Water a driver of economic growth
Financial Gleaner COLUMNIST, Aubyn Hill
THE NATIONAL Water Commission's (NWC) motto is "Water is life" and no one will contest that.
What is less recognised is that in Jamaica, this 'land of wood and water', water is often scarce, wasted, inefficiently handled and is a serious inhibitor of economic growth.
A check with the experts from the NWC and its regulator, the Office of Utilities Regulation (OUR), reveals that there are scores of construction development projects that are on hold around the country because we do not have sufficiently sustainable and plentiful supply of water to support these projects.
That is not the same thing as Jamaica not having enough water. Similarly, while we have enough rainfall and naturally stored water supply, our irrigation systems to bring water to farmers and their agricultural activities is quite subpar. Our national sewer systems are disjointed and woefully inadequate.
We accept the truism that 'water is life', but we have not yet come to the realisation that water is a main driver of economic growth in Jamaica and the mismanagement of that vital resource is a harbinger of weak-to-zero economic growth and broad social underdevelopment.
Take the construction industry as an example of how poor water management has stymied our economic growth. For each multi-building project that has to be put on hold because of the lack of an adequate supply of water, we rob our economy of vital activity and positive stimulant.
Building suppliers lose business and employ fewer people; transportation companies secure reduced levels of business and hire fewer people; building contractors, quantity surveying firms, food- and drink-supplying businesses fail to get custom and avoid hiring workers that otherwise would have been hired if these projects came to fruition.
All these missed business and employment opportunities occur because the NWC has done such a terrible job of managing and supplying water where it's needed around the country.
DITHERING WITH LIFE
It is widely reported that the NWC has the uncanny perennial ability to lose about 70 per cent of the water that passes through its distribution systems. In Kingston, only about 30 per cent of the required sewage capacity is in place. In other towns, maybe less installed capacity exists and given that Savanna-la-Mar is below sea level, a lot of raw sewage has nowhere to escape and so could be a health risk - unlike some other places where the sewer finds its way to the sea.
The National Water Commission is one of the largest loss-making and taxpayer-subsidised government entities. It is also the single largest customer of the Jamaica Public Service Company (JPS), from which it buys about 15 million kWh of electricity per month, a bill that costs, until quite recently, about $280 million per month.
A great deal of that electricity is used to pump water. Given our abundance of sunlight for such a high percentage of days each year, it is a shame that the NWC has not taken the steps to find the cash to install solar power-driven pumps, which would pump water in the days to NWC reservoirs from where it could be gravity-fed in the nights and mornings when its customers use most water.
It is now more than three years since the Inter-American Development Bank (IDB) loaned the NWC, at very agreeable rates, a sum just over US$133 million to upgrade our sewage and social water - water for poor people - facilities run by the NWC.
The money has not yet been spent.
There is talk in the market that the IDB is so fed up with the inordinate delay that it has threatened to cancel the loan.
This broken-down, water-wasting, sewage-releasing, government-governed and poorly managed National Water Commission simply cannot get its act together to draw down on a much needed loan facility to fix our limping potable and wastewater systems. One wonders if the source of the funding was, say, Chinese, rather than the IDB, whether the funds would have been drawn already.
OWNERSHIP, MANAGEMENT PROBLEMS
Persons who are familiar with the workings of the NWC suggest that its ownership and management are the major problems with this organisation. The government-appointed board members are said to have individual agendas and appear to dither when it comes to making decisions and choices - as with the IDB deal. Some say that is a too benign and charitable view.
Clearly, the management of the organisation over the decades must take a great deal of the responsibility for the state of affairs at the NWC. Those who figured out early that management's hands were tied because of the politics of the place and resigned did the right thing.
Still, 70 per cent wastage of water and making no arrangements to reduce its electricity cost over time, as well as other failures, put a blot on those managers who stayed and did not buck the board to approve the required resources of this 'life'-giving organisation.
Properly run, with much greater transparency and with a much more accountable management, the NWC could find the funds to fix the water-wasting problem, the insufficient sewage capacity, address the social water issues and craft a better and renewable energy production and usage arrangement. The NWC could, probably, become a profitable entity.
A listing on the Jamaica Stock Exchange could produce the needed fillip towards much better governance and management, transparency, and profits.
Aubyn Hill is CEO of Corporate Strategies Ltd and chairman of the opposition leader's Economic Advisory Council. Email: email@example.comTwitter: @hillaubynFacebook: facebook.com/corporate.strategies