Corporation for Sustainable Development

Under the Millennium Development Goals (MDG) of the United Nations (UN), it has been agreed to halve the number of people without access to safe drinking water by 2015. The Johannesburg Plan of Implementation, agreed at the World Summit on Sustainable Development, added a similar global sanitation target.

All this has meant that the UN is busy drawing up strategies to implement and monitor this massive task. It has been estimated that meeting the drinking water goal would require providing access to an additional 1.6 billion people by 2015. The crisis involves the poorest; with more than four out of five people without access to drinking water living in rural areas of the world. Furthermore, these estimates do not even begin to understand the crisis of the quality of the drinking water source, which is increasingly contaminated with sewage, industrial waste or underground toxins like arsenic or fluoride - an issue we in India understand all too well.

The UN estimates that roughly US $26 billion will be needed just to meet the water goal over the next 11 years. How then will these targets be met? Till about a year ago, when these targets were set, the expectation was that the private sector would provide the key to reform. But now reality seems to be sinking in.

The progress report of the UN secretary-general, presented to the 12th session of the UN Commission on Sustainable Development in April, admits that private investment in the poorest regions of the world has been "virtually non-existent". Over 90 per cent of the business has gone to the richer East Asia, Pacific and Latin America. But that does not mean that the poor have benefited. The secretary-general's report notes that in Latin America "privatisation generally failed to take the interests of the poor into account with regard the affordability of service and access to connections".

Why am I not surprised? For the past many months I have argued that the private sector will not invest in water and sanitation services in the poor regions of the world. I have argued this simply because the water business is not altruistic, it will invest only if there is money to be made, and it is evident that, on the one hand, the poor cannot pay. On the other hand, the rich middle class, used to the subsidy in the name of the poor, will not pay for the 'true' cost of water and sewage services.

Therefore, private sector will only be interested in making a fast buck, based on concessions it can receive from the hamstrung state. For instance, cheap or free groundwater that it can bottle and sell as drinking water to the rich; water or sewage treatment plants that it can run as sub-contracts from the state or under Enron-type guarantees that minimise its risk. Worse, because the real costs are in taking back the sewage and treating it, private business will avoid it, skimming the profits by supplying water. This will leave the public sector utility to take back the sewage and now, with even less money on hand with its water business gone, it will have no option but to dispose it untreated in waterways, deepening the quality crisis.

I think it is quite obvious that we need to get beyond this current, rather simplistic, debate on the private sector's involvement in water and sanitation services. The answers will be complicated and diverse. But most of all, the answers will demand government plays an effective role in providing the institutional and legal framework for service providers to work. It is not about water, but about governance.

I would argue the following: Ensure water is a basic human right through a provision of a daily quota of free or subsidised water. Then charge - price the water and sanitation services - and recover the costs by billing the users based on the quantum consumed. Once the water use is metered and cost recovery is proposed, then the role of the service provider and their capacity to be efficient in providing for the rich and the poor can be considered and legislated.

But just because the cost is paid won't mean that the private sector will be seduced into supplying water or treating sewage. The question is if the middle class of the developing world will be able to pay for the increasing costs of water treatment (increasing pollution means more expenses to clean up) and the costs of the modern pipe and treatment plant based sewage disposal. I would suspect not.

Therefore, the big issue is how technology costs of water distribution and sewage disposal can be reduced. That is where innovative solutions will have to be found. By involving the small-scale water service providers, who can cut costs and work efficiently to provide for the poor. By reducing water consumption - 80 per cent of total water used in houses leaves as waste. By finding technologies that are much more cost effective in treating sewage. Or by simply ensuring that the drinking water sources are not polluted so that the cost of cleaning is reduced.

And this, remember, does not even begin to answer for rural areas. Access to water and sanitation here will demand even deeper structural changes so that communities can play an effective role in the management of their water systems. But communities, which are disabled and destitute, cannot build their futures. The water and sanitation crisis is less about water and more about planning for the world, so that the last person mattered. Nothing less will do.

- Sunita Narain