For how much longer must the water utilities are rip us off?

A good question, no?

Here’s an article from Socialist Appeal:

Severn Trent: the case for renationalisation
By Eric Hollies
Tuesday, 03 June 2008

Severn Trent Water has already been fined £36m in April. It faces another fine of perhaps £70m for vast frauds on its customers and upon the general public. Here’s the story.

The water companies were privatised by the Tories to harness ‘the dynamism of private enterprise’ to the water industry. Most people at the time didn’t realise there was a problem with the water supply. They could turn a tap on any time and water rates were low. There’s a problem now – the problem is private ownership.

In April Severn Trent were done for falsifying a report to Ofwat, the useless regulator of the water industry. The Serious Fraud Office found that Severn Trent had been lying about its performance in order to inflate the bills to its 8 million customers.

Now it has been caught lying about the amount of leakages from the water supply. One justification for privatisation was that the private firms could afford to deal with leakages. Well, they could afford to, but they find it much more pleasant to pay the money out in dividends to their shareholders. Thames Water, for instance loses one third of its water supply in leaks. The present court case showed that Severn Trent falsified its losses as 340 megalitres a day when the real figure is 514 megalitres. This is not just a cover for incompetence. The prosecution showed the firm was using ‘sophisticated dishonesty.’

Part of the evidence was an email from the leakage manager of Severn Trent who, the SFO showed, had devised a ‘template for deceit’. In his email, titled, ‘Lies, damned lies and statistics’, he wrote, “You asked me, ‘are you telling porkies?’” [pork pies = lies] “My answer is, I have done what I believed was necessary to deliver a certifiable 340 megalitre target. Because I was unable to do that within the bounds of credibility, I have had to be selective in the data I have used and put forward.

“I think it depends on your definition of porkies. I have been economical with the truth. I think I have had to go too far.”

The court decided that porkies had indeed been told and fraud committed.

Water bills are due to go up by 6% this year, twice the official rate of inflation. The water companies are due to make £1bn this year, 20% up on last year. Invest it in the industry? Not likely. £700m will go straight out as dividends. The water companies are having a laugh.

It is clear the water companies think that Gordon Brown and New Labour are fools. They are not far wrong. Severn Trent has committed real crimes with real victims. We ask Gordon Brown – how many frauds do these firms have to commit before they are sent packing without compensation, and water taken back into public ownership where it belongs?


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