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Examining Public-Private Partnerships as an Instrument for
Sanitation Services
A Case-Study in Beijing, People’s Republic of China
Ang Junci, Kimberly (10882367) MSc. International Development
University of Amsterdam Supervisor: Professor Joyeeta Gupta Second Reader: Dr. Michaela Hordijk
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Ang(Junci,(Kimberly((10882367)(
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Second(Reader:(Dr.(Michaela(Hordjik((
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Acknowledgements
This has been an extremely trying and rewarding journey. I have tried my best to incorporate all that I have learnt from everyone involved in my data collection process in the past eight months into this thesis, and I only hope that I can do it justice. There are a number of people that I owe my gratitude towards, without whom this would have been impossible.
Firstly, I have to thank my family for their relentless support – without them, Amsterdam and Beijing would only have been a dream. To my research supervisor, Professor Joyeeta Gupta, thank you for your guidance and patience – I have learnt so much from you. Your enthusiasm and work ethic is nothing short of inspirational. I also extend my gratitude towards Dr Michaela Hordjik, for being my second reader, and Dr. Pan from Beijing Water Science and Technology Institute for his time in the field. I would never have survived Beijing without the help and kindness of the many people who took time off for interviews, and went above and beyond to guide me when I was lost.
To my classmates (friends) who made Amsterdam home – Joas Platteeuw, Jonathan Teoh, Sara Azeem, Sophie Zupper and Wendy Jacobs – this would have been impossible without all of you. I will remember the game nights we had; our commiserations together, and the many, many, many discussions and panic attacks we had about our research topics.
Lastly, I give my thanks to Romain Marcuzzi. You have been there every step of the way – from assuaging my fears when I was alone in the field, to proofreading my thesis and offering constructive criticism. Your support over the last two and a half years is indispensable, and very much cherished. ! ! ! ! ! ! ! ! ! ! ! !
Abstract
Given the potential health, environmental and economic benefits, the investment in sustainable sanitation services and infrastructure is extremely beneficial. Unfortunately, the sanitation sector suffers from a dilemma – it is often not prioritised by policymakers, whilst private investors find the industry to be very risky and unattractive to invest in. When faced with such financing gaps in infrastructural projects or public service deliveries, some governments opt to utilise public-private partnerships (PPPs) to address financing deficiencies, alleviate governmental debts and increase overall efficiency. However, current literature offers little knowledge on the effectiveness in utilising PPPs for sanitation industries in developing countries in particular – where the governments are usually poor, and the citizens often unable to/or unwilling to pay for sanitation-related services.
This thesis utilises a case-study of Beijing – including 13 interviews and 60 surveys to complement an extensive literature review – with the aim of examining if Beijing should continue and/or expand its utilisation of PPPs as an instrument to address sanitation concerns. The Chinese government has been promoting the PPP model relentlessly, but this thesis argues that its indiscriminate push towards this model of partnership might be misguided – given how PPPs are not ideal instruments for sanitation services in developing countries. China advocates an expansion on the utilisation of PPPs, supporting a shift from BOT models to ‘narrow-definition’ models as it would allow the government greater management control over the project. However, this thesis suggests that the expansion of PPPs should be halted – that the volume and complexity of PPP projects in China should be decreased, due to its immature institutional and organisational environment. Furthermore, given the prominence of State-Owned Enterprises (SOEs) in Beijing’s sanitation environment, this thesis argues China can continue its use of familiar models like BOT in high-merit industries if necessary, provided that the government continues working towards implementing a good organisational and institutional framework.
Table of Contents
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ACKNOWLEDGEMENTS! 3! ABSTRACT! 4! TABLE!OF!CONTENTS! 5! LIST!OF!FIGURES! 8! LIST!OF!TABLES! 8! LIST!OF!IMAGES! 8! ABBREVIATIONS! 10! TRANSLATIONS! 10! ! 1.! INTRODUCTION! 11! 1.1! INTRODUCTION! 11! 1.2! GAPS0IN0KNOWLEDGE! 12! 1.2.1! REAL=LIFE!PROBLEM:!THE!SANITATION!CRISIS!AND!FINANCING! 12! 1.2.1.1! SANITATION!CRISIS! 13! 1.2.1.2! FINANCING!AMIDST!THE!CRISIS! 15!1.2.2! THEORETICAL!GAPS!IN!KNOWLEDGE! 16!
1.3! RESEARCH0QUESTION! 17! 1.4! METHODOLOGY! 17! 1.4.1! METHODOLOGICAL!SETUP! 17! 1.4.2! CASE=STUDY!APPROACH! 19! 1.4.2.1! CHOICE!OF!CASE=STUDY! 20! 1.4.3! METHODS! 22! 1.4.3.1! QUALITATIVE!METHODS! 22! 1.4.3.2! QUANTITATIVE!METHODS! 24! 1.4.4! METHODOLOGICAL!REFLECTIONS! 25! 1.4.4.1! ASSESSING!QUALITY!OF!QUALITATIVE!DATA! 25! 1.4.4.2! ASSESSING!QUALITY!OF!QUANTITATIVE!DATA! 26! 1.4.4.3! ETHICAL!CONSIDERATIONS! 26! 1.5! CONCEPTUAL0FRAMEWORK! 27!
1.6! THESIS0FOCUS0&0LIMITATIONS! 28!
!
2.! UNDERSTANDING!SANITATION! 30!
2.1! INTRODUCTION! 30!
2.2! DEFINING0SANITATION! 30!
2.3! INTERNATIONAL0NORMS0AND0INSTITUTIONS0OF0SANITATION! 31!
2.3.1! HUMAN!RIGHT!TO!WATER!AND!SANITATION! 32!
2.3.2! MILLENNIUM!DEVELOPMENT!GOALS!(MDGS)!AND!SUSTAINABLE!DEVELOPMENT!GOALS!(SDGS)! 33!
2.3.3! JMP!AND!THE!SANITATION!LADDER! 34!
2.3.4! SANITATION!–!PUBLIC!OR!MERIT!GOOD?! 36!
2.4! CHARACTERISTICS0OF0THE0SANITATION0INDUSTRY! 39!
2.5! WATER0AND0SANITATION0GOVERNANCE0THEORIES0AND0ARRANGEMENTS! 41!
2.6! PRIVATE0PARTICIPATION0IN0THE0WSS0INDUSTRY! 43!
2.7! CONCLUSION! 45!
! !
3.! LITERATURE!REVIEW:!PUBLIC=PRIVATE!PARTNERSHIPS! 46!
3.1! INTRODUCTION! 46!
3.2! ORIGINS,0DEFINITIONS0AND0SCOPE! 46!
3.3! COMMON0PPP0MODALITIES! 49!
3.4! WHY0USE0PPPS?0–0BENEFITS0AND0COSTS! 52!
3.5! PUBLICEPRIVATE0PARTNERSHIPS0IN0THE0SANITATION0INDUSTRY! 54!
3.5.1! “UNPOPULARITY”!OF!SANITATION!PPPS! 54!
3.5.2! COMMON!MODALITIES!OF!SANITATION!PPPS! 55!
3.6! SANITATION0PPP0CHALLENGES0FACED0BY0DEVELOPING0COUNTRIES! 58!
3.7! CONCLUSION! 59!
!
4.! BEIJING’S!SANITATION!CONTEXT! 62!
4.1! INTRODUCTION! 62!
4.2! CHINA’S0ECONOMY0&0THE0ENVIRONMENT! 62!
4.3! BEIJING’S0SANITATION0ENVIRONMENT! 64!
4.3.1! BEIJING’S!SANITATION!INFRASTRUCTURE!AND!TECHNOLOGIES! 64!
4.3.2! BEIJING’S!TARIFF!COLLECTION!SYSTEM!FOR!WSS!SERVICES! 67!
4.4! EVALUATING0BEIJING’S0SANITATION0SYSTEM! 67!
4.5! CONCLUSION! 71!
!
5.! PPPS!IN!BEIJING! 72!
5.1! INTRODUCTION! 72!
5.2! BACKGROUND0&0HISTORY0OF0PPPS0IN0CHINA! 72!
5.3! DEFINITIONS:0“NARROWEDEFINITION”0VS.0“BROADEDEFINITION”! 76!
5.4! BEIJING’S0PPP0ORGANISATIONAL0FRAMEWORK! 78!
5.4.1! KEY!ACTORS!IN!BEIJING’S!SANITATION!PPP!INDUSTRY! 78!
5.4.2! ORGANISATIONAL!CHARACTERISTICS/DEFICIENCIES! 80!
5.5! BEIJING’S0PPP0INSTITUTIONAL0FRAMEWORK! 81!
5.5.1! FORMAL!INSTITUTIONS! 81! 5.5.2! INFORMAL!INSTITUTIONS! 83! 5.6! CONCLUSION! 84! ! 6.! ANALYSIS:! 85! DO!PPPS!ADDRESS!BEIJING’S!KEY!SANITATION!PROBLEMS?! 85! 6.1! INTRODUCTION! 85!
6.2! USAGE0OF0PPPS0IN0BEIJING’S0SANITATION0INDUSTRY! 85!
6.3! EFFECTIVENESS0OF0PPPS0IN0BEIJING’S0SANITATION0INDUSTRY! 89!
6.3.1! INCREASING!ACCESS!TO!ADEQUATE!SANITATION!FACILITIES! 89!
6.3.1.1! CASE=STUDY!OF!FENGHU"YING"URBAN!VILLAGE! 91!
6.3.1.2! CASE=STUDY!OF!DONGSI"SHISAN"TIAO"HUTONG! 94!
6.3.1.3! CONCLUSIONS! 97!
6.3.2! IMPROVING!SUSTAINABLE!FINANCING!OF!THE!INDUSTRY! 98!
6.4! EVALUATING0THE0PROMINENCE0OF0STATEEOWNED0ENTERPRISES0IN0BEIJING’S0PPPS! 99!
6.5! CONCLUSION! 101! ! 7.! CONCLUSIONS!&!REDESIGN! 102! 7.1! INTRODUCTION! 102! 7.2! REECALL0TO0SUBEQUESTIONS! 102! 7.3! CONCLUSIONS! 105! 7.4! REFLECTIONS! 106! 7.5! FUTURE0RESEARCH! 107!
BIBLIOGRAPHY! 108!
ANNEXES! 120!
ANNEX!A!–!LIST!OF!INTERVIEWS!AND!SURVEY!RESPONDENTS! 120!
ANNEX!B!–!SAMPLE!OF!SURVEY!QUESTION! 122!
ANNEX!C!–!CHARACTERISTICS!OF!CONCESSIONS! 126!
ANNEX!D!–!DETAILED!BACKGROUND!&!FIELD=NOTES!OF!FENGHU"YING! 127!
ANNEX!E!–!ANALYSIS!OF!SURVEYS!DISSEMINATED!IN!FENGHU"YING! 133!
ANNEX!F!–!DETAILED!BACKGROUND!&!FIELD=NOTES!OF!DONGSI"SHISAN"TIAO! 138!
ANNEX!G!–!ANALYSIS!OF!SURVEYS!DISSEMINATED!IN!DONGSI"SHISAN"TIAO! 144!
ANNEX!H!–!DETAILED!BACKGROUND!ON!PUBLIC!TOILETS!IN!BEIJING! 147!
ANNEX!I!–!DETAILED!BACKGROUND!OF!URBAN!VILLAGES!!( )! 149!
ANNEX!J!–!DETAILED!BACKGROUND!OF!HUTONGS! 151!
ANNEX!K!–!INTERVIEW!QUESTIONS! 152!
List of Figures
"Figure 1 Mixed Methods in Multiphase Design"..."18
Figure 2. Diagram of Single-Case Design with Embedded Multiple Units of Analysis ... 20
Figure 3 Choice of Methods in Thesis ... 22
Figure 4 Conceptual Framework ... 27
Figure 5 Rudimentary Sanitation System surrounding Human Excreta ... 31
Figure 6 Timeline of Global Access (%) to "Improved" Sanitation ... 34
Figure 7 MDG Classification System & JMP Sanitation Ladder ... 35
Figure 8 Different Types of Governance Arrangements ... 42
Figure 9 Spectrum of Mix Public & Private Involvement ... 49
Figure 10 Potential PPP Interventions in Sanitation Systems ... 56
Figure 11 Estimated Expenditure/Investment in Environmental Protection for China (2011-2020) ... 63
Figure 12 Current PPP Interventions in Beijing’s Sanitation Value Chain ... 88
Figure 13 Typical Structure of Concession Contracts ... 126
Figure 14 Residents’ Views on Public Toilets as Responsibility of Government ... 145
List of Tables
Table 1 Benefits from Attaining the MDG on WSS ... 14Table 2. Reasons to Choose Mixed Methods Design for this Thesis ... 19
Table 3 Analysed Policies/Policy Papers ... 23
Table 4 Millennium Development Goal 7 ... 33
Table 5 Sustainable Development Goal 6 ... 34
Table 6 Characteristics of Sanitation ... 38
Table 7 Differences in Public Sector and Private Sector Interests ... 44
Table 8 Main Differences between Public Management and New Public Management ... 47
Table 9 Common PPP Models Used by Industries ... 51
Table 10: PPPs by Sector ... 52
Table 11 Levels of Annual Investment Required to Finance New WSS Infrastructure in low- and middle-income countries (2002-2025) ... 55
Table 12 Prominent PPP Models Utilised in the Sanitation Industry ... 57
Table 13 Pros and Cons of Utilising PPPs as Instruments for Sanitation Services ... 60
Table 14 Operation and Maintenance of Wastewater Treatment Facilities: City-Centre vs. Peri-Urban Areas ... 66
Table 15 Operation and Maintenance of Drainage Pipes: City-Centre vs. Peri-Urban Areas ... 66
Table 16 Evaluation of Beijing’s Sanitation System ... 68
Table 17 Four Phases of PPPs in China ... 74
Table 18 Actors in Beijing’s Sanitation-Related PPP Organisational Framework ... 79
Table 19 List of Organisational and Institutional Factors Affecting PPPs in Beijing ... 84
Table 20 Basic Demographic of Fenghu Ying Respondents (Median) ... 93
Table 21 Beijing's Organisational and Institutional Environment ... 103
Table 22 Pros and Cons of Concession Contracts ... 127
Table 23 Public Toilets’ Cleanliness Control Index ... 147
List of Images
Image 1 Map of Beijing Districts ... 86Image 2 Street-view of Fenghu Ying ... 91
Image 3 Exterior of Public Toilet ... 92
Image 4 Interior of Female Public Toilet ... 93
Image 5 View of Hutong Alley ... 95
Image 6 Exterior of Public Toilet ... 95
Image 8 Location of Fenghu Ying in Beijing ... 128
Image 9 Map of Fenghu Ying, with marked toilets ... 129
Image 10 Entrance to Fenghu Ying ... 129
Image 11: Interior of Female Toilet ... 131
Image 12 Origins of Survey Respondents in Fenghu Ying ... 133
Image 13 Respondents’ Views on Public Toilets as Responsibility of the Government ... 135
Image 14 Willingness of Respondents to Contribute Money for Upgrading ... 136
Image 15 Location of Dongsi Shisan Tiao Hutong in Beijing ... 138
Image 16 Map of Dongsi Shisan Tiao Hutong, with toilets marked ... 139
Image 17 View of Hutong Alley (A) ... 140
Image 18 View of Hutong Alley (B) ... 140
Image 19 Exterior of Public Toilet ... 142
Image 20 Interior of Public Toilet ... 142
Image 21 View of Squatting-Style Toilet ... 143
Image 20: Source from Author (2015) ... 148
Abbreviations
4P People-Private-Public-Partnerships ADB Asian Development Bank
BOO Build-Own-Operate BOT Build-Operate-Transfer BT Build-Transfer BTO Build-Transfer-Operate DBFM Design-Build-Finance-Maintain DBOT Design-Build-Operate-Transfer IO International Organisation
JMP WHO/UNICEF Joint Monitoring Program for Water Supply and Sanitation
MOF Ministry of Finance
NDRC National Development and Reform Commission
NETSSAF Network for the development of Sustainable approaches for large Scale Implementation of Sanitation in Africa
NGO Non-Governmental Organisation
OECD Organisation for Economic Cooperation and Development O&M Operations and Maintenance
PPNP Public Private Not-for-Profit Partnership PPP Public-Private Partnership
TOT Transfer-Operate-Transfer
UNDP United Nations Development Programme
UN ESCAP United Nations Economic and Social Commission for Asia and the Pacific
UN DESA United Nations Department of Economic and Social Affairs VfM Value for Money
WSS Water and Sanitation Services
Translations
Guanxi Personal relations; social relations
Hukou Household residency
Hutong Alleyways/narrow lanes surrounding siheyuans
1.!Introduction
1.1! Introduction
The unprecedented rates of urbanisation today pose new challenges for water and sanitation (WSS) management in both developed and developing countries alike. With two-thirds of the global population estimated to live in urban areas by 2050 (UNDESA 2014), there is legitimate concern that such rapid urban growth will place immense constraints on urban infrastructures in the developing world to provide adequate access to “improved”1 water and sanitation services to meet population demand (Cohen 2006).
Myriad environmental, health and well-being consequences underscore the importance of constructing adequate WSS infrastructures. However, such infrastructures are expensive, large-scale projects that require consistent operation and maintenance (OECD 2011). These costs are too high for governments facing budgetary constraints (OECD 2015), and if left unattended, financing gaps will only delay pivotal investment projects and lead to “deferred benefits and higher investment costs in the future” (OECD 2011, p.27).
However, here lies a dilemma regarding the financing of the WSS sector – private investors often consider investments in this sector to be risky and unprofitable (Sohail and Cavill 2009), whereas water services have remained low on the priority lists of policymakers when compared to other development sectors (UN Water 2015). In face of such challenges whilst searching for sustainable financing, public-private partnerships (PPPs) are often explored as options by many countries – international development agencies and financial institutions like the Asian Development Bank (ADB) and The World Bank are advocates for using PPPs in infrastructure as well (ADB 2008; World Bank 2012).
Broadly defined as a “long-term contract between a private party and a government agency, for providing a public asset or service, in which the private party bears significant risk and management responsibility” (World Bank 2012, p.11), the use of PPPs has been increasingly
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1 An improved sanitation facility is “one that hygienically separates human excreta from human contact.
Sanitation facilities shared with other households are not considered to be improved” (JMP 2015b). !
popular amongst developing and emerging economies (English 2005; Guasch et al. 2008; Yang et al. 2013). However, the impacts from the utilisation of PPPs in the sanitation industry within developing countries are understudied. These countries have unique socio-economic circumstances – governments who cannot afford the subsidisation or profit guaranteeing of the industry sustainably; and/or have citizens who are often unable to/or unwilling to pay for sanitation-related services – that might impede the successful and sustainable delivery of sanitation services if PPP contracts were engaged.
This thesis utilises a Beijing case-study to examine the use of PPPs as an instrument to address sanitation-related concerns in a developing country-context. The Chinese government has promoted the extensive use of PPPs (see 5.2), and WSS PPP projects have proved to be popular in China (PPI Database 2015), despite the general low profitability of the industry for private investors (see 0). This thesis aims to examine the contextual specificities surrounding Beijing’s use of PPPs for the sanitation industry, and determine if the city should continue (or even expand) its use of PPPs to address sanitation-related concerns.
This chapter introduces the gaps in knowledge (1.2) that inform my research question and sub-questions (1.3); explains the methodology (1.4) and conceptual framework (1.5) utilised in this thesis; and identifies the focus and limitations of this research project (1.6).
1.2! Gaps in Knowledge
This section explores both the real-life problem (1.2.1) and the theoretical gap in knowledge (1.2.2) that guided my research focus.
1.2.1!Real-Life Problem: The Sanitation Crisis and Financing
A two-pronged real-life problem underpins this thesis – a “sanitation crisis” currently exists where 1 out of 3 people in the world lacks access to “improved” sanitation facilities (Aravosis 2015), whereas a dilemma in the financing of the WSS industry where growing public deficits and low private sector interest has created a ‘financing gap’ in this sector.
This segment will explore both real-life problems and reiterate the importance of providing access to adequate sanitation services and infrastructure.
1.2.1.1! Sanitation Crisis
We are living amidst a “sanitation crisis” (Aravosis 2015; WaterAid 2015; Sanergy 2015) where an estimated 2.6 billion people live without “improved” sanitation systems, whilst almost 1 billion people in the developing world still practice open defecation – the act of defecating outside without the use of a toilet (UNDP 2015).
Such a crisis has far-reaching societal and individual-level repercussions, including health consequences, environmental consequences, economic consequences and impacts on citizens’ well-being.
!! Health Consequences
The lack of access to adequate sanitation standards and facilities encourages the spread of:
1.! Waterborne diseases like diarrhoea – which is the second leading cause of death for children under five years of age (Lüthi et al. 2011); intestinal worm infections, affecting 44 million pregnant women annually (UNDP 2015); cholera and dysentery (UNDP 2004);
2.! Parasitic diseases like soil-transmitted helminsthiasis and schistomiasis – which are directly linked to exposure to human faeces (Prüstun-Urstün et al. 2008).
Prüstun-Urstün et al. (2008) estimates that safe sanitation could alleviate the 1.4 million preventable diarrheal child deaths each year, and the 860,000 child deaths from chronic malnutrition/stunting2.
!! Environmental Consequences
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2 Chronic malnutrition in children can be caused when nutrients are not absorbed by the bodies, but instead
diverted towards the fighting of repeated bouts of diarrhoea and intestinal worm infections (Nguyen 2015). This stunts their body growth, and can lead to a myriad of health problems including premature death (Save the Children 2015).
The environment suffers heavily from pollution due to inadequate sanitation infrastructure along the sanitation value chain. An estimated 80% of sewage waste in developing countries are discharged untreated back into the environment – polluting rivers, lakes and coastal areas – facilitating the spread of diseases (UNESCO Water 2009). Aquifers are also polluted as people defecate or relieve themselves outdoors (ibid).
For instance, 1.1 million litres of human excrement enter India’s Ganges river annually (UNDP 2015), not only threatening the lives of millions of people dependent on this river with diseases and infections from a “superbug bacteria resistant to antibiotics” (Jayalakshmi 2015), but is also a fundamental reason why the Ganga river dolphin faces the threat of extinction (Gupta 2012).
!! Economic Consequences
“Unimproved” sanitation and the practice of open defecation costs the world’s poorest countries US$260 billion annually (UNDP 2015b). Furthermore, calculations show that attaining the Millennium Development Goal (MDG) on Water and Sanitation will amount to yearly savings of US$84 billion (Prüss-Urstün et al. 2008; Hutton and Haller 2004) stemming from productivity, healthcare, and time savings per annum (Table 1).
Table"1"Benefits"from"Attaining"the"MDG"on"WSS"
Types of Benefits Monetized Value (USD)
Health-care Savings $7 billion p.a. for health agencies; $340 million p.a. for individuals Time Savings: from more
convenient WSS services 20 billion working days a year = $63 billion p.a.
Productivity Gains 320 million productive days a year (15-59 year age group) + 272 million school attendance days + 1.5 billion healthy days for children under age of 5 = $9.9 billion p.a.
Values of Deaths Averted: based on discounted future
earnings $3.6 billion p.a.
Adapted from Prüstun-Urstün et al. (2008); OECD (2011)
In particular, advocates for sustainable sanitation infrastructure often reiterate how rewarding investments in such systems are – for every dollar invested in developing countries into sustainable sanitation systems, there are returns of US$5 – US$46 dependent on the type of intervention (Hutton et al. 2007).
!! Impacts on Citizens’ Well-Being
The lack of access to drinking water and basic sanitation in schools have direct consequences on students’ school attendance rates, their capabilities to participate in classes and learn. For girls experiencing menstruation, the lack of safe sanitation facilities in schools that allow them to wash and/or dispose off their menstrual pads and clothes negatively impacts their attendance (Obando and Moraga 2014)3. By providing toilets in schools, student enrolment rates for girls actually improve (WaterAid 2005).
Furthermore, providing access to the 1 in 3 women globally who lack a safe toilet means they they do not have to be exposed to diseases, indignity and even danger as they travel long distances to search for a place to relieve themselves (WaterAid 2012).
1.2.1.2! Financing Amidst the Crisis
This sub-section elaborates on the neglect of financing in the WSS industry by both policymakers (WWAP 2015) and private investors. The sanitation industry in particular fares worse-off – drinking water is allocated the majority of the funding in WSS projects (WHO 2012; UN-Water 2015), whilst financing for wastewater treatment is considered to be “chronically neglected” (WWAP 2015, p.15).
Given the nature of the sanitation industry and the physical infrastructure required (see 2.4 ), it traditionally remains the responsibility of governments (see 2.6), and is commonly financed by public expenditure or bilateral and multilateral aid (Akintoye and Li 2003; Rodriguez et al. 2012). However, due to budgetary constraints and inefficiencies associated with state-provided services (Wibowo and Mohamed 2008), governments are increasingly looking towards the private sector for financing (Kajimo-Shakantu et al. 2014).
However, “cherry-picking” often occurs in the sanitation sector –private investors choose to invest in profitable areas where cost-covering tariffs can be charged, or where existing infrastructure is already in place (Tan 2011; Sohail and Cavill 2009). Due to its inherent benefits (see 1.2.1.1), equitable access to sanitation services for all citizens should be provided !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
3 A school study in Ethiopia showed that over half the girls missed between one to four days of school monthly
(2.3.1) – resulting in tariffs being unable to cover costs entirely (Tan 2011), thereby lowering its attractiveness for investors.
For many developing countries – where financial and infrastructural constraints are larger (3.6) – the financing gap is often harder to solve. As such, this thesis hopes to examine PPPs as an instrument to address sanitation-related concerns, especially within a developing country-context.
1.2.2!Theoretical Gaps in Knowledge
An analysis of the current literature on PPPs in the sanitation sector shows several main gaps in knowledge:
1.! The current literature on PPPs in sanitation is surprisingly sparse – PPP research into the WSS sector is overwhelmingly focused on water supply and distribution, rather than the sanitation sector in particular4;
2.! The literature highlights the unpopularity of the sanitation industry for PPPs, but does not elaborate further on the unique challenges and difficulties faced by developing countries with regards to sanitation-related service provisions;
3.! The current literature on PPPs seem to have institutional standards pegged against that of developed countries – case-studies of developing countries and their experience with PPPs often highlight the failures or deficiencies. There is very little emphasis on PPPs in developing countries, and the generalizable lessons that the country can offer its peers that face similar economic or development constraints.
These gaps in knowledge helped identify my research locale (1.4.2.1) and research question (1.3). Since sanitation PPPs in developing countries are understudied, I have determined my research focus to revolve around a developing country (China) that has been promoting PPPs in the sanitation sector in particular (5.1), and examine its use of PPPs to address sanitation problems.
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4 See articles by Choi et al. (2010); Wang et al. (2010); Kajimo-Shakantu et al. (2014); Johannessen et al. (2014);
Hukka et al. (2006); Sohail and Cavill (2009). Literature on urban water PPPs in developing countries also neglect the sanitation sector --
1.3! Research Question
“Should Beijing continue and/or expand its use of public-private partnerships (PPPs) as an instrument to address its sanitation problems?”
Sub-questions:
1.! According to current literature, are PPPs effective instruments for the sanitation industry?
2.! What are some prominent sanitation problems that Beijing city is facing?
3.! What are the organisational and institutional frameworks underlying Beijing’s sanitation-related PPPs?
4.! To what extent has the use of PPPs mitigated or ameliorated Beijing’s sanitation problems?
1.4! Methodology
This section introduces this thesis’s methodological setup (1.4.1); its case-study approach (1.4.2); methods used (1.4.3) and finally reflecting on the quality of data and ethical concerns (1.4.4).
1.4.1!Methodological Setup
This thesis utilises mixed methods – both quantitative and qualitative methods in a multiphase design (Creswell and Plano Clark 2011), with a case-study approach. The multiphase design combines both “sequential and concurrent strands” (Creswell and Plano Clark 2011, p.73), as seen in Figure 1.
Figure 1 Mixed Methods in Multiphase Design
Since my research question is problem-centred (Creswell 2003) and stems from knowledge claims related to pragmatism, a mixed methods approach is most appropriate. It allows for holistic recommendations (complemented by both data collected qualitatively and quantitatively), and provides a cohesive wealth of information that would otherwise be unavailable.
Bryman (2006) suggests several reasons for choosing a mixed methods design for research, and I have identified the most relevant few:
Table 2. Reasons to Choose Mixed Methods Design for this Thesis
Reasons Explanation
Triangulation !! Qualitative data (literature review, case-study, semi-structured interviews) can be combined with quantitative data (content analysis, surveys) and triangulated for corroboration.
Completeness/Holistic
Research !! A holistic account can be gathered with both qualitative and quantitative sources, by complementing each other. Illustration
!! Qualitative data from the semi-structured interviews can be used to shed light/enhance quantitative findings from content analysis of policy papers.
Diversity of Views
!! Different perspectives from different actors/respondents can be included in mixed methods design – for instance, semi-structured interviews were conducted with academics and professionals, whilst the survey participants were urban-poor residents with on-the-ground experience and insights.
Credibility !! Employing both methods will enhance the reliability of the research. Instrument
Development
!! Content analysis and literature reviews/desk research are both necessary to develop the questions for the semi-structured interviews. Context !! Mixed methods design allows for the simultaneous building of
contextual knowledge (from qualitative research), as well as generalizable, “externally valid” findings (from quantitative research).
Source from Bryman (2006)
1.4.2!Case-Study Approach
According to Yin (2009), a case study is “an empirical inquiry about a contemporary phenomenon (e.g., a “case”), set with its real-world context – especially when the boundaries between phenomenon and context are not clearly evident” (p.18). It involves a detailed contextual analysis of events, institutions and relationships, supplemented by rich illustration and description (Yin 2009; Flyvberg 2006; Soy 1996). Flyvberg argues that case-studies provide a wealth of information that allows for the “development of a nuanced view of reality” (p.223), which is arguably very important when redesigning instruments.
Figure 2. Diagram of Single-Case Design with Embedded Multiple Units of Analysis " ! ! ! ! ! ! ! ! ! ! ! !
Adapted from Flyvberg (2006)
Some critics argue that since case-studies are so contextually-bound, the findings are therefore neither reliable nor generalizable (Soy 1996; Yin 2009; Flyvberg 2006), making them ill-suited as a research method. However, it is argued that the generalizability of case-studies can be enhanced via a “strategic” selection of cases, and that atypical or extreme cases are encouraged as they often “reveal more information” (Flyvberg 2006, p.226).
1.4.2.1! Choice of Case-Study
With the goal of strategically choosing an atypical case, I embarked on a process of information-oriented selection for my case-study on sanitation-related PPPs. This segment will illustrate the decision-making process I had when determining my choice of a case-study in two steps:
!! Choosing between an urban or rural context !! Choosing the country or locale
There are various reasons for choosing the urban context. Rapid urbanisation and sanitation share a dialectical relationship; even though sanitation coverage tends to be higher in urban areas compared to rural areas, there is an increasing number of urban residents without access to “improved” sanitation today (WWAP 2015). Between the years of 1990 and 2012, urban residents without “improved” access increased by 40%, from 541 million to 754 million people
(JMP 2015). The higher concentration of population not only exacerbates health consequences associated with inadequate sanitation conditions (WWAP 2015), but also contribute as the main source of point-source pollution (WWAP 2012).
There are several reasons that point to Beijing, capital city of the People’s Republic of China as a prime case-study option:
1.! The “sanitation crisis” is prevalent in China – 460 million Chinese lack access to “improved” sanitation, whereas only 40% of China’s excreta were safely disposed off (JMP 2008);
2.! China’s water and sewerage sector has the highest number of projects reaching financial closure compared to other sectors (433 projects out of 1204 projects between the years 1990-2014) – this is atypical of most countries, where the WSS sector tends to be less popular than other sectors (PPI Database 2015);
3.! It is interesting to examine how China’s “socialist-market economy” (Rapoza 2013) utilises a neoliberal instrument like PPPs;
4.! English-medium literature regarding the development of PPPs in China are often sparse and outdated; and
5.! On a practical level, I have a fluent grasp of the Mandarin language which helps when conducting interviews, surveys and policy reviews.
Ever since the new brass of Chinese political leadership in 2013, China has embarked on different campaigns and policies – including an extensive anti-corruption campaign (Bo 2015; The Diplomat 2015), as well as the relentless promotion of PPPs in the construction and operation of urban infrastructure projects (see 5.2). However, current literature has identified problems in China’s current push to implement PPP projects on a large scale – often citing a lack of regulatory or institutional framework as impediments (Chen and Wang 2009; Ke et al. 2014). This makes an inquiry into the impacts of such institutional or organisational deficiencies on the ability of PPPs to alleviate sanitation problems in Beijing meaningful (6.3).
The governmental policies, coupled with the institutional chaos (and physical chaos) that characterises rapidly-urbanising cities like Beijing, makes for an extremely interesting case-study when researching about PPPs in the sanitation sector within developing countries.
1.4.3!Methods
This thesis utilised both qualitative and quantitative methods for data collection, in an attempt to provide completeness, triangulation, credibility and context, amongst others (see Table 2 for more).
Figure 3 Choice of Methods in Thesis
1.4.3.1! Qualitative Methods
This thesis utilises the following qualitative methods:
1.! Desk Research – Literature Review & Policy Analysis
2.! 8 semi-structured interviews and 2 focus groups conducted in Beijing 3.! 3 Key-respondent interviews conducted in the Netherlands
!! Desk Research: Literature Review & Policy Analysis
An extensive literature review was conducted on both Mandarin language-medium and English language-medium legislative, policy, and academic papers. This ensures an updated perspective and understanding of current sanitation- and PPPs-related trends, norms and institutions; as well as a holistic view on China’s PPP environment, whilst also offering a balance
between Anglo-medium academia and local Chinese academia. Anglo-medium academia on China’s PPPs often prove to be outdated – written before Phase 4 of PPPs in China (see 5.2) for more), whilst Chinese literature articles tend to be brief where it is not uncommon to be referred to other articles for more information at the end of the one just read.
I analysed official policy documents as seen in Table 3, and identified codes inductively from the text. These codes were transformed into themes or concepts, for instance – “institutional deficiencies” or “overlap of mandates” via the software package, Atlas.ti. I then sieved through all available material and sort them into categories, and later established meaningful relationships and patterns which are later analysed for interpretation. For instance, the content analysis of regulations and management plans issued by the Ministry of Finance (MOF) and National Development Reform Commission (NDRC) in China was useful in grounding my case-study of China’s PPPs in Chapter 4, whilst the governmental policies implemented regarding sanitation was useful in exploring Beijing’s sanitation context in Chapter 3.
Table 3 Analysed Policies/Policy Papers
!! Semi-structured Interviews & Focus Groups
13 in-depth interviews were conducted in Beijing and the Netherlands, amongst public administration, public-private partnership, and built environment academics, as well as private consulting professionals (see Annex A). These semi-structured interviews lasted an hour each on average, and were pivotal in the contextualisation of the research. They allowed insights into Beijing’s institutional environment that cannot be otherwise deduced from secondary material. Most of the interviews were conducted in Mandarin, and then later translated and transcribed into English by myself.
1.4.3.2! Quantitative Methods
60 surveys (see Annex G for survey questions) were disseminated into 2 different urban poor communities in Beijing, in an attempt to determine opinions, tastes and preferences regarding the use of public toilets in the residents’ daily life – in order to later determine if the construction of public toilets could be done via a PPP contact (see 6.3.1 for more) .
The two sample groups included (see 6.3.1.1 and 6.3.1.2 for the case-studies):
!! Fenghu Ying: An urban village at the city peripheries outside the 5th Ring in Beijing !! Dongsi Shisan Tiao: A Hutong in the historic/old city centre of Beijing
The results of the surveys were transformed into a ‘Satisfaction’ index, measuring the opinions the residents have with regard to their current sanitation facilities, or if there were any deficiencies they would address. The surveys also revealed the respondents’ unwillingness to pay for sanitation-related services and sentiments regarding private provision of sanitation.
1.4.4!Methodological Reflections
1.4.4.1! Assessing Quality of Qualitative Data
This sub-section will reflect on the quality of qualitative data collected for the thesis, paying special emphasis on the credibility, consistency and transferability of data.
The credibility of my qualitative data is increased due to the triangulation of sources, which displayed depth of information that would be otherwise unavailable from literature alone. For instance, Guanxi (personal relations) was touted as an important informal institutional factor that affects the implementation of PPPs in China, but interviews from several Chinese academics proved that worries about Guanxi are less relevant post-2013 President Xi Jinping’s crackdown on corruption5.
Consistency of data is ensured by having standardised questions when conducting interviews with different professionals. However, since my interview subjects are from different industries and contribute to different bodies of knowledge in my research, I made a decision to have different (but sometimes overlapping) interview questions for all my subjects.
Lastly, a key criterion for quality in qualitative research pertains to the transferability of the research. Since the aim of the thesis is to produce a list of transferable recommendations for using PPPs as an instrument in the governance of sustainable urban sanitation systems for other PPPs late-adopter countries, I tailored my interview questions conducted in China to be contextually-specific to the Beijing case-study, but also conducted key respondent interviews in the Netherlands. These respondents are public administration and PPP academics familiar with working in both China’s context and in OECD countries – allowing me to compare, contrast and eventually derive conclusions regarding institutional conditions that can applicable universally in all contexts. For instance, a finding from my thesis is that a national-level specialised PPP-unit is useful for organisational purposes (to facilitate knowledge transfer, etc.) across most, if not all, case-studies.
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1.4.4.2! Assessing Quality of Quantitative Data
This sub-section will reflect on the quality of quantitative data collected for the thesis, paying special emphasis on the stability, internal validity, replicability and concurrent validity of my research.
The stability of quantitative data is increased by returning to disseminate surveys at both locales twice each – once in the afternoon and once at night. During the afternoons, there are more survey respondents socialising in communal areas, but they tend to be elderly residents or children. I returned to the locales at night to gather data from younger, working respondents, thereby ensuring that my data is not skewed demographically. Furthermore, to increase internal validity of the survey data, I have included counter-questions in the survey and some open-ended questions (see Annex G), where the residents can qualify their choices.
The replicability of this quantitative research seems limited to other cities in China given the country’s unique socio-political and geographical context; however, this research could prove to be useful for other case-studies where public/shared sanitation facilities are prevalent as well.
A limitation of the quantitative data collected pertains to concurrent validity of my research. The differences in the respondents’ socio-cultural environments result in differing standards and conceptions. Respondents in the urban village sample hail from poorer areas of China, whereas respondents from the Hutong sample tend to be older, native Beijing residents. (see Annex D and F for more). To counteract that, if given appropriate manpower and time, more surveys could be disseminated to other urban poor communities in Beijing to truly ascertain with authority, their tastes and preferences with regards to Beijing’s urban sanitation system – tested against ecological, social, and financial sustainability criteria.
1.4.4.3! Ethical Considerations
Informed consent is a pillar of research ethics, and was a guiding principle when I was collecting data. I assured both interview and survey respondents their anonymity, and explicitly asked for permission when recording interviews. Career backlash was a concern for at least two of the interview respondents.
The implications of researching sanitation – an industry so intertwined with citizens’ standards of living – was thoroughly felt by me when Dongsi Shisan Tiao hutong’s district leader insisted on screening my survey questions. With such sensitivities in mind, I attempted to approach the respondents with care. As such, for the surveys collected in the urban village and hutong, I avoided naming the subjects entirely – only noting down their age and gender. Sanitation remains a little taboo, especially when conducting surveys in communities with an older demographic (like in Dongsi Shisan Tiao hutong), where the respondents were often initially shy.
Acknowledging such sensitivities – stemming from either fear of political and socio-economic backlash or from talking about a ‘taboo’ subject – was crucial the development of my survey questions and interview questions.
1.5! Conceptual Framework
1.6! Thesis Focus & Limitations
This thesis questions the effectiveness of PPPs as instrument for sanitation deliveries, especially in developing countries. However, this thesis does not look at specific case-studies of various successes or failures in PPPs from the WSS industry. Rather, I have chosen to analyse a case-study of Beijing – since the use of PPPs and its success is highly contextual-specific – I wished to account for the Chinese government’s decision to pursue PPPs so relentlessly.
Since I am interested in the impacts of PPPs on sanitation, rather than the implementation of PPPs as a whole in China, I have avoided delving deeper into the technical and legal aspects of PPPs.
With that in mind, I have identified four main limitations to my approach:
1.! A lack of governmental contacts and collaboration with the Chinese public sector has narrowed my perspective.
When examining PPPs, it would be meaningful to include the perspective of the public sector – especially in an environment where the growth of PPPs is mostly government-led. However, due to a lack of contacts, I was unable to interview anyone from Beijing’s local government. This is complicated by the strict hierarchy and opacity that exists in the Chinese socio-political environment. In fact, the professionals that I was able to interview (consulting professionals, Chinese academics, directors of state-owned enterprises) were approached via “word of mouth” and a snowballing of introductions by previous interview subjects. It was impossible to secure any interviews or surveys otherwise, as many people were suspicious that I was a foreigner studying in a Western institution.
2.! My interaction with the private sector was limited to consultancy firms.
The consultancy firms were all financially invested in the success of the PPP model in China, and this might have led to an over inflation in the merits of the model. Furthermore, since they were all introduced by “word of mouth”, they were actually all alumni from the same department in university. This narrows my perspective slightly, as they might mirror each other
as they all share a common school of thought with regards to investment in public sector infrastructure.
3.! My data collection process could be more robust.
Building upon the previous point, I feel that my data collection process could be enhanced by not only including the government’s perspective, but also by increasing the number of surveys distributed. An important point of my thesis includes establishing the socio-cultural sustainability of Beijing’s sanitation system – done via surveys in two communities that utilise public toilets on a daily basis. If resources permit, it would be useful to survey more communities as I have only visited two specific locales in a city with at least four different configurations of urban poor communities (see 6.3.1 for more), and incorporate a wider range of responses.
4.! The sheer magnitude of material and concepts to be covered has led to a brevity when addressing the various components within the sanitation system and potential PPP interventions.
2.!Understanding Sanitation
2.1! Introduction
This chapter is interested in exploring the body of literature surrounding sanitation, by answering the overarching question – “What does the current literature say about private participation in sanitation-related service deliveries or infrastructure?”. It first defines sanitation (2.2); introduces international norms and institutions of sanitation (2.3); explores the characteristics of the sanitation industry (2.4); and highlights key “good” water governance theories (2.5) before discussing private participation in the water supply and sanitation industry (2.6)
2.2! Defining Sanitation
There is little consensus amongst international development agencies and sanitation practitioners on a precise definition of sanitation6. This thesis suggests the utilisation of the following two definitions:
1.! Sanitation as “access to, and use of, excreta and wastewater facilities and services that ensure privacy and dignity, ensuring a clean and healthy living environmental for all” (COHRE et al. 2008, p.17);
2.! Sanitation as a ‘big idea’ surrounding the following processes (UNICEF et al. 2008): !! The safe collection, storage, transportation, treatment and disposal/reuse of
human excreta;
!! The management of solid wastes like trash or rubbish; !! Storm water drainage;
!! Storage, transportation, treatment and disposal/reuse of drainage effluent; !! Collection and management of industrial waste products; and
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6 The definitions are heavily dependent on the specific development agency or international organisation. For
instance, WaterAid (2015) defines sanitation as “access to excreta disposal facilities”; the World Health Organisation suggests that sanitation is “the provision of facilities and services for the safe disposal of human urine and faeces… [and] also refers to the maintenance of hygienic conditions, through services such as garbage collection and wastewater disposal” (2015); and the United Nations Department of Economic and Social Relations (UN DESA) defined sanitation as “any system that promotes proper disposal of human and animal wastes, proper use of toilet and avoiding open space defecation” (2008) when lecturing Nigerian policy-makers as part of the International Year of Sanitation Campaign.
!! Management of hazardous wastes (chemical/radioactive wastes, hospital wastes etc.)
The thesis incorporates both definitions as the definition with sanitation as a ‘big idea’ is useful in providing a ‘bigger picture’ of flows and components within sanitation systems; whilst COHRE et al.’s definition supplements the technical definition with a reminder to consider issues of privacy and dignity of users.
Based on the above-mentioned definitions, I have constructed a rudimentary (non-exhaustive) diagram of a sanitation system7 surrounding human excreta, as seen in Figure 5. Other aspects of sanitation concerning solid waste, storm water drainage, industrial waste and hazardous wastes are not covered in this thesis. Figure 5 highlights the main flows and components present within a sustainable sanitation system, and introduces other possible flows outside the system. This diagram returns in the thesis in Chapters 3 and 5, in edited forms to demonstrate different PPP interventions possible within the sanitation system.
Figure 5 Rudimentary Sanitation System surrounding Human Excreta
Adapted from COHRE et al. (2008); Lüthi et al. (2009); UNICEF et al. (2008)
2.3! International Norms and Institutions of Sanitation
International norms and institutions of sanitation inform national practices, and policymaking in individual states, development agencies and non-governmental organisations. This section !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
7 A sanitation system considers all components required for the management of human waste, and is a combination
of “product and function specific technologies designed to address each flowstream from origin to reuse or adequate and safe disposal” (Lüthi et al. 2009, p.458).
introduces the discourse surrounding the human right to water and sanitation (2.3.1); the Millennium Development Goals and the Sustainable Development Goals as frameworks for global sanitation standards (2.3.2); the WHO-UNICEF Joint Monitoring Programme for Water Supply and Sanitation (JMP)’s ‘Sanitation Ladder’ which is a vital sanitation governance tool (2.3.3); and lastly, attempts to determine the nature of sanitation as a merit or public good (2.3.4).
These norms and institutions of sanitation contextualises the international community’s views regarding sanitation practices, and informs the discussion on public or private provision of sanitation services.
2.3.1!Human Right to Water and Sanitation
Access to affordable safe water and sanitation is increasingly recognised either implicitly, explicitly, or independently as a human right (Gupta et al. 2010; Obani and Gupta 2014). It is also acknowledged as being critical to the accomplishments of other developmental goals and targets (Obani and Gupta 2014).
Most notably, Resolution 62/292 (UNDA 2010) was passed on 28th July 2010, thereby codifying safe drinking water and adequate sanitation as “essential to the realisation of all human rights” (UNDESA 2015b). Despite significant abstentions to this resolution by major donor countries (Obani and Gupta 2014), almost all governments have recognised the right to sanitation in a political declaration8 (COHRE et al. 2008).
As such, states have a responsibility towards their peoples (if not in a legal sense, at least in a moral sense) in providing access to safe sanitation, especially amongst vulnerable populations in society.
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8 An international binding legal agreement regarding the right to sanitation is still absent, but the right is
increasingly being recognised by national-level governments. Some countries like Mexico, Uruguay, Maldives and Kenya have even enshrined the right to sanitation within their constitutions (Obani and Gupta 2014; COHRE et al. 2008).
2.3.2!Millennium Development Goals (MDGs) and Sustainable
Development Goals (SDGs)
The MDGs are a set of eight international development goals introduced during the Millennium Summit of the United Nations in 2000. As part of a universal agreement between states and development institutions to unite and bond the international community, specific quantitative targets surrounding developmental issues were agreed upon to be achieved by 2015. It facilitated a ‘global conversation’ that was absent in the aftermath of the Cold War (McArthur 2013), with the goal to advance the cause of global development.
As seen in Table 3, Target 7.C in particular, served as a framework for global sanitation standards for the last 15 years. As of 2015, the global MDG target for sanitation – 77% of the global population with access to “improved” sanitation – has been missed by almost 700 million people (JMP 2015).
Table 4 Millennium Development Goal 7
Source from the United Nations (2000)
MDG Target 7.C in particular (Table 4), has served as a guide for global sanitation standards over the last 15 years. As seen in Figure 6, much has been accomplished since the establishment of the JMP in 1990 – at least 2.1 billion people have since gained access to “improved” sanitation facilities (JMP 2015).
MDG Goal 7 – ‘Ensure Environmental Sustainability’
Target 7.A !! Integrate the principles of sustainable development into country policies and programmes and reduce the loss of environmental resources
Target 7.B !! Reduce biodiversity loss, achieving, by 2010, a significant reduction in the rate of loss
Target 7.C !! Halve, by 2015, the proportion of the population without sustainable access to safe drinking water and basic sanitation
Target 7.D !! Achieve, by 2020, a significant improvement in the lives of at least 100 million slum dwellers
Figure 6 Timeline of Global Access (%) to "Improved" Sanitation
Adapted from JMP (2015)
With the expiration of the MDGs, the United Nations formally adopted the Sustainable Development Goals (SDGs) on 25th September 2015. Goal 6 on Clean Water and Sanitation (Table 5): “Ensure availability and sustainable management of water and sanitation for all” will undoubtedly influence international norms, and country legislations regarding sanitation in the post-2015 world.
Table 5 Sustainable Development Goal 6
Source from the United Nations (2015)
2.3.3!JMP and the Sanitation Ladder
The WHO-UNICEF Joint Monitoring Programme for Water Supply and Sanitation (JMP) plays a crucial role within the WSS sector – it has been monitoring the sector’s progress since
1990; it provided regular updates of progress towards the MDG targets; and also developed the ‘Sanitation Ladder’ as an indispensable tool for sanitation governance globally.
The ‘Sanitation Ladder’ developed by JMP in 2008: ‘the Year of Sanitation’ (JMP 2015a), is used to demarcate and ascertain global sanitation standards, as well as to measure or compare individual countries’ and regional progress towards meeting the MDG goal on water and sanitation (JMP 2015b). The ladder is presented in “rungs of service level” (Exley et al. 2015, p.1086): open defecation, unimproved, shared and improved (Figure 7); where progressing to each rung is seen as an improvement towards a more hygienic and safer form of sanitation.
Figure 7 MDG Classification System & JMP Sanitation Ladder
Adapted from Exley et al. (2015)
Access to “improved” sanitation facilities indicates that “human excreta is hygienically separated from human contact” (UNICEF and WHO 2008, p.39). Unlike the MDG classification system which classifies forms of shared facilities9 as “unimproved” regardless of existing sanitation technologies having met ‘acceptable’ standards – the JMP sanitation ladder !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
9 The MDG classification systems define “shared” and “communal” sanitation facilities to be facilities that are
utilised by 2 or more households. Whilst the sanitation standards of workplaces and schools are important and should be maintained, it is arguable that the emphasis of the sanitation ladder is placed on individuals or communities that have to rely on “unimproved” or “communal” facilities on a daily basis (for a lack of alternatives for the households), rather than on a temporary or transitory basis.
differentiates between improved facilities and ‘acceptable’ shared facilities. This emphasises that a significant portion of the global population – an estimated 638 million people – are reliant on communal facilities otherwise deemed ‘acceptable’ (JMP 2015a)10.
The sanitation ladder has been criticised; some question the assumption that progressing up the sanitation ladder will lead to improvements in sanitation and hygiene standards, even though “there is surprisingly little evidence to support [that] (Exley et al. 2015, p. 1086; Heijnen et al. 2014). JMP has also acknowledged suggestions related to “limited sharing” – setting a threshold of five or more households – thereby, including households with “limited sharing” of facilities within the “improved” category (JMP 2015, p.15).
2.3.4!Sanitation – Public or Merit Good?
Given that access to basic sanitation is increasingly recognised as a human right (2.3.1), the discourse surrounding private participation in the sanitation industry (2.6) inevitably mentions public and merit goods. The debate surrounding the appropriateness of PPPs as an instrument for sanitation-related services and infrastructure is highly dependent on the nature of such sanitation goods.
Economic goods and services can be distinguished as private, public and merit goods (Ver Eecke 2008). A pure ‘public good’ has the following properties (Black et al. 2012):
!! Non-rivalry: one’s consumption does not deprive others from consuming it; and !! Non-excludable: If one person consumes, it is impossible to exclude others from
consuming it too (leading to a free-rider problem).
It is difficult to find a pure public good (such as street lights) that satisfies both conditions – goods that have some characteristics of a public good but is not entirely rivalrous or non-excludable, can be classified as an impure public good (Black et al. 2012; Mader 2011). Due to its non-rival and non-excludable nature, public goods will be underprovided in a free market scenario (Ver Eecke 2008). As such, they are normally funded and provided by the government !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
10 This discussion is pertinent to this thesis’s Beijing case-study, as I examine aspects of socio-cultural sustainability
(Budds and McGranahan 2003). Some examples of impure public good include roads and parks (Black et al. 2012).
Richard Musgrave introduced the concept of ‘merit goods’ in economics, arguing that “some governmental activities do not fit the definition of public goods” (Ver Eecke 2008, p.8). Rather, some goods are “so meritorious” (ibid) that their consumption is “believed to confer benefits on society as a whole greater than those reflected in consumers’ own preferences for them” (Black et al. 2012, p.262). Unlike public goods, merit goods are both excludable and rivalrous in nature (Tan 2011). They are also limited in supply, and the spill-over/external benefit from its consumption means that it should be readily available in society for reasons of equity, justice (Tan 2011; Humphreys et al. 2007) and efficiency. Musgrave suggests that merit goods can be both privately and publicly provided (Ver Eecke 2008).
Whilst certain goods can be easily classified as either ‘public’ or ‘merit’ based on the general characteristics outlined above, the literature on sanitation is divisive. Due to the many processes and components that underlie the ‘big idea’ of sanitation (2.2), consensus on sanitation as a public or merit good has not been reached. Mader argues that since water and sanitation share a close relationship with “underlying common-pool resources”, they are public goods dependent on “collective governance solutions” (2011, p.iii). Humphreys et al. (2007) delve deeper, distinguishing between infrastructural networks for sanitation (public good) and safe sanitation services (merit good).
Based on my analysis of current literature, I agree with Mader (2011) that sanitation services display characteristics shifting between both public and merit goods – depending on the definition or scope of sanitation adopted. Since this thesis adopts the definition that sanitation is a ‘big idea’ (UNICEF 2008) surrounding myriad processes (2.2), I have constructed an elementary table (Table 2) which breaks down said components and processes of sanitation, and analysed the different characteristics. The table does not aim to be wholly-comprehensive, but to provide a view into the underlying thought processes/display the complexity of the nature of sanitation goods.
Table 6 Characteristics of Sanitation
Characteristics
Non-Excludable Rivalry Non- Marginal No Cost
Excludable Rival Limited External Benefit Access to excreta disposal
facilities (private or shared)
"! "! "! "!
Sewerage Pipes "! "! "! "!
Wastewater Treatment "! "! "!
Disposal "! "! "! "!
Water Reclamation/Reuse "! "! "! "!
Solid Wastes & Rubbish Management
"! "! "! "!
Storm Water Drainage "! "! "!
Management of Hazardous
Wastes "! "! "!
Management of Industrial
Waste Products "! "! "!
For instance, I argue that if we analyse access to sanitation facilities, it is clear that sanitation in this context is a merit good. As seen in Table 6, access to sanitation facilities (whether private or shared) are both excludable and rivalrous in nature11. If the consumer is unable to either pay for a private facility or the user fees for shared facilities (run by small local owners or the community), s/he is excluded from using it. One’s usage of the shared facilities can deprive others from using it – especially if levels of cleanliness or hygiene are not maintained. This proves that sanitation is a merit good – its benefits and value are underappreciated by consumers who see open defecation as an alternative if they are unable or unwilling to pay for access to excreta disposal facilities (Obani and Gupta 2014). However, since there are many benefits to society at large if people have access to “improved” sanitation, in terms of higher levels of hygiene and less infectious diseases, there are incentives for the state to ensure the provision of such facilities.
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11 In cases where access to shared sanitation facilities are free for users – like in the case of Beijing and the public
toilets built by the government – they are not excludable in nature for users then.
