Water campaigners in the UK have recently called for a public vote on whether the water industry should be renationalised.
A recent petition asking the UK government to nationalise water companies and create a non-profit has gathered over 26,000 signatures so far. They want the government to make the water companies public-owned again.
Who is behind the campaign for a referendum on water supply?
The campaign is being led by Oxfordshire-based organisation, Windrush Against Sewage Pollution (WASP). A recent Channel 4 docudrama called Dirty Business featured WASP leaders, Ash Smith and Peter Hammond, in their campaign against water companies.
Involved in WASP are specialists from different academic fields who have been investigating quality failures in water and sewage treatment. They do this via field work in UK waterways and desk-based research.
What are the water campaigners concerned about?
The WASP pair were first concerned about sewage pollution in the River Windrush and the environmental damage caused by it. Originally, their campaign was focused on Thames Water, which was found to have discharged untreated sewage into waterways.
Other concerns are the pricing increases and the prioritisation of profit in water companies. Recently, five water companies appealed to the competition regulator so they could raise water bills ostensibly to reinvest that cash into network improvements.
WASP has since expanded the campaign to a national call for a referendum to make water companies non-profit and publicly owned again. They hope that if nationalised, it will improve the current pricing and environmental situation.
When was water first officially nationalised in the UK?
The first nationalisation of water in the UK was via the Water Act 1945, replacing a fragmented private system. It was designed to give everyone access to clean, potable water and provide a consistent and more equitable supply across the country.
Before nationalisation, local authorities and land owners provided an unregulated supply. This meant that not everyone had access to clean water and waste removal, and costs and quality of supply varied wildly across the country.
When was water first privatised in the UK?
During the 1980s, many of Britain’s industries and infrastructures were privatised. Among them was the privatisation of water in 1989 by the Thatcher government.
The idea behind it was to provide additional investment in an infrastructure that was not fit for purpose any longer and provide a more efficient system. The government was unable to raise funds to fix the water system because of limits on borrowing.
It resulted in England and Wales having the only privatised water systems in the world. All the initial investment vastly improved the supply and quality of water compared to what was delivered previously.
But, more recently, the cracks have been showing in the private system with increases in bills, issues with sewage treatments and a huge anticipated shortfall in supply.
How would renationalising the water industry impact businesses?
According to some, the move to privatise water in the 1980s was a mistake, while the opposition would describe nationalisation as high risk and high cost.
For businesses, the main cost will likely be the bottom line of the spreadsheet. A nationalised system would mean that firms would not be able to switch business water suppliers to get the best deals and service.
They would be tied to a nationalised tariff, which could prove more stable, and without needing to pay dividends to shareholders, it could prove cheaper too.
The current private system already has investment in place to improve infrastructure through new pipelines, plants and reservoirs. These large-scale projects can provide opportunities for contractors and employees.
In contrast, a move to nationalisation could be an unknown quantity in terms of investment and therefore an unknown in terms of reliability of supply and shortfalls.
The stability of the network would depend on governmental budget commitment, and so could be at risk of underinvestment. If this were the case, businesses could be more vulnerable to fluctuations in supply and shortages.
What could happen next with the campaign?
Although the number is short of the 100,000 petition signatures required to force a debate, the government has given a formal response.
It recognises the concerns about pollution and infrastructure, but it denies that nationalisation will provide an answer to the situation.
In the meantime, the debate is ongoing as to the financial and environmental benefits of renationalising the water companies.
At this stage, we can expect to wait a lot longer before any big changes occur in the water industry, leaving the supply of water and treatment of sewage in the hands of private suppliers for now.
The good news is that businesses can continue to have control over who they choose to supply their water in England and Wales.
