The future control of the Irish Water Service.
The Position Paper says nothing in an overt fashion about the long term future and control of Irish Water, other than that it will be a “public utility”. The key question is whether this will be a public utility under public control or whether it will be under private, corporate control?
However, the language used and tone adopted throughout the document give very clear indicators as to indications and aspirations of the government. For example the Position Paper, under:
* The “Independent Assessment on transfer of functions to Irish Water” states as one of its criticism of the present system states:• “Funding regime exposed to variation in development levies, limited ability to access alternative sources of funding (e.g. capital markets) and low recovery rates of nondomestic water charges”. * Under “Functions of Irish Water” it states as an objective: • “Sourcing private finance for investment in capital projects”.
* And, discussing the role of the Economic Regulator vis a vis Irish Water the paper states: “Independent regulation of the water sector has been identified as a prerequisite if Irish Water is to source private finance for investment in capital projects.” The logic of all these statements is that the government envisions a major role for “private capital” in the water services. Decoded, this means that privatization is the medium term agenda. Clearly the Workers Party are not the only organisation who believe that this is the ultimate outcome of the present process. Since the previous government signalled the introduction of water metering numerous private water multinationals, Irish front-companies and new Irish operators have set up here waiting for their chance to make a killing.
The planned centralization of water supply as a national public utility and its subsequent privatization would fit seamlessly with the government’s present programme and actions. The government’s overall position on Public Utilities as outlined no later than Wednesday 22nd February, is that everything is on the auction room floor. Parts of vital national infrastructure, ESB, Bord Gáis, Coillte, and what’s left of Aer Lingus are to be sold off. These sales will raise minimal funds at this time, make very little impact on the scale of our national debt, make no impact on the €3.1 billion annual repayment on promissory notes. Experience has shown that it will lead to neither efficiency nor job creation as the still bitter example of Eircom clearly shows. It will however provide a bonanza for certain wealthy venture capitalists and will satisfy the ideological cravings of certain politicians and commentators.
The history of the privatization of the water service in the UK must be taken on board here. Under Thatcher’s privatisation the number of people employed in water and sanitation was cut from 80,000 to 50,000 in UK. This process started immediately once she came to power. The public utilities were asset-stripped and slimmed down in the name of modernisation. As the Irish experience of both Eircom and the Irish Sugar Company demonstrate this phenomenon is not a once-off UK aberration.
A new regulatory body (quango) called OFWAT was formed – this is what the new Irish Water board will eventually become. Some of the privatised UK companies are now being taken over by US and other multinationals and facing further “slimming down”. In the meantime the service to customers deteriorated while the costs continued to increase. 7