Severn Trent Plc

Market Expansion: Private-Public Partnership


Courtesy of Severn Trent Plc


Severn Trent is one of the world's largest water and waste services companies. It is an environmental contractor, providing water, sewerage and waste management services to communities around the world.   The company safeguards public health by providing safe drinking water and effective sanitation services, while it protects the environment and serves the community by disposing safely of other peoples' polluting waste.

On the island nation of Trinidad and Tobago, water service was poor; water was delivered erratically and some areas received nothing. Additionally, the Water and Sewerage Authority (WASA) consistently incurred losses, accumulated massive debts, and relied on government subsidies.

Private Sector Role

As part of the government’s move towards improved water and waste treatment, private sector involvement was sought to fulfill specific service quality objectives and to comply with special requirements. Private sector involvement would also enable the World Bank to provide new capital funding for the sector.

After extensive negotiations, the government and WASA developed the Interim Operating Arrangement (IOA), with Trinidad and Tobago Water Services (TTWS), a joint venture company formed by Severn Trent Water International and Tarmac Construction International. By April 1996, the key deliverables agreed to were the following:

  • Improved service to the existing customer base
  • Expanded service to those not currently served, and
  • Financial and operational self-sufficiency.

Water Improvements

The Government Ministry of Public Utilities engaged an independent consultant to undertake a mid term review of the partner’s performance against these deliverables. Its final report noted the improvement in the performance of WASA but recognized limitations caused by major constraints not originally envisaged when the IOA contract was signed.

However, the report saw that there was a marked improvement in financial management and, for the first time in its history, WASA will almost certainly post an operating profit in 1998/99.

Significantly, more water is now delivered and plant breakdowns have been reduced. Unfortunately, this has not yet led to significant improvements to customer service as measured by the Full Service Equivalent (FSE) indicator. FSE statistically relates all levels of service for water supply 24 hours per day supply. However, new strategies and systems are now in place for more efficient and effective operational management.

The original plans for improvement of levels of service were linked to the crucial provision of new capital investment and were a pre-requisite of the IOA. Delays and postponement of funding and other investments has had a major detrimental effect on the planned potential increases in levels of service. Now, at last, the new capital investment plan has been approved, and WASA is poised to make significant improvements in service.

Customer comments

No comments were found for Market Expansion: Private-Public Partnership. Be the first to comment!