Export of drinking water by public companies

Some weeks ago, there was an article in newspaper presenting anticipated plans of public commercial company for supply of drinking water (see: Mariborski vodovod bi vodo prodajal v Azijo, DELO, 17.10.2015) from Maribor (Mariborski vodovod) and according to this plans, the company would like to bottle drinking water and sell it to Asia. This is not the first attempt you can find in public that public companies would like to act as private ones and to sell drinking water. It is however a new approach towards market approach and also towards drinking water as a “product”, which does not need any production, is given by the nature and shall be the basic right of any single person on the planet. Looks like municipalities and their public companies realised that water can bring additional revenues to their budget and municipalities can also act as commercial entities. Both is possible, both is not prohibited, but at is questionable whether such approach is appropriate.

There are several reasons, why I oppose such plans:

–          first, because underground water in Slovenia, in most parts, sinks for years and since anticipated predictions for future are not good. From this point of view, it is not enough, that we estimate that there is enough underground water in this very moment, but one have to think, what will happen to our posterity in the future. Even though that there are huge supplies of underground water right now, this cannot be the sole  reason to pump and sell water. Like it is written in USA constitution in the preamble, but even there this is forgotten … “to promote the general Welfare… to our Posterity” ie. for our inheritors, one shall think applying the principle of sustainability. This by its own word means, that we have “to sustain” from actions which will have negative effects in the future. The facts, which can be visible in the yearly report (by ARSO; see: http://www.arso.gov.si/vode/podzemne%20vode/) of the underground water, the quantity and quality of it in Slovenia is sinking. Corollary we should take care of the underground water, thinking how to increase its quantity and not how to sell it.

–          public commercial companies are established by local communities with an aim to offer public services and not to make profits, not to use infrastructure built with tax payer money, for commercial purposes. Especially if the product of this services is not public good, i.e. it is good which belong to everybody. This is the case with (drinking) water. Even though that Transparency of Financial Relations and Maintenance of Separate Accounts for Different Activities Act is respected and public infrastructure is given certain pay back (in order to avoid state aid), a huge problem remains; can a public good, drinking water, be commercialised? Legally speaking, the answer is positive, but from doctrinal point of view, the answer is, on my opinion, negative. Of course, municipalities, public commercial companies, also individuals will oppose that point of view, usually saying, that this is a pure money one can get it.

–          But as I recall above, this is not the question of present, this is the question of future time. This is also a question, whether we can now act contrary to interest of our posterity, out children. Selling water is not an act of necessity for our generation, but this act of capital interest. It is an act of necessity to get financial founds and not the act of survival (necessity) of today’s generation. That is rather a huge difference. Municipality simply find out that there certain product in (i.e. under) their territory, which is of huge importance (value) which can they sell and obtain finance, additional sources, so badly needed in municipalities budgets.

–          We are facing with activities of companies that use to be activities which one can attribute only to the concessioners (which follows and support the idea of private interest and not public one).

For some time now, there is a procedure going on preparing a proposal to change Slovenian Constitution in a way, that drinking water would be defined as human right and that aces to supply of drinking water would be limited to public sphere. But actually, as we can see now, even public sphere – public companies, would like to act as private companies. It is question, huge question, whether it is really wise to give a monopoly to public companies and local communities. Seems, that this can be even more dangerous than to enable concessionaries to supply drinking water. Namely, public partner supervises every concessionaire; every concessionaire has to act within the auspicious of the public partner; we understood that public partner would limit concessioner in its private interests. But, if the public partner itself acts or would like to act as private company, than there is nobody to supervise what the public partner is doing. If such a public partner, a municipality, would like to explore underground water, not taking into account the above fact and interest of our posterity, the damage to drinking water supplies might be much bigger than done by the concessionaires. Namely, the concessionaries have no administrative power like municipalities. They, on the one hand, have that power, and they can define prices, adopt acts demanding citizens not be use rain water or to tax rain water etc, and on the other hand, they are independent from the State powers (once the permit to use water is obtained).  One shall therefore think not only how to limit concessionaires, but how to limit any private interest, even the one by public entities.

Categorised in: Blog

This post was written by Rajko Knez