This is just an incredible surprise, isn\’t it?

The most persistent and frequent polluters of England\’s rivers and beaches are the nation\’s 10 biggest water companies, an Observer investigation has revealed.

The largest possible pollutant of the water of the nation is the rivers of shit and piss that 65 million of us spray around. That the organisations which deal with this flood are then the largest polluters isn\’t all that much or a surprise really. You know, even if they dealt with 99.999% of it successfully then they\’d still be the largest polluters.

Simon Hughes MP, deputy leader of the Liberal Democrats, said: \”These figures are another indictment of the failings of our privatised water companies in England. Many of them make large profits, pay huge dividends, increase prices and pay little tax. When, in addition, these figures show they don\’t deliver clean water, the public is entitled to say that our monopoly water providers are neither good corporate citizens nor good stewards of our precious environmental assets.\”

\’N\’ you can fuck off \’n\’all. If you want to blame privatisation then you\’ve got to do one of two things: compare with matters before privatisation or compare with places which were not privatised. And anyone at all who thinks that water quality is worse now than it was in the 1980s needs shooting as they\’re obviously rabidly insane. Ofwat did in fact compare England, with privatisation, against Wales with a mutually owned system, Scotland with a government owned but independent system and Northern Ireland with direct government provision. And by all the usual measures, higher purity of water, less environmental damage, lower prices etc, England beat the rest. In fact, the systems ranked both by performance and levels of improvement went England, Wales, Scotland, NI.

You know, things got worse the more the government was involved. Funny that, eh?

12 comments on “This is just an incredible surprise, isn\’t it?

  1. Simon Hughes is just such an honest, trustworthy man. Like when he won his seat with a homophobic campaign against Peter Tatchell even though he himself is… Oh

  2. It’s always see-saw logic, really. A is not completely satisfactory, B is not A, therefore B would be completely satisfactory.

  3. Overflowing sewers are a result of rain, no? Bit harsh to blame water companies for the weather.

    Here in France the water companies haven’t actually killed anyone with their pollution, but the farmers have. Excess nitrate runoff from fertilisers encourages eutrophic growth of algae, which wash up on Brittany’s beaches and exhaust H2S as they rot. Passers by have indeed died as a result.

  4. Don’t ruin an ideological argument with mere facts!

    We know that the water companies make a profit and by definition they must therefore be evil!

    It is only your local organic farmer that sells his crops below costs that is worthy of praise.

  5. Hi Tim, interesting article, but I wonder why you limit the comparison to UK countries when one could look at the Swedish, not-for-profit, mutalised model, which IWA stats from 2007 (quickest to hand) for example, show that total cost for water per capita in Sweden for example, is around $600 compared to the UKs $900.

    According to a 2006 survey by NUS Consulting Group the average water tariff (price) without sewerage in the U.K. for large consumers was the equivalent of US$ 1.90 per cubic metre. This was the third-highest tariff among the 14 mostly OECD countries covered by the report.

    I don’t deny that water quality has improved, but you are comparing an under-invested old public system, with a privatised system which has had significant additional investment.

    This investment hasn’t come for free – consumers are paying for it through increased bills, and through continued government subsidies.

    The cost of capital for the private sector is significantly more than for public borrowing, so taking into account the need to pay dividends etc then its a tall order for the private sector to be so much more efficient that it can still reduce costs overall.

    In addition a lot of “efficiency” savings from privatisation come from just reducing employees wages and pensions, which in turn means more people whose income needs to be subsidised and supported by the taxpayer through tax credits.

    So maybe if you cherry pick which countries you compare against, then you might come up with the simplistic conclusion of “private sector good, public sector bad”, but looking at other comparisons, I see no reason why we cannot design alternatives to privatisation, which could realise better value for money for the public.

    The sooner we get away from this puerile notion / belief system that privatisation is a) the only option and b) will make everything all better again then the quicker we can make better progress. (This is not to say that centralised government control is a panacea either or that the old system was sufficient!)

    I think we need an alternative to the profit motive for the provision of public goods.

    I mean look at the privatised rail fiasco! The train operator with the lowest cost / subsidy per mile travelled is the publicly owned East Coast, and the supposedly efficient private sector operators like Virgin rail have received billions in public subsidies, yet still pay out 100s of £millions in dividends, and avoid tax on their ill gotten gains by putting their headquarters in the British Virgin isles.

    Tim adds: “I think we need an alternative to the profit motive for the provision of public goods.”

    Perfectly happy to consider alternatives for public goods. But I would demand that those who wish to so discuss know what a public good is.

    Hint: water isn’t one and sewage treatment is only partially one.

  6. In fact, just found an OFWAT report (perhaps the same one you mention) which shows in one of the many tables for example, that the cost of water and wastewater tarifs in 4 UK cities, is 2-3 times more expensive than the two main cities in Sweden.

    http://www.ofwat.gov.uk/regulating/reporting/rpt_int2007.pdf

    The report even comments that “Lower [tariff] costs in Sweden reflect that companies are not allowed to make a profit from water; consumption is also lower than in England and Wales.”

  7. Hmmmm – I take the challenge that ‘public good’ certainly needs to be clearly defined and that has caused me to challenge my own definition, so thanks for that. I am not formally educated in economics so was using ‘public good’ in a more generalised sense. I see that perhaps water might be more precisely defined as a ‘common good’ from an economic perspective.

    But is this nitpicking a little? Let me restate my proposition, and ask if you agree – I think we need to consider an alternative to the profit motive for the provision of common goods.

    I think the other thing that I would take issue with is this definition of UK water as ‘privatised’. Water is in a very highly regulated, quasi-free market, as in fact all markets are.

    Markets can all be placed somewhere on a broad spectrum where the two extremes might be called ‘free or privatised markets’ and ‘communism’. That these extremes do not actually exist in practice often passes people by.

    Modern ‘markets’ are not a natural phenomena, they are created designed and maintained by a sustained government effort to bring them into being. The belief that there is some natural state for markets, at which their outcomes are optimised (read ‘privatised’ or ‘free’ markets), and that if the designs for our markets differ from this optimum template, they will deliver worse outcomes, is a utopian fallacy.

    None the less this fallacy has permeated political discourse, and is used to prevent a process of experimentation with different forms of ownership, which might in schumpters terms, lead to some creative destruction and the identification of better models for provision of common goods.

    We have designed a quite bespoke market for UK water, with some quite elaborate arrangements, rules, structures and institutions designed to achieve a certain outcome.

    It just so happens that one of the features of the market we have designed is that private sector operators are allowed to provide the service and to make a profit on it. There is no reason why this should continue to be the case. Trying to draw conclusions that a more ‘privatised’ model is best seems disingenuous when we realise that ‘privatised’ is simply a spectrum rather than an easily defined unitary condition.

  8. Privatisation=deals between the fucking govt and their watery buddies. The water companies serve the wishes of the scum of the state (who “regulate” them) not the people who actually pay for the water. Ask yourself why we don’t have the reservoir capacity we need in this nation and why new ones are not being built despite the healthy cash balances of the water companies (also why the leak plugging/pipe replacing is going so slow). Because the green-poisonous slime of NuBluLabour want our water rationed by price–none of the old fashioned need-a-new-resi/build-a-new-resi for these scum. That would hurt Gaia–so your water bills are going up and if the very poorest won’t be able to afford a wash–do millionaires Cammie or Millie give a shit?.

    Private is better than public–when the customers buy directly from the producers–the thugs of the state must be kept out altogether.
    Remember–
    Socialim=pure evil
    Fascism= socialism-lite
    Social Democracy=fascism-lite

  9. @gm
    What made you pick Sweden for comparison? Have you ever been to Sweden? Not consider a largely empty country consisting of a lot of lakes joined together with strips of dry land might find the provision of water a tad less challenging than in high population density UK?

  10. @bloke in spain

    What you mean like Scotland, one of the countries that Tim compares to?

  11. @ geneticallymodified
    I’m older than Tim and I can remember taking ‘A’ levels when the local water company was municipally-owned. The whole school suffered from dysentry as a result: I had to exit the exam hall, under supervision, at one point and got a ‘B’ in my best subject; an ‘A’ in my worst subject, when the infection was past its peak and two distinctions and a merit at ‘S’ level..
    Some years later the Thatcher government introduced privatisation and the press, freed from constraints on reporting, revealed that South-West Water had, shortly prior to privatisation, fed a dangerously excessive level of aluminium salts into treated water.
    I do not care one iota about your theoretical lower level of capital costs: I care about clean safe water and some way to hold the providers to account. If you think subjecting ‘A’ level candidates to dysentry is acceptable I beg to differ.

  12. I’m not too expert on the water side of things, but on the rail thing: East Coast made *exactly the same amount of money for the government* as Virgin did over the same timeframe. The difference is, East Coast makes profits and hands the money to the DfT, whereas Virgin makes franchise premium payments to the DfT.

    This isn’t exactly surprising. Nobody who wasn’t utterly blinkered by ideology would expect “whether a given service is provided by a nominally public sector or nominally private sector organisation” to be a particularly major determinant of medium-term outcomes for that service.

    Managers and staff, sitting in the same offices and faced with the same problems, will tend to do more or less the same things no matter who the shareholder is.

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