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Water Rights Questions

Bryan Bruns 1

Prepared for the National Seminar on Farmer Water Use Rights

Bandung, Indonesia, 15-17 December 1997

Contents

Abstract

Why water rights?

What rights? Implicit, informal and customary

Who? Rights holders and enforcers

How much water? Proportionality and efficiency

When? Duration and droughts

Where? Transferability

Conclusions

Table 1: Water rights characteristics and alternatives

Notes

Abstract: This essay outlines a series of questions for understanding current water rights and the prospects for improving water allocation institutions to cope with increasing competition and demands for intersectoral reallocation. It concludes by contrasting assumptions about water rights formalization, rights holders, enforcement, allocation principles, efficiency, duration, flexibility and transferability.

Why water rights?

Are conflicts emerging? Increasing scarcity brings different claimants to water into conflict. Existing users want to secure their access to water, which is subject to growing competition. Increased demand from users sharing the same resource brings a need for better coordination, and links distant users who could ignore each other when water was more abundant. One of the key roles for government is to create a framework within which strangers can peacefully agree to cooperate, and to coordinate their actions.2

Is reallocation needed? Cities, industry and others seek new supplies, and often see transferring water from irrigation as the easiest, and cheapest, source to serve their needs. If new claimants use their political and economic power to expropriate water from existing users, with little or no compensation, this not only creates current injustice but contributes to the prospect for increasing conflict in the future. If reallocation is not possible the options for serving growing urban demands are very limited.

Can reallocation be managed constructively? Controversies about storage reservoir construction have important lessons for policy on water reallocation. Debates have highlighted the high economic, social and environmental cost of dam construction, which encourages alternative strategies like demand management and reallocation. The history of broken promises and inadequate compensation for land expropriation in reservoir construction has discredited water development projects, breeding mistrust and opposition. In the same way, if water is expropriated with little or no compensation, the prospects are for a similar result of distrust and conflict. However, if current users think their concerns will be heard and any transfers carried out with equitable compensation, then reallocation may be able to proceed relatively smoothly. Making equitable reallocation possible will usually require significant adjustments in the institutions which regulate access to water.

Questions. This essay looks at some questions which deserve consideration in trying to understand the water rights which currently regulate water allocation, and the prospects for reforming water rights and water allocation institutions to meet the challenges of increasing scarcity. Much of the literature about water rights has been framed in terms arising from the settlement of the western United States, under conditions which differ greatly from the challenges which face contemporary water management. Economic and legal analysis often seems to presume effective courts, thorough policy implementation and other conditions which are far from universal. This essay uses a series of questions about water rights to point out alternatives, particularly some that may be more relevant in tropical Asian rice growing areas, with their own history, current institutions and management challenges.

What rights? Implicit, informal and customary

What are water rights? Water rights institutions already exist in various forms to regulate access to water. Water rights concern who should be able to take how much water, when and where. Any attempt to limit the definition of water rights to only those rights fully recognized by the state leaves out most of the institutions which regulate water allocation in practice. Water rights may be implicit in dams, canals, division structures and pipes of existing infrastructure, or in specifications about which land should be irrigated, in which season. Rights may be explicit in share systems, quantified flows or rules about how many hours an area can take water during rotational irrigation. Water rights may be informal, embedded in local practice, or formally framed in water permits. Customary rights are usually not static, but evolve in response to local conditions and state influence. In most parts of the world the major challenge is not one of assigning new rights to unused water. The history of usage is one of only several relevant factors, and priority may be lost in history, and highly contested. Instead of focusing on claims to "unused" water, the principal challenge is to better manage the contesting claims of current and new users, amidst the various legal and social institutions which already influence water allocation.

Is formalization necessary? State laws can play an important role in improving water allocation, if they recognize and enhance the full set of institutions which shape water allocation. Conversely if state regulation attempts to ignore or override existing claims, then it may undermine existing water management, foment confusion and create more problems than solutions. Formalizing water rights, through state issued registries, permits or other means, may be a useful part of improving water management, but needs to be done in ways which respect existing rights and create equitable means for dealing with conflicting claims. Formalization processes risk being heavily biased towards those who are wealthier, better educated and politically more powerful, perhaps increasing inequity and hurting those who are poorer and more dependent on secure access to water. If formalization is required, strong efforts need to be made to ensure that poorer, less educated and more remote users have access to the means for protecting their rights. Where conflicts are urgent, rights may need to be formalized to some extent, particularly where competition is severe or there is strong demand for transferring water between uses. Conversely if water is still relatively abundant there may be little need to formalize rights. In a broader perspective, formality may be more the exception than the rule, if existing institutions currently allocate water effectively, or can be made effective enough through modest strengthening, for example by setting up councils or other forums to facilitate negotiation among users sharing the same resource. Formalizing all rights, everywhere, at the same time, is far from the only choice. It may be wiser to formalize rights carefully and selectively, focusing on sites where water conflicts are most urgent and where efforts to improve water allocation are initiated by users.

Who? Rights holders and enforcers

Who holds water rights? Rights may be held by individual farmers, or by corporate bodies such as irrigators' organizations or water utilities. Having rights held by a water user association or other collective entity may be simpler than having rights held by multitudes of individual farmers. However internal decisionmaking and accountability then become key concerns. Much research on community management of irrigation and other forms of common property has demonstrated the effectiveness of local management. Unwise imposition of state control can undermine and disrupt local resource management, making things worse rather than better, unless intervention is carefully designed and carried out.

Who enforces water rights? Most allocation is handled by interaction among users, not by court decrees or agency decisions. Frequently courts are seen as too expensive, time consuming or ineffective. If disputants cannot resolve conflicts among themselves, they may ask administrative authorities to mediate or arbitrate the conflict. State law is an important point of reference for such quasi-judicial forums, but local history and other factors may be given equal or greater weight. Attempts to reform water rights will be effective if they translate into changes in such practical forums.

How much water? Proportionality and efficiency

Is scarcity shared? Rights to water do not have to be specified only in terms of absolute flows, e.g. liters per second, but instead can be a share, e.g., a percentage, of available flow. Most systems for rotational irrigation of rice embody a principle for proportional sharing of available supplies. This is most highly elaborated in share systems, famous in Nepal, Spain, Philippines and elsewhere, with shares based on investment in building and maintaining irrigation works. This contrasts with a prior rights systems where "senior" rights holders can take there entire amount, with "junior" rights only allowed to take whatever is left over. Even in the western U.S., the home of such "prior rights," allocation within mutual companies and irrigation districts commonly reflects proportional sharing rather than absolute prior rights. Furthermore many systems which are nominally specified in absolute terms actually have rules for sharing shortages which make them proportional in practice. Proportional sharing can be used to manage reservoir capacity as well.3

Is water consumed or returned? If the water right is to be transferable then it becomes important to take account of how transfers might affect return flows, through both surface and groundwater. This has been a major issue in the literature on water transfers and water markets. However, the existing infrastructure and management of irrigation schemes often depend on relatively large flows, well beyond the consumptive use that might be assumed in theoretical design calculations, whether in smaller farmer managed schemes or large agency managed schemes.4 Attempts to improve irrigation performance and increase water use efficiency have shown how limited is the capacity to impose changes in water allocation. There is growing recognition that basin level water use efficiency may be high, even when efficiency within individual schemes appears low.5 Attempting to define water rights limited only to consumptive use can be interpreted as taking away access enjoyed by current users without providing any compensation, an approach likely to evoke resistance and opposition. Reallocation is likely to be more feasible if those who reduce water use gain from the sales, i.e. recognizing the value of their existing rights and creating incentives for efficiency.6 The implication of these issues is that the basic water right should often be defined in terms of the entire amount currently diverted, as it is currently used. Changes in use or transfers may need to be restricted to the amount consumptively used, but the primary rights should secure the entire amount currently diverted.

When? Duration and droughts

Are water rights forever? Assigning water rights in perpetuity is only one option. Water rights can be issued for a limited terms, with provision for renewal, as, for example, in New Zealand. The primary consideration is likely to be whether this will give adequate security for users to invest in productive and efficient use of the resource. A right which lasts only for a single year or even only five or ten years is probably too short to give adequate security and stimulate optimal investment. However similar economic logic suggests that little may be lost, and flexibility encouraged, by limiting the term of rights to twenty or thirty years, with provision for renewal to be determined well in advance of when the right expires. This may create more opportunity for reallocation and reduce long term problems due to speculative acquisition of rights.

What happens when drought occurs? Water rights may be defined so that the same principles apply regardless of the degree of shortage, or there can be explicit provision for shifting management regimes during periods of emergency. Locally-managed irrigation schemes often apply very different allocation rules depending on the degree of water scarcity, and have procedures for switching between different management regimes. Flood and drought are inescapable. At what point does it become necessary to sacrifice crops in order to ensure adequate water for drinking and other domestic needs? There is a need to be able to shift from routine to emergency management, without making emergency the routine condition. If this need is ignored the result is that crisis management is ad hoc, and likely to be highly conflictual, politicized and inefficient. Planning for drought can forge consensus about when to shift to different rules, and how to share the pain when this becomes necessary.7

Where? Transferability

Is water tied to land? Customary water rights often make little or no provision for reallocating water. This may work well enough as long as water is not particularly scarce, so there is little need to consider reallocating water between different uses. Share systems may permit expanding irrigated area and moving the point of use, and so may create important incentives for efficient use within a local area.8 Even where reallocation is formally prohibited, new users may buy up irrigated farmland in order to move the water to other uses. Planning and zoning systems have shown limited ability to restrict conversion of farmland to other uses in most countries. Attempts to prohibit water transfers are even less likely to succeed. As the demand for water increases, competing users will use one means or another to obtain water. The question may better be framed as one of how to best channel the process of reallocation.

Can win-win transfers occur? Commonly those demanding water for urban and industrial use are willing to pay a much higher price for water than the economic value of the water as used in agriculture. This creates the potential for mutually satisfactory, voluntary agreements. Within a locality, renting or sale of water may evolve on an informal basis, as in informal groundwater markets. A more formal institutional infrastructure is needed for such transactions to take place between strangers, located in different places.

Conclusions

Increasing demand is bringing conflicts and pressures for better institutions to manage scarce water resources. Emergence of conflicts is far from uniform, and conflict management may be more effective if it is selective and prioritized, with formalization of rights as only one option, along with strengthening user self-governance, assistance to facilitate negotiation among disputants and technical analysis to clarify conditions and alternatives.

The literature on water rights derived from the western United States often brings with it a series of assumptions, frequently oversimplified, about how water rights are or should be defined: rights in perpetuity, claiming previously unused water, to absolute volumes of flow or storage, with senior rights served first in their entirety, held by individuals, uniformly applied, legally formalized and regulated by courts. This essay presents a contrasting view, emphasizing that a range of alternatives exist, which should be considered in any attempt to understand or reform water rights.

Users should have rights to water which are secure and can be protected. The best pathways to improving institutions for water rights and allocation are likely to go through recognizing and building on existing local principles and practices for water allocation, making reform selectively and strategically, and optimizing the limited capacity of state agencies to address urgent issues, rather than wasting time and energy to impose the appearance of uniformity, or trying to abolish the social capital embodied in existing institutions.

In conditions common to much of tropical Asia the most appropriate formulation of a water right may be directly opposite from that presumed in much of the literature. The default assumption for understanding existing rights and for considering reforms in water rights might be conceived as assuming that rights concern water for which there are already existing uses and claims, formalization should be the exception rather than the rule, rights should be proportional to flows, held by irrigators' associations or other collective entities, and mainly regulated according to local custom and practice, user self-governance, with courts and state agencies having only a secondary role. Rights should secure the access to all water currently diverted , with consumptive use and return flows only considered if usage is to be changed or transferred.9 Table 1 summarizes some of these questions and options for defining water rights.

 

Table 1. Water rights characteristics and alternatives

CHARACTERISTICS

SOME

OPTIONS

Formality

Explicit rights in registers, permits and licenses

Informal, customary and implicit rights

Universal formalization

Selective formalization

Rights holders

Individuals

Irrigators' associations

Enforcement forum

Litigation in court

User self-governance

Allocation principles

Volumetric

Proportional

Absolute priority

Sharing

Efficiency

Consumptive use only

Full flow

Duration

Permanent

Limited term

Flexibility

Uniform rules

Adjusted to season and circumstance

Transferability

Tied to land

Transferable

 

Notes

1 Bryan Bruns is a consulting sociologist based in Chiang Mai, Thailand. He has worked extensively on participatory approaches to irrigation and water resources management in Southeast Asia. He can be contacted at C-723 Lanna Condo, T. Pa Tan, A. Muang, Chiang Mai 50300 Thailand. Tel. 66-53 872-225 Fax 66-53 872-226 BryanBruns@BryanBruns.com

Many of the ideas in this paper have grown out of work on a forthcoming book, "Negotiating Water Rights," co-edited with Ruth Meinzen-Dick. The analysis of water rights characteristics here, particularly in connection with proportionality, collective rights and consumptive use, draws heavily on work by Mark Rosegrant and various colleagues. They have focused from an economic perspective on the prospects for fostering water markets, agricultural diversification and reallocation more in line with the opportunity cost of water. In particular, see Rosegrant, Mark W., and Renato Gazmuri Schleyer. 1994. Tradable Water Rights: Experiences in Reforming Water Allocation Policy: Irrigation Support Project for Asia and the Near East, USAID; Rosegrant, Mark W., and Hans P. Binswanger. 1994. Markets in Tradable Water Rights: Potential for Efficiency Gains in Developing Country Water Resource Allocation. World Development 22 (11):1613-1625; and Rosegrant, Mark W., Renato Gazmuri Schleyer, and Satya N. Yadav. 1995. Water Policy for Efficient Agricultural Diversification: Market Based Approaches. Food Policy 20 (3):203-223.

2 On the role of the state in enabling strangers to enter into successful transactions, see North, Douglass C. 1990. Institutions, Institutional Change and Economic Performance. New York: Cambridge University Press.

3 Dudley, Norman J. 1992. Water Allocation by Markets, Common Property and Capacity Sharing: Companions or Competitors. Natural Resources Journal 32 (Fall):757-778.

4 For a critical analysis of how effective operation and maintenance in practice differs from technical design assumptions see Irrigation O&M and System Performance in Southeast Asia: An OED Impact Study. Report No. 15824 Operations Evaluation Department, the World Bank. 1996.

5 On basin efficiency and the risk of non-existent gains from increasing water use "efficiency" see Seckler, David M. 1996. The New Era of Water Resources Management: From "Dry" to "Wet" Water Savings. Research Report 1. Colombo, Sri Lanka: International Irrigation Management Institute.

6 An example of assuming the generality of prior rights, and ignoring the possibility for non-market mechanisms for proportional sharing of scarcity, is in Farhed Shah, David Zilberman and Ujjayant Chakravorty. 1993. Water Rights Doctrines and Technology Adoption. Pages 478-499 In The Economics of Rural Organizations: Theory, Practice and Policy, edited by Karla Hoff, Avishay Braverman and Joseph E. Stiglitz. Oxford: Oxford University Press.

7 On drought planning, see Harald Frederiksen (1992), Drought Planning and Water Efficiency Implications in Water Resources Management. World Bank Technical Paper Number 185. Washington, D.C. 1992.

8 On incentives for efficiency in share systems see Maass, Arthur, and Raymond L. Anderson. 1978. ...and the desert shall Rejoice: Conflict, Growth and Justice in Arid Environments. Cambridge, Massachusetts: MIT Press. The advantages of shares untied to land are analyzed in Martin, Edward, and Robert Yoder. 1983. Water Allocation and Resource Mobilization for Irrigation: A Comparison of Two Systems in Nepal. In 1983 Annual Meeting Nepal Studies Association, Twelfth Annual Conference on South Asia. University of Wisconsin, Madison, Wisconsin.

9 A further point of difference is between establishment of the institutional apparatus for full-fledged water markets, with the expectation of frequent transactions, versus an assumption that, in most cases, transfers may be relatively infrequent, and so more capable of being handled through a combination of negotiation among users and administrative review. For further discussion of alternatives and interaction among administrative water allocation, user-based allocation and markets with tradable rights see Meinzen-Dick, Ruth S., and Mark W. Rosegrant. 1996. Alternative Allocation Mechanisms for Intersectoral Water Management. Berlin: Paper Presented at the DSE-ATSAF Workshop on Strategies for Intersectoral Water Management in Developing Countries: Challenges and Consequences for Agriculture. One entry point for literature on the infrequency of water transfers is Young, Robert A. 1986. Why Are There So Few Transactions Among Water Users? American Journal of Agricultural Economics 68 (5):1144-1151.

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BryanBruns@BryanBruns.com

C-723 Lanna Condo, T. Pa Tan A. Muang Tel 66-53 872-225

Chiang Mai 50300 Thailand Fax 66-53 872-226

www.BryanBruns.com