Algeria perseveres with outsourcing model

 

The management contracts, whereby a foreign company is responsible for running the city’s water and wastewater utility and training its staff for five and a half years, were launched in 2005 in Algiers, and extended to the other three cities in 2008.

 

The scheme has proved successful in Algiers, where Suez Environnement’s contract with water and wastewater utility SEAAL was renewed for another 5.5 years last October and simultaneously extended to the neighbouring city of Tipaza, but the model floundered in Annaba, where Gelsenwasser’s contract was revoked last April. A recent audit concluded that Agbar is making good progress with SEOR, Oran’s utility, despite shortfalls on the wastewater side, and that Eaux de Marseille is committed to improving services at Constantine’s utility, SEACO, despite delays and a difficult start.

 

“At the moment, we are neither in favour of, nor against the management contracts,” Sellal told GWI in an exclusive interview. “We have been a little put off by our experience in Annaba, but we want to give ourselves until the summer. This is when tensions over water and wastewater arise, so we will decide afterwards.”

 

The ministry will decide whether to tender the management of water and wastewater services in large cities such as Sétif, Sidi Bel Abbès and Mostaganem, and also what to do in terms of managing SEATA, Annaba’s water and wastewater utility. The company is now managed by Algerian personnel and could either carry on as it is – with the option of calling in foreign consultants when the need arises – or give outsourced management another go. Sellal said his main ambition is still to train a new generation of managers and change the culture of the sector. “What is fundamental for management contracts is not so much to ensure that they provide 24-hour water supply, but that they instil a new management culture amongst Algerian staff, where water is no longer perceived as a natural or social good, but as a commercial good that requires technological know-how and management skills,” he said. As for the difference in performance between the contracts, the minister said that a number of factors had played a part, from the state of the infrastructure in each town, to the skills of the respective companies, and the order in which the contracts had been awarded.

 

Michel Valin, chief executive of SEACO in Constantine, told GWI that ageing infrastructure and union disputes had been the biggest challenges the company had faced to date. Although Eaux de Marseille received an ultimatum in February 2010 regarding ongoing leakage levels, Valin says he now feels that technical issues are secondary to getting his growing and increasingly young team to take ownership of the company, a feeling echoed by SEAAL’s chief executive Jean-Marc Jahn (see GWI November 2011 p18).