Who are we?

WASA (the Water Supply Authority) is responsible for making sure that the water supply companies under its regulatory remit give their customers a good quality, efficient service at a fair price. We are a government organisation, setup in 1999, within the Department of Housing and Urban Planning of the Ministry of Communication, Transport, Post and Construction (MCTPC).

Between the Director and the Ministry is the Regulatory Board consisting of representatives of various government and non-governmental agencies. This Board is responsible for setting the overall policy of WASA. WASA's role is to implement this policy.

What is WASA's role?

We are the regulator of the urban water industry in the Lao PDR. Draft legislation, currently under consideration by the Government states that we:

• Limit the amount companies can charge customers
• Make sure that companies carry out their responsibilities as set out in legislation and regulations
• Protect the standard of service customers receive
• Encourage companies to be more efficient
• Encourage competition in the sector where appropriate
• Ensure that the companies carry out their activities in an environmentally sustainable manner
• We also compare the activities of all the companies helping poor performers rise to the standards of the best.

Tasks and Responsibilities

Setting tariffs

Currently the responsibility for tariffs is totally vested in the Provincial Governors' Offices. This all too often results in uneconomically low tariffs that in turn results in falling levels of service and is a major disincentive for investors. Draft legislation intends to transfer some of this responsibility to WASA in the near future, although final approval of tariffs will still remain vested in the local political authorities.

To this end the Regulatory Board and WASA is in the process of developing a tariff policy, a necessary first step before the WASA can meet its tariff setting obligations. Following this we intend to develop a more transparent tariff determination process based upon regulatory accounts, affordability and many other factors. It is envisaged that WASA will be in a position to provisionally set tariffs in many, but not all, of the companies by the end of 2004. Until then responsibility will remain vested in the local political authorities.

In the long term we envisage a tariff regime that is a balance between ensuring that the operators have the necessary finance to provide the best possible service and at the same time address the needs of the customers, notably the poor.

Compliance with regulations

The rights and obligations of the various water companies are set out in various legal instruments, included proposed legislation. It is our role to ensure that the water companies comply with such legal instruments. In the event of non-compliance we may impose enforcement measures on the water companies.

In the event of a dispute between a water company and one of its customers that cannot be resolved at a local level then we will have the powers to act as an arbitrator to the dispute.

Compliance with regulations is one of the key benchmarks of comparative competition between the various water companies. Future monitoring will include a detailed analysis of enforcement measures.

Protecting customers

We check that companies meet their responsibilities to customers, for example, water quality, and reliability of service.

Each year we intend to publish information about how the companies perform and we will take action against companies if they are considered to be seriously failing their responsibilities.

Economy and efficiency

We check how companies perform to make sure that customers get value for money. We expect companies to improve their services by being more efficient, not just by putting up prices.

We monitor specific performance indicators such as lost water, labour utilisation and financial management. These indicators shall form the key components of annual published comparative competition results. Customers will themselves see how their water company is performing in com parison to others in the Lao P.D.R.

Encouraging competition

Although direct competition in the water sector does not exist we promote the concept of comparative competition described above.

We also promote competition in other areas such as capital investment where fair and open competition in the tendering process is standard practice.

In the longer term we envisage a more competitive environment whereby companies may have to bid on a competitive basis for the right to operate water supply services.

Environmental duty of care

We are required to exercise our powers with due regard to the environment. This means that we should recognise environmental constraints that the companies operate within. We must respect that demands for efficiency improvements should not be at the expense of the environment.

What we are not

We do not currently have any jurisdiction over rural water supplies as this activity falls under the jurisdiction of Nam Saat, itself under the jurisdiction of the Ministry of Health. WASA is not responsible for any of the day-to-day management of the water companies. Operational responsibility has been delegated to them through the decentralisation process. Our role is to supervise their activities to ensure compliance with statutory requirements and to encourage efficiency. WASA is also not responsible for the protection of the environment as this is a direct responsibility of the Science, Technology and Environment Agency (STEA) and various departments within the Ministry of Agriculture and Forestry. However, WASA has an obligation to recognise the environmental impacts of its actions and those of the operating companies, all of which are compelled to adhere to statutory regulations and best practices.

Support

Although the concept of regulation of utilities has been employed elsewhere in the world it is new to the Lao P.D.R. In this respect we have enjoyed significant support through various international development agencies in helping to establish an appropriate regulatory framework for the water supply sector for our country. This includes a long-term support programme funded by NORAD. Other agencies such as the Asian Development Bank (ADB), the Japan International Co-operation Agency (JICA), the World Bank's Water and Sanitation Program, and the Public-Private Infrastructure Advisory Facility) (PPIAF) have also recognised our efforts in this area and have given us their support.

Ultimately, it is the support of the customers that is most important for our work to be considered a success.