Privatisation of CWA: What for?

The fundamental issue about privatization is that there are certain necessities of human life that fall under the category of public good which must never be allowed to be outside of State control. Water and sanitation which go together, and energy are two vital public goods which must ever be under the control of the State, because private operators will not be answerable either to government or to the public. Should they decide to boycott or blackmail, the government will be powerless to do anything and it is the public who will be deprived and suffer, not to speak of the risk of the country being brought to its knees. Since we are in a democratic set-up, government will be loathe to take any drastic action required, and will be forced to resort to legal procedures that are unlikely to yield immediate results.

Besides, private operators are entirely profit driven, and if they do not fulfil their promises of not laying off workers and creating jobs, once again they will create a difficult situation which will lead to confrontation with government and would require a long-drawn battle for resolution. And of course, the focus on profit will inevitably mean an increase in the price of the service. This is also the genuine concern expressed by consumer groups (such as ACIM) as well as other activists and union leaders, with the latter adding that since we are already making a contribution towards big infrastructure projects, they do not understand why VPM Collendavelloo is so hell-bent on the privatization of the Central Water Authority (CWA).

In fact, according to the Parliamentary Debates (Hansard) First Session Tuesday 29 March 2016, he said: ‘We have to be modern, we have to be efficient. And the only way you are going to go about it is with private sector participation. Yes, I have made up my mind and that is why I am a Minister’. (vide article by Chetan Ramchurn in Le Mauricien of April 17, ‘Le Forum’ page).

Is there any robust rationale to insist on privatization, or is there an agenda or ideology?

In an article on March 2, 2018 about privatization in the Financial Times of London, this is what we read about the water sector: ‘A recent poll by the free-market Legatum Institute showed 83 per cent of the public favouring taking the water system back into public ownership’, and this is also happening in a number of other countries as well. Furthermore, ‘sectors like water supply, where there is a clear natural monopoly, have proved particularly difficult to regulate. Price caps have failed to generate much productivity growth in the industry, and water charges have risen much faster than prices overall. Regulators have consistently overestimated the finance costs faced by water companies. Along with a failure to regulate balance sheets, that has permitted those businesses to load up on debt and distribute all the industry’s post-tax profits in dividends’.

And Collendavelloo still wants to privatize water supply?

To come back to his reply in Parliament, he has never to date spelt out what are the gaps in modernity and efficiency that need to be addressed. Nevertheless, the people have a right to query his assertion that ‘the only way’ to modernize and be efficient is to bring in the private sector.

Private firms usually provide technical expertise or management capacity. Are we to be fed the canard that in the 21^st century this country does not have management professionals of the calibre required to man the CWA efficiently? Or is it that there is something else in the privatization agenda that is not being divulged to the people? Why spend Rs 8.7 billion on new pipes and then hand over lock, stock and barrel to a private company?

As for the technical aspect, here we are on surer ground: in fact, we wonder whether before calling in the World Bank to assess the situation, and subsequently approving its recommendation of privatization, the authorities took into account the views of local experts in the matter? Indeed, we have to go no further than google ‘Integrated Water Resources Management Mauritius’ and look up the link ‘What Water Crisis? – Institution of Engineers, Mauritius’ to find a detailed and comprehensive paper about ‘Water supply in Mauritius’, authored by Raj H. Prayag et al., the ‘et al’ being qualified in a post-scriptum which reads, ‘This paper was written with inputs from engineers/experts (some who wish to remain anonymous and others who will recognise their inputs)’.

Are we to understand that the analysis and solutions proposed by our local experts are worth nothing, and that we absolutely need outsiders to come and tell us what to do? Do we wish to remain colonized? Nobody is disputing that foreign technical expertise may be required for certain specific matters – but let our own experts identify the need and source accordingly, and the sine qua non condition must be that the foreign experts must work with the local ones.

This said, the people must insist that all available documents should be thoroughly consulted by the authorities and serious attention be given to their contents. The paper under reference is a must read for all who are concerned about and take decisions about our water supply before we go down a path – privatization – that will lead us into spiraling debts besides other potential problems.

We will only reproduce the conclusions of that paper, and they speak for themselves – and for the Mauritian people:

‘It is seen that Mauritius receives enough rainfall (over 2000 mm/year) to cater for the national demand. On the other hand, demand for potable and industrial use has gone up by an average of 2% a year while the trend in rainfall is down by approximately the same percentage. Therefore the need to plan for capturing more rainfall through strategically placed surface reservoirs, as advocated by the numerous master plans MUST be implemented in the short to medium terms. Innovative technologies for recharging the aquifers must be developed, as a matter of urgency.

‘In view of the predicted exacerbated Climate Change driven uncertainties, the authorities should give the highest of priorities to securing water availability for its sustained development in the key sectors such as the social, economic, for ensuring agricultural productivities and food security.

‘There should be no Water Crisis in Mauritius if the Authorities implement the recommendations of the various master plans. The technical/engineering solutions are available and there are enough Mauritian Engineers with experience in this sector to make water shortage a thing of the past.’

What more needs to be said?

* Published in print edition on 20 April 2018