Process Financial Services Limited (TNUIFSL) was formed with the

Process Analysis

The present
condition of the sanitation facilities and the sewerage system had called for a
serious action. There were major life threats to the citizens and serious
underground contamination was increasing. In order to tackle this, an
underground sewerage system was proposed in the municipality of Alandur in

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government of Tamil Nadu took a decision to provide a sewerage system in
thoughtfully selected urban centres. There were a total of 12 such centres and
Alandur being the one of it. The government received support from the World
Bank as the leading financial institution which was helping in reforming the
state under urban infrastructure planning in Tamil Nadu.

Preparation of the PPP Project:

The Tamil
Nadu Urban Infrastructure Financial Services Limited (TNUIFSL) was formed with
the objective of enhancing the state of urban infrastructure in the state. This
agency had been nominated to co-ordinate the investigation and detailed
studies. They were also responsible for structuring the financing of the
complete project.

A private
engineer contractor was appointed by TNUIFSL. His role was to prepare a
technical design. There were also engineering reports that needed to be
prepared and that role was assigned to him for the Alandur project.

The scope of
the work included the following:


of the locations of pumping stations



Also, a
‘Willingness to Pay’ survey was conducted by the consultants. The main aim of
the survey was to access the scheme’s acceptability by the people of Alandur
town, and their willingness to pay for the service.  

More than 10
per cent of the population of the Alandur Municipality, spread over to 42 wards
was covered by the WTP survey conducted. It indicated that the average
household income of the majority of the people was in the range of Rs 1000-5000
per month. There were about 24 thousand assessed properties in the town of
which nearly 70 per cent had the municipal water connection.

Even though
the non-domestic consumers were willing to pay in the range of Rs 51-100 per
month for water charges, domestic consumers wanted to pay only Rs 21-50 per
month.  About 97% of the people of Alandur
wished to have the sewer connection, and would like to pay a reasonable amount
for provision of the service: for connection up to Rs 2000; for maintenance- Rs
21-50 per month as in the case of water supply.

Government of Tamil Nadu accorded administrative sanctions to the project on
the 9th of December 1998 and the technical sanctions were provided
on the 27th of January, 1999.

responsibility of acquiring the land for the project was given to the Alandur

Public Participation

This was a
unique case in which the public actively participated in the financing of the
project. Unlike in water supply where the community is well informed about the
advantages of a safe water delivery system, in case of sewerage the majority of
the people are usually unaware about the impact of unhealthy sanitary
conditions on their own health as well as on the environment of the
settlement/city concerned. Therefore, collection of sewer charges and
convincing the community to pay for it is a difficult and challenging task.

To gain
acceptance and build consensus among the public, the municipality mounted a
vigorous public outreach/public participation campaign with extensive media
coverage to explain the projects benefits, costs, and tariff system. The
municipality adopted the following procedures:

detailed discussion was held among the officers and staff along with the
Chairman about the sewerage project.

were motivated through corner meetings and advertisements on the public
transport system such as auto rickshaw, buses; cable network; local newspapers;
distribution of pamphlets, etc.

the holidays including Saturdays and Sundays were used for discussion with the
resident’s welfare associations. During the discussions, the scheme was
explained in detail: its advantages on the city environment and quality of life
of the residents of Alandur.

initially a large amount of the population of the town was not ready to pay the
high deposits related to the sewerage collection charges and monthly tariff, as
indicated by the survey, active canvassing and educating the people about the
benefits of the sewerage system let to agreement in paying for the sewerage
charges as per the municipal tariff structure. As per the available
information, more than 13,000 domestic and non-domestic connection seekers had
deposited the one time collection fee to the municipality by the end of May


In order to increase the convenience of the residents of
the town in terms of payments, the municipality opened several collection
centres at different locations.

Also, provisions were made for collection of deposits on
the receipt of the phone messages and at the designated bank.


Punjab National Bank (PNB) also came up with a scheme of
providing instalments to residents to make the payments for the sewerage
system. However, due to interest rates as high as 13% to 14%, hardly anyone
availed that service.


In order to seek the opinion of the public on multiple
issues and with a view to inform the project progress in multiple stages, the
authorities of the Alandur Municipality (AM) used to arrange meetings of the
representatives of the welfare association on a multiple basis. This procedure
ensured a system of effective participation of the community in the
implementation of the project.