An article in the New York Times today (see below) is both funny and informative. It is about government plans to upgrade London’s sewage system, privately of course. There are concerns here about the environment, and about disruption during construction. But much of the discussion is about who is the most appropriate provider, the public or the private sector. The government, of course, says private.
A few points to make: Ann Rosenberg is surely right here when she says:
“The thing that sticks in my throat is that I will be paying for this until I die, and then my children will pay for this tunnel, which none of us will own but which will go into the asset base of Thames Water and its investors.”
And Michael Gerrard at Thames Water revives a hoary old bit of nonsense: “Londoners”, he says testily to objectors, many of whom, like Ann Rosenberg, catch a hint of the profit motive wafting on the breeze, “will have to contribute to their city’s future. If you want London to grow you must invest in the infrastructure.” Sorry, Michael, Londoners would be “contributing to their city’s future” even if your company was bypassed in favour of public investment. Sewage treatment wouldn’t be free. Londoners would contribute as taxpayers.
Of course, Michael Gerrard is not thinking of contributing. He’s thinking of profiting. And we should never forget that if the service is to be provided by the private sector it has to be profitable. So if profit margins aren’t satisfactory, prices will presumably rise (whatever makes me think that?).
But if the company goes bust? Well, the government that let the company loose on our sewage will try to persuade another company to take over the operation (British Gas, for example, or Tescos). If that doesn’t work, it will step in to pick up the pieces, pay for all the costs of failure, and set about providing the service itself from the public purse. All that will cost Londoners a great deal of money. So couldn’t we move straight to public, and cut out the nonsense in between? After all, it’s quite an essential service.
Anyway, here’s the article:
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