Accounting and the move to privatize water services in Africa

Abstract

PurposeUsing the recent attempts by the Ghanaian Government to privatize its urban water services, this paper seeks to understand the role and functioning of accounting within the global move to “reinvent government.”Design/methodology/approachUnlike the attempts made in other African countries such as Kenya and Tanzania, the case of Ghana is interesting because of the vociferousness and length of the debate that has been going on. Using Bourdieu's notion of field and capital and Foucault's idea of governmentality, and relying on a variety of archival documents and interviews with 27 key participants, the study examines the positioning of accounting practices, vocabulary and experts in this debate.FindingsThe study shows how accounting is enlisted at an almost sub‐conscious level, how its use can engender significant resistance and how accounting can be used to position the debate in various terms, including “profitability” “affordability” and “accountability.”Research limitations/implicationsThe paper shows that within new democracies such as Ghana policy‐making requires the enlistment of technologies of government – including accounting – to articulate and justify divergent policy options.Practical implicationsThe findings of the paper have implications for regional policy‐makers and their various development partners.Originality/valueResearchers and practitioners working in the area of public sector management and reforms should find significant value in the paper.

Management Accounting Research on Africa

“…In line with patrimonial governing logics (Hopper, 2017), many of the reviewed studies report high degrees of power centralization common to many African societies (e.g. Abdel Al & McLellan, 2011;Asechemie & Ikeri, 1999;Goddard & Mzenzi, 2015;Ndiweni, 2010;Ouibrahim & Scapens, 1989;Rahaman et al, 2007Rahaman et al, , 2010Rahaman & Lawrence, 2001;Sogbossi Bocco, 2010). Collectively, these papers argue that clear hierarchical orders are usually accepted in African societies, with the power distance between actors at the hierarchical top and actors at lower hierarchical levels comparatively high in many African organizations.…”

“…In several of the sampled articles, MA practices and systems are closely related to the concept of new public management (NPM) and are enhanced through notions of accountability and governance (e.g. Awio et al, 2007;Dixon et al, 2006;Goddard & Assad, 2006;Lassou & Hopper, 2016;Rahaman et al, 2007;Tambulasi, 2007;Uddin & Tsamenyi, Management Accounting Research on Africa 11 2005). Such notions are central to legal-rational forms of governing (Hopper, 2017;Lassou, 2017).…”

“…Through economic liberalization (e.g. Pretorius et al, 2003) and the privatization of state-owned organizations (Rahaman et al, 2007;Rahaman & Lawrence, 2001), state-led entities have shifted from their traditional focus on MA practices as development instruments to more modern, market-led, profit-oriented and capitalistic MA practices and systems (e.g. Tambulasi, 2007).…”

“…These issues have led to a low acceptance of NPM-related accounting practices, as shown by many articles (e.g. Rahaman et al, 2007;Sartorius et al, 2007). Additionally, some articles suggest that NPM-based accounting reforms have intensified nepotism and corruption promoted by ethnic divisions (e.g.…”

“…One of the central conditions imposed by international institutions, lenders and donors was the privatization of public companies, especially those performing poorly according to Western market-based performance measures. Consequently, several entities including water and electricity suppliers have been privatized, although some authors argue that they were well managed in terms of their assigned long-run goals (Rahaman et al, 2007;Rahaman & Lawrence, 2001). These privatizations show that NPM-based MA practices and systems have contributed to a shift in basic infrastructures to multinationals, who, in turn, may favor short-run profit maximization at the expense of sustainable development.…”