GWP Toolbox - C6.03 Regulations for water services

Water service providers should be subject to the general quality and quantity regulations outlined in C6.01 and C6.02. In addition, governments will be concerned to ensure that providers deliver services in an efficient and cost-effective manner and at appropriate service standards. Service providers typically enjoy significant monopoly power; their output levels, service standards and investments all tend to be lower than under competitive conditions, while their prices tend to be higher. Performance regulation has often been seen as only necessary when the private sector is involved but public monopoly providers also need to be put under regulatory pressure to improve their performance. Effectively monitored performance targets, possibly employing benchmarking and the publishing of performance league tables, can play a critical role in public sector institutional reform.