January 27, 2016 - 6:36 PM EST
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Unbundling of Zinwa Could Do Wonders

The move by Government to create a water and waste water regulator is indeed progressive insofar as it will help clarify grey areas relating to the responsibilities of the Zimbabwe National Water Authority.

Currently ZINWA is both the "player and referee" in matters referring to water and waste water licensing, tariff setting, borehole drilling, permit administration and management.

A senior official from the Ministry of Environment, Water and Climate this week told an ongoing study tour of

the Netherlands
that the establishment of a water and waste water authority will complement the unbundling in ZINWA as the entity has sometimes performed non-commercial functions which are of a statutory nature.

He said the move by Government is influenced by concerns arising from stakeholders and customers where ZINWA currently performs certain functions such as the issuing of drilling permits when they too have their own drilling rigs, or setting tariffs for both raw and clear water with no independent regulator to interrogate the cost build up.

This is amiss, as there is no recourse for consumers. We can now understand why there have been a lot of complaints against this.

Government should also speed up the unbundling process to ensure that the strategic business units to be formed in the authority are focused in their areas of construction of dams, supply of raw and treated water and drilling of boreholes and general rural water supply services are delivered in a much more efficient way.

Splitting the regulatory and commercial functions will make the two institutions focus on their specific mandates. This will help improve efficiencies as it eliminates the possibility of divided attention and clear the overlaps in mandates. The element of conflict of interest will also be alienated.

Locally we have clear examples from two other sectors where unbundling has improved operational efficiencies and improved focus. The Zimbabwe Electricity Regulatory Commission, which later became the Zimbabwe Energy Regulatory Authority, assumed the regulatory functions of the energy sector.

This helped create order in the energy sector and provided fertile ground for the unbundling of ZESA to create entities that are solely focused on electricity production (ZPC) and transmission (ZEPC) and the other that focuses solely on fuel; while ZERA performs the functions of a regulator.

ZERA is a statutory body established by the Energy Regulatory Authority Act (Chapter 13:23) of 2011. The Act mandates and empowers the Authority to regulate the procurement, production, transportation, transmission, distribution, importation and exportation of energy derived from any energy source.

Another example is the unbundling of the Forestry Commission which saw the creation of Allied Timbers, a commercial institution focused on the timber business.

The separation of the regulatory and commercial functions under the two sectors is a classic example that Government wants to follow with the unbundling of ZINWA. The coming on board of a water and waste water regulatory board will help also clarify the issue of overlapping roles between ZINWA, the Zimbabwe Energy Regulatory Authority and the Environmental Management Authority.

The Ministry of Environment, Water and Climate senior official laid bare some of the overlaps among the three entities that need streamlining.

These include issues in hydro-power licences, water quality testing and river outline plans as they relate to wetlands. We believe the move by Government will clarify these issues. As parastatals are arms of Government, we expect them to be run well, efficiently and expertly. Grey areas that frustrate potential investors should be avoided.

They make the cost of doing business in

unnecessarily high. Apart from the institutional framework, our legal framework too should be clear. To this end, we call upon the authorities that be, to ensure that while consummating the idea of unbundling ZINWA, harmonisation of the enabling legislation relating to the water issues and other allied laws are looked into.

There must be clarity on how far the regulatory authority should go and how it relates to other regulatory bodies. Water is a critical resource and needs undiluted attention.

The fact that it cuts across all sectors of the economy places water at the centre of Government planning. We need a proper water management authority to manage our water bodies. We also need proper regulation of the same sector. Customers, investors and all other key stakeholders need to be protected.


has cut down production of electricity from Kariba Dam due to dwindling water levels is a tell-tell sign that we need a reliable authority to manage our water.

We are aware that Kariba is managed by the Zambezi River Authority, a joint body between

. But the developments at Kariba could happen to other water bodies in the country and populations could face water challenges. The Kariba experience provides enough evidence that we need a focused eye on water.

According to a Needs Assessment and Business Opportunities Report commissioned by the Netherlands Enterprise Agency, once a regulatory framework is created ZINWA will become a lean organisation with a clear structure and functions.

Lean management is critical in modern business.

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Source: Equities.com News (January 27, 2016 - 6:36 PM EST)

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