English water, anyone?

The Stonemason has blogged about the eagerness of the Adam Smith Institute to see Glas Cymru (which owns Welsh Water) subjected to the “disciplines of private sector ownership”.

While it’s no surprise that they are calling for a successful publicly-owned company to be used as a cash-cow for shareholders, I feel I must unpick this particular assumption.

The issue of “discipline” relates to the principle-agent problem. How can those running a company be held accountable to its owners?

The Adam Smith Institute may argue that privatisation has been a wonder – but this is only true for shareholders. And some of these shareholders are ordinary people who are facing huge bills because of prices that go up when costs go up and stay up even when costs go down – yet they cannot as shareholders demand this of the company.

Because Glas Cymru is a company limited by guarantee its purpose is not to maximise the dividend paid to shareholders but to meet its objectives of providing high quality water and sewerage services to customers. This year each customer of Glas Cymru will recieve a dividend of £21.

Now, I’m not saying that it has the most socially-just model of ownership.

The company’s workforce – and the employees of contractors – should be regarded as stakeholders just as much as consumers. The objective of high-quality service cannot be met if workers are disempowered; good wages, working hours, and democratic representation ensure that high standards are maintained.

The remit should also include efficient use of energy and minimising any negative effects on the environment or natural wildlife.

Though Glas Cymru may not be perfect, it looks a damn sight better than what we have in England! We are being told that the only way to lower our bills is to have the profiteering water companies competing with each other. We have this with our gas and electricity suppliers – but do our bills come down? No, they compete with each other to squeeze as much money out of customers!

Privatisation has been a disaster. Public assets sold off at knock-down prices to the friends and sponsors of the governing party (Tories, now New Labour). Prices have been allowed to skyrocket -natural monopolies are milked for profit by colluding suppliers in gas, electricity, and railways. Rather than seeing greater private investment in our railways, more public money is invested in rail than ever before!

The likes of the Adam Smith Institute can try all they like to convince the public of the benefits of handing public resources over to big businesses. Their nonesense is only heeded by those politicians hoping to get cushy non-jobs in business after they leave office.
We need to return the privatised utilities to public ownership and democratic control, with the involvement of workers and consumers in the process of management.

Surveys of public opinion have never found a clear majority in favour of privatisation – and with the credit crunch being perceived as resulting deregulation and demutualisation, more and more people will begin to see the necessity of reversing the neoliberal era.

Privatisation of water and sewage services did not take place in Scotland or Northern Ireland. Scottish Water is owned by the Scottish government and both the incumbent nationalist party and the opposition Labour Party are committed to the company remaining in the public sector. The Scottish Tories are for privatisation, but are at pains to point out they don’t want what has happened in England! Northern Ireland Water priovides water and sewage services in the six counties; like Scottish Water it is still part of the public sector.

So, there’s Northern Ireland Water, Scottish Water, Welsh Water – how about English Water?

Advertisements

Brown gets a coat of red paint from the press

I give you the red-wash:

 1. Gordon Brown’s class war attack on Cameron

2. Gas and electricity bosses told ‘give back profits’, Energy giants told to help poor or face levy

3. Gordon Brown to curb second home ownership

The reality, of course, is somewhat different…

Tensions between Gordon Brown and the trade unions were exposed at the closing session of Labour’s spring conference yesterday when the leader of the affiliated unions rejected the prime minister’s call for a commission on agency workers.

Tony Dubbins, the chairman of Tulo, the group representing unions affiliated to Labour, angered party officials when he demanded talks quickly on a second wave of pro-union reforms and said unions should oppose attempts to cap their donations. [Emphasis added]

Second wave? Whatever happened to the first wave? We are hardly witnessing a tsunami of socialist measures…

Look who lunch with, and donate to, New Labour:

Lord Sainsbury, 67, Labour’s most generous donor, giving more than £8 million since 2002.

Still large stockholder in supermarket chain that bears his name. Junior Minister for Science under Tony Blair, resigned in November 2006 to spend more time working on charitable causes. Questioned by police over the cash for peerages

Jon Aisbitt, 50, director of Man Group, Britain’s largest hedge fund firm, thought to be worth more than £100 million. Has donated £250,000 annually to Labour over past three years.

Also gave £250,000 to Mr Blair’s 2005 election campaign and pledged £2 million for city academy in Brighton

Martin Littler, 59, chairman and CEO of Oldham-based Inclusive Technologies, said he had given around £15,000 to Labour and was “flattered” to be invited to dinner

M T Rainey, or Mary Rainey, 52, former advertising executive, close to Mr Brown. Set up mentoring networking website, horsesmouth.co.uk, launched last year at No 10 reception.

Non-executive director at Scottish Media Group and WH Smith, founded Rainey Kelly Campbell Roalfe. Says she has given small amounts but not enough to register with Electoral Commission

Sonny Leong, 55, from Chiltern, Oxfordshire, chairman of airline chartering service One Charter plc, has given £56,755 to Labour since 2004.

Came to prominence last month after Alan Johnson was criticised for registering late donations, including £2,000 from Mr Leong. Previously involved in successful publishing ventures

Bill Bottriell, 50, from North London, founded online recruitment company SThree which floated in 2005. Has given £48,000 to Labour’s HQ since then, but came to attention last year when Mr Hain failed to declare donations including £5,000 from Mr Bottriell towards deputy leadership campaign.

Reportedly a Tottenham Hotspur shareholder, once paid £1,700 for tour of No 10, auctioned by Cherie Blair to raise funds for sons’ school, the London Oratory

Stefanos Stefanou, 66, chairman of Hertfordshire construction company John Doyle Group plc, has given £40,000 to Labour. Donated to Harriet Harman’s successful mdeputy leadership campaign.

Appointed OBE last January for services to construction industry.

Why public ownership of public utilities will be cheaper for the average family…

I give you this, from the Torygraph by way of explanation:

Bills reach £42 a day as cost of living soars
By Lewis Carter
Last Updated: 2:45am GMT 03/03/2008

The average British family is having to spend £42 a day on bills, as the cost of living continues to increase.

* Phone firms profit from cash or cheque fees

Household bills have risen to £3,426 a year for the typical family, it is claimed, a figure that will rise again next month when council tax and water bills increase.

Added to the average mortgage, which costs almost £12,000 a year, it brings the annual bill to more than £15,000 – or £42 a day.

Data shows that mortgage costs have increased by an average of £600 from this time last year as a result of Bank of England rate rises and the impact of the credit crunch.

But it is the rising cost of utilities which is squeezing finances.

So folks, we need a Campaign for Public Ownership.

Don’t expect the Torygraph to start plugging it…