Influence of governance institutions on households' willingness to pay for resources conservation in Khalong-la-Lithunya wetland area Lesotho

Abstract

This study uses the double-bounded bid elicitation format to estimate how much households in the Khalong-la-Lithunya wetland area (KWA) would be WTP (on top of monthly water bills) for wetland resource conservation, and test whether WTP significantly varies with the institution responsible for its conservation management. KWA was purposely selected on account of the critically important role it plays in securing water provisioning ecosystem services; a role that is currently threatened by proximate and ultimate factors hypothesised to be driven by its unrecognised economic value. WTP was thus elicited and compared when the governance institution was (i) the Ministry of Natural Resources, and (ii) a private environmental conservation agency that is currently active in Lesotho i.e. the Transformation Resource Centre (TRC). Purposive and simple random sampling methods were used to collect survey data from 204 households. Results show that respondents have high levels of factual knowledge about the threats to the sustainability of KWA. They also have attitudes, opinions, and perceptions that are receptive to a policy that improves the status quo. Mean WTP was M78.80 per household per month (UB M92.89 and LB M38.21) when the Ministry of Natural Resources was responsible for conservation management in KWA (equivalent to M 0.011 per litre or M0.21 per 20 litre jerry can), and M83.09 per household per month (UB M98.00 and LB M32.94) when TRC was responsible for conservation management in KWA (equivalent to M0.011 per litre or M0.22 per 20 litre jerry can). The null hypothesis of equality of the two mean WTP values was rejected at the 1 % level (t= 4.34 and p = 0.000), suggesting that institution responsible for conservation management in KWA significantly influences households' WTP. Double bounded models differentiated by institution responsible for conservation management in KWA were used to econometrically determine factors that influence households' WTP. Results show that WTP was positively related to the following variables: income, age, education, whether households had experienced seasonal water shortages, knowledge of health risks associated with water shortages, and gender (males had higher WTP). WTP was found to be negatively related to household size (the more the household members, the lower the WTP). These results were consistent with prior expectation and literature. Considering, also, that this study further used secondary sources to estimate that households, on average, spend about M300 per month on water (equivalent to M0.04 per litre or 0.80 per 20 litre jerry can), three key recommendations follow. First, subject to extensive stakeholder consultations, the Water and Sewerage Authority (WASA) of Lesotho should consider adding to the regular charge a resource conservation tax amounting to at least M0.011 per litre of water delivered to customers, i.e. instead of charging M0.04 per litre of water delivered, WASA should charge customers at least M0.051 per litre of water delivered. Second, WASA should consider instituting a policy that isolates the conservation charge from the M0.51 per litre, and explicitly invest it in mitigating the resource conservation challenges in KWA (i.e. the charge should be used to support activities that secure the sustainable water provisioning ecosystem services from KWA). Finally, WASA should consider engaging TRC directly in converting the proceeds from the conservation charge to tangible resource conservation outcomes in KWA, given that households expressed higher WTP when TRC was responsible for its conservation management.