Abstract:
Purpose: The main purpose of this study is to identify critical factors affecting the design and implementation of a cost reflective tariff system for domestic water in Sri Lanka, to recommend guidelines for policy framework and strategies to formulate such a system.
Design: This study was carried out through a situational analysis and in-depth interview. Also a structured questionnaire survey was carried out to identify the economic affordability, with consumers randomly selected in the western province of Sri Lanka.
Findings: The situational analysis of western province shows that the water supply entity in Sri Lanka is unable to recover the cost of supplying domestic water, due to the non existence of a cost reflective domestic tariff structure. Survey response shows that the existing tariff structure has failed to profit by the economic affordability of middle/high income categories. Also, the water supply entity does not comply with the Key Performance Indicators (KPIs), currently being used in the water industry internationally and regionally.
Research Limitation: This only covers the western province but nine provinces operate in Sri Lanka. All provinces have commercial and industrial water sectors. Therefore, generalization of this specific sector results for other provinces may have limitations.
Practical Implication: Guidelines for implementation of policy and strategy are made for the design and implementation of a cost reflective tariff structure for domestic water in Sri Lanka: implementation of KPIs, optimization of operational efficiency, reduction of production costs and institutional developments are some of the factors.
Social Implication: Facilitating access to safe drinking water for people has great impact on socio-economic development in Sri Lanka. Therefore, results of this study may help to develop a cost reflective water tariff system for domestic water, while ensuring the economic affordability of all income levels.
Originality/Value: For the first time this kind of a scientific study has been carried out in Sri Lanka, to identify the critical success factors affecting the design and implementation of a cost reflective water tariff system for domestic water in western province. Therefore, the methodology employed and the guidelines derived to formulate policies and strategies can be used for similar types of research in other provinces and countries as well.
