Paul Gertler, Li Ka Shing Professor, UC Berkeley
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Designing User Fee Based Contract Mechanisms for Public Toilets in India

3/22/2018

 
The Municipal Administration has the goal of making all cities in the Indian state of Tamil Nadu (TN) "Open Defecation Free." To achieve this goal, there have been deployed a large number of public toilets across cities. These toilets, managed by independent contractors who are provided fixed monthly compensation from the government for operations and maintenance, require effective management if the goal of making TN cities "open defecation free" is to be achieved. Currently, a significant proportion of the existing public toilets are not effectively managed and do not provide the level of quality service expected by users. Under the existing system, the operations and maintenance contractors are provided a fixed compensation based on a contract with the government, to run the public toilet facilities. Users do not pay any fees and as a result, there is little incentive for contractors to deliver better service quality (and thus incentivize more consumers to use toilets). 

The study, in partnership with the Municipal Administration and Water Supply of Tamil Nadu, is aimed at helping the government develop a market driven user-fee based contractual arrangement for public toilets which will motivate operators to maintain effective service quality, while at the same time reduce the government's financial burden. The study design offers operators different levels of user fees bundled with appropriate fixed compensation. This experiment will help the government evaluate whether user fees should be adopted (and if so, at what level), determine the reductions in fixed financial payments to the contractors, and understand the impact on consumer welfare -- with the ultimate goal of increasing consumer use of public toilets. 

Starting in Spring 2018, J-PAL South Asia, in close collaboration with the Greater Chennai Corporation (GCC), will conduct a full-scale impact evaluation that will inform the privatization of toilet operations and inspections. The research team will independently monitor and inspect approximately 660 toilets, administer detailed surveys, and collect data on toilet service quality, use, user satisfaction, financial sustainability, and savings to the corporation to provide information and recommendations on the effectiveness of tendering and viability of user fees as a model for public toilets. 

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