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Saint John and Regina take note, the global trend is toward water remunicipalisation

As Saint John, New Brunswick and Regina, Saskatchewan pursue public-private partnerships for their drinking water and wastewater systems, a new report says that the global trend is in the other direction toward public ownership instead. The report – Here to stay: Water remunicipalisation as a global trend published by the Public Services International Research Unit, Multinationals Observatory and the Transnational Institute – highlights that there has been at least 180 cases of remunicipalisation in 35 countries over the last 15 years.

Amsterdam-based Transnational Institute researcher Satoko Kishimoto says, “Despite more than three decades of relentless promotion of privatisation and public-private partnerships by international financial institutions and national governments, this experiment has clearly failed to deliver its promises and is leading many cities to seek to take public control over water and sanitation management.”

The report reveals, “The factors leading to water remunicipalisation are similar worldwide. The false promises of water privatisation that have led to remunicipalisation include: poor performance of private companies (e.g. in Dar es Salaam, Accra, Maputo), under-investment (e.g. Berlin, Buenos Aires), disputes over operational costs and price increases (e.g. Almaty, Maputo, Indianapolis), soaring water bills (e.g. Berlin, Kuala Lumpur), difficulties in monitoring private operators (e.g. Atlanta), lack of financial transparency (e.g. Grenoble, Paris, Berlin), workforce cuts and poor service quality (e.g. Atlanta, Indianapolis).”

And it warns governments like those in Saint John and Regina to avoid entering P3s. It notes, “Policy makers and public officials who are considering transferring the management of water services to the private sector should consider the risks and learn from the mistakes of other local authorities. Rather than bringing the promised private sector efficiency and innovation, water privatisation and PPPs almost systematically produce negative long-term consequences for local communities and their governments. Terminating unsatisfactory private contracts before their expiry is not easy due to the risk of paying multi-million compensations.”

The Council of Canadians has called on Saint John city council to not pursue a P3 model for its new drinking water treatment plant and for Regina city council to abandon its plans for a P3 wastewater treatment plant. Many of the names of the corporate bidders for these systems in Saint John and Regina can also be found in this report that lists cities where global remunicipalisations have occurred.

We are also concerned that the Harper government is both requiring P3s for critical municipal infrastructure and seeking the conclusion of the ‘free trade’ agreement with Europe. We have highlighted that leaked documents have shown that the Harper government was unwilling to exclude drinking water, sanitation and other water-related services from the investment chapter of the Canada-European Union Comprehensive Economic and Trade Agreement. That provision would essentially lock in existing privatizations and encourage more private delivery of water services.

To read the 16-page report Here to stay: Water remunicipalisation as a global trend, please click here.