Many now agree there is no single model for providing a good water supply and sanitation services. Private sector participation has not attracted as much private investment as was once hoped for. Evidence from Bolivia indicates that cooperatives may provide an alternative way to meet the water and sanitation needs of poor urban communities.

A report from the World Bank assesses the Cooperativa de Servicios Públicos Santa Cruz (SAGUAPAC), a water supply and sanitation (WSS) cooperative in the Bolivian city of Santa Cruz. Established in 1979, SAGUAPAC now provides water to over two thirds of the 1.25 million inhabitants of Bolivia’s largest city. It is the world’s biggest water cooperative, and continuously provides good quality water through house connections. Some 97 percent of connections are metered and 95 percent of water charges are collected. 

Owned and controlled by its customers, SAGUAPAC is an enterprise based on honesty, discipline and efficiency. With the help of modern technology, it is trying to build a better-informed society that values water. The cooperative’s corporate culture embodies values of self-help, responsibility, democracy, equality and solidarity.

SAGUAPAC provides its employees with competitive salaries, work stability and the possibility of promotion, and tries to treat everyone equally irrespective of rank. Recognising that some members’ ability to pay their bills was affected by Bolivia’s economic crisis, SAGUAPAC organised courses for housewives and young people to help them acquire a trade. This has not, however, distracted it from its main role.

SAGUAPAC’s success is partly attributable to the characteristics that stem from its cooperative structure. Its organisational structure has enabled it to isolate decisions from political interference, adopt decisions unrestricted by awkward procedures, and maintain a strong focus on consumers’ needs.

The authors stress that SAGUAPAC’s success is not solely attributable to its cooperative model. Three additional factors have been identified as critical for its success:

• The two-tiered electoral system of SAGUAPAC’s Board contributes to strong member participation that helps maintain a strong customer orientation and encourages a high degree of integrity among elected officers.
• The continuity of its management has defined a corporate culture dedicated to improved service provision.
• The high degree of self-reliance and a strong sense of regional identity and the well-organised and powerful civic movement in the city of Santa Cruz are very favourable to cooperatives.

The study concludes the cooperative model has some attractive attributes that make it a potential alternative for the provision of urban WSS services. However, it is not an appropriate option in all cases. Only after careful consideration of a few key factors will cooperatives be successful in effectively delivering and expanding sustainable services:

• The choice depends on whether the external conditions provide an enabling environment for the cooperative principles to be put effectively into practice.
• The cooperative model is not an end in itself and does not guarantee success.
• Design and practices of the cooperative have to suit the particular circumstances of a given city and country.

Source(s):
‘Consumer Cooperatives: An Alternative Institutional Model for Delivery of Urban Water Supply and Sanitation Services?’, World Bank Water Supply & Sanitation Notes, Note No.5, World Bank: Washington DC, by Fernando Ruiz-Mier and Meike van Ginneken, 2006 Full document.

Funded by: Bank-Netherlands Water Partnership

id21 Research Highlight: 08 November 2006

Further Information:
Meike van Ginneken
Water and Energy Department
World Bank
1818 H Street NW
Washington DC 20433, USA

Tel: +1 202 4587796
Fax: +1 202 4776391
Contact the contributor: mvanginneken@worldbank.org; fruizmier@ifc.org

World Bank, Water Supply and Sanitation Programme

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