Commercialisation and centralisation in the Ugandan and Zambian water sector

Abstract

Reforms in the water supply and sanitation sector in Uganda and Zambia have appeared to favour increasing the scale of operations of the utilities. By elaborating on these cases, this article argues that the trend to centralisation is a consequence of a particular dimension of the New Public Management reform agenda, namely increased commercialisation in the water supply and sanitation sector. Commercialisation has impacted the scale at which service provision is organised as the goal of operating on cost-recovery basis has lead to a (horizontal) economic integration of service provision activities. The aim of this integration is mainly to generate economies of scale and to allow the utility expand into more 'profitable' service areas. Furthermore, the article argues that the emphasis on commercialisation and subsequent increased centralisation of water utilities may come at the cost of other objectives such as local accountability to consumers and social equity. Copyright © 2012 Inderscience Enterprises Ltd.