With the campaigning of well-known celebrities like Feargal Sharkey and Chris Packham, various water company scandals, the Channel 4 docudrama Dirty Business and the rise of Andy Burnham to the role of Prime Minister, the issues of public control and ownership of water has risen up the political agenda in recent months.
It has become a major campaign for the progressive organisation Compass and on 28 July they held a webinar about what should be done regarding the ownership of water in this country.
Compass had two guest speakers, Cat Hobbs, the founder and director of leading campaign group We Own It and Ewan McGaughey a legal scholar at King’s College London and leading expert on public ownership.
Cat Hobbs and Ewan McGaughey
Cat Hobbs began by saying that Burnham was coming in as Prime Minister after success with taking back control of Manchester’s buses and that he had concerns with our water provision and the cost of living.
Ewan McGaughey, from King’s College London, stated clearly that public ownership is the best way to run water as shown by many other countries having a better and cheaper service than us, with 90% of the world population having a public water service. This is also reflected in the fact that over 80% of the British population want public ownership of our water, while campaign groups like We Own It and trade unions have called for water to be taken back into public ownership.
Meanwhile, recent years have seen 26% rises for chief executive officers of water companies, while we suffer an appalling sewage situation. It was also noted that while there are many good campaign groups campaigning for public ownership of water they are up against an immense amount of money behind private water groups.
It was noted by a representative of Compass that the failure of the water industry was a symbol of the risk economy we currently live in and suffer under.
Hobbs said that what Burnham has been saying is really encouraging and that Thames Water should be a public company, however, public control and ownership are not the same.
It was also noted that with the water and energy industries we do have public control through regulation, but it is clearly not enough.
There are no immediate plans to take back Thames Water. It was argued that companies could be taken into special administration tomorrow and Burnham could put companies under pressure to perform better and if they go bust bring them back into public ownership.
The government has an important role in defining what is acceptable and this is a patriotic issue and a vote winner. Burnham should be going further now, while he is popular. Essentially, Burnham should be standing up for the public and clearly regulatory reform is not enough.
McGaughey then reiterated that we do have public control and that regulation should be setting the right standards and making sure that the taps keep running and the problem of huge CEO bonuses is fixed. However, within the present regulatory framework the water companies push as far as they can and pay shareholders what they can before being stopped. Consequently, standards keep getting worse and debts rise higher.
Instead of this system, water should be a public good owned by us and while lobbyists for water companies say it will cost a lot of money, they are of course paid to say this by water companies. In fact McGaughey has calculated that if we take over a failed water company it would cost us virtually nothing.
McGaughey then said that it was that we could take the whole water industry back including failed companies for £12 billion. We could take Thames Water back now and have a10 year plan for the rest, as some of the present water companies are not so bad so a long-term plan is needed. All this could have begun in the first week of the present Labour government.
It was also noted by Compass that the cost covers a few things, but the lack of information about the level of investment needed is not forthcoming as water companies are not saying what is needed.
Hobbs then pointed out that we need to get inside water companies to find out what is happening. Feargal Sharkey has said that the lack of investment since 1989 should be a liability as companies are simply extracting profit and not putting money back in. There is going to be a mess to clean up, but money should be put back into the infrastructure.
Who should run the new water companies?
Hobbs said that users, trade unions and environmental groups should be on board and that the government should allow wider society to be represented.
McGaughey talked about what do we do with the debt that the private water companies have accrued and talked about where the funding will come from when water is back under public control.
At present, the government doesn’t have funding and it comes from bills. However one third of the funding now goes to shareholders and this money could go to the infrastructure, paying workers fairly and reducing bills. Both Berlin and Paris are cities whose water provision provides examples of how this kind of system works.
Hobbs and McGaughey both support users, workers and others being on the boards of new companies and Hobbs pointed out that there is an opportunity with unions and public service users having a representative as well and that across public services as a whole we could vote for watchdog members.
Compass also argued that the public need to own the assets not just the governance of new water companies.
McGaughey said that he would accept mutual or cooperative companies if we could have not fully public owned water companies as it would take away shareholders but there must be representatives on the board. Wales has a water mutual company, but it is failing as it is top down in its management.
Instead, public ownership is the best solution.
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