The Role of State in the Delivery of Basic Services

Construction of the  Koko Dam in Ethiopia, 1960

Welcome back! In this blog post, I thought I’d provide a bit of an overview of the political history that has shaped how the delivery of basic services such as water has changed in the past half century. Specifically, how and why the private sector has become so involved in the provisioning of these services. I felt the need to include this as it provides some context on the political landscapes currently at play in African nations (and in the world more  broadly). Additionally, having an understanding of the context, I feel,  allows us to look at current events more objectively, which hopefully leads to more rational approaches when addressing issues. This post will also act as a kind of foreword for the next few blogposts which will discuss the arguments for and against the increasing role the private sector has in the delivery of these services. Given the topic is quite large and significant, I thought it would be easier to divide it up this way.

The shifting role of the state in the delivery of basic services

Around the halfway point of the 20^th century, majority of the nations of Africa gained independence.. Many of these newly formed governments embraced a strong state-led approach for the provisioning of basic services such as water, with the private sector having no involvement in the process, at least not in a formal sense. This was further reinforced by the idea of the state being an expression of solidarity in the period after independence (Khan, 2002).

As time went on however, the demanding obligations placed on the state (not just the delivery of basic services, but also maintaining law and order and effective political leadership) became financially straining. This led to insufficient investment and maintenance of services, operational inefficiencies, public utilities becoming politicised and in some cases exclusion of lower income groups. In addition to this, the economic downturns of the 1980s and 90s and a rising neo-liberal movement meant the perception of the state as the sole entity for providing these services was challenged (Awortwi and Helmsing, 2007). These conditions resulted in the responsibilities associated with the provisioning of basic services to find other means leading to policy reforms allowing for private sector involvement. This involvement could have been formally led, such as through Public Private Partnerships (PPP) or informally led, out of necessity as the public infrastructure was not effectively providing the service. Awortwi and Helmsing (2007) consider this initial wave of private sector involvement as the ‘first generation’ reform.

The current ‘second generation’ reform

Expanding on Awortwi and Helmsing (2007), the current state of reform is distinct from what was seen in the 1980s and 90s, and promotes the ‘unbundling’ of the service supply chain. This means the splitting up of the main activities attributed to providing basic services and encouraging private sector involvement within these activities. This was actively endorsed by the World Bank in 2004, as seen in their policy research report, Reforming Infrastructure: Privatisation, Regulation and Competition. This report outlines some of the reasons why the World Bank seeks greater private sector involvement in the service production chain, namely to improve efficiency, promote innovation and enhance services.

Khan (2002) also interestingly points out why support for this agenda might seem appropriate for developing countries. This is due to issues with corruption that have direct, adverse impacts on resource allocation, with privatisation seen as more or less preventing this from occurring. In these instances, anticorruption and democracy are goals in themselves, not just the providing basic services.

To summarise…

There are two competing views on the state’s role in providing basic services, specifically, water. The first view assumes complete responsibility of the state for delivering these services and the second advocates for private sector involvement. Many African nations have seen a shift from the former to the latter. Following this blogpost will be the arguments for and against these competing views and will look at particular examples.

Thanks for reading

Reference List:

Awortwi, N. and Helmsing 2007, Governance of basic services provision in Sub-Saharan Africa: The need to shift gear, Presented to AEGIS European Conference on African Studies in Leiden, The Netherlands on 14 November 2007. Available online at https://core.ac.uk/download/pdf/18519970.pdf.

Khan, M.H 2004, State Failure in Developing Countries and Strategies of Institutional Reform, Revised Paper for ABCDE Conference, Oslo 24-26 June, 2002. Available online at:  https://eprints.soas.ac.uk/3683/1/State_Failure.pdf.

World Bank 2004, Reforming Infrastructure: Privatisation, Regulation, and Competition. Oxford, U.K.: Oxford University Press.