Again, Lagos denies privatisation of Water Corporation, seeks private investors’ participation

As pressure continues to mount over the inadequate water supply in Lagos State, government, for the up tenth times, has expressed her readiness to partner private investors to ensure that the commodity is available to as many residents as possible, without necessarily resorts into privatisation.

Commenting on the water situation in the metropolis, Commissioner for the Environment, Dr Samuel Adejare said though, condition of water supply is quite challenging, but that his ministry is working assiduously to ensure that Governor Akinwunmi Ambode’s desire to make water available is achieved.

“Over the years, the state government has invested heavily in the water sector. The Lagos water programme which is anchored on 15-year expansion programme is not limited to the urban areas alone as it is the desire of the state government to ensure that every part of the state has unrestricted access to portable water supply.

“The project entails expanding water supply facilities, transmission and distribution systems, rehabilitation of existing ones, improved administrative infrastructure and institutional support,” said Adejare, who declared that it has never plan to privatise the Lagos Water Corporation (LWC).

The commissioner noted that all its planning to do is to involve private sectors participation in building water treatment, a component that is said to be capital intensive.

He also stated that government is in talk with private investors who will construct new water treatment plant at Adiyan Phase 11.

“What people are misinterpreting to be privitisation of Lagos Water Corporation was the involvement of private investors who will provide the plant. The need for PPP initiative was informed by the cost of such plant that may not be feasible for government to undertake.

“Initial cost of the plant was put at N54 billion, but in view of the current economic reality, over N60 billion would be required and this is beyond what government can shoulder.

“This is just like 30 per cent of our annual budget and it doesn’t make sense to commit such amount to a sub-sector of a social amenity when other sectors such as health, education, security and others are seeking attention.

“So, the most wisest decision is to look for an investor who will then recoup his money by charging reasonable rate from consumers,” the commissioner said, arguing that the N5 rate LWC is currently charging is unrealistic if quality water is expected to be provided.

The Commissioner also hinted that the State Executive Council (EXCO) had approved the construction of another plant in Odomola area of Epe Division.

The plant, he said at completion would serve Victoria Island, Ibeju-Lekki axis, noting that water would be tapped from Osun River to serve the plant.

“The project doubles that of Adiyan and it will cost billions of naira. The project is also to be financed through PPP initiative”, he said.

Advising government on what to do to realise its objectives, and alleviate the suffering of the residents, a member of Water Supply for the Vulnerable (WSV), a newly formed non-governmental-agency (NGO), Michael Odogwu, said government should take a look at whether the 15 mini-micro water works, constructed by the immediate past administration are functioning or not.

“The first phase of the project, coordinated by the Lagos State Water Corporation, LSWC, involved the construction of 15 mini micro water works that have the capacity of producing 30 million gallons per day across various parts of the state to improve accessibility.

“The completion of these mini water works, according to officials, aside from enhancing output and improving water distribution channels in the state, is also capable of reducing the untold hardship experience by the residents while searching for water.

“Notwithstanding, our findings revealed that only three out of the entire 15 are working, due to what the personnel in charge attributed to inadequate power supply. So, it’s our belief that Governor Ambode should direct his officials to carry out the inventory of the water works and do the necessary adjustment,” he said.

But official thinking, as encapsulated by  Dr Adejare, is the long-term plan aiming at resuscitation of the Adiyan and Iju water works which both have the capacity to produce 230 million gallons daily, if fully operational.

“Part of the state government’s long term plan is also to encourage private sector participation in the water sector. This explains why it is necessary to invest heavily in the sector in order to make it attractive to private investors who will subsequently device creative strategies that will make the sector lucrative for investment.

“It has been realised by governments world-wide that funding of government programmes and projects can no longer be sustained by the government alone as evidenced in the global economic recession and decline in oil revenue.

“Public-Private Partnership (PPP) is a contractual relationship between the private and public sectors as a systematic collaboration geared towards ensuring communal, state or national socio-economic development that is comprehensive and self-sustaining.

“It is an arrangement with clear direction and defined roles and responsibilities of all the actors in the plan. PPP is a financial module designed to attract private investors to engage in infrastructural projects with short and long term benefits to the people, said the commissioner.

In adopting this strategy, said the commissioner, government is not abdicating its responsibilities but essentially releasing scarce resources for other equally important projects, thus creating a win-win situation for the government and the private enterprise as well.

He reemphasised that the major advantage of the involvement of the private sector in governance is the efficiency it brings to project management. “The issue of wastes, delayed delivery and abandonment that is usually associated with public projects is highly minimised. This is as a result of the optimisation of the returns on huge investment of the private sector,” he stated.