The concession system that a private company
manages all phases of the water business, from the construction to the
operation of a water plant, helped French water majors like Veolia and Suez enjoy
the dominant power in the world market. In Japan, the Cabinet Office tries to introduce
the concession system. However, no concession system has been introduced in
Japan.
The concession system entrusts a private
company with the right to operate and develop infrastructure for a long period,
leaving the ownership of a plant to the government. That is, a private company collects
water charge from the users and manages the water business with the charges
under government license. The private company is expected to improve business
operation and pursue efficient management with its originality and ingenuity.
However, some problems have to be solved to
introduce this system in Japan. First, it is critical how to set the optimal
water charge and scale of operation. The water business is primarily managed on
the municipality basis, such as city, town, and village, and supposed to suffer
demand decline due to falling population. For efficient management of the water
business, therefore, it will be necessary to integrate it in the basin of a
river, and formulate the charging system to make the cost for sustainable
development of the water business reflect in the charging system, while
maintaining the transparency of the system.
What is more, it will be necessary to organize
the consistence of several governing laws including Water Supply Act, Local
Public Enterprise Act, and Local Autonomy Act. In some situations, it may also be
necessary to revise the law governing the dispatch of government employees to a
private company because a government employee can work for a private company
for only up to three years at present. However, these reforms will be vital for
Japanese water-related companies to increase the presence in the world market. Revision
of the related laws will be unavoidable in the near future. (To be continued)
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