World Water Day

World Water Day, on 22 March every year, is about focusing attention on the importance of water. This year’s theme, ‘Nature for Water’, explores nature-based solutions (NBS) to the water challenges we face in the 21st century.  

Water is a human right according to the United Nations, which in 2010 declared that every man, woman and child should have access to clean drinking water and safe sanitation.  As the most precious life source the earth has to offer, without which humans cannot survive, the recognition of water’s importance to human beings as equal to their right to life and dignity goes without saying.

In Scotland, we take the provision of clean water from our taps and the safe removal of waste water for granted. Sadly, this is not the case in many parts of the world:

• 2.1 billion people lack access to safely managed drinking water services. 
• By 2050, the world’s population will have grown by an estimated 2 billion people and global water demand could be up to 30% higher than today. 
• Around 1.9 billion people live in potentially severely water-scarce areas. By 2050, this could increase to around 3 billion people. 
• 1.8 billion people use an unimproved source of drinking water with no protection against contamination from human faeces. 
• Globally, over 80% of the wastewater generated by society flows back into the environment without being treated or reused. 

This February, the European Commission published the Re-cast of the Drinking Water Directive. We have been waiting four years for this first concrete outcome of the European Citizens Initiative, following the Commission’s unambitious Communication in 2014. The proposed Directive, as the ETUC and others said at the time, is a step forward, but misses the opportunity to recognise the Human Right to Water. Now we have to mobilise allies in the European Parliament, the European Social and Economic Committee and the Committee of the Regions to push the European Union to commit to really implementing the Human Right to Water. Hopefully it will happen before Brexit, but I wouldn’t hold your breath.

In Scotland, we have the benefit of a largely public sector water service. Despite Scottish Water’s persistent reference to ‘the company’, they are in fact a public corporation. This public service delivers a quality service more cost effectively than private companies in England, despite the additional costs of managing water in Scotland. The private sector has crept into a few corners of the service through competition measures in the non-domestic market and through ruinously expensive PFI schemes. However, the core service remains in public hands. 

There is a case for greater democratic accountability and moving away from the regulation model that seeks to copy the private sector model in England and Wales. We could also do much more with water as an economic asset, something envisaged in the Hydro Nation concept. Sadly, that vision hasn’t been realised in full. I hope that is something Scottish Labour and other political parties will consider in the run up to the next Scottish Parliament election. 

The sharks are always circling around Scottish Water and we need to remain vigilant. Scotland’s water is not for sale.

Public sector top of the league for consumer trust

Scotland’s public sector water industry rates the “most trusted” sector among Scottish consumers at 68%. In contrast, private sector energy is one of the “least trusted” at 36%.


This is set out in a report by the consumer group Which? on consumer attitudes in Scotland. The report shows some interesting contrasts between the views of consumers north and south of the border.


Public spending cuts topped consumer concerns in both tables, but the concern was much greater in Scotland at 74%, compared to 62% elsewhere in the UK.


Energy prices are a bigger concern in Scotland at 67%, compared to 56% in the rest of the UK. However, 68% have not switched supplier in the past five years and only a quarter who considered it actually switched. Most though the price difference wasn’t worth the hassle.


Nine out of the ten most financially distressed constituencies in Scotland are in Glasgow. Western Isles is the least distressed.


Only 10% of consumers had a problem with public services in the last two years.


So good is public sector water delivery that Scottish Water’s expertise is in demand worldwide. The public corporation’s international arm has generated more than £8 million of turnover, in total, since it was established in 2012. It recorded a £200,000 profit last year.


Maybe public ownership is the right approach for other utilities!

World Water Day 2016

Today is World Water Day. The 22nd March is designated as World Water Day by the UN to mark the importance of water and sanitation.

This year's theme is 'Better Water, Better Jobs'. 1.5 billion people work in water related sectors and nearly all jobs depend on water and those that ensure its safe delivery. Yet the millions of people who work in water are often not recognised or protected by basic labour rights. The theme in 2016 is therefore focusing on how enough quantity and quality of water can change workers' lives and livelihoods - and even transform societies and economies.

In Scotland we benefit from a public water service, unlike the rest of the U.K. Recognised trade unions ensure that basic labour rights are protected and we have a high quality water and wastewater provision, delivered at a reasonable cost. 

However, we should not be complacent. The privatisers have been chipping away at Scottish Water for years.

Many of our wastewater plants were updated using the ruinously expensive Private Finance Initiative (PFI). Those plants are still managed by private water companies and even the Water Industry Commission has suggested buying them out.

Contractors have been taking over large chunks of Scottish Water. 92% of the capital programme is delivered by private contractors.

This year the Scottish Government awarded a £350m contract to Anglian Water to provide water and wastewater to the Scottish public sector. Anglian is one of a number of English water companies who are happy to take public contracts, but less enthusiastic about paying Corporation Tax. 

Finally, on the horizon we have the trade agreements, CETA and TTIP. Both of these put public provision at risk, by allowing corporations to challenge democratic decisions to return services to public ownership. For example, Anglian Water is part owned by Canadian pension funds.

The EPSU was going to press their enormously successful European Citizens Initiative 'Right2Water' today. It calls on EU institutions and Member States to ensure that all citizens enjoy this right, that water supply and management be excluded from “internal market rules” and commercialisation, and that the EU increase its efforts to achieve universal access to water and sanitation. Despite huge support for the Right2Water movement, the European Commission has failed to act. An unambitious Communication released by the Commission in 2014 has been followed by two years of silence and no concrete legislation.

The tragic events in Brussels meant today's event was called off, but the campaign goes on.

World Water Day is an opportunity for us to remember that the clean water and sanitation we take for granted is not available world wide. We should celebrate our public provision, but remain vigilant. The privatisation sharks have not gone away. 

Scotland's public sector water contract privatised. Confused? You should be!

A £350m contract to provide water and wastewater to Scotland’s public sector has been awarded to a privatised utility firm in East Anglia. Confused?

Scotland has a public water corporation, Scottish Water that is accountable to Scottish Ministers and the Scottish Parliament. Scottish Water is responsible for the provision of water and waste water services to almost all domestic and non-domestic properties and for maintaining the public system.

However, there is competition in the provision of customer-facing activities such as billing, charge collection, meter-reading and complaints handling for non-domestic customers in Scotland. This means that Scottish Water levies a wholesale charge on licensed retailers for non-domestic customers. Licensed retailers can agree their own charges with customers, subject to them being no higher than a default tariff set by the Water Industry Commission Scotland (WICS). Scottish Water is also a retailer; through its own retail arm Business Stream, which provides a service to the vast majority of non-domestic customers in Scotland.

The market was created by the Water Services etc. (Scotland) Act 2005. The then Labour led administration was persuaded that this was the least they could get away with due to the provisions of the UK Competition Act 1998. The 2005 Act prohibited common carriage and household competition and put a licensing regime in place for non-domestic competition. UNISON Scotland opposed the legislation and would argue that it has simply created an unnecessary bureaucracy. The claimed savings are almost entirely down to water efficiency measures that do not require competition to implement.

As the public bodies are non-domestic customers they come under this system of retail competition and the Scottish Government, actually the then Infrastructure Secretary Nicola Sturgeon, put one big contract for public bodies out to tender last August. It could be argued that this was not the best way to organise this tender.

It appears that Anglian Water has submitted the lowest price bid in an evaluation that was 50/50 price and quality. The Scottish Government is not obliged to accept the lowest bid, but it would have to have a good reason for not doing so under the utilities procurement regulations. In fairness, the Scottish Government had few options because the system of retail water competition is the ultimate in market madness. £350m will be paid to Anglian Water in Huntingdon, only for most of that money to be repaid to Scottish Water in wholesale charges. The cost of this crazy system is picked up by the taxpayer. However, it was unwise to include savings from water efficiency measures that should be undertaken anyway to spin out the alleged benefits of the contract.

It would also be interesting to know if the evaluation panel took into consideration the risk that this bid was a loss leader to give Anglian Water a base in Scotland. This is important because contractors who do this squeeze a margin post-contract from quality.

The direct job implications are not likely to be huge, but significant for those impacted. Competition only covers the customer facing services i.e. call centre, customer service and transactional staff within Business Stream.

This procurement also highlights the importance of addressing tax dodging in procurement, an issue UNISON and other civil society organisations campaigned for during the passage of the Procurement Act. There should be pre-qualification disclosure of company taxation policies and public bodies should be able to evaluate a tender on the basis of which company pays tax or not. Assessment of bids could make use of the Fair Tax Mark.

The significance with this contract is that Anglian is one of a number of private water companies who are happy to take taxpayer funded public contracts, but less happy to pay corporation tax. A consortium called Osprey, made up of asset and pension managers in Canada and Australia, owns Anglian Water. Corporate Watch reported that Anglian paid £151 million to its private owners, but just £1 million in tax in 2012, after an operating profit of £363 million. It avoids millions in tax by routing profits through tax havens by way of taking on high-interest loans from their owners through the Channel Islands stock exchange.

Anglian Water was described as a “significant repeat offender” in an Environment Agency report on polluters and was fined for polluting five years in a row. Friends of the Earth said of the company: “Clearly, this company is a classic example of a company which sees pollution fines as a legitimate business expense and doesn't care about the environment”. It would be interesting to know just how much weight the evaluation panel gave to this in their quality weighting.

Non-domestic competition is not the only area of privatisation within Scottish Water. Last year the insider web site Utilities Scotland submitted FoI requests to ascertain the extent of privatisation in the delivery of the water and waste water capital programme. In the last four years, 92.5% of Scottish Water’s capital programme has been delivered by private contractors, 7.5% by Scottish Water staff. By any standard that is substantial privatisation. This is on top of PFI schemes run by a variety of privatised water companies.

We are also concerned about the impact the Transatlantic Trade and Investment Partnership (TTIP) could have for Scotland’s public service model. The greater the privatisation, the easier it will be for overseas corporate interests to challenge our public water system.

Scottish Water works well, is good value for money and water customers support the corporation staying in the public sector. While there were limited options for the Scottish Government on this occasion, we should be aware of the pressures for privatisation and the lessons to be learned for future procurement.

 

Water is returning to public service delivery

Water privatisation is in retreat. Water and wastewater is returning to local authority ownership across the world.

The Public Services International Research Unit (PSIRU), Multinational Observatory, Municipal Services Project (MSP) and European Federation of Public Service Unions (EPSU) have released new research on the growing wave of cities worldwide that are taking previously privatised water supply and sanitation services back under public control, in a process called remunicipalisation.

Over the last 15 years, 235 cases of water remunicipalisation have been recorded in 37 countries, impacting on more than 100 million people. Moreover the pace of remunicipalisation is accelerating dramatically, doubling in the 2010-2015 period compared with 2000-2010.

After huge problems in the developing world, private companies have been shifting their efforts to the developed world. It is therefore interesting that recent remunicipalisation is concentrated in high-income countries, with 184 cases compared to 51 in low- and middle-income countries. The great majority have taken place in two countries: France (94), home of two of the world’s private water companies, Suez and Veolia, and the United States (58).

Transnational Institute water expert Satoko Kishimoto said: "This report shows that water privatisation, which has been promoted so heavily in recent years, is increasingly being rejected by cities worldwide after years of failed promises, poor services and high prices. The pendulum is swinging back in favour of public water, because of the strong evidence that remunicipalisation brings immediate cost savings, operational effectiveness, increased investment, higher levels of transparency and accountability."

The former Deputy Mayor of Paris Anne Le Strat, who was behind the flagship 2010 remunicipalisation of water in the French capital added; "Moreover, public water operators are now joining forces within and across countries to support and learn from each other so we can achieve the human right to water for all."

The book Our public water future: The global experience with remunicipalisation comes out as global leaders are gathering for the World Water Forum, which is dominated by private water operators and has been a key proponent of water privatisation in recent years.

The delivery of clean water and sanitation also has to be seen the context of a global water crisis with supplies running dry at an alarming rate. The world’s population continues to soar but that rise in numbers has not been matched by an accompanying increase in supplies of fresh water.

The consequences are proving to be profound. Across the globe, reports reveal huge areas in crisis today as reservoirs and aquifers dry up. More than a billion individuals, one in seven people on the planet, now lack access to safe drinking water.

We should therefore be doubly grateful that we live in a wet country with a public water service. And we want to keep it that way. Well, the public service bit at least!

 

Public water contract - ultimate in market madness

Paying a privatised English water company to provide Scottish public water to Scotland’s public services has to be the ultimate in market madness.

An article in yesterday’s SundayTimes reports that the Scottish Government is about to award a massive contract to provide water and waste water services for most of Scotland’s public bodies to Anglian Water, which is based in Huntingdon.

If you thought we had a public water service in Scotland, you might be a bit confused at this stage. Well we do, but it’s looking a bit frayed at the edges.

Scottish Water is a public corporation (even if it often wrongly calls itself a ‘company’) accountable to Scottish Ministers and the Scottish Parliament. Scottish Water is responsible for the provision of water and waste water services to almost all domestic and non-domestic properties and for maintaining the public system. There are some small scale privatewater supplies, largely in rural areas.

However, there is competition in the provision of customer-facing activities such as billing, charge collection, meter-readingand complaints handling for non-domestic customers in Scotland. This means that Scottish Water levies a wholesale charge on licensed retailers for non-domestic customers. Licensed retailers can agree their own charges with customers, subject to them being no higher than a default tariff set by the Water Industry Commission Scotland(WICS). Scottish Water is also a retailer, through its own retail arm BusinessStream, which provides a service to the vast majority of non-domestic customers in Scotland.

As the public bodies are non-domestic customers they come under this system of retail competition and the Scottish Government, actually the then Infrastructure Secretary Nicola Sturgeon, put one big contract for public bodies out to tender last August.

The driving enthusiasm for non-domestic competition was the WICS CEO – a well known supporter of privatisation. So keen that he promoted the scheme’s extension to England and Wales. UNISON has always argued that this arrangement is an expensive waste of effort. The WICS claims it has resulted in savings, but in practice these savings are all about water efficiency, not marginal differences in billing systems.

Non-domestic competition is not the only area of privatisation. Last year the insider web site ‘Utilities Scotland’ submitted FoI requests to ascertain the extent of privatisation in the delivery of the water and wastewater capital programme. In the last four years, 92.5% of Scottish Water’s capital programme has been delivered by private contractors, 7.5% by ScottishWater staff. By any standard that is substantial privatisation. This is on top of PFI schemes run by a variety of privatised water companies.

Weare also concerned about the impact the Transatlantic Trade and Investment Partnership (TTIP) could have for Scotland’s public service model. The greater the privatisation, the easier it will be for overseas corporate interests to challenge our public water system.

There is a certain historical irony in the Scottish Government exporting Scottish jobs to Huntingdon. The Earldom of Huntingdon was held by Scottish kings, most famously by David 1 in the 12^th century. He used the revenues to build several abbeys in Scotland and generally spruce up public buildings. On the other hand, Oliver Cromwell came from Huntingdon and he knocked down quite a few public buildings in Scotland. Also, a later Lord Huntingdon was a custodian of Mary, Queen of Scots – that didn’t end well either!

ScottishWater is a public sector success story, but we are only too aware that there is a powerful lobby for privatisation. As I said in yesterday’s Sunday Times, the gradual drip of privatisation will have reached a new high if this contract is awarded to Anglian Water. The privatisation sharks are still circling ScottishWater and we need to remain vigilant.

 

Scotland's public water service continues to deliver

Scotland's public water service continues to deliver high levels of investment with charge increases below the rate of inflation. However, they persist in disowning their public corporation status and we the consumer continue to waste £millions on bottled water

Scottish Water has published capital investment plans totalling £3.5bn for the period 2015 to 2021. The overall cost of delivering the plan will be £8bn. met by customer charges of £7bn and net new government borrowing of £720m. There will be a fixed nominal annual price increase of 1.6% for the years 2015/16, 2016/17 and 2017/18. Well below the rate of inflation.

Scottish Water said: "We expect that our future capital investment requirements will remain around £500 million per annum (in 2012/13 prices) as a result of increasing capital maintenance requirements and ongoing investment to improve services to meet customers' expectations in areas of water supply resilience and prevention of flooding from sewers."

These plans show the continuing benefits of having a public water service in Scotland that doesn't have to fund private profit. Not that you would recognise that from Scottish Water publications that talk about being a trusted 'business', rather than a public service. Scottish Water subsidiary, Business Stream talks about customers cutting £36 million from their consumption-related water bills due to the introduction of competition. This is simply nonsense, what's happened is that 'customers' have been helped to invest in water efficiency measures - nothing to do with competition.

Despite getting high quality water from the tap, the UK market for bottled water is now worth £1.6 billion per year and Britons drink more bottled water than fruit juices or wines and spirits. Consumption per person exceeded 34 litres in 2012, up from 26.9 litres in 2001 and is set to reach 40 litres per person by the end of the decade.

Given the fact that UK tap water is widely considered to better for you than the bottled variety and subject to more stringent safety checks, why do we insist on purchasing something which is up to 300 times more expensive than what comes out of our taps?

It is of course a triumph of marketing over common sense, but with a big environmental kick. Plastic bottles add massively to pollution and clog up landfill sites. Professor Paul Younger puts it well, “The bottled water industry is very largely a scam, and a very expensive one at that, in terms of both money and extravagant carbon footprint.”

So let's celebrate our public water service even if Scottish Water dreams of privatisation. We might also drink more of it and help the environment at the same time.

 

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