Govt Subsidies Is One Way of Strengthening Consumers’ Right to Access to Basic Services

By Bernard Kihiyo

Former US President John F. Kennedy defined ‘’consumer’’ as ‘’all of us’’; he went further by saying consumers are the largest economic group, affecting and affected by almost every public and private economic decision. Yet they are the only important group... whose views are often not heard.’'

Recently Tanzania Electric Supply Company Limited (TANESCO) announced to raise connection charges by 100% and tariff by 40% reason behind this move is the decision by the government to stop giving subsidies to TANESCO. TANESCO is now required by the government to operate as a business entity. If the government decides to stop giving subsidies to TANESCO there is no other way TANESCO can do than to shift the burden to the consumers, let us stop politicising on this.

But this is a bit funny as I do believe that the first priority of all governments is to provide safe and affordable utilities services to the poorest consumers, services such as electricity, drinking and wastewater services must be available to all consumers at affordable price rates. In 2001, 36% of people in Tanzania lived below the national poverty line. (Household Budget Survey report, NBS, 2002), the average national income (GNI) was US$340 per person. It is against this background that; government efforts should focus on assisting these poor Tanzanians consumers.

Tanzania consumers expect the government to;-
Ø Raise and provide investment for network expansion where needed. That will increase access to a water and electric supply from a household connection, a public standpipe and street lights.

Ø Ensure that consumers have adequate to meet basic human needs, every person must have access to 20 to 50 litres of safe water every day and electricity lifeline of 50 to 75kwh per month:

Ø Ensure that supply of water and electricity which is safe, sufficient, regular, convenient, and available at an affordable price through its’ regulatory agencies like Energy and Water Utility Regulatory Authority (EWURA) in this case.

Ø Utility distribution must be subject to strict regulation — even more so given the vital resource it provides utility sector reforms must be assessed from the vantage point of consumer protection — and can be improved by the promotion of water and electricity as consumers’ right.

Ø Stop all bad financial management, corrupt contracts, low funding/investment, arbitrary political interference like Tanga cement scandal and Idrisa Rashid’s resignation from directorship, little or no independent regulation and a lack of civil society consultation.

Ø Guarantee a framework that takes into account all stakeholders like consumers, not just investors.

Ø Develop a democratic framework for management and scrutiny of the utility industry by provide regulatory control for such matters as tariff-setting and awarding of contracts.

Ø Public interest should take precedence over corporate profit irrespective of ownership.

Ø Finance of any sort must enable universal access, not be an excuse for excluding the poor.

Ø To picks up the historic role to construct and extend the network, or new customers can be paid for by cross-subsidy paid by existing consumers.

Above all; there are about ten basic consumers’ right but for today’s discussion we are going to refer only one; the right to satisfaction of basic needs; this means having access to basic, essential goods and services; adequate food, clothing, shelter, health care, education, public utilities, water and sanitation.

These are indisputable needs; no matter the financial capability, no consumer should be excluded from access to essential goods and services for reasons of poverty. water and electricity is valued as a community asset to be protected from capture by economic elites.

Consumers are the main stakeholders in the paradigm clash between water/electricity as human right and water/electricity as essential economic good, but the tools of consumers’ rights and protection have been largely missing from the ring.

If the government decides to stop giving subsidies to these essential services to the public, how can the National Strategy for Growth and Reduction of Poverty (NSGRP) been achieved?

In this Tanzania government’s document (NSGRP) Cluster II aims on Improvement of quality of life and social well-being the strategy set the broad outcomes of improving the quality of life and social well-being, with particular focus on the poorest and most vulnerable groups that aim to amongst other things; public to have access to clean, affordable and safe water, sanitation, decent shelter and a safe and sustainable environment and thereby, reduced vulnerability from environmental risk.

Moreover NSGRP aims on provision of adequate social protection and of basic needs and services for the vulnerable and needy and lastly to provide effective systems to ensure universal access to quality and affordable public services.

In connection with the above; efforts will be stepped up to reduce the proportion of the rural population below the basic needs poverty line from 38.6 percent in 2000/01 to 24 percent by 2010.

Economic elites should not be allowed to capture the agenda and misdirect the government to stop doing its’ core duties to its citizens. It has to be strongly noted that government subsidies is one way of strengthening consumers’ right to access to basic services. Our fellow European countries are giving subsidies to cows up to 5 USD per day per cow; let alone these essential public services.

Whether it is the government internal policy or external pressure, the government should not stop giving subsidies on public health care, education, public utilities, water and sanitation.

The Author is
The Executive Director of
Tanzania Consumer Advocacy Society
With the Help from Consumers International