THINK of water services to small towns and rural areas, operated as a franchise by a local start-up entrepreneur, and supported by and subject to the rigorous quality control of a franchisor water- services provider in a class with SA’s best. Research by the Water Research Commission and the Council for Scientific and Industrial Research (CSIR) indicates that the concept is feasible and possible. In the past decade, municipalities, assisted by the national water affairs and forestry department and others, have been remarkably successful in answering the challenge of services delivery. Large numbers of households are now, thanks to massive investments in infrastructure, supplied with water services.
However, this very success provides the seedbed for future problems. As the number and complexity of water-services systems increase, so the operations and maintenance requirements escalate.
This rapid rate of construction and commissioning of new water- services infrastructure challenges the institutions responsible for managing this infrastructure. Current institutional approaches, made even weaker by capacity and skills shortfalls, are often inadequate to ensure that the new infrastructure programmes sustain improved access of the poor to basic services.
There is a need to explore a range of alternative options, and to selectively incubate innovations, including innovative public sector-driven partnerships with the private sector, on an experimental basis. One such option is franchising.
The twin driving forces of the franchising concept are: an incentive in the form of a focused and quantifiable financial outcome (profits, dividends or surplus), and a successful business model that can be copied widely.
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