RESEARCHING, DEVELOPING AND TESTING OF PAYMENT STRATEGIES FOR THE LOWER INCOME GROUPS AT FOUR SELECTED COMMUNITIES IN ORDER TO MANAGE CHARGES FOR WATER USE
REPORT NO: 1202/1/03
April 2003
EXECUTIVE SUMMARY
1. BACKGROUND OBJECTIVES AND SCOPE OF THE STUDY
The research started with a literature overview of work that was done in South Africa by Johnson, Schlemmer and Veck & Bill.
Veck & Bill discovered through their research that consumers are generally aware of how they could save water, but not how they use water.
Johnson identified 5 main factors that were central to the non-payment of water accounts during his 1999 study, namely:
The research of Schlemmer, also during 1999, found that poverty played a major role in non-payment. However, he also found that the "culture of non-payment" was a minority phenomenon and rather a "climate of non-payment" because "everybody does it". He also found a lack of knowledge about water cost and the way revenues were utilized. He mentioned that most studies undertaken regarding non-payment lack an in- depth attempt to uncover causal "relationships in the data".
The aim of this study was, amongst others, to explore this lack of attempt to uncover relationships in the data. Another aim of this study was to involve different role players in the research to make it a participative research project. Participative in the sense of having 4 task teams (with representation at council level) in each of the areas (namely Tshwane, Johannesburg, Durban and Cape Town). Also, to involve local interview people to conduct the interviews with the selected low-income consumers, and grow their knowledge about water related research. This approach facilitated capacity building research and transparency.
The initial research aims were to monitor the changing attitudes (during the research period) of water consumers to the right of access to water and the payment of water services. The potential effects of specific interventions between pre-test and post-test surveys were also examined after task teams (local authorities) identified issues that were of value to them, for example the perceptions of respondents in Durban of a new flow limiting system ('flow limitor'). In the areas in Cape Town, the potential effect of a pamphlet, with water saving hints, as well as the introduction of a "mock" (or dummy billing system, based on water consumption and not a fixed role), were also examined.
This lead to an adjusted set of objectives for the research with a generic and local focus of the research. It also included a classification of respondents into "regular" payers and "irregular" payers in order to formulate hypothesis to identify probable causal patterns.
The secondary objectives were to detect the effect of specific demographics (employment status, income, ownership, language, etc.) and other research variables (general attitudes, estimation and knowledge of water consumption units, systems of payment, communication and intention to save water), on payment behaviour.
2. RESEARCH DESIGN
In order to test any causal relations between variables, an adapted Pre-test/Post-test Design with Control groups was implemented. The areas for the study were selected from lower income groups in co-operation with the local councils. Respondents were selected in clusters of 200 (4 clusters with a pre- and post study were undertaken). All respondents in the selected clusters were interviewed and a semi-structured questionnaire was used to capture the data. Statistical analysis was done using SPSS (Statistical Software Package). The areas were: Tshwane (Elandspoort and Lotus Gardens), Johannesburg (South Hills), Durban (Chesterville), and Cape Town (Guguletu, Langa and Weltevreden Valley).
3. MAIN FINDINGS
In the literature some factors were identified as being central to the non-payment of water accounts. This study supported some of the findings namely that the "culture of non-payment was a minority phenomenon". But, this study found that the non-payment was not because "everybody does it". It was mostly because of low income of households and lack of knowledge about how much water was being used.
Water Affairs Minister Ronnie Kasrils announced in the National Assembly in February 2001 that every household in South Africa would receive the first 6k/of water free every month. This grant could have far reaching implications, therefore the knowledge and opinions of the respondents in the survey areas about the grant were included in the study. The provision of the first free 6k/ of water was still a relatively new concept during the time of the surveys. The awareness levels of the grant, however, showed a marked increase from the pre-test to the post-test surveys. Regarding water saving methods, a wide variety of creative measures were spontaneously mentioned by many water consumers, which could provide a base for future information campaigns.
Most of the findings of this study underscore the complexity of the problem of (non-) payment for water. It is particularly households with lower income levels that suffer in Davina their water accounts. Other findings, however, provided some hopeful solutions.
3.1 Metro related findings
In the Tshwane Metropolitan Municipality the perceptions about a "push button tap", "trickle flow" and "cut off" systems were surveyed amongst the sample of residents. Mixed reactions were received. Positive perceptions from the regular payers, but not perceived as sound solutions to the problems of non-payment for water by the irregular payers.
In the Johannesburg Municipality the change in supplier, from Johannesburg Municipality to Johannesburg Water, was perceived as positive action. The warning system of Johannesburg Municipality about accounts in arrears was also viewed in a positive light.
Perceptions about the new system of Durban Water, namely the "flow limitor" for households that do not pay or cannot afford to pay for the water services, were found to be fairly positive. Respondents were not familiar with the system, but post-test results were more positive. However, the group in arrears was negative about the implementation of a "flow limitor" system.
In Cape Town Metropolitan Council three issues were tested, namely:
The research found that the new billing system based on consumption was perceived positively. The use of pamphlets to create awareness about the new payment system proved not to be a success. No significant differences in attitude and knowledge could be identified between the groups that received the pamphlet and those that did not. Differences between those respondents that received "mock" or dummy accounts were also not significant.
3.2 Core findings
The majority of water consumers in the study were quite satisfied with the quality and provision of water in their residential areas. An alarming finding, however, was that consumers highly under-estimated their water consumption. These estimations varied between three to seven times ~ than their actual water consumption. If the situation is allowed to continue, it may result in the further escalation of debts, and subsequently increasing pressure on water providers.
Consumers frequently expressed the need for continuous information from the Councils. Signs were observed that traditional measures against defaulters, such as the prompt cutting off of the water supply, were not perceived as an idea! solution for the problem. Consumers expressed the need for personal communication with a friendly official at their homes.
Water consumers displayed a lack of knowledge of the units in which water consumption is expressed. The bigger the units (kilo and Mega litres), the less the respondents knew about them. These aspects could be addressed in information campaigns.
Perhaps the most significant finding regarding possible solutions for the problem of the non-payment for water was the availability of more payment options to water consumers. Consumers frequently expressed the need for more options, which would make it easier for them to choose an option for paying. Various options, combined with a friendly individual who visits them at their homes, may be a worthwhile avenue to pursue.
Another significant finding was an underlying negativity among consumers, particularly in the groups that were further in arrears with the payment of their water accounts. Not only were these groups more negative in their attitudes about the payment for water, but their consumption levels were much higher than the groups that were not in arrears. These "arrears" groups also seemed to take less personal responsibility for the situation in which they find themselves, and signs of despondency were also detected. Financial problems expressed by the groups in arrears and their excessive water consumption, are reasons for great concern.
4. CONCLUSION
In conclusion, it could be said that the financial, social and psychological dynamics of non-payment for water is a complex and multivariate problem. Poverty, negative attitudes to payment for water, excessive water usage, and the lack of interest in water saving measures, were identified as major causes for payment default. As Schlemmer described it correctly, that what is often seen as a "culture of non-payment can be considered as a minority phenomenon. The findings from the current study confirmed Schlemmer's findings that most people accept the principle of payment for services, although the lower groups see a need for targeted relief.
Signs of solutions for the problem were however, observed. Multiple payment options, combined with a personal approach of visiting consumers who are in arrears with their payment for water, provide some optimism for alleviation of the problem of non-payment for water in the study areas.
Although the findings of this study cannot be generalised to other areas (due to the method of selection of the respondents), it is significant to note that the groups in arrears consistently exhibited similar negative attitudes and payment behaviour, lack of interest in water saving measures and excessive water consumption.
5. RECOMMENDATIONS
5.1 Metro specific recommendations
5.2 General
It is recommended that local councils:
With regard to the WRC it is recommended that: