utilities are not legally bound to report on their performance to customers. They are only required to report to higher tiers of government on budgets and expenditures. Each of these elements must be strongly present for a fulfillment of construction and expenditure targets, and service provision system to function effectively and not to the issues which most concern citizens: that is, accountably. In other words, institutionalized citizen uninterrupted, high-quality service and responsiveness engagement and monitoring needs to be created at each of from the service provider. Since citizens are largely these five points to build a successfully operating model of unaware about the performance standards that have service delivery in the Indian water and sanitation sector. been set, they find it difficult to influence them. Visually, an accountable system could be depicted as a Performance (or service delivery): Investment decisions closed loop, as in Figure 2.2. on new infrastructure projects are generally taken by parastatal agencies, without consulting citizens or Currently, the accountability loop in the Indian water and municipal governments. Moreover, the institutional sanitation sector is far from complete due to the lack of arrangements and resulting incentives within the sector effective citizen engagement on each of these five key create systemic pressures for more infrastructure elements, as discussed below. spending,21 rather than service improvements through better operations and maintenance. As a result, Delegation (or the setting of performance standards): In infrastructure often does not cater to citizens’ needs view of the top-down manner in which the sector and/or the technical ability of local engineers. operates, water and sanitation utilities look to elected Additionally, deficient operation and maintenance (O&M) representatives and government officials to set practices results in repeated wasteful capital performance standards and decide on new projects for investment, which make a negligible dent in the them. Performance standards thus relate primarily to the continuing cycle of high water losses and inadequate and irregular water supply. Figure 2.2: Finance: Citizens play a minor role in financing the The Accountability Loop operations of the sector and, so, it is easy for water utilities to overlook them in planning new investments or setting tariffs. 70 percent of all capital spending in the sector comes from budgetary allocations made by central and state governments, through a variety of grants, schemes, and incentive funds.22 Moreover, state and municipal governments require service providers to keep domestic water tariffs at an average of US$0.03 per cubic meter (while the average cost of supply is about 21 Since state engineering agencies receive fees that are a fixed percentage of total project costs, they have little incentive to optimize costs and strike a better balance between O&M and capital expenditures. 22 Another 20-25 percent of funding comes from the Life Insurance Corporation of India (LIC) and the Housing and Urban Development Corporation (HUDCO), both of which are government bodies directed to lend a fixed percentage of their funds each year to water and sanitation projects. Multilateral and bilateral donor agencies provide the remaining 5 percent of funds. 12 Overview and Key Findings Engaging with Citizens to Improve Services Information: Water utilities are not legally bound to report on their performance to customers, and they are only required to report to higher tiers of government on budgets and expenditures. Further, many municipal water departments have no definitive measures and mechanical tracking systems by which to monitor and record water flows, and so are unable to assess the extent to which poor metering, theft, or breaks and leakages are individually responsible for water losses.26 There is thus a significant information vacuum in the sector, which makes it difficult for citizens and policy makers to press for targeted improvements and to Citizen engagement will create effectively hold utilities to account. accountability pressures on utilities, together with the separation of sectoral policy-making, service provision, Enforcement: Since the same set of interlinked entities and regulation. act as policy maker, regulator, and service provider, governments and elected representatives have no real incentive to act against poorly-performing water and sanitation utilities. For this reason, citizens find it difficult to institute effective action against poorly- performing utilities. US$0.33 per cubic meter23) and to provide free water to While citizen engagement will go a long way in creating the poor through public taps and handpumps. From the accountability pressures on utilities, in the longer term it utility’s perspective, therefore, there is virtually no is vital to clearly separate these three sets of financial incentive to pay attention to customers. institutions, in functional and financial terms. Role clarity Municipal financial management and accounting and demarcation will lead to definitive improvements in practices further entrench this state of affairs. Since accountability. First, service providers would have the municipal governments do not maintain a separate autonomy to make operational choices in accordance budget for water and sanitation spending,24 they do not with their objectives, particularly decisions related to have a reliable estimate of how much it actually costs personnel recruitment, compensation, performance, and them to supply these services within their jurisdiction – outsourcing. Secondly, role separation will facilitate nor, indeed, of the subsidies they are providing.25 performance measurement and the creation of service 23 A Scorecard for India, Raghupati, Usha and Foster, Vivien (2002). (Water Tariffs and Subsidies in South Asia, Paper No 2 of the Water Tariffs and Subsidies in South Asia series published by the Water and Sanitation Program-South Asia, PPIAF, and the World Bank Institute). 24 This is clubbed together with other urban services including transport and solid waste management. 25 Benchmarking Water Utilities, Water and Sanitation Program–South Asia (2006). 26 Ibid. 13 Citizen engagement will create accountability pressures on utilities, together with the separation of sectoral policy-making, service provision, and regulation. ‘contracts’ that bind water service providers to accountability,’ in which consumers are also given the well-defined and enforceable service targets, regulated power and the right to participate in the various stages of by clearly defined and independent bodies. Thirdly, it service planning and monitoring, including: would allow policy makers to focus on ensuring the achievement of service outcomes, rather than feeling • the design of both sector policy and services; compelled to control day-to-day operational and pricing issues in the greater public interest. • the design of financing mechanisms and tariffs; Enhancing Accountability in Practice • the monitoring and assessment of service quality; and As is clear from the preceding sections, both the theory • the institution of penalties against poorly-performing and practice of accountability emphasize that the more utilities. points of contact that can be created between the service provider and the customer, the more accountable This does not mean that customers become providers, a public service delivery system is likely to be. but rather that they will actively participate in setting Most importantly, existing processes for ‘horizontal standards and priorities. In a context where citizens have accountability,’ in which one tier or agency of government had the opportunity to say so little, this creates practical holds another one to account, must be complemented opportunities for them to influence the nature and and strengthened by the establishment of ‘vertical effectiveness of service delivery. 14 Section 3 Augmenting Citizen ‘Voice’ and ‘Client Power’: Some Models 15 A variety of pioneering Indian 'voice' and 'client power' initiatives present important models by which to design citizen involvement in the Indian water and sanitation sector. Some have been devised by consumer and civil society groups; some by local governments and public service providers; and some by Indian state or central government agencies. 10 of these innovations27 are examined in detail and summarize more extensive research commissioned by the Water and Sanitation Program-South Asia (WSP-SA) in 2004-05. The Framework for Analysis directly holding service providers accountable for standards of delivery? What are the particular The 10 case studies provide lessons on the points at challenges in effectively serving the poor? Did which citizen engagement was created, the form it frontline staff become more responsive? Are the took, and the impact it had. Within the framework of experiences replicable, and under what conditions? the World Development Report 2004’s five-point accountability matrix (Figure 2.2) the analysis sought Case Study Summaries to determine how elements of this matrix — ‘delegation’, ‘performance’, ‘finance’, ‘information’, and For the reader’s convenience, the 10 citizen ‘enforcement’ — could give citizens a voice in setting engagement and participation initiatives are briefly the terms of service delivery, designing delivery introduced below. Although only three of these infrastructure and defining tariffs. The key question initiatives relate solely or even directly to the water was whether civil engagement created incentives for and sanitation sector, in totality they yield important service providers to consider customers in their findings on potential areas for citizen engagement and decisions rather than ‘look upward’ to politicians and internal management improvements in any water utility higher tiers of government? Other questions were how or public service provider aiming for a happier and dependence on state/central government grants was better-served customer. Also, while each innovation reduced, and information made available to citizens has its own unique institutional and sectoral context, on the performance of their service providers. The for purposes of discussion it has been viewed as a effectiveness of consumer grievance redressal was representative prototype for the possibilities and also considered. Did engagement follow the indirect challenges presented by similar mechanisms ‘long route’ of accountability or the ‘short route’ of throughout the country. 27 These were identified on the basis of intensive interactions between WSP-SA and leading Indian civil society organizations over 2004-05, in particular Janaagraha (Bangalore), Lok Satta (Hyderabad), and the Consumer Unity and Trust Society (Jaipur). 16 Overview and Key Findings Engaging with Citizens to Improve Services Case Study 1 User Contributions in Urban Water Supply Infrastructure: Bangalore What and when? In 2000, the Bangalore Water Supply and Sewerage Board (BWSSB) launched a program designed to test the feasibility of providing metered individual water and sanitation connections to unauthorized slum households in the city, departing from its traditional practice of servicing such communities via free, shared public taps. For this purpose, it waived its requirement that only households with legal tenure could avail of an individual connection. Why? BWSSB was forced to find new ways to recover the costs of servicing the poor, because the Bangalore Municipal Corporation (which had earlier reimbursed BWSSB for the cost of free water from public taps) discontinued this payment. However, the corporation agreed to finance the extension of the city’s water distribution network to more outlying areas. This, together with financial support from AusAid, encouraged BWSSB to experiment with new models by which to serve slum communities. How? • BWSSB worked closely with community-based groups to generate awareness and mobilize finance from slum communities. It also dialogued extensively with them on the nature and price of the services they desired, and brought down by two-thirds the rates for new domestic connections to US$12.2-17.7, and user tariffs from US$2.5 to US$1.6 a month. • It set up an in-house Social Development Unit to spearhead the program. Each BWSSB engineer was set a zonal revenue target. • Slums were connected to the network only after at least 50 percent of households committed to pay; and water usually supplied on alternate days for two to six hours at a time. Impact • BWSSB succeeded in mobilizing 46 poor communities by early 2005, accounting for 10 percent of the city’s slums. More than half of these have connected to BWSSB’s network, and continue to receive and pay for service. The program is now being scaled up, and the Government of Karnataka is planning to replicate it throughout the state. • BWSSB engineers’ need to mobilize revenues and connections from the areas under their jurisdiction has compelled them to engage with slum communities, both to explain the program and to lay the distribution pipes. This has served to create client power for these communities for the first time, in response to which BWSSB has had to innovate new models for service delivery to the poor. Limitations Since the model is heavily reliant on community-based organizations, slum communities lacking such entities may be by-passed. Additionally, the momentum has slowed since BWSSB has not yet introduced incentives that specifically reward its engineers for working with the urban poor, and has not provided sufficient resources to its Social Development Unit. 17 Case Study 2 User Contributions in Sewerage Infrastructure: Tamil Nadu What and when? In 1997, Tamil Nadu’s Urban Local Bodies (ULBs or municipal governments) embarked on a pioneering effort to expand their sewerage networks by raising capital contributions from the public. Why? Over the 1980s and 1990s, the Tamil Nadu Government had become seriously concerned by the state’s high incidence of water contamination and diarrheal disease, resulting from its rudimentary and limited sanitation infrastructure. It decided to upgrade and universalize the state’s sewerage network, but did not have sufficient resources. It thus asked ULBs to spearhead this initiative, in collaboration with local communities. How? ULBs (municipal councilors, in particular) mobilize communities, while the state’s two water and sanitation utilities — that is, the Tamil Nadu Water and Drainage Board and Metrowater — lay the sewerage network. Each ULB decides on the flat-rate amount to be contributed by households and other users, in close consultation with municipal councilors and community organizations. ULBs pay about a quarter of the cost of expanding the municipal sewerage network, households one-sixth, and the rest is obtained through loans (defrayed through property taxes) and a variety of government funds. Household contributions are paid in two installments – 50 percent before state funds are released, and 50 percent at the time of implementation. Sewer connections are paid for separately from monthly sewerage maintenance charges. The average connection charge is US$142.2 per household, and the average monthly sewerage charge is US$3.5. Few cities have differential rates for the poor. Impact 64 urban areas in Tamil Nadu are now involved in building sewerage schemes, up from 14 just a few years ago. This is the first time that ULBs have been given the power to decide the amount of public contributions and user charges. Public support for the scheme has been extensive, expanding community ownership and engagement with local government. Since municipal councilors have played the central role in championing the initiative, they have been careful to ensure that all implementation details are decided upon only after extensive consultations with constituents. As a result, local communities have been able to proactively contribute to the design and implementation of the scheme, and to cost management. For these reasons, implementation has also proceeded largely on schedule. Limitations Neither end users nor ULBs have a mechanism by which to demand performance information from or to enforce service standards upon the two parastatals undertaking construction within the scheme, since no post-construction performance standards were put in place. Some participating urban areas have also witnessed difficulties with deposit mobilization. 18 Overview and Key Findings Engaging with Citizens to Improve Services Case Study 3 Ahmedabad’s ‘Parivartan’ and ‘Slum Electrification’ Initiatives What and when? In 1996, the Ahmedabad Municipal Corporation (AMC) collaborated with Arvind Mills, a local industrial house, to launch a program to upgrade the city’s slums. Called ‘Parivartan,’ it offered each household a bundle of eight fee-based services, including an individual water connection and toilet, underground sewerage, and storm water drains. Simultaneously, AMC collaborated with the Ahmedabad Electricity Company to pilot the electrification of slum households. Why? Arvind Mills wished to improve the living conditions in the slums in which many of its workers lived, and donated US$220,000 to AMC for this purpose. At the same time, the Ahmedabad Electricity Company was battling with electricity losses of 40 percent, due to electricity theft by urban slum populations. It, therefore, decided to tackle the problem head on, by working directly with slum communities to regularize and meter their connections. How? In the ‘Parivartan’ initiative, AMC contributed about 70 percent of the capital cost of US$350 per household, and Arvind Mills and the beneficiary community contributed 14 percent each. AEC’s slum electrification initiative, on the other hand, emphasized full-cost recovery and O&M costs. Connection costs ranged between US$78 and US$111, which could be paid in monthly installments. User charges are approximately US$3.3-4.4 a month, about a half of what households were earlier paying their illegal electricity providers. In both instances, community-based organizations were responsible for mobilizing communities and collecting payments. Connected slum communities also become liable to pay property tax. Impact In the span of eight years, the ‘Parivartan’ program has networked 18 settlements. In these, 90 percent of households now have individual water connections, open defecation and diarrheal diseases have reduced significantly, incomes have increased, and property values have risen. The Slum Electrification Program now covers almost 10 percent of the city’s slum population, and has considerably reduced AEC’s losses. Limitations The ‘Parivartan’ program has fallen far short of its original target, networking only 1 percent of the city’s slum population in eight years. A variety of factors has contributed to this, including its top-down approach; the lack of involvement of or incentives to frontline staff; inadequate institutionalization within AMC; and slum households’ inability to pick and choose among the eight services to suit their needs and pocket. Additionally, since the responsibility for O&M rests with local ward offices, rather than with AMC, it has been difficult to ensure upkeep. Politicians, promising free water and electricity to slum communities from their constituency development funds, have also undermined slum communities’ willingness to avail of paid services. However, AEC’s program showed considerable success – expanding to 10 percent of slums in just two years, by explaining to slum households that it was considerably cheaper for them to legally connect to the network than to pay bribes. 19 Case Study 4 Participatory Budgeting in Kerala What and when? In 1997, Kerala’s State Government made ULBs responsible for spending 30 percent of state annual plan funds. This triggered a state-wide pioneering participatory budgeting and training initiative, known as the ‘People’s Plan Campaign,’ in which local neighborhood groups and Ward Committees contribute project ideas for their city, negotiate with counterparts, and reach an agreement with the local municipal council on specific projects for the year. Communities then participate in the drafting, implementing, and monitoring of projects. Why? The Government of Kerala wanted to ensure that development spending responded to felt local needs, and so placed ULBs and beneficiary communities at the center of planning, budgeting, and implementation. Most of all, it wanted to mobilize Kerala’s poor citizens to be more self-reliant and learn how to undertake development on their own. How? Neighborhood Groups and Residents’ Welfare Associations relay their ideas to their Ward Committees, who send representatives to city/town-level conventions, where a draft plan for the city is negotiated and crystallized. Draft plans are then sent on to the municipal council, which forwards it to the district council for inputs, and finalizes it accordingly. Over 224 full- time coordinators, and scores of citizen volunteers, at the municipal, district and block levels assist this state-wide process. Impact Citizens are now able to exert ‘voice’ through their involvement in the municipal planning and implementation process. This is particularly evident in the case of the poor, as a result of which basic services have seen significant improvements. Citizens have also been able to exert more ‘client power’ over some municipal service providers. Additionally, ULBs have now become fully responsible for projects that directly affect their constituencies, including poverty eradication and the upkeep of roads. This has completely transformed their relationship with the state government. At the same time, the use of volunteer labor and cash contributions by beneficiaries has substantially lowered project costs. Limitations Since water and electricity continue to be provided by parastatal agencies that are not responsible to ULBs, accountability in such services remains weak. The Campaign has also not succeeded in ensuring widespread public participation in performance monitoring and enforcement, as a result of which there have been some instances of corruption in citizen- led project implementation. Better-off citizens have also lost interest in active involvement, since they perceive the Campaign as primarily serving the needs of the poor. 20 Overview and Key Findings Engaging with Citizens to Improve Services Case Study 5 Consumer Courts and Consumer Grievance Redressal Forums What and when? Since the late 1980s, customers who are dissatisfied with the manner in which their complaints are handled by Delhi’s electricity and water utilities may approach Delhi’s network of consumer courts for a more favorable solution. Why? In 1986, India passed the Consumer Protection Act which, among other things, stepped up the standard for consumer protection and complaint redressal across a variety of sectors. Subsequently, Delhi’s liberalization of its electricity distribution sector was accompanied by the imposition of stringent consumer protection and complaint redressal norms on private electricity distribution companies. At the same time, the Delhi Jal Board is attempting to upgrade its complaint redressal system as part of a voluntary effort to become more accountable to consumers. How? Delhi’s three electricity utilities have fairly similar complaint registering and redressal systems. Both written and telephonic complaints are logged into a computerized system by a centralized complaint cell, and are then forwarded to the respective area engineers for action. The computerized system automatically monitors the status of complaint redressal, ‘escalating’ unaddressed complaints to the General Manager (Operations). Delhi’s electricity utilities have also established Consumer Grievance Redressal Forums, which serve as in-house courts that adjudicate on unresolved consumer complaints. Delhi Jal Board customers file different sorts of complaints at different zonal levels. All complaints — whether telephonic or written — are logged in a physical register, and forwarded to area engineers for action. The Delhi Jal Board is working to streamline this process by devolving the responsibility for billing, complaint redressal, and the maintenance of local customer databases to the zonal level. Customers dissatisfied with the remedy they receive from Delhi’s electricity and water utilities can then file cases with Delhi’s consumer courts, which are required to rule on them within three months. Impact Delhi’s consumer courts tend, by and large, to rule in favor of complainants, so customers have been able to exert some punitive pressure on the city’s utilities. To avoid legal action, the latter have also proactively made more of an effort to attend quickly and positively to complaints. Limitations The massive backlog of cases and the courts’ limited ability to enforce rulings significantly undermine the effectiveness of this route. Additionally, court processes are not easily comprehensible to complainants, so they must rely on lawyers who charge a high fee. Court houses are generally located at a considerable distance from where consumers live, creating transaction and transport costs. Also, monitoring court performance is hard due to poor record-keeping. 21 Case Study 6 CUTS-FES Program to Involve Rajasthan’s Rural Electricity Consumers in Sectoral Policy-making What and when? Since the late 1990s, the Consumer Unity and Trust Society (CUTS), a Jaipur-based nongovernmental organization (NGO), has mobilized and trained Rajasthan’s rural electricity customers to present their views about service and sector policy to the state’s utilities and electricity regulatory commission. CUTS has also served as the intermediary between the state’s grassroots consumers and its Electricity Regulatory Commission and policy makers. Why? CUTS realized the importance of creating a mechanism by which to formally involve Rajasthan’s consumers in the power reform process in the state, particularly since the Rajasthan Government committed that it would “use participatory approaches to address and balance the genuine concerns of various stakeholders� in restructuring its power sector in 1999. How? The Friedrich Ebert Stiftung (FES), a German think-tank advocating democratic participation, financially supported CUTS in establishing a three-tier advocacy and information-sharing civil society network across six districts in Rajasthan. CUTS, together with partner NGOs at the district level, facilitated the setting up of vidyut sudhar samitis (power improvement committees) in each village to organize, educate, and obtain feedback from consumers on service-related issues. Each samiti is responsible for logging information on service standards/technical problems in a dedicated village register on a daily basis. CUTS agglomerates this information and conveys it to the state’s policy makers. Moreover, CUTS regularly holds workshops in each of the participating districts to encourage interaction and information-sharing amongst samitis, utilities, and the electricity regulator on an ongoing basis. Impact The initiative has succeeded in translating citizen engagement into tangible impacts on policy-making and service delivery. As a key member of RERC’s Advisory Committee, CUTS (and its citizen network) has been integrally involved in the design of all electricity-related policy and regulation in Rajasthan. The ongoing interface with and pressure from consumers has also encouraged Rajasthan’s electricity regulatory commission and its utilities to noticeably increase their accountability, transparency, and responsiveness to the public. Limitations The information-sharing process between CUTS and the grassroots relies on regional workshops, which are dependent on donor funding and the consumer mobilization capacity of local partners. Moreover, consumers are not allowed to see the performance reports that utilities submit to the regulator, making monitoring difficult. 22 Overview and Key Findings Engaging with Citizens to Improve Services Case Study 7 Mumbai’s Online Complaint Monitoring System What? PRAJA, a Mumbai-based civil society organization, has helped the, Brihan-Mumbai Municipal Corporation (BMC) set up an Online Complaint Monitoring System (OCMS), which enables citizens to register service-related complaints via telephone, personal visits, letter/ fax and the Internet. Citizens may monitor the status of complaint redressal online, from the comfort of their homes. PRAJA also carries out regular ‘complaint audits’ to determine the public’s level of satisfaction with complaint resolution – a pioneering initiative in which a citizen-based organization plays a formal watchdog function over service delivery. Why? BMC was anxious to transform Mumbai into a world-class city, and saw partnerships with civil society groups such as PRAJA as key to rapidly improving urban governance and service delivery. In 1999, PRAJA assisted the corporation in drafting a Citizen’s Charter, committing to significantly upgraded standards of service delivery and consumer responsiveness. In 2000, PRAJA helped BMC establish a centralized complaint registration system to facilitate the speedy redressal of consumer complaints, and to aid in the establishment of new benchmarks for performance. OCMS carries forward these efforts. How? Complaints are registered on a central data server, which automatically distributes them to the relevant ward offices for redressal. The action taken is then recorded on the system, and unaddressed complaints escalate upward to senior officers, all the way up to the Municipal Commissioner. In addition, a review committee of senior BMC officials and PRAJA representatives meets regularly to determine action on non-redressed complaints. PRAJA also generates instantaneous reports on the status of departmental and ward complaints, allowing BMC officials at various levels to monitor and manage the quality of redressal, and address structural complaints. Additionally, as mentioned earlier, PRAJA also undertakes complaint audits, in which it survey citizens on the speed and effectiveness of the redressal they received. PRAJA incurred most of the costs of OCMS software, while BMC paid for hardware and O&M. Impact There has been a marked improvement in the corporation’s complaint handling system and in some broader service indices, as indicated in PRAJA’s ongoing consumer surveys. These include a reduction in the average number of visits required for successful redressal; and lower revels of rent-seeking by BMC officials. Additionally, services to some of the city’s slums have improved. Limitations Since OCMS has not been accompanied by systems to hold individual staff responsible for complaint handling and service delivery, it has not resulted in a dramatic improvement in service standards. Another difficulty is the continuing ‘leakage’ of complaints to the corporation’s pre-existing consumer grievance redressal forums. 23 Case Study 8 Independent Regulation What? Andhra Pradesh, Karnataka, Maharashtra, Orissa, and Rajasthan have set up State Electricity Regulatory Commissions (SERCs) to protect the interest of consumers. In particular, they are mandated to ensure that utilities deliver good service, and that electricity prices remain affordable to consumers by providing them an opportunity to participate in tariff-setting. Why? Since the mid-1990s, India has fundamentally reformed its electricity sector – moving away from heavy subsidization and government control to private participation and market-based pricing. The government has, therefore, established independent electricity regulators to balance the conflicting interests of consumers who want low prices, and utilities who need to recover costs. How? Electricity tariffs are set on a state-by-state basis. Electricity distribution companies file ARRs with their respective SERCs. These explain the company’s proposed tariffs for the coming year, in the context of a list of various items of expenditure such as power purchase and capital costs, O&M, and debt-servicing. The ARR also lists the transmission and distribution losses claimed by the utility. SERCs invite the public to scrutinize ARRs and to submit feedback on the proposed tariff. Additionally, SERCs conduct a series of public hearings on ARR to record the views of all stakeholders within the state. On the basis of this feedback, SERCs issue tariff orders that bind each utility to a particular tariff for the following year. Impact Regulation has forced utilities to address easily observable concerns, such as faulty meters, incorrect billing, load-shedding or brown-outs. It has noticeably improved consumer grievance redressal and the transparency of utility functioning. It has also depoliticized tariff-setting to a large extent, enabling utilities to recover costs and thus provide better service. Most importantly, it has amplified citizen voice and client power by involving the public in tariff-setting and in establishing performance standards for utilities. Limitations Citizen and civil society intervention in rule-making and tariff-setting has not been as extensive as was hoped, due to the technical nature of the power sector, and the fact that many ARRs are not issued in the vernacular and are not easily available. Moreover, while consumer organizations serve on regulatory commissions’ Advisory Committees, they wield no weight in the decisions that the latter eventually take. Regulatory commissions do not have consumer advocates on their staff; the only exception being Karnataka. 24 Overview and Key Findings Engaging with Citizens to Improve Services Case Study 9 Public Interest Litigation and Judicial Activism What? In the 1970s, the Supreme Court of India innovated the practice of the Public Interest Litigation (PIL), which permits litigants to file cases on issues that affect the public at large. Over the years, the PIL has emerged as a form of political action by which citizens can hold politicians and policy makers, as well as service providers, accountable. This case study examines two landmark Indian cases in detail: the Delhi Vehicular Pollution Case and the Municipal Solid Waste Management Case. Why? The Delhi Vehicular Pollution Case (1985) was filed by M.C. Mehta, who was concerned by the Delhi Government’s inaction in the face of rising vehicular pollution in the city. He accused the Delhi Government of jeopardizing the health of city residents, especially children, by failing to take concerted steps to check air pollution. The Municipal Solid Waste Management Case (1996) was filed by Almitra H. Patel against the Government of India for its inability to properly collect and dispose of municipal solid waste, which was being dumped in the open and destroying the environment. How? In both cases, the Supreme Court instituted high-level governmental committees to study the issues and make recommendations on new standards of governance in the sector. Additionally, the Supreme Court maintained a close oversight on the implementation of these recommendations to ensure that they were strictly adhered to. Impact The Delhi Vehicular Pollution Case resulted in the conversion of Delhi’s public transport fleet to Compressed Natural Gas (CNG); in the phasing out of old and polluting vehicles in the city; and in the development of a National Fuel Policy, among other things. The Municipal Solid Waste Management Case resulted in the institution of national rules on municipal solid waste management, now gradually being operationalized throughout the country. In both cases, the judges that heard the case have continued to oversee the implementation of their ruling over a number of years. Limitations PILs do not generally involve a widespread process of public consultation. As a result, PILs may sometimes impinge on the poor. For example, in the Delhi Vehicular Pollution Case, it was bus and autorickshaw drivers that suffered the most, and in the Municipal Solid Waste Management Case it was rag-pickers. 25 Case Study 10 Citizen Report Cards What? In 1994, 1999 and 2003, the Public Affairs Centre, a Bangalore-based NGO, ran extensive surveys with city residents to determine their levels of satisfaction with a range of municipal services, as also to ascertain the costs they incurred for poor service. Based on the findings of the survey, Citizen Report Cards (CRCs) and ratings were then produced on individual public service providers within the city. These were widely disseminated in the local press, and served to create a significant pressure for service improvement. The Citizen Report Card model has now also been used by a variety of governments, donors, and civil society groups, both in India and overseas, to gauge public perceptions about the status and impact of public services and other governmental interventions, with a view to enhancing them. Why? Citizen Report Cards are an invaluable tool by which to gauge public feeling and to design actionable interventions for government, donors, and civil society. This is why they have also come to be used as a strategic tool for building public awareness about civil and development issues. How? The Public Affairs Centre first assessed the nature of the problems that citizens were confronting through group discussions. It then designed a specialized questionnaire, and used a market firm to administer it to 1,200 middle class to low income households. Local donations covered the costs of the survey. A similar approach has been employed in the other citizen report card exercises, although the size and nature of the respondents’ sample varies. Impact In Bangalore, user satisfaction with municipal services went up by some 40 percent between 1999 and 2003. Also, the percentage of customers facing service-related problems dropped from 24 percent to 11 percent, and consumer satisfaction with the behavior of service staff rose from 27 percent to 44 percent. Similar impacts are seen in many of the other instances in which citizen report cards have been employed. Limitations Political and bureaucratic support is essential if consumer feedback is to translate into tangible improvements in service and in governance. Additionally, deep-rooted problems, such as poor staff motivation, can only be remedied through a multi-pronged approach that includes staff training, the reduction of transaction costs, the use of IT, and the publicization of standards and norms. 26 Section 4 Key Findings and Lessons 27 Citizen engagement in one stage of service delivery can also strengthen other stages. Strengthening Systemic Accountability: Applying the WDR Framework Each of the case studies attempted to strengthen a relationships often generates subsidiary gains in some of different element, or elements, of the World Development the other accountability relationships. For instance, the Report 2004’s five-point accountability matrix. However, new approaches to water supply and sanitation service they also indicate that focusing on specific accountability provision in Tamil Nadu (Case Study 2) and Bangalore 28 Overview and Key Findings Engaging with Citizens to Improve Services and Ahmedabad (Case Studies 1 and 3) centered on Creating ‘Voice’ and ‘Client Power’: strengthening the ‘finance’ relationship, by requiring users A Comparative Overview wishing to receive piped water and sewerage service to contribute to the capital costs of extending infrastructure. Table 4.1 illustrates the points within the service delivery This led to gains in ‘delegation’ too. chain at which consumers were provided the opportunity to engage with service providers and policy makers in Similarly, while consumer courts, consumer grievance the innovations profiled. redressal mechanisms and online complaint systems (Case Studies 5 and 7) strengthen ‘enforcement,’ they Voice was created mainly by focusing on three elements: can lead to gains in ‘information.’ While independent regulation primarily creates an ‘enforcement’ relationship • Delegation – Citizens determine the kind of service between citizen and service provider, it also strengthens they want (user contributions, participatory budgeting, the ‘finance’ relationship by requiring citizens to pay a fair regulation). and collectively-agreed price for the services they use. While citizen report cards (Case Study 10) focused on • Finance – Citizens participate in deciding how and on creating more information on performance, it also what terms the service will be financed (user improved ‘delegation’ and service delivery systems. contributions, participatory budgeting, regulation). Table 4.1: Enhancing ‘Voice’ and ‘Client’ Power: A Comparative Overview BWSSB TN Ahm’bd Ker’l CC/GRM CUTS OCMS Reg’ln PIL/Jud’l CRC Sectoral policy-making Tariff-setting Performance standards Informal Informal Informal Informal Planning and budgeting Cost recovery Implementation Performance measurement Complaint redressal audit Penalties for poor performance BWSSB = Bangalore Water Supply and Sewerage Board’s slum program; TN = Tamil Nadu Sewerage Infrastructure program; Ahd’bd = Ahmedabad ‘Parivartan’ and Slum Electrification program; Ker’l = People’s Plan Campaign; CC/ GRM = Consumer Courts and Grievance Redressal Mechanisms; CUTS = CUTS-FES program to facilitate dialogue between rural consumers, electricity utilities and the electricity regulator in Rajasthan; OCMS = Mumbai’s Online Complaint Monitoring System; Reg’ln = Independent regulation in the electricity sector; PIL/ Jud’l = Public Interest Litigation and Judicial Activism; CRC = Citizen Report Cards 29 Citizen participation results in more locally-relevant, cost-effective projects and better service to the poor. • Performance – Citizens participate in setting Tariff setting and standards of performance: The ongoing standards of performance for public service providers process of power sector reform in the country (Case (judicial activism, regulation). Studies 5, 6 and 8) presents some important lessons for the water sector. Electricity, like water, is a networked Client power emanated largely from three elements: service and, until a few years ago was completely government-controlled. It displayed the same problems • Information – Citizens monitor the performance seen in India’s urban water and sanitation sector, of public service providers, so as to ensure including politically-motivated tariff subsidization and free satisfactory service standards (citizen report cards, power, poor metering, a heavy reliance on governmental participatory budgeting, user contributions). handouts, operational intransparency, and widespread collusion and theft. Resulting financial crises constrained • Enforcement – Citizens are able to ensure that State Electricity Boards’ capacity to maintain and expand poorly performing institutions are made to deliver power generation, transmission, and distribution (consumer courts, online complaint management infrastructure, triggering severe electricity shortages systems, judicial activism). throughout the country. The Five Accountability Relationships Reform has brought discernible improvements in this situation, by assisting electricity providers in moving The specific ways in which each of these 10 new toward full-cost recovery, while minimizing the influence approaches strengthened individual relationships of government over tariff-setting. Additionally, citizens within the accountability matrix is now discussed in have been given a formal space in policy-making and detail below. tariff-setting, as a result of which these processes have become significantly more transparent in those states 1: Delegation undertaking power sector reform. Now, electricity distribution companies are required to file ARRs with Budgeting and planning: In Kerala (Case Study 4), their respective SERCs. These explain the company’s citizen participation in project conception, selection, proposed tariffs for the coming year, in the context of a planning, budgeting, and overseeing implementation list of various items of expenditure such as power has resulted in more locally-relevant, cost-effective purchase costs, operating costs, and planned projects and expanded basic service infrastructure to investments. SERCs then seek public feedback on serve the poor. Planning starts with discussions at these ARRs, on the basis of which they fix tariffs. the neighborhood level, during which local SERCs also hold public hearings on ARRs and other communities decide which projects they consider to power-related issues, although they are not required to be a priority, and write technical and financial do so by law. Civil society groups that have developed proposals for them. Their suggestions are an expertise on power issues, such as Prayas in Pune agglomerated and prioritized, first at the ward and CUTS in Rajasthan, are thus able to play an active level and then at the municipal level, and role in defending citizens’ interests in the sector, at both then implemented. the state and central levels. 30 Overview and Key Findings Engaging with Citizens to Improve Services Electricity regulation has introduced clear performance Since required contributions were fairly significant, local parameters for electricity distribution companies. ‘Discoms,’ residents were keen to exact the greatest return on their as these companies are popularly known, can now only money. They thus questioned in detail the individuals operate on the basis of licenses issued by the SERCs, which commit them to detailed standards of performance Box 4.1: and electricity supply, public participation and disclosure, Setting Water Prices in the United Kingdom and customer care (including how to meter, bill and redress complaints). Companies that do not meet these standards While not profiled in this study, tariff-setting in are liable to have their licenses revoked. Not only has the the United Kingdom’s water supply and sanitation public’s understanding of the working of the sector service sector also points to the benefits of a improved, so gradually has its performance. Electricity bills regulator. Although the United Kingdom has a now itemize each component of tariff and, in some states, completely privatized system of water and utilities even inform consumers about scheduled power sanitation delivery, price-setting is closely cuts in advance. Collusion and theft have reduced overseen by Ofwat, its water regulator. All utilities drastically, although many states continue to provide free are required to submit five-year business plans to power to farmers for reasons of electoral gain. Ofwat, in which they explain the investments that they plan to make over this period and how they The benefit of these new standards and penalties in the will impact on tariffs. They are also required to electricity sector is also illustrated in Case Study 5. report on their performance against specific Significantly, Delhi’s private electricity companies, now financial, operational and service parameters, subject to regulation, complied with 86 percent of such as capital-to-output ratios, cost reductions consumer court rulings against them, while Delhi’s and efficiency achievements, reduction in unregulated government-controlled water-utility complied complaint levels, and the speed and customer with less than 50 percent. satisfaction with grievance handling. Utilities must have their business plans and performance De facto service ‘contracts’: The Bangalore, Tamil Nadu, reports vetted by Ofwat-recognized audit firms. and Ahmedabad case studies point to the crucial role Ofwat then shares these plans and reports with that de facto performance contracts, arising from the experts and the public for their comment. reputational pressures upon utility engineers, municipal Incorporating all these inputs, Ofwat sets the tariff officials and councilors, and community-based that each utility is allowed to charge over the organizations, can play in enhancing service, in coming five-year period, including the percentage situations in which de jure contracts do not yet exist. by which prices are allowed to rise every year. Since each of the three schemes profiled in these Ofwat is bound to publicly explain the reasoning studies required community contributions, the municipal by which it reached its decision. All relevant council/service provider had to persuade citizens to business plans, audited performance reports, and participate, and had to work in partnership with local Ofwat notifications and documents are available community-based organizations and/or municipal to the public on its Web site (www.ofwat.gov.uk). councilors to do so. 31 The attitude of frontline staff can make or break even the best-intentioned accountability initiative. Table 4.2: Engagement Engenders de facto Delivery ‘Contracts’ BWSSB Tamil Nadu Ahmedabad Kerala CUTS-FES OCMS Citizen Report Cards responsible for popularizing and administering the document utility performance, and interact with the scheme within their community, on such issues as its community on its behalf. In Andhra Pradesh and purpose, its costs, its scheduled timelines and other key Karnataka (Case Study 8), electricity utilities have deliverables. This process created an unwritten outsourced the task of complaint registration and performance contract between the scheme’s grievance handling to franchisees. In many parts of administrators and the community, further strengthened India, local governments have also begun to outsource by local municipal councilors’ and community-based such functions to Resident Welfare Associations. organizations’ active stake in ensuring that they drew reputational mileage from its success. The close The need to hold frontline officials accountable: The engagement between service provider staff, and local single common learning from all case studies is that communities and community-based organizations also the attitude of frontline staff can make or break even created personal relationships between these two groups the best-intentioned accountability initiative. Consumer that made the former feel personally responsible for Courts and Consumer Grievance Redressal adhering to the timelines and standards they had Mechanisms (Case Study 5), and Mumbai’s Online committed to. Complaint Management System (Case Study 7), both set up specifically to protect the interest of A similar pattern is seen in the other case studies in consumers, do not serve the end for which they were which service providers worked closely with civil society/ intended due to the indifference, disinterest, and ‘work local communities on an ongoing basis, engendering de overload’ of frontline staff. In contrast, the energy and facto service contracts that worked to enhance delivery. enthusiasm displayed by BWSSB engineers, Tamil For the readers’ convenience, Table 4.2 lists the studies Nadu’s municipal councilors, the staff of the in which this pattern is evident. Ahmedabad Electricity Company and of Rajasthan’s electricity distribution companies, and of People’s Plan 2. Service Delivery (Performance) Campaign volunteers in Kerala (Case Studies 1, 2, 3, 6 and 4) was instrumental in ensuring the success of Co-delivery: Involving beneficiaries in downstream these programs. activities, such as billing and complaint handling, or the actual delivery of services, is a strategy that displays a Since frontline staff is the public ‘face’ of the service strong potential to make frontline officials more provider, and its ‘eyes and ears’ on the ground, they play responsive to customers. Electricity utilities in Rajasthan the lead role in the process of engaging with customers. and Orissa (Case Study 6) have begun to successfully For this reason, it is absolutely essential that they be use local youth to distribute bills and collect payments, properly trained, resourced, and incentivized to 32 Overview and Key Findings Engaging with Citizens to Improve Services Frontline performance must be measured: While citizen report cards (Case Study 10) afford an external measure of frontline performance, service providers need to develop matching internal measures. The ‘audit’ that PRAJA and BMC regularly undertake on the handling of complaints through OCMS is a step in this direction. Additionally, the information that OCMS makes available enables management to isolate and study the performance of individual departments/employees. There is also an urgent need to train and resource frontline staff to execute their responsibilities. To improve frontline behavior, management needs to Involving beneficiaries in downstream assign specific responsibilities and outcomes to frontline activities, such as billing and complaint handling, or in the actual delivery of staff, and hold them to account for these. Only in services, is a strategy that displays a Bangalore (Case Study 1) did the service provider adopt strong potential to make frontline officials more responsive to customers. such an approach, by assigning revenue targets to individual frontline staff and monitoring performance against these. As a result, BWSSB’s program has shown a high degree of success. Also important is that customers are provided the opportunity to engage with senior and/or middle officials to put a further pressure on frontline staff to deliver. The genuinely engage with consumers. Frontline officials are case studies on CUTS-FES’ program in Rajasthan, also crucial to the successful operation of a public citizen report cards in Bangalore, and the Ahmedabad service delivery system because they maintain the Electricity Company’s pilot slum electrification program network at the point of service provision, and are thus demonstrate the value of regular customer-manager intimately familiar with how the system performs on interaction, over and above formal organizational the ground, the challenges it confronts, and how it may systems for customer liaison. be improved. 3. Finance The case studies on Bangalore, Tamil Nadu, and CUTS-FES in Rajasthan show the gains that accrue The Bangalore, Tamil Nadu, and Ahmedabad case from enabling frontline staff to transmit policy and studies present a new approach to financing basic operational information back to management, take services, particularly for the poor. In these, service decisions on the ground, and respond quickly to providers defray a portion of the capital costs involved in evolving customer needs. extending the municipal water supply, sewerage and/or 33 Service providers were compelled to engage with customers when government grants were reduced. electricity network through direct contributions from users reduce connection costs. In Tamil Nadu, many towns who must, thereafter, also continue to pay monthly O&M redesigned their proposed sewerage infrastructure to charges. Triggering this change was the reduction or non- minimize costs and the required contribution from availability of financing from the service provider’s individual households. In Ahmedabad, the Ahmedabad erstwhile primary funding source. In Bangalore, for Electricity Company permitted new customers to pay instance, the municipal corporation ended its subsidy on their connection fee by way of monthly installments. free water through public taps, forcing BWSSB to find new ways of financing water supply to the poor. In Tamil The Bangalore scheme showed the greatest success for Nadu, the state government had only a limited budget to two reasons. First, BWSSB engineers and staff interacted expand sewerage and sanitation infrastructure within its directly with slum communities on an ongoing basis, to jurisdiction and so encouraged ULBs to work with understand their needs and service preferences and relay citizens to assume this responsibility. In Ahmedabad, the these back into the organization. Secondly, BWSSB municipal corporation wanted to dramatically upgrade management was willing to yield to the suggestions of end basic services to the urban poor throughout the city, but users, and was thus able to tailor a more relevant and faced financial constraints. affordable service, by giving customers the liberty to choose between various delivery and financing options. The most noticeable fall out of compelling service providers to seek financing from within beneficiary In contrast, Ahmedabad’s ‘Parivartan’ slum upgradation communities, and reduce their dependence on scheme failed to take off because AMC was unwilling to government grants, is that they are forced to engage with respond to clearly-stated customer needs and and respond to end users. requirements. Although most customers only wished to obtain a few of the program’s package of eight services In all three cases, the service provider had to repeatedly (individual water supply, underground sewerage, dialogue with target communities to persuade them to individual toilets, storm water drainage, paved internal connect to the expanded network. It had to explain roads and bylanes, street lighting, solid waste schemes to them in detail and outline benefits of management, and landscaping), AMC remained resolute participation. In each case, consumers insisted that they in maintaining an ‘all or nothing’ approach. should be allowed to pay only for what they used, so service providers were forced to find creative ways to 4. Information bring down connection and service tariffs to win a larger number of customers. In Bangalore, BWSSB brought As a World Bank study asserts,28 “Publishing information down tariffs from US$2.5 to US$1.6 per month, when it is not enough to enhance performance. Information must realized that slum households use an average of just 8 be used to enhance performance.� The case studies kiloliters a month, and not 15 kiloliters as the initial tariff show how both citizens and utilities can strategically had assumed. Customers were allowed to choose collect and employ service-related and complaint between individual or shared connections to further information in an effort to enhance service delivery. 28 India: Urban Governance and Finance Review, World Bank, December 2004 34 Overview and Key Findings Engaging with Citizens to Improve Services Box 4.2: Harnessing User Payments Correctly Requiring users to pay for or contribute to services can have a significant impact on accountability. Nonetheless, payment schemes relying solely on upfront contributions fail to create a sustained relationship of accountability between citizens and providers. User payments have the greatest accountability impact when directed toward O&M or when paid in multiple installments over a long period of time. Such arrangements afford users the option of using nonpayment as a credible sanction against the provider for failing to meet service obligations. Similarly, phased tariff increases should be accompanied by tangible improvements in service quality to be publicly credible and politically acceptable. Most importantly, cost-related information must be effectively communicated to users to help them distinguish genuine costs from those arising from systemic inefficiency. Thus, the following types of payment schemes are likely to be the most effective: • Payments in small installments, particularly for poor consumers who find it difficult to put together a large sum at one time. • Direct payments to provider, since this limits the diversion of funds due to corruption and financial leakages. • Explicitly linked to individual services, so that the amounts paid can be matched to the quality of services on offer. • Recurrent or paid through an entire project cycle, to empower citizens to use bill payments as a credible means to enforce service quality on a continuous basis. • Reflective of the full costs-to-serve, to sufficiently pinch provider budgets and induce a more responsible management of costs. Citizen monitoring of utility performance: The case In Bangalore, the Public Affairs Centre used studies make it clear that it is possible and feasible customer satisfaction as a vicarious measure of for consumers to collect information on provider service. All three organizations strategically used this performance, and use it to pressure improvement. information to identify and highlight shortcomings in In Rajasthan, CUTS measured the quality and provision, rally widespread public support, and to availability of electricity service on a daily basis by militate for targeted investments and improvements. training designated villagers to log the number of The fact that this information was credible to service hours of service, voltage and fluctuation levels, and providers, also earned for them the formal authority to so on. In Mumbai, PRAJA collected extrapolated actively collaborate with these institutions in data on service by monitoring customer complaints monitoring related service and management and the speed with which they were addressed. improvements. 35 Citizens and utilities can strategically collect and use service quality and complaint information to press for service improvements. The power of benchmarking and comparison: The most crucial lesson on the strategic use of information is the Box 4.3: Performance Indicators for power inherent in public benchmarking and comparative Water and Sanitation Utilities rating. The Public Affairs Centre’s comparison of Bangalore’s municipal agencies on a standard set of The International Benchmarking Initiative (IBNET)30 service and operational parameters prompted them to enables the public to compare the performance of compete with each other, as also against past water and sanitation utilities on a core set of performance. This led to measurable improvements in performance and cost indicators, which present a service delivery. Some agency heads were so concerned clear picture of a utility’s financial and about their institution’s relative rating that they called up operational health. These indicators include: the Public Affairs Centre to determine the results of the • Service coverage survey before it was released and, if they discovered a • Water consumption and production bad rating, to plead that it not be publicly disclosed. • Non-revenue water Similarly, the information collected through PRAJA’s • Metering practices OCMS provided BMC’s management — both at the top • Network performance and at the departmental levels — with a comparative • Costs and staffing perspective on the performance of individual • Quality of service departments and staff. While not profiled in this study, • Billings and collection the Hyderabad Metropolitan Water and Sewerage Board’s • Financial performance use of internal benchmarking, to assess staff against • Assets certain performance indicators, has shown significant • Affordability of services results since it was introduced a few years ago.29 • Process indicators Upgraded information on system performance and service outcomes: In India consumer complaint and upgraded complaint and management systems set up by grievance redressal mechanisms form the primary Delhi’s water utility and its three private electricity institutionalized mechanism for direct engagement distribution companies afford management a bird’s-eye between customers and service providers. Complaint view of service problems and the speed of complaint systems can provide service providers with vital internal handling. An external civil society ‘watchdog’ can further management-related information. The OCMS has help to audit performance and mobilize pressure for provided BMC with a new and more detailed perspective improvements on an ongoing basis. on the nature of complaints being made by consumers, and further insights are provided by PRAJA’s ongoing In CUTS-FES’ program in Rajasthan, electricity utilities’ audits of customer satisfaction. The institution has been readiness to engage with village-level consumers on better able to direct investments to priority areas and to service standards has provided management with a identify high-performing departments and individuals. The detailed understanding of the functioning of the 29 In Pursuit of Good Governance: Experiments from South Asia’s Water and Sanitation Sector, Jennifer Davis et al, Water and Sanitation Program-South Africa (WSP-SA), 2003 30 IBNET is an initiative of WSP-SA, DFID and World Bank. 36 Overview and Key Findings Engaging with Citizens to Improve Services strategically employing computerized complaint registration and monitoring systems. Such systems are not too expensive to deploy (OCMS cost just US$9,000 given PRAJA’s pro bono contribution of technical expertise), and will most likely continue to become cheaper as they are purchased more widely. Moreover, they require only a handful of well-trained staff to run. Formal avenues for customer feedback: However, complaints represent only a narrow data set and are an inadequate basis on which to base ongoing and strategic system enhancements and refinements. Complainants represent only a limited group from within a service While service providers are trying to providers’ overall universe of customers and their enhance their customer-responsiveness through online complaint management complaints may not adequately reflect the varying systems, it is more valuable for them to problems of the broader mass of consumers or help institutionalize ongoing mechanisms of customer feedback. measure specific service outcomes. Additionally, as made clear by an analysis of the electricity- and water- related cases filed with Delhi’s consumer courts, over two-thirds of all complaints relate to billing. In Mumbai, the largest number of complaints received by OCMS relate to building violations and encroachments, offering little idea about the strengths and limitations of service delivery in other areas. distribution system down to the smallest participating village. Similarly, the Bangalore Municipal Corporation’s While a number of service providers are trying to willingness to act on the findings of the Public Affairs enhance their customer-responsiveness through online Centre’s citizen report cards has not only improved complaint management systems, it is more valuable for service delivery, but has also revived its flagging service providers to institutionalize ongoing mechanisms reputation with city residents. The information contained of customer feedback. Citizen report cards present a in these public surveys has provided the corporation’s useful instrument in this respect, if run by a credible and management with an invaluable insight into which sufficiently resourced agency (although it may be departments and services need to be reformed, and financially difficult for service providers to regularly training packages and incentives on how this might commission such studies on their own). In addition, be done. direct management interaction with customers makes it possible to obtain feedback and mobilize public Public service providers can greatly augment their understanding and support in dealing both with accountability and responsiveness to customers by immediate and specific service problems and longer-term 37 Existing consumer protection and grievance redressal mechanisms are failing to deliver due to the absence of platforms for citizen oversight and enforcement. strategic issues, including utility plans for investments, service improvements, and pricing. Box 4.4: Empowering Consumers to Demand Improved Service from Water Utilities The need to make information available in a comprehensible and convenient manner: As Case South Africa’s Department of Water and Forestry Studies 6 and 8 show, merely instituting platforms for (DWAF) has realized that consumers are its key public input is not sufficient to ensure meaningful partner in ensuring that31 water utilities deliver as participation, particularly in technically complex sectors intended. DWAF has therefore developed an 11- such as electricity and water. The case study on module consumer education program, intended to independent regulation in the electricity sector identifies teach water users their rights and responsibilities, the lack of public understanding of the issues as the how to read their bills and water meters, and how primary limitation to consumer engagement on reform to work with their municipalities in improving and tariff issues. Aside from training, consumers will service. The program comprises three-hour training benefit if technically complex information is made sessions every fortnight, for six months, each comprehensible, and issues highlighted simply and dedicated to one of the 11 topics below: clearly, in a language they understand. • Citizens’ rights and responsibilities • Understanding the water cycle • From tap to toilet For instance, although citizens are encouraged to • Using water wisely participate in tariff-setting in the electricity sector, ARR • Sanitation and hygiene documents run into hundreds of pages, and are highly • Pollution abatement and water quality technical and often issued in English. This limits the • Tariffs, billing and meter-reading number of people who can comprehend them. Even • Affordability vernacular language versions of these documents tend to • Different spheres of government be found only on SERC Web sites or at state/district • Regulation, monitoring and evaluation headquarters, and are not easy for poorer and rural • Identifying the gaps and planning the way consumers to access. forward The program will initially be funded by DWAF The experience suggests that civil society organizations funds but other sources of funding will also be are mostly best skilled and positioned for educating tapped as the program expands. To further consumers, but specific government support can add incentivize water utilities to perform, DWAF has value. In Rajasthan, NGO CUTS-FES’s work benefits made its funding to municipal water departments considerably from special funds created by the state contingent on their regularly reporting on a set of eight performance indicators, including access to electricity regulatory commission and discoms for water and sanitation, drinking water quality, consumer education. metering coverage and efficiency, environmental impact, customer service standards, financial Public and open dialogue is essential: Another important performance, and institutional effectiveness. lesson from the experiences profiled is the need for 31 While there is some private participation in South Africa’s water sector, it is extremely small. 38 Overview and Key Findings Engaging with Citizens to Improve Services information collection to be accompanied by open and Studies of 2 and 4). While, in Tamil Nadu, sewerage public dialogue, within civil society, and with the expansion occurred rapidly when local actors were concerned provider. Besides generating widespread spearheading the process, service problems were awareness and institutional transparency, extensive experienced when parastatals took over O&M. Similarly, participation has two benefits. First, it helps to marshal in Kerala, the noticeable expansion in basic services that and synergize the collective strength of various groups followed the introduction of the People’s Plan Campaign toward one common end, so as to apply greater pressure slowed due to local governments’ and consumers’ on the government for reform. Secondly, it minimizes the inability to exert any effective influence over parastatal possibility that one set of players benefit at the cost of agencies, such as the Kerala Water Authority (KWA) another by throwing up likely areas of conflict, as also a or the Kerala State Electricity Board (KSEB). host of potential solutions. In the case studies, a variety of approaches were used to foster free and open This underscores the need to truly devolve basic municipal discussion, including workshops and collaborative services, so that citizens and local governments exert seminars, media campaigns, public hearings, and effective control over service providers. community meetings, at all of which governmental Holding consumer protection mechanism to account: officials interacted with consumers on key service Similarly, all consumer protection mechanisms examined improvement issues. in this study are failing to deliver due to the absence of platforms for consumer oversight and enforcement. 5. Enforcement These include consumer grievance redressal mechanisms, consumer courts, public interest litigation, In addition to the poor performance of frontline officials, the and independent electricity regulation. other common failing of the innovations profiled in this volume was consumers’ inability to take public service For instance, VOICE’s study of the experience of 485 providers to task for not holding up their part of the bargain, poor Delhi consumers in pursuing justice via the city’s in service implementation or complaint redressal. consumer court system (Case Study 5) found that 50 percent of complainants had to wait for over six months Holding service providers to account: Despite the for a ruling, and a further one-third for up to six months.32 significant accountability gains issuing from closer utility- Additionally, Delhi’s water utility could not comply with customer (or government-citizen) engagement in the 50 percent of the rulings, since it had been ordered to Bangalore, Tamil Nadu, Ahmedabad and Kerala cases, no improve supply to complainants and said it did not have ongoing standards of service were stipulated for the post- the water necessary to do so. In other words, Delhi’s construction stage, or enforcement mechanism set up to courts were unable to ensure that Delhi’s water and enable citizens to enforce continued quality delivery. This electricity utilities complied with their rulings in a timely led to noticeable problems in the two cases in which manner, if at all. While the huge backlog of cases is parastatal agencies were responsible for implementation partly responsible, more important is the absence of any and service – that is Tamil Nadu and Kerala (Case mechanism by which consumers may exert ‘client 32 The Consumer Protection Act 1986 stipulates that consumer courts must rule on consumer complaints against service providers within three months of receipt. Only a fifth of respondent had received a ruling within this time. 39 Service providers need to approach the poor as a distinct customer segment. power’ over the institutions intended to safeguard that impact negatively on third parties, in particular the their welfare. poor. In both cases, the Supreme Court consulted widely with experts, but did not make effort to seek public Similarly, while independent electricity regulation33 has feedback. While the Municipal Solid Waste Management resulted in improved service and stepped up sector and Case resulted in radical and far-reaching shifts in the utility transparency in five states (Karnataka, Andhra policies regulating waste handling/disposal the resulting Pradesh, Orissa, Maharashtra, and Rajasthan) that are regulation fails to make any provisions for rag-pickers, undertaking power reform programs, some shortcomings who have traditionally run waste management services in remain. First, State Advisory Committees, which include the country. The Delhi Vehicular Pollution Case resulted in a variety of consumer and other representatives, have the introduction of new emissions and pollution no power over the decisions of SERCs. Similarly, abatement standards in the country, but the short although Electricity Act 2003 mandates each distribution deadline that the Supreme Court gave commercial company to set up a Consumer Grievance Redressal vehicle (taxi, bus, and autorickshaw) operators to Forum that includes one consumer representative, he or convert to using CNG forced them to wait for hours on an she has no voting rights. According to Case Study 8, almost daily basis to fill their tanks at the restricted only the Karnataka SERC has appointed a consumer number of CNG stations in Delhi. advocate to its staff to intervene on behalf of the public in the tariff-setting process and in clearing related Servicing the Poor investment proposals. It is also considering whether to fund select NGOs to regularly intervene in its hearings. The primary lesson on servicing the urban poor is that providers need to approach this group as a distinct Moreover, while all the five SERCs are punctilious about customer segment. Cost recovery is possible, if services making available their draft regulations and ARRs for are relevant and affordable to the poor, and providers public comments, they pass on the work of scrutinizing would be well advised to engage directly with urban poor ARRs as well as consumer inputs to consultants. It is communities to understand specific service and delivery difficult for citizens, therefore, to verify whether and how needs, consumption patterns and ability to pay.34 Unless their comments were incorporated. Similarly, none of the service providers find innovative ways to legally connect five states reviewed sought public inputs or comments this population, they will increasingly resort to illegal or on the selection of SERC chairmen. In all cases, the unauthorized methods of servicing their needs. public learnt about the new chairman from the media, after the appointment had been made. Modifying municipal and service rules: A variety of existing municipal and provider-specific rules will need to While PILs enable citizens to take errant service be modified to enable universal service to the poor. In providers to court, the two cases profiled in Case Study Bangalore and Ahmedabad, BWSSB and AMC made 9 underscore that the absence of public consultation or significant departures from established operational participation in the court process can result in outcomes practices to develop packages to service the poor. In 33 Independent regulation was introduced by the Electricity Act 2003, which also opened India’s electricity distribution, generation, and transmission sector to private participation for the first time. 34 For instance, daily wage laborers may prefer to buy water on a daily basis, since they do not have guaranteed monthly incomes. 40 Overview and Key Findings Engaging with Citizens to Improve Services More customer-friendly complaint channels: While Box 4.5: service providers throughout the country are making Who Will Police the Policeman? sincere efforts to make themselves more accessible and responsive to customers by upgrading complaint Many countries have created formal ‘watchdog’ handling and redressal mechanisms, the case studies consumer institutions in their UWSS sectors to indicate that poor consumers’ ability to access these ensure that both utilities and regulators remain forums is constrained by a number of logistical factors. accountable to consumers and the public. The A survey of 485 poor consumers who had filed budget for these institutions is provided by the complaints with Delhi’s water and electricity utilities had government on an ongoing basis, which often to travel an average of 10 km to reach them, spending an also underwrites the expenses of relevant average of US$3.3 to get there and back, and missing a consumer training and education throughout the day of work (Case Study 5). Moreover, they were forced country. Examples are the Consumer Council for to make an average of three to five trips to the redressal Water in the U.K., and the consumer department forum to follow up and resolve their complaints, due to of the Florida Public Services Commission. the absence or disinterest of key staff. This happened Indian state and municipal governments might despite the fact that these utilities have set up wish to consider the creation of similar complaint offices in every one of their divisional zones institutions within their service areas. A key within the city. challenge to address in design is to put sufficient distance between the watchdogs and the Conversely, while Mumbai’s OCMS offers consumers the government so as to ensure the highest level of convenience of filing and pursuing complaints over the independence. Quality information, transparent telephone or the Internet, it can only be used by nomination and operating procedures, and clear customers who possess these facilities. Similarly, most rights, powers and responsibilities are key existing complaint cells stipulate that complainants must elements of achieving such distance. submit their cases in writing – a requirement that is difficult for illiterate customers to meet. both cases, they were willing to waive their long-standing Service providers thus need to devise grievance requirement that only households with tenure documents systems that are more physically and culturally could be legally connected to the city’s water and accessible to poor consumers. Indian water and electricity networks. AMC even went so far as to promise sanitation utilities might wish to take a leaf from the book participating slum households that they would not be of electricity distribution utilities in Rajasthan (Case evicted or removed for 10 years, to reassure them that Study 6) and Orissa (Case Study 9), which have both their investments in legal connections would not be lost. appointed local youth to deliver bills, collect revenues, This requires firm and clear policy decisions to balance and record service-related information at the the expansion of services with procedural stability. grassroots level. 41 Service providers should create grievance redressal systems that are physically and culturally accessible to poor consumers, who are finding it difficult to access existing systems. a companion to depose for them before the utility’s Box 4.6: complaint cell. This was a marked departure from the Keeping Politicians in the Loop prevailing practice in which all complainants had to present their own cases themselves. Since many rural The empirical evidence in the case studies and poor consumers were not articulate enough to do so illustrates that pro-poor initiatives which effectively, their problems were often not fully understood completely bypass political leaders may not be by the utility and so remained unresolved. Public easily sustainable in the long term. While hearings are another method of customer-utility politicians can be a vital force for community engagement that poor citizens find comfortable. Andhra mobilization, they can also be a source of Pradesh, for example, has set up vidyut adalats — or opposition to utilities’ efforts to improve services public electricity courts — in each of its 1,200 mandals (particularly to poor communities) through a (sub-districts). Adalats are held once a month, and the more realistic model of cost-recovery. When accounts and operational staff of the utility come politicians are harnessed as partners in public equipped with their records. Billing and engineering service and infrastructure schemes, they are less complaints are recorded, and action is taken. Complaints prone to create obstacles as seen in the case of are sent to headquarters, which randomly monitors their user contributions for sewerage networks in resolution. Karnataka has now set up similar adalats for Tamil Nadu. On the other hand, politicians have the on-the-spot resolution of consumer complaints. hindered reform when insisting on free services without due analysis of the fiscal scope for such Changing the Incentives of Public policies, as in the case of electricity reform in Service Delivery Rajasthan. It is important to invest in raising awareness among politicians about the systemic Utility incentives: Direct engagement between service and practical trade offs often required to achieve providers and citizens on service and financing issues sustainable service delivery improvements generates pressures for providers to become more in UWSS. responsive to end users, and to grapple more directly with the challenges of universalizing and improving The Bangalore, Tamil Nadu, Ahmedabad, and Kerala service. At the same time, as the experiences profiled studies also point to the value of empowering a trusted in the case studies show, service providers might member of the local community to serve as a conduit stand to benefit significantly from working more and a broker between the customer and the utility. In all directly with consumers. Citizen engagement has of these cases, poorer citizens relied on community enabled service providers to more quickly raise leaders or NGOs to mediate on their behalf with utilities finances and expand delivery infrastructure; recover with respect to the schemes in which they were costs; ensure the cost-effectiveness and sustainability participating, and in conveying and resolving complaints. of projects; obtain a better understanding of system performance and service outcomes; and establish a In another pro-poor innovation, CUTS persuaded the more constructive and sustaining relationship with Rajasthan SERC to permit rural complainants to employ end users. 42 Overview and Key Findings Engaging with Citizens to Improve Services Service providers can meet their own goals by engaging directly with consumers. For instance, BWSSB was able to expand its network in In Ahmedabad, AEC substantially reduced power theft by the city by working closely with slum households to persuading slum communities to legally connect to its encourage them to opt for paid household connections network, proving to them that paying for use through a and to design a relevant and cost-effective physical metered connection was half the monthly fee typically delivery system. 46 slum communities, representing paid to middlemen for an illegal, ‘unmetered’ one. To 10 percent of the city’s slums, have signed on to the assist slum households in paying the upfront capital program and BWSSB’s revenues have risen. Additionally, costs, AEC allowed for payments to be amortized in the its engineers’ continuing interaction with connected and form of monthly installments. As a result, AEC ‘target’ slums has also provided it with an ongoing source succeeded in getting close to 10 percent of Ahmedabad’s of customer feedback on system performance and ‘unauthorized’ slum households to pay for a legal possible improvements. connection and meter monthly consumption, in a period 43 Citizen engagement has enabled service providers to devise innovative ways to connect the poor, thus moving closer toward universal service. of just two years. Similar gains accrued to the Orissa State Electricity Board (mentioned in Case Study 8) Box 4.7: The Value of Engaging ‘Face-to-Face’ rather which, in partnership with the Xavier Institute of than through Consultants Business Management (XIBM) in Bhubaneswar, trained and appointed one local youth in 100 pilot villages of the The case studies underscore the importance of state’s Sambalpur District to study fellow villagers’ service providers engaging directly with citizens, electricity use habits and to show them how paying for rather than through third party consultants. electricity would, in fact, be cheaper than the monthly Further momentum is obtained when senior and payment to touts and officials to enable illegal mid-level management, rather than just frontline consumption. The pilot was so successful that the officials, interact directly with consumer groups program has now been extended to 5,000 villages. to explain a scheme to them, or to discuss refinements and modifications in those under A similar set of gains is apparent in the Tamil Nadu case implementation. While this is not to diminish the study, where ULBs and local communities have a direct value that trained development communications influence in infrastructure investment decisions about consultants can bring to a project, their role expanding sewerage infrastructure in their areas. Municipal should support rather than substitute that of councilors actively discuss proposals with constituents, provider officials. Using responsible officials as including how project costs might be contained, the size of an interface has two strengths. First, they have household contributions to the initial deposit, as well as enough authority to discuss and commit to sewer connection and monthly user charges. As a result of suggested program modifications during public public financial contributions, 64 urban areas in Tamil consultations; unlike consultants who can only Nadu had partial sewerage schemes by mid-2005, as commit to relaying the same information to their opposed to 14 in 1998 when the program began, and contracting institution. Secondly, only a direct many smaller towns have already achieved 100 percent interaction can begin to overcome the distance coverage. Moreover, municipal councilors have managed and relationship of mistrust that currently to draw political mileage from their role as initiators of prevails between many service providers and this scheme, while both ULB officials and the customers in India by attaching a ‘face’ to the Government of Tamil Nadu saw it in their interest to have service provider and putting pressure on senior an expanded sanitation network to show. officials to make and honor public commitments on service improvements. Table 4.3 provides a brief visual overview of the varied gains that have accrued to public service providers profiled in this publication through an enhanced and Political Incentives direct engagement with consumers. In the case study on Public Interest Litigation and Judicial Activism, there is The analysis also sought to determine the role that civic no direct engagement between public service providers engagement and citizen involvement have in compelling and utilities, since this relationship is completely politicians to hold service providers to account against a intermediated and directed by the Supreme Court. set of predetermined service standards. 44 Overview and Key Findings Engaging with Citizens to Improve Services In Tamil Nadu (Case Study 2), since municipal councilors Finally, while most citizen report cards (Case Study 10) were personally responsible for persuading their electoral have focused on holding service providers and constituencies to financially contribute to the government agencies to account, some groups have sewerage scheme, they were particularly careful to successfully used them to hold politicians accountable ensure that voters got the best value for their money. as well. The Public Affairs Centre in Bangalore Councilors worked closely with scheme participants to strategically used the findings in its series of report vet and reduce project costs, and connection and user cards to press the senior-most tier of the political fees, and held contractors to the terms of their establishment — particularly the state’s Chief Minister — construction contract on timelines and quality standards. to improve service quickly and along the lines suggested by the customer satisfaction data. In Kerala (Case Study 4), the collective and transparent decision-making that has accompanied the People’s Plan In Gujarat, the Self Employed Women’s Association Campaign and vetting of projects by independent (SEWA) segmented its citizen report card findings on technical experts reduced favoritism and arbitrariness in a ward-by-ward basis to provide each area with a the disbursement of contracts. comparative perspective on services. This provoked Table 4.3: Public Service Providers Benefit from Engaging Directly with Customers BWSSB TN Ahd’bd Ker’l CUTS OCMS Reg’ln CRCs More locally-relevant projects Reduced reliance on state/central finances Lower project costs Faster project implementation Enhanced understanding of consumer needs Improved capacity to service the poor Better data on system performance Improved understanding of service outcomes More credibility with consumers BWSSB = Bangalore Water Supply and Sewerage Board’s slum program; TN = Tamil Nadu Sewerage Infrastructure program; Ahd’bd = Ahmedabad ‘Parivartan’ and Slum Electrification program; Ker’l = People’s Plan Campaign; CC/ GRM = Consumer Courts and Grievance Redressal Mechanisms; CUTS = CUTS-FES program to facilitate dialogue between rural consumers, electricity utilities and the electricity regulator in Rajasthan; OCMS = Mumbai’s Online Complaint Monitoring System; Reg’ln = Independent regulation in the electricity sector; PIL/ Jud’l = Public Interest Litigation and Judicial Activism; CRC = Citizen Report Cards 45 In Mumbai, slum residents used citizen report card findings to present a ‘charter of citizens demands’ to their municipal councilor and hold him accountable. residents from poorly-performing wards to demand election if he was unable to ensure that these were an explanation and seek improvement from met. To create further pressure, the charter was their municipal councilors. In Mumbai, Apnalaya used painted on the walls of all community toilets in the the findings of its citizen report card on services in area, together with the corresponding duties of the urban slums to draft a ‘charter of citizens’ demands. councilor. Citizens thus created an agenda for This was presented to the local municipal councilor service and governance improvements by their with the warning that he would be voted out in the next elected representatives. Citizens can create an agenda for service and governance improvements. 46 Overview and Key Findings Engaging with Citizens to Improve Services Other Lessons • Champions: In all cases, the involvement and support of ‘champions’, who wield authority, credibility The case studies also put forward a number of and respect within the public service provider or secondary learnings that could serve to reinforce any beneficiary groups, was vital to the adoption and initiatives to advance consumer voice and client power in success of new programs. This might include utility the water and sanitation sector. These are briefly managers, municipal commissioners, regulators and discussed below: judges from among governmental agencies, and municipal councilors, politicians and community • Microfinance: Financial support is of immense value leaders from within beneficiary communities. A to slum households in enabling them to make the caveat, though, is that programs that rely heavily on investments required to connect to public champions tend to wane in their absence. It is thus of infrastructure systems, even when their participation the essence to institutionalize such programs as soon is subsidized – as was the case in the ‘Parivartan’ as possible, by establishing suitable and formal and slum electrification programs in Ahmedabad. This staffing, financing, performance measurement, and holds particularly for first-generation migrants, who reward mechanisms. often do not have a guaranteed monthly income. • Honest brokers: An intermediary trusted by both • Reduced project costs: Accountability is not just customers and the public service provider can be of about ensuring a better service. While in the private immense value in building the mutual confidence sector, competition exerts a constant pressure on required to design and initiate an acceptable program. companies to reduce project costs, this incentive This role can be played by NGOs and community- is weak among public service providers that draw based organizations, but may also include local their operating budgets primarily from government politicians, an independent regulator, or a credible grants and do not have to show good investment- third party, such as a judge. Such intermediaries often return ratios. serve as a bridge through which provider-customer engagement is initiated. Additionally, they assist in • Need for sufficient funding: Underfunding and taking this early contact forward by representing each understaffing pose a significant limitation to efforts to party’s compulsions and positions to the other. scale up innovative new programs, and sufficient provisions should be made for this at the time of • Co-finance: Composite financing, in which project planning and design. governmental agencies, beneficiary and other interested groups share program costs, facilitates the Success Factors: From the experiences detailed in the launch of much-needed programs that may otherwise case studies, certain factors appear to enhance the not have come into existence due to limitations on credibility and success of governmental and utility efforts government funds. More crucially, they result in to enhance accountability, transparency, and consumer significant design improvements due to the need to participation. These are: convince and share information with all contributing 47 Small-scale, experimental projects are invaluable to test new hypotheses and translate them into working models. parties about their proposed merits and deliverables simultaneously in order to retain and achievements. increase public interest. • Pilots: Small-scale, experimental projects are • Space for innovation: Successful programs allow invaluable to test new hypotheses, translate them into room for innovation in response to changing needs working models and build the legitimacy of new and conditions on the ground, and the more public approaches within the institution. support is mobilized, the better the prospects of getting innovations accepted. The service providers • Incremental development: Developing a program that have achieved success have generally monitored gradually often makes it more durable as it provides public support and customer satisfaction as they time for public consultation and feedback, went along. This shifts the emphasis from simply improvements based on early experiences and the making additional connections to also attending to the evolution of a relationship of ‘trust’ and partnership. quality of services and improving planning, innovation The challenge is to ensure a regular flow of and delivery. 48 Section 5 Conclusions: Some Practical Steps to Enhance Accountability 49 The lessons emanating from the case studies indicate some major ‘action points’ for Indian water service providers, policy makers, and civil society groups searching for new strategies by which to create a greater role for end users in the operation and control of the sector. For convenience, these are separated into three discrete agendas, although in reality there are many overlaps, complementarities and interdependencies among them. Action Points for Water Service Collect and disseminate information Providers on performance Involve and consult citizens Water service providers will more effectively meet their own needs, not to mention those of policy In instituting formal practices to involve citizens on makers and end users, by collecting and publicly planning and operational issues, it might be useful for reporting data about institutional performance and water utilities to take a first step by: service outcomes. While some of this information may already be with providers, new methods by which to • inviting the public to attend their operational meetings measure delivery and outcomes will need to be on a regular basis; instituted. In this respect, the International Benchmarking Network for Water and Sanitation • pasting the minutes of such meeting on the utility Utilities (Box 4.3) represents an interesting model for Web site and/or publishing them in local performance measurement and disclosure. newspapers; Also useful in this regard would be to institute a practice • holding public hearings on proposed investments, of regularized customer feedback, as also expenditure policies and tariffs; and and performance audits.36 Strategically collected and analyzed complaint information can also be a valuable • sharing contracts with the public.35 tool for management. Not only are these practices common in utilities Delineate clear responsibilities for overseas but they can be introduced immediately with individual staff little extra effort or expense, while growing into ongoing relationship of citizen participation in policy-making, Once a service provider has committed to a set of service design, implementation, delivery, and external deliverables and performance parameters, performance monitoring. internal management needs to focus on creating 35 In some countries, consumer pressure for more transparency has resulted in the practice of ‘open tendering’, in which all bids received by utilities are public. In this way, it is easy for consumers to monitor and influence the contracting process. 36 Such measures would also contribute to strengthening the long-term provider-customer relationship. Repeated experience shows that customers, including the poor, are willing to pay higher rates for a service if they believe that it is of superior or definitively improving quality. 50 Overview and Key Findings Engaging with Citizens to Improve Services and financial efficiencies; delivery innovations; new types of services for the poor; and so on. Create channels for citizens to interact directly with senior officials Platforms that give customers the opportunity to interact directly with management on policy, investment and service issues, and complain about poorly performing frontline officials provide management a good overview of how the institution and its performance is perceived by customers. Online systems of complaint registration and monitoring are Water service providers will more useful, but work best when consumers can also effectively meet their own needs, as also interact directly with management. those of policy makers and end users, by collecting and publicly reporting data about institutional performance and service outcomes. Action Points for Policy Makers Create separate budgets for water supply and sanitation As discussed, the prevailing system of financing water and sanitation activity out of a budgetary ‘common pool’ has resulted in a considerable lack of understanding about the real costs of operation and of supplying water supporting systems of internal delegation, in which to differentiated customer segments. Even the best- clear job roles, responsibilities and outcomes are intentioned water and sanitation utility finds it difficult to assigned to individual staff members, together with significantly increase efficiency, cut unnecessary costs transparent and collectively agreed institutional and make useful investments, when it cannot accurately rewards and penalties.37 This is particularly important measure how much it is spending to obtain a specific in the case of frontline staff. Possible targets and level of output. For this reason, creating a clear standards might include, among other things, delineation within municipal budgets for water and customer satisfaction with complaint redressal; sanitation spending and revenues would trigger improved water quality; expanded service area; significant performance and accountability gains within enhanced revenue and reduced leakages; operational the sector. 37 In this respect, a growing body of research shows that reward and reinforcement systems create a positive and sustained incentive toward outstanding performance. Penalties tend to incentivize performance in which staff members ‘stay out of trouble’ by meeting minimum standards, while rewards drive innovation and excellence. Similarly, while financial incentives could be useful, peer recognition and public acclaim is also a strong motivator. 51 It should be mandatory for utilities to report regularly to the public on service quality and performance. Increase cost recovery Educate consumers Enhanced cost recovery will also have a discernible India’s electricity reform experience also points to the impact in improving performance and water providers’ importance of consumer education in training citizens to response to customer demands. This can be done in a effectively dialogue with policy makers on sectoral policy number of ways, including rationalizing tariffs, improved and performance monitoring issues. As state metering, more effective billing and collection, reduced governments and service providers have done in the leakage, and the development of affordable service electricity sector, municipal governments and water and packages for the poor. State and local governments can sanitation service providers might wish to consider provide incentives by linking funding to water and developing and funding programs of consumer education sanitation utilities to clear poverty-related or in this area. performance criteria. Action Points for Citizens and Declare minimum service standards Civic Action Groups Since the absence of clearly-defined service contracts is Information on service is essential to lobby one of the reasons for the poor state of water and for change sanitation delivery in the country, central and state governments should announce minimum standards of Given the dearth of information in the sector, civil society performance for municipal water departments and water can play a useful role in creating new ‘service-related’ boards against which they should be forced to report. parameters by which utility performance can be Publicly committing water departments to a key set of measured. At the same time, citizens can play a key role deliverables will compel a generalized re-think about the in collecting and disseminating data to policy makers and management and reporting structures required to achieve utility management, to highlight strategic areas for such an outcome. South Africa presents an interesting change. Widespread publicity of this data in the media, example in this context (Box 4.8). Its Department of and through public hearings and workshops, generates Water and Forests has now introduced eight service further and stronger pressure for reform. indicators on which all municipal water departments are required to report every year. The power of comparative rating and benchmarking might be strategically harnessed to foster competitive Depoliticize tariff-setting pressures that trigger delivery and efficiency improvements. Thus, civil society groups might Important lessons can be drawn for the Indian water benchmark the performance of utilities across cities; and sanitation sector from the country’s ongoing or they might benchmark their local utility’s power reform experience, which illustrates the improvements on past performance. This creates potential benefits that could accrue from a public incentives both for officials, and for the political and objective way of setting tariffs, with a formal role leadership overseeing these utilities, who will be held for consumers. accountable at future elections. 52 Overview and Key Findings Engaging with Citizens to Improve Services Citizens need to pay a fair price for water. Fulfil responsibilities Auditing Institutional Accountability Citizens need to fulfill their own responsibilities in paying Finally, in understanding the specific issues on which a fair price for the water they consume, if the health and utilities, consumers and policy makers need to focus in responsiveness of the sector is to improve. Proper enhancing consumer ‘voice’ and ‘client power’ at an metering and conservation is key. Only if all players in operational level, they might wish to make a careful the sector assume their part of the bargain can a assessment of the extent to which existing institutional sectoral turn-around begin. structures and processes within individual water service 53 Improving the finance and information relationships appears to have made service providers most responsive to customers. Table 5.1: An Accountability Questionnaire Have the specific objectives, performance standards, service targets and delivery schedules for the Delegation institution being clearly defined? Have consumers been given the opportunity to participate in this process? Have the finances and resources necessary for these tasks, and their longer-term financial and other Financing implications, been identified in partnership with consumers? Is the resulting system of service delivery relevant, convenient and affordable to end users? Performance Is the institution capable of operating the delivery system effectively? Have mechanisms been created by which consumers and policy makers may assess the Information performance of the institution, and provide effective feedback? Have mechanisms been established that enable aggrieved consumers to seek redressal from Enforcement providers, and to effectively penalize those who do not comply? providers encourage responsiveness and openness to than focusing on other areas. Is it easier to close the consumers. In doing so, Table 5.1 presents a set of ‘accountability loop’ by investing efforts to bolster some, questions that might serve as a useful guide. They draw rather than others, of the five accountability on the World Development Report 2004’s accountability relationships? Such an investigation would require the framework, and are intended to evaluate the manner in development of reliable parameters to measure the which internal processes and structures within utilities accountability of a public service provision system. From contribute to or hamper operational transparency and the case studies, it appears that improving the finance clear lines of responsibility. As emphasized earlier, even and information relationships seemed to have resulted in the best-intentioned and most carefully designed the largest gains in customer responsiveness by the mechanism for customer engagement yields little service providers profiled. tangible benefit if not matched by supporting incentives and lines of responsibility amongst the staff responsible Political incentives: What forms of civic engagement and for execution. oversight would help to transform the existing political incentives within the Indian water and sanitation sector to For Further Research restore politicians to their intended role of acting on behalf of citizens to hold service providers to account, on The case studies raise a number of interesting issues for the basis of collectively agreed performance and service further research and investigation. These are: quality standards? Differential accountability gains: Will strengthening Internal lines of control: What internal performance specific points within the World Development Report measurement and management systems, and lines of control, 2004’s five-point accountability matrix have more impact should Indian water and sanitation service providers in making service providers accountable to customers introduce to ensure optimal organizational performance? 54 Water and Sanitation Program- South Asia World Bank 55 Lodi Estate New Delhi 110 003 India Phone: (91-11) 24690488, 24690489 Fax: (91-11) 24628250 E-mail: wspsa@worldbank.org Web site: www.wsp.org May 2007 WSP MISSION To help the poor gain sustained access to improved water and sanitation services. WSP FUNDING PARTNERS The Governments of Australia, Austria, Belgium, Canada, Denmark, France, Ireland, Luxembourg, the Netherlands, Norway, Sweden, Switzerland, the United Kingdom, the United States of America; the United Nations Development Programme, The World Bank, and the Bill and Melinda Gates Foundation. AusAID provides WSP-SA programatic support. Written by Premila Nazareth Satyanand, with input from Badal Malick Editors: Ananda Swaroop; A. Venkata Narayana Pictures by: Indo-USAID (FIRE-D) Project, India; WSP-SA/Guy Stubbs; Sajid Darokhan Created by: Roots Advertising Services Pvt. Ltd. Printed at: PS Press Services Pvt. Ltd., India