The Environmental Management of Water and Biodiversity - Essay Example

Private sector involvement in environmental management There has been a greater public sector involvement in issues of environmental management, notably in the water and biodiversity segments over the years. The public institutions that have been involved in this area include the local authorities, government departments, municipalities and county authorities. The involvement of the privates sector in this area has been an indirect involvement, where the private sector is contracted to supply plants and equipments necessary for this practice. Therefore, the involvement of the private sector in environmental management is a recent phenomenon, whose advantages and disadvantages need to be analyzed. There are various advantages that are associated with the involvement of the private sector in the issues of environmental management, more so, as regards the management of water resources and biodiversity. One of these advantages is the provision of technical assistance in the environmental management issues. The private sector may be well equipped and versed with technical expertise that is relevant for the management of water and biodiversity (Brown, Aradau, and Budds, 15). Thus, the involvement of the private sector in this practice will serve to ensure that such expertise is availed in the management of water and biodiversity projects. This ensures that the whole process becomes successful and is implemented within the shortest duration possible, in that the presence of technical assistance helps the whole project to run smoothly and efficiently, saving on the time that would be involved in correcting mistakes arising from the lack of technical skills in the project implementation (17). Provision of private finance is the other advantage associated with the involvement of the private sector in environmental management programs (23). Such finances provided by the private institutions may be in form of loans or grants towards such projects. This is an advantage in that the financial provision by the sector serves to supplement the public finances that could have been allocated for such a program. In so doing, a project that could have been implemented over many years due to financial challenges is implemented within a short duration. The provision of financial support from the private sector also serves to ensure that, suitable and most recent technology can be accessed and acquired for the implementation of the environmental management projects. This way, the projects are implemented more rapidly and efficiently, while ensuring that the necessary tools and equipment, which are most suitable for the project, are afforded and involved in the project execution (59). Additionally, the provision of private finance serves to ensure that the project can run continuously, since there is some aspect of public finance that requires many bureaucratic procedures to be undertaken before the finances are availed for used in the project. Most limiting factor associated with public finance, is the fact that, if any additional finance is deemed necessary, then such has to wait until another budget period, when such supplementary finances can be planned (161). In contrast, the private sector finance is easily accessible and requires less bureaucracy to obtain and use. The involvement of the private sector in environmental management is also advantageous in that it affords an opportunity for contracting a single contractor, who will deal with the whole project, from the design phase to completion (39). If such projects would be left wholesomely to the public sector, their implementation would be a great challenge, in that, the project would require various departments of the public sector to be involved at different phases and stages of project implementation. Thus, the planning department would be required to plan for the project, the architecture department to design the project structures and the other departments to take respective phases of the project execution until the end of the project. With the involvement of the private sector, this is eliminated by the fact that a single contractor is hired to accomplish all the phases of the project from planning to the time the project is fully accomplished. This serves to eliminate the chances of project delays, associated with different implementers at every stage of the project (89). Additionally, the confusion and errors that would be involved while the project is being handled by different groups at every stage are eliminated. Another advantage associated with this contracting is the fact the whole risk associated with the project implementation is effectively transferred from the public institution to the private sector. This way, the contractor becomes fully responsible for all the risks that may arise from the project and its implementation process. This way, the costs associated with risk aversion in any project are saved by the public sector. Private sector involvement in environmental management is advantageous in that in provides for an opportunity for operational contracting as well as full privatization of environmental management projects (36). This is beneficial to the public sector, since the private sector takes the whole responsibility of constructing the project facilities required and running the project thereafter on a contractual basis. Operational contracting entails the involvement of the private sector in the whole of the project, where the contractor funds the construction of the project and runs the project for an agreed duration until the contractor recovers his investment (175). This way, it places the whole burden of financing the project on the contractor, effectively saving the public sector from incurring such costs (128). The application of this mode of establishing a project ensures that the public sector incurs less cost of establishing and running a project, as opposed to when it would have borrowed money directly from the private sector to implement the project. In addition, the risks that would have been involved in the project are transferred to the private sector, ensuring that the public sector is set free from any liability or responsibility as regards the project. This can enhance the speed at which the public sector establishes such environmental management programs, as no financial or technical risk is to be planned for such projects. Under such circumstances, the contractor implements and executes the project excellently, since it is in their best interest to ensure the project is of high quality, as they are responsible for running such a project (102). Reduction of workload is yet another advantage associated with the involvement of the private sector in environmental management projects. Since such involvement allows the public sector to delegate certain projects fully under the full privatization and the operational contract options, the public sector is relieved of some of the responsibilities that it ought to have undertaken on its own, thus leaving it with a few projects and programs, which it can effectively manage and implement (65). Quality is the other aspect that is enhanced by the involvement of the private sector in the management of environmental programs, more so regarding water and biodiversity. The collaboration of the public and the private sector in the management of such projects ensures that there are shared ideas and experiences, which are earned differently from the undertakings of these sectors. This way, the shared ideas contributes to higher chances of creativity and innovation in implementing such projects, an aspect that goes a long way to enhance the speed of completing such projects, as well as the quality of the projects so completed (288). Shared technology is yet another advantage of involving the private sector in the management of the environment. Since the private sector is known to embrace and adopt recent and new technologies more than the public sector, then its involvement helps the public sector share in the new adopted technologies, thus derive the benefits acquired from such technology in implementing environmental management programs (210). There are however, several disadvantages associated with the involvement of the private sector in the management of the environment. The first of these shortcomings is related to the costs of implementing and accomplishing such projects. The involvement of the private sector in the management of environmental projects makes such projects costly, in that the private financiers expects to recover their investments in such projects within the shortest time possible (354). This way, they charge high interests on the finances they lend for the implementation of such projects, making the costs escalate. The other factor contributing to a higher cost of such project through the involvement of the private sector is the fact that, the private financiers do not want to incur any financial or technical risks in the implementation of the environmental projects. Therefore, they predict the risks involved, calculates the portfolio risks and charges such risks on the public sector as part of the costs of capital that they lend (349). This serves to increase the costs of implementing such projects. In case the private financiers perceive a project to involve higher risks, they opt to stay away from financing such projects. This is a limitation in that; they only finance the projects, which are perceived to be of a manageable risk. Thus, the involvement of the private sector in the management of the environment may hinder the implementation of the risky, yet essential water and biodiversity projects. Another disadvantage associated with the involvement of the private sector in environmental management is the fact that, water is an essential element for life, which needs to be availed to all, and notably the poor people in the society (115). However, contrary to such considerations, many private sector institutions are interested in generating profits. This way, they may fail to prioritize the provision of clean water to the poor people and end up preferring undertaking such projects in areas they are sure of recovering their investment and earning profits easily. In so doing, the involvement of the private sector can easily discriminate the environmental programs, preferring to set such projects in areas of convenience and of potential profit generation, as opposed to the areas where such services are most needed. Thus, water and sanitation management is most suited for the public sector, in that, the sector can prioritize service provision to the people, at the expense of earning returns, and provide such services to the people, even when there are no profit earning prospects (67). Considering that environmental management is mostly undertaken as an aspect of free good will, then, this may not be the case of the private sector, who engages in any undertaking with an aim to gain. Therefore, before any involvement of the private sector in such environmental programs, then, the public sector needs to assess the ability of the public to pay for such services. The inability of the people to pay for such essential services may hinder them from accessing them, if such projects are left on the hands of the private sector. The involvement of the private sector entails a lot of legal framework establishment, in order to put in place the necessary regulations that guide the sectors involvement, solely or in partnership with the public sector, for the management of the environment. Such legal framework involves the formation of contracts, which may last for long before a suitable contractor is indentified to handle the project. This causes delays in the establishment and execution of environmental management programs (242). Another disadvantage is that the private sector needs supervision and follow-ups from the public sector, on how it undertakes the implementation of the projects. Such activities add to the burden of the public sector, which is already pre-occupied with other undertakings. More to this, most of the water and sanitation projects are undertaken underground, making the assessment of such facilities a complex issue (106). The opposition of the private sector involvement in such sensitive issues as the environmental management of water and biodiversity by key stakeholders also serves as a limit to the involvement of the private sector in the management of such projects. Considering that such issues are managed for the common good of the people and not for generating revenues, then, the key stakeholders in this area may oppose the commercialization of environmental management projects, effectively limiting the involvement of the private sector in this area. Such opposition may be experienced from such stakeholders as consumer organizations, labor unions, political parties and the NGOs (92). Work Cited Brown, William, Aradau, Claudia, and Budds, Jessica. Environmental Issues and Responses. Open University Worldwide, 2009. 13-472. Print. Read More