Rodney Hide wrong, says Right to Water

Rodney Hide’s statements that proposed laws will not allow for privatisation are wrong, says Right to Water.

The Local Government Act 2002 Amendment Bill 142-1 removes clauses that require councils to maintain ownership and control of water when aspects of water delivery are contracted out. It also increases the length of time councils can enter into such contracts from 15 to 35 years.

"Any ordinary person would say that a law that allows companies to own water for 35 years is privatisation," said Right to Water spokesperson, Maria McMillan.

"But if you're going to be fussy about it, then there is a wealth of global literature that confirms this common understanding. Princeton University professor, Paul Starr's seminal 1988 article defines privatisation as '(I) any shift of activities or functions from the state to the private sector; and, more specifically, (2) any shift of the production of goods and services from public to private.' Under either definition the Bill is about privatisation," said Ms McMillan.

"In fact, it is difficult to find any academic literature that adopts the very narrow definition of assets being sold for perpetuity as the only type of privatisation which is what Hide is claiming," she said.

"The new model of long-term contracts is the dominant model of water privatisation in the world. And it is lauded internationally by the private water sector as it allows private companies to carve off the profitable parts of the water sector while the public sector retains the burden of long-term maintenance and ultimate responsibility," she said.

“It’s astonishing that Rodney Hide keeps denying this is privatisation. He’s either being overtly disingenuous or he hasn’t got a grasp of the facts.”

"Semantics aside, the real issue is that the bill, if passed into law, will put water in the hands of private companies. It will mean higher costs for New Zealand councils and ratepayers, and it will greatly enhance the ability for private companies to make profit from a necessity of life," she said.

More information: http://www.righttowater.org.nz

Paul Starr, "The Meaning of Privatization," Yale Law and Policy Review 6 (1988): 6-41: http://www.princeton.edu/~starr/meaning.htm

ENDS

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