Office Du Niger - Reforms

Reform of Governance of the Office du Niger in Mali

Contractualizing irrigation management, in conjunction with upgrading of fields, canals, rice varieties, and cultivation practices, can multiply paddy yields per hectare by three and per m3 of water by six, result in good farm incomes as well as improve the government's finances. This is demonstrated by the reform of the Office du Niger in Mali, an agency that manages the head works and distribution network of a 60,000 ha irrigation scheme in the interior delta of the Niger river in West Africa.

Historical Background

During the 1970s and much of the 1980s, the Office du Niger suffered from yields around 2T/ha and a cropping intensity that dropped to 60%. Farmers were forced to sell their paddy to the Office that enjoyed a monopoly on marketing and milling. Sale of paddy to merchants resulted in the farmer's eviction from the scheme and from the area, since farmers were only tenants of their fields and the entire delta was administered by the Office. Farm prices were low and the ability and willingness of farmers to pay the water fee limited, if not lacking. Fee income was largely insufficient to maintain and operate the canals.

The agency's 4,000 staff ran not only the irrigation network, but also supplied seed, fertilizer and insecticides, provided extension, stored the paddy, worked the rice milling factories, ran a seed farm, produced farm equipment, managed guest houses and restaurants, staffed health clinics and ran literacy courses. Thanks to this nearly complete vertical integration, the agency was all-powerful and in the absence of transparency and accountability mechanisms, numerous, but not all, staff engaged in rent-seeking.

This vertical integration was useful when the scheme was under construction, for then the interior delta of the Niger was almost uninhabited. However, after construction and the development of roads and towns, vertical integration gradually lost its meaning and instead became a source of inefficiency and lack of accountability. The scheme survived on annual major infusions of funding by the Government of Mali that turned to donor governments for financial and technical support.

Reforms and Further Changes

In 1979, a round table of representatives of the Government, the Office and the donor governments reached consensus on the need for reform and initiated a reform process that in 1995 reached temporary closure. At that stage, farmers had become free to de-hull paddy and sell rice to whom and when they wanted and to buy inputs where and when they chose. All non-irrigation activities had been privatized, a first three-year performance contract been signed between the Minister of Finance of the Government of Mali, the Chairperson of the Board of the Office and two elected representatives of the farmers, the Office been established as a public enterprise with full financial and administrative autonomy, and two co-decision making mechanisms involving staff and farmers had become formal components of the management structure.

The first co-decision making procedure concerns operation and maintenance. Between fifty and sixty percent of all income from water fees must be spent on the maintenance of the scheme's distribution network, depending on its technical quality. This network is split into five units, called zones that receive their share of the annual O&M budget based on their share in collection. Priorities are set in co-management committees at the tertiary, secondary and primary levels, composed of representatives of farmers and ON staff. Once preliminary priorities are set, ON staff costs them and a final decision is reached. All maintenance is contracted out to private agents. Farmers on the committees received training in bid handling and recently obtained that reception of work is no longer done by ON staff but by independent commercial verification agencies.

Fees are collected by the Office. Enforcing fee payment is a two stage process. During the first phase, the committees prepare proposals to ON management for the eviction of farmers with arrears. During the second phase, the director of the zone approves the list and forwards it to the Managing Director for implementation. Sanction for nonpayment of the fee is severe. Since the farmers are tenants, they may be evicted from their land. Eviction occurs every year and is therefore a credible threat. The process has for two advantages that it links maintenance to fee payment and allows for the temporary consideration of local attenuating circumstances.

The other co-decision making procedure focuses on the three-yearly performance contract between the Ministry of Finance, the Office du Niger, and two representatives of the farmers. The latter are elected by the inhabitants of the villages in the area through a two tiered process just before the start of the negotiation of the new contract. Since Government owns both infrastructure and land, Office and farmers are formally engaged only in managing these assets. The contract sets the water fees, details the part that in each zone must be spent on maintenance, and sets goals for the increases in cultivation intensity, new construction and rehabilitation. It also defines how funds will be managed, how the contract will be monitored and what rights and obligations farmers have.

Farmer rights increase slowly. During the negotiation of the current contract, farmers obtained that the reception of out-sourced maintenance be transferred from ON staff to independent commercial verification firms. The contract defines the services that Government purchases from the Office and sets the price. In the current contract, the Government buys such services as the design and supervision of rehabilitation and construction projects, the O&M of the head works, the maintenance of a register of land tenancy titles and the provision of extension and functional literacy training to the farmers.

Some Major Outcomes

· In many zones, paddy yields climbed from 2T/ ha to 6.5T/ha;
· Water use dropped from 1,500m3/T to 250m3/T, an increase in the crop for drop ratio of 600 percent;
· Cultivation intensity in the majority of the zones rose from 60 to 115 percent;
· Income from one season of paddy on an average 3 ha farm in these zones equals 877 500 FCFA (=USD 1350 at Euro 0.88 to USD 1). Other sources of farm income are vegetables, which at the level of the scheme yield an income equal to 30 percent of income from paddy, and livestock;
· Number of hectare per staff increased from 13 to 170;
· Collection rates in the well rehabilitated zones are practically 100%;
· Water fees in those zones equal 8.5% of Gross Value of Output (calculated at FCFA 110/kg);
· Sustainability of the network is now assured to the point that private companies are investing the provision of small farm equipment and the construction of a 1,000 ha scheme to run a seed farm, and that donor governments are now funding extensions.

After nearly forty years of stagnation, the command area is expanding again.

Three Defining Features

One defining feature is the absence of WUAs. The absence of WUA may historically be linked to the efforts in the 1980s by the Malinese Government to make the multipurpose villages associations also responsible for irrigation matters. At the same, the co-decision and co-management procedures emerged from a donor funded project and these were embraced by parts of ON staff in the face of the relative ineffectiveness of the village associations. Literacy on the scheme appears to be 35 percent, and it may be argued that these procedures well match an environment where administrative and accounting skills are scarce. The co-decision and co-management procedures find their legal basis in a Presidential Decree that defines the new mode of operation of the Office.

Another is the fact that fees are collected by the ON that also implements the sanction of eviction and handles court litigation.

A third main feature is the degree of transparency. The farmers on the canal committees know the fee income that HQ collected in their zone and the percentage that HQ must return. They also know the composition of the zone's budget and are in a position to track expenses and staff use of resources (vehicles, telephone). Farmers in the villages are involved in the negotiation of the performance contract and the final version is translated into the local language and communicated in village meetings.

Co-decision, co-management and transparency of budgetary arrangements together create accountabilities between ON staff and farmers that provide farmers with an ability to pay, through improved incomes, as well as a willingness to pay. In combination with the staff's technical skills, they assure the sustained existence of the distribution infrastructure. The core of the institutional changes can be summarized as corporatization of the agency and contractualization of its links with the Government and the farmers. Technical staff now are accountable to both hierarchical superiors as well as to representatives of farmers.

Replicability/Lessons Learned
The model evolved in Mali appears replicable elsewhere in Africa because it
· matches the literacy levels and financial management capacity of the users,
· requires only limited training inputs,
· provides the Government with some negotiated steering capacity through the performance contract,
· insures financial sustainability.

Gerald Diemer, Independant Consultant,
E-mail: GeertDiemer@aol.com