THEME 1: IMT POLICY AND THE SCOPE OF REFORM

Starting Date: 3 September 2001

Theme coordinator: J. Raymond Peter, Executive Director, International Network for Participatory Irrigation Management (INPIM)

This is the Theme Note for Theme 1, which launches the Theme 1 Session of the International E-mail Conference on Irrigation Management Transfer (or IMT). Theme 1 provides a brief overview of key issues about IMT policies--their objectives, motivations, scope, process of formulation, support for them and feasibility. This note starts out with a few questions meant to stimulate discussion and then describes briefly some key issues. The paragraphs are numbered for easy reference by participants in subsequent comments.

Key questions for discussion:

1. What are the main motivations for and objectives of IMT policies in your country? How do these objectives compare with the interests of the key stakeholders? (farmers, agricultural traders, agency staff, planning and finance officials, policy makers, etc.)
2. What kinds of irrigation systems (river diversion, reservoir, groundwater lifting, etc.) are included or not included in the IMT policy in your country? What hydraulic levels of irrigation systems are being transferred? (tertiary, distributary, main canal, intake, etc.) Does the type of scheme or level of scheme included or not included in the IMT policy make sense? Why or why not?
3. What kinds of roles, rights, authority and obligations are being transferred in the IMT policy? Are these sufficient and balanced? Why or why not?
4. If farmers still need guidance or technical or financial support from government, does this mean that an IMT policy should NOT be adopted? Under what conditions should an IMT policy not be adopted? How can the two needs for 1) IMT and for 2) continuing support from government or the private sector be reconciled?
5. What are the best methods for formulating and IMT policy? Are stakeholders adequately involved? How can stakeholders participate and how can support be mobilized?

IMT POLICY AND THE SCOPE OF REFORM

A. INTRODUCTION

1. The purpose of the rapid expansion of irrigated agriculture from the 1950’s to the 1980’s was primarily to increase food production and improve rural incomes. Irrigation development was a major part of the national budgets of many developing countries during these years. Global irrigated area grew by about 2% per year in the 1960’s and 1970’s but slowed to less than 1% per year by the 1990’s. Irrigation expansion has slowed dramatically since the 1980’s. Irrigated area grew from 150 million hectares (ha) to about 250 million ha between 1965 and 1995. It is now growing at a very slow rate. This is due to a slowdown of investments combined with the loss of irrigated areas due to water logging, salinization, urban encroachment and aquifer over-drafting. Most governments often find it difficult to finance the recurring costs of irrigation or to collect water charges from farmers.

2. Irrigation agencies often lack a service orientation. Government emphasis in the past has been on construction of new systems without much, if any, farmer participation. The need for providing sustainable services under diminishing budgets calls for radical measures to modernize existing irrigation agencies in terms of technology, management and personnel policies, to meet the rising organizational challenges. Modernizing long-established agencies requires strong political support and leadership, much capacity building and sufficient time for institutional change.

3. Growing realization among governments that a new paradigm in irrigation management is needed has ushered in a new wave of reforms in the irrigation sectors of both developed and developing countries. It is hoped that IMT will reduce the cost burden of irrigation on the government and will increase the productivity and profitability of irrigated agriculture enough to compensate for any increase in the cost of irrigation to farmers.

4. If irrigation performance is to improve, a wide range of mutually-supporting interventions will be needed including: improved agronomic, maintenance and irrigation management practices; system modernization and promotion of advanced irrigation technologies; institutional reform, including the restructuring of irrigation agencies and irrigation management transfer to farmers and private entities; and the creation of incentives that treat water as an economic good and promote self-financing of irrigation schemes by water users.

B. IRRIGATION MANAGEMENT TRANSFER

5. The term "Irrigation Management Transfer" (or "IMT") normally means the relocation of responsibility and authority for irrigation management from government agencies to non-governmental organizations such water users associations. It may include all or only partial transfer of responsibility to deliver irrigation services. It may include full or only partial transfer of authority. It may be implemented only at subsystem levels such as distributary canal commands or for entire irrigation systems. And it may be done only for some kinds of irrigation systems but not others (river diversion, lift schemes, reservoir schemes, etc.). (Vermillion, 1999)

6. Irrigation management transfer (IMT) is a process of shifting basic irrigation management functions from a public agency to a private sector entity, a non-governmental organisation (NGO), a local government or a local water users association (WUA). The most common form of IMT relocates management responsibility from a government irrigation agency to a more or less financially autonomous, local organisation in which water users have a substantial voice in control over the management of their irrigation system. (Svendsen, Trava & Johnson 2000)

7. Irrigation management transfer can be considered as a reduction of the government’s role in irrigation management and the corresponding expansion of the role of water users and other local institutions in irrigation management. (Vermillion & Johnson 1995)

8. Transfer of irrigation management can mean transfer of authority and/or responsibility for decision-making about, supervising and/or implementing the following roles: financing irrigation, diverting and/or distributing water, maintaining infrastructure, rehabilitating systems, managing water related disputes, allocating water rights or planning crop calendars. It can include the transfer of management authority for the entire irrigation systems or only for tertiary or distributary canals.

9. Management can be transferred from public agencies to farmer organizations, third party firms, NGO’s or irrigation companies. Management transfer does not necessarily mean total withdrawal of the Government, nor, in most cases, does it include the transfer of ownership or privatization of irrigation systems assets.

10. Irrigation management transfer could be adopted in small irrigation schemes such as tanks, small lift irrigation schemes or river diversion schemes. It may be simplest to work when water user decision-making is done at the village level. The process is much more complicated in large-scale irrigation systems. In these cases, sometimes the tertiary and secondary systems are handed over to farmers or WUAs but the primary system continues to be under the control of the irrigation agency. In a way, irrigation agencies continue to be reluctant to hand over the complete control of large-scale irrigation system.

C. POLICY OBJECTIVES

11. Governments are increasingly under severe financial and water resources constraints. On the one side, there are large irrigation agencies that are often inefficient and overstaffed with outdated personnel policies which impede organizational responsiveness. On the other side is the problem of intense competition for water among various sectors, including industries, municipalities, fisheries and so on.

12. By transferring the management of irrigation, governments may be hoping to accomplish the following objectives:

i) improve the management performance and sustainability of irrigation systems;

ii) reduce government costs for O&M;

iii) reallocate scarce government revenues to more technical or more inherently governmental functions, such as regulating water use along river basins and addressing environmental and health concerns related to water;

iv) increase farmer capacity to manage irrigation systems by themselves;

v) provide transparency and accountability for irrigation management between the irrigation agency and water users;

vi) establish an autonomous water service agency fully financed and supported by the users and beholden to the users.

13. Often, there is much reluctance in irrigation agencies toward IMT, even when high levels of government adopt an IMT policy. This is partly due to the reluctance of irrigation agencies to shed their powers and budgets and also due to the technocratic tendency for irrigation agencies to focus on design and construction of irrigation infrastructure and be less interested in operating and maintaining irrigation systems.

14. Government that adopt an IMT policy often face a dilemma. On the one hand, there is a need to involve farmers in decision-making about maintenance or rehabilitation of irrigation systems and water delivery and drainage. On the other hand, the technical requirements of water management, the hierarchical hydraulic nature of irrigation systems and the top-down technocratic nature of irrigation agencies can make implementing IMT difficult. Formulating an IMT policy and mobilizing support for it can require high-level political support, strong leadership and sufficient time for institutional change and capacity building.

D. THE CHANGING ROLE OF AGENCIES

15. Historically (especially in pre-colonial times), in many countries farmers have developed and managed irrigation systems. Sometimes rulers have mobilized farmers to build irrigation systems. Rural people have also played an important role in the construction and maintenance of local flood control works.

16. Locally built farmer managed irrigation systems constitute about 50% of the irrigated land in India, Sri Lanka and Morocco. In Nepal they constitute 70% of irrigated area. However, infrastructure for large-scale systems--particularly primary storage and conveyance structures and canals--have been built by governments (including for flood prevention and drainage).

17. In theory, irrigation systems are designed and operated to meet crop water requirements. In the future, the required functions of irrigation systems are likely to diversify to include bulk water supply and domestic, rural industry, fishery, livestock needs. In many contexts in the future, IMT cannot merely concern itself with the transfer of irrigation management responsibilities. It will also have to concern itself with transferring responsibilities for multiple service functions in the water sector. Thus it is essential that the scope of IMT be well examined, discussed, negotiated and researched, if necessary, before it is launched.

18. The competing demands for drinking water and industrial supply versus the constraints of water supply are giving rise to new and more challenging service requirements in existing irrigation systems. The function of bulk water supply will dictate fundamental changes in the operation of main storage and conveyance facilities. In the future, often the cost of O&M will increase due to the need for greater reliability in water supply around the year by villages and cities. This will require a higher level of intensity of system management and more responsive government agencies to ensure affordable and sustainable provision of water services.

E. SCOPE OF IRRIGATION MANAGEMENT TRANSFER

19. The scope of an irrigation management transfer policy and program will depend on the ultimate goal of irrigation reform in a country. The scope of the policy should be consistent with the accepted vision and strategy for the water sector. This will normally include the goal of sustainable productivity of irrigated agriculture. It is common to find donor-driven initiatives which fail after external funding for the project is completed or withdrawn. The problem of financial and physical sustainability is critical. But in many countries, it may not be possible for water users associations, by themselves, to ensure sustainability of irrigation systems. A new partnership between WUAs, government and the private sector may be needed. Government may be more needed in the future for regulation and provision of support services. The private sector may be more needed for provision of support services and investment in irrigation systems, agricultural extension and marketing.

20. In most cases, to define the scope of an IMT policy will include the following aspects:

i) what type of roles, rights, authority and responsibilities will be transferred and in what kinds of irrigation systems and at what hydraulic levels;

ii) type of arrangements for providing services such as management contracts, service contracts, franchising etc;

iii) type of services or control to be retained by the irrigation agency;

iv) type of organizations to take over management - local bodies, municipalities, water user organisations, federated hierarchies of user organizations, irrigation districts, mutual companies, autonomous water service agencies, public or private company, etc.;

v) extent of organizational, financial and functional autonomy;

vi) agriculture pricing policies and use and extent of subsidies.

F. FACTORS ENABLING IRRIGATION MANAGEMENT TRANSFER PROGRAM

21. It is apparent that the key factors that have enabled successful irrigation management transfer programs in Mexico, Turkey, Australia and Andhra Pradesh are:

- A favourable reform environment;

- Strong political will and commitment;

• Existence of champions for change;
• Involvement of stakeholders in formulating the policy and program;

- A clearly defined vision;

- Development of a supportive legal framework;

- A simple and transparent implementation process;

- Incentives aligned with the reform program;

- Adequate training and capacity building;

- Constant monitoring, evaluation and adjustment (by learning while doing).

G. THE REFORM PROCESS

22. Initiating the process of irrigation management transfer necessitates an extensive stakeholder consultation and participative process. There has been much debate on whether the process of reform need be bottom up or top down approaches. Since IMT devolves managerial functions to user organizations, but also redesigns the role of government as a regulator and potential provider of support services—a combination of top-down and bottom-up approaches, or a "new partnership" would be appropriate. One of the contradictions of a top-down approach (no matter how benevolent it may be) is that grass roots priorities, concerns and involvement may be sacrificed. IMT policies are often incomplete. They often lack sufficient incentives, accountability mechanisms, transfer of authority or capacity building and reorientation of government. These are probably the main reasons why IMT has only had partial success in some countries.

23. The success of IMT programs probably also depends on the extent of organizational, functional and financial autonomy granted to water users organizations.

H. FUTURE ROLE OF GOVERNMENT

24. IMT may diminish the role of the government or the irrigation agency in some areas, but it certainly should not become a form of abandonment. After IMT, governments would normally still have a significant role in the future. They will often likely be needed in the future to:

i) provide a regulatory framework that would safeguard the interests of all stakeholders;

ii) regulate the conjunctive use of ground and surface water, including regulation of ground water pollution;

iii) ensure equitable deliveries by establishing clearly defined water rights, which are justifiable;

iv) finance the construction of new irrigation infrastructure and provide assistance for rehabilitation in the wake of natural calamities;

v) control water quality;

vi) provide for flood control and drainage for agriculture, villages and other needs, as a generalized public good.

Contact: imt-moderator@fao.org