Water supply and wastewater sector as state regulation object

Abstract

The sphere of water supply and sewage is directly related to a human and society life including a certain creation of life conditions with satisfaction of the immediate needs of a person, and so on. Despite the time, era, change of historical conditions, ideology and culture, the need for water and services is associated with its constant. Just the state policy, goals and tasks of public authorities aimed at regulation of this sphere are changing. The state regulation in any sphere of economic relations is the influence of the state through the normative legal acts adoption, regulations and compliance control including the control by the subjects of the legislation sphere, and application of coercive measures in case of violation of these requirements. In this article, the author considers the water supply and drainage sphere as an object of state regulation, and analyzes the definition of the concept in this field, which is disclosed in various sources, as well as its components and characteristics, and methods of state regulation of the sphere. Formation and development of the water supply and water discharge sector of Ukraine took place as an integral part of housing and communal services. And only since 2002 the sphere of water supply and sewage became regulated by the separate Law of Ukraine «On Potable Water and Drinking Water Supply», which has defined the main concepts, subjects and objects of this phere, and the principles of state policy. While exploring the conditions of state regulated market economy transition, the principles of housing and communal services reform, the author analyzes the scope of water supply and drainage as a market for water supply and sewage services, and reveals its characteristic features. It is very important to identify the specific features inherent in the services of water supply and discharge – the demand inelasticity; dependence of the services supply on the availability of networks; availability of technological and infrastructure constraints in providing services; lack of any alternative to drinking water and water supply and sewage services; water supply and drainage are technologically separate processes carried out using various engineering systems. Paying no attention to the privileged position of natural monopoly entities providing centralized water supply and sewage services, the availability of production facilities, material and financial resources, a guaranteed market for sales of services and the lack of competition, the sphere of water supply and drainage (as well as the sphere of housing and communal services), unlike other branches of natural monopolies, is unprofitable. The statistical data in the field testify that today housing and communal services are the most technically backward sector of the economy with many accumulated problems. Reforms conducted at the state level do not provide the expected result. Until now, at the state level, there are no clearly formulated mechanisms for creating conditions, which would balance the interests of market participants, and protect the interests of consumers in providing them with good quality public services at reasonable prices, and create conditions for the effective functioning of natural monopoly entities, while attracting investments to the development of housing and communal services. And the fact that the water supply and sanitation sector is one of the most attractive in terms of reliability and investment return in the world practice, confirms the correctness of the chosen research direction.