Benchmarking of water services
(17 September 2014) In its response to our European Citizens’ Initiative, the European Commission stated that it would explore the possibility of promoting the benchmarking of water services (on quality and performance) as a way to increase transparency and information for final users.
On 9 September the Commission organized a stakeholder meeting in which we as ECI organizers have been invited to explain our ideas and demands. We criticized the Commission’s response to our ECI as unsatisfactory and expressed our hope for a different approach to water; as a human right and public good, and away from the ‘market logics’ that do not apply to a ‘natural monopoly’. Our position is that Benchmarking should be promoted especially as an instrument whereby stronger operators help weaker ones to achieve better performances. It is a means for cooperation and not for competition. It should remain a voluntary approach and, above all, it must be understood as an alternative approach to competition to enhance water operators performances. In our view Benchmarking is a means to learn from colleagues and best practices. In the light of our ECI the issues to be addressed are accessibility, affordability, quality and availability, all as part of the human right to water and sanitation. Another important aspect that can be addressed by benchmarking is sustainability. Benchmarking is definitely NOT the same as price comparisons or cost-efficiency comparisons. All Water utilities are different and operate under different circumstances; they cannot be compared like apples and pears. In cases where they operate under similar circumstances (e.g. legislation, geographically, or culturally) a benchmarking exercise could help by providing a platform for mutual learning and cooperation to improve overall performance.
EUREAU (the European umbrella organization of national water federations) expressed quite a critical position about the possibility that a Europe-wide benchmarking mechanism can be established and warned about the fact that some indicators (especially regarding water price) could easily lead to distortive interpretations and misunderstandings. EUREAU also asked if the Commission intends to make financial resources available to support benchmarking. Also the European Confederation of Employers in the Public Sector (CEEP) insisted that benchmarking must remain a voluntary approach and plead for financial support mechanisms. The World Health Organization (WHO) expressed the view that, in the light of the ECI requests, transparency and accountability issues should also be underlined. This stimulated a long discussion on the difference between benchmarking and transparency and on the need to keep the two things distinguished in order to give citizens useful information. We also made it clear that Benchmarking is something else than Transparency and that it cannot be seen as a means to increase transparency. Aqua Publica Europea (the association of public water operators) stressed the idea that, if ever a European benchmarking system is established, the choice of the indicators should be made in a very careful way and include indicators on investments rates for renewal and leakages detection, on reinvestment of profit, and said that the Commission should support the not-for profit partnerships between operators aimed at improving performances of especially smaller operators. There is not a one size fits-all solution.
To clarify our thoughts behind Benchmarking we made a number of suggestions for topics that can be part of a Benchmarking exercise, like:
• existence of social tariff structures or social support mechanisms (affordability)
• number of household / population connected to the grid (accessibility)
• physical leakages (availability)
• quality of water (with regards to public health) (safe and clean)
• sustainability of services (environmental, social, financial)
• support for international (not-for-profit) cooperation (solidarity cooperation for universal/global access for all)
• involvement of citizens in water governance (participation)
The Commission acknowledged that there are divergences among stakeholders about the possibility of establishing a European benchmarking mechanism, especially for economic-related indicators. It said it will wait to know in detail stakeholders’ positions before proceeding with this initiative. The Commission expects written contributions by stakeholders by mid-October. We will also submit a written explanation of our ECI wishes related to benchmarking.