WATER IS THICKER THAN BLOOD - a study on water privatisation in South Africa

Abstract

As many countries have entered into privatisation schemes, the question of how and when privatisation can be successful is becoming increasingly important. Privatisation of water services has been a controversial and important discussion in the world since the 1980s, so also in South Africa. The aim of this thesis is to further examine the factors behind a municipality’s decision to privatise and the subsequent effect on access to piped water and tariff level using cross-sectional data. The probability of privatisation has been evaluated using the Probit model and Ordinary Least Squares-method has been used to evaluate the subsequent effect of privatisation on access to piped water and tariff level. The results show that a privatisation decision might be influenced by employment rate. No evidence can be found of privatisation having any impact on infrastructure coverage or tariff level. Further research needs to be conducted to obtain results valid outside the scope of the sample.