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NEWS: Toronto Star supports full cost water pricing

The Toronto Star comments on the proposed Ontario Water Opportunities and Water Conservation Act today.

They write, “The best way to conserve enormous quantities of water would be to fix our aging and leaking water mains, which waste some 25 per cent of the water that flows through them. And, in this respect, the Water Opportunities Act is likely to have little impact. It would allow for regulations requiring municipalities to develop water conservation plans, but it is silent on how the necessary billions of dollars would be raised to replace or upgrade tens of thousands of kilometres of water pipes.”

“In the short term, improvements will require higher water rates, which are unpopular with voters. So the politicians are loath to raise rates high enough to pay for the necessary infrastructure.”

“To address this problem, Liberal MPP David Caplan, a former minister of infrastructure, has introduced a private member’s bill (Bill 237) that would set up publicly owned corporations to establish water rates that would be adequate both to provide safe water today and build the necessary infrastructure to maintain water quality in the future. But the bill will go nowhere without government support.”

The Toronto Star concludes, “Full-cost water pricing was one of the suggestions made by the judicial inquiry under Justice Dennis O’Connor that probed the tainted water disaster in Walkerton, Ont. …Given that our water systems are still woefully underfunded, the government should revisit this idea.”

This has already been seen in the global South and the agenda has been evident at the World Water Forum.

In Blue Covenant, Maude Barlow writes that, “Increasingly, throughout the 1990s, the emphasis was on full-cost recovery for the (private water) companies. By 2003, reported Public Citizen, 99 percent of (World Bank) loans promoted full-cost recovery for the private companies.”

Daniel Moss writes, “At the latest World Water Forum meeting March 16 to 22 in Istanbul, the dominant view of water-management issues prevailed. Whether discussing the Parisian water system or problems in South African townships, the prescription was the same: full cost recovery, which means that agencies, even public ones, that provide water must recover the full costs associated with delivering the service. This leaves the door wide open for privatization of our water. Increasingly pro-water-privatization development agencies, such as the U.S. Agency for International Development (USAID), are insisting that consumers pay more for water.”

Moss adds, “Full cost recovery policy is immoral, claim organizers of the People’s Water Forum – an alternative to the World Water Forum advocating that water to be managed as a commons for all rather than a commodity for the profit of a few. Water commons activists point out that the full cost recovery strategy is applied only selectively. Poor users who consume the least amount of water bear a disproportionate burden of the cost. A better system would use progressive taxation programs to support public water systems just as they do public schools.”

Jeff Conant adds, “Two of the world’s largest private water operators, Suez and Veolia, the major shareholders of the World Water Council, have received the lion’s share of World Bank investments in water and sanitation, and, in their pursuit of full cost recovery around the world, have raised water tariffs and delivered poor service from Atlanta to Argentina.”

While full-cost recovery is common in many developing countries and hurts many poor people, apparently Germany is the only country in the global North that recovers the costs of its water system solely from charges paid by users.

In December 2002, the Ontario legislature passed Bill 175 which supports full cost recovery for water and sewer services.

In August 2007, the Ministry of the Environment filed regulations under the Safe Drinking Water Act, which sets out requirements for ‘financial plans’ which all municipal drinking water systems will be required to prepare as early as July 2010.

These regulations encourage both full cost recovery and full cost pricing, but do not require these approaches. (Full cost recovery requires systems to recover the full costs of the water services by any means, full cost pricing requires the full costs to be recovered through customer water charges.)

In response to the original legislation, the Association of Municipalities of Ontario said ten years ago that, “a move to full cost recovery makes sense in principle, particularly in the absence of any sustainable and predictable funding program for infrastructure.”

In response to the Toronto Star’s editorial, national water campaigner Meera Karunananthan has submitted a letter to the editor. We will also continue to follow this debate. Additionally, we will be submitting comments on the Water Opportunities and Water Conservation Act before the July 17 deadline for public comment. We will then be following it through the legislative process.

The Toronto Star editorial, http://www.thestar.com/mobile/opinion/editorials/article/811864–new-water-bill-lacks-backbone

Our action alert critical of David Caplan’s Bill 237, http://canadians.org/action/2010/bill-237-feb-10.html

Our campaign blog on the Water Opportunities Act, http://canadians.org/campaignblog/?p=3626

Our media release on the Ontario government’s most recent Throne Speech, http://canadians.org/media/water/2010/08-Mar-10-2.html

Daniel Moss’ comments, http://onthecommons.org/content.php?id=2463

Jeff Conant’s comments, http://www.ourwatercommons.org/feature/fixing-our-water-crisis-cant-be-done-corporations-are-exacerbating-it

A description of Bill 72 the Water Opportunities and Water Conservation Act, http://www.ebr.gov.on.ca/ERS-WEB-External/displaynoticecontent.do?noticeId=MTA5NzY0&statusId=MTY0Nzkw&language=en