Bracing for hike in water rates

The Editor: All indications are that the country is being prepared for a hike in water rates rationalised recently by way of a calculation, in simple math, intended to prove that there is a short fall in WASA’s revenues and the public must make up this shortfall. The algebra of the equation however show a different picture, one in which this shortfall has been caused by successive Governments committing the people of this country to “Interim Operators” and  providers of desalinated water on terms and conditions that have left us all with massive financial debt.

This all began when Government awarded a contract to Severn Trent under an Interim Operating Arrangement (IOA) to, inter alia, provide Industrial Water and thereby free up a significant supply of potable water for domestic use (the now infamous Third Envelope that determined the choice of Preferred Proposer for the IOA was essentially about industrial water). For several reasons Severn Trent never provided the industrial water as contracted (some say they never intended to) although it was the main reason for the IOA award in their favour, and this left the country with an inadequate supply of water to provide for the anticipated needs of industry, most of which was foreign owned and operated.

Severn Trent and Wimpey therefore never delivered on what was the primary reason for the IOA. ie to provide a source of industrial water. Instead, WASA was left with increased debt, an increasing operational cost and an increasing demand for industrial water and consequently an inadequate supply of potable water. Government’s commitments to these industrial users were such that they were the priority — not you and I, the public. In order therefore to satisfy the growing demand of this prioritised group it determined that desalinated water should be looked at as a quick and manageable way of meeting the urgent need for industrial water, or so it was rationalised.

The water gets somewhat murky here (pun intended) but the approach sold to the public was one in which the desalinated water would have been processed and sold to WASA at and in turn this water sold to the industrial users at x + y with they amount, less a small deduction for handling, being profit accruing to WASA. If done this way, instead of letting the industrial users do their own desalination, it would have also meant that WASA kept its industrial base of customers which was, and still is, an invaluable source of revenue.

The approach that was eventually followed and which placed us, the public, in the bamboo was one in which a desalination plant, much larger than what was required to meet the demand for industrial water, was agreed to by Government/WASA. The latter also agreed to purchase all the water not required by the industrial users at a price above that at which water was being sold to domestic users (WASA sells water to domestic users at a cheaper price than it does the same water to industrial users). Because of these arrangements and related expenditures, and other inefficiencies, WASA experienced a significant increase in its operational cost and the proposed rate increase to the public is to cover this increase. In effect we are all now being asked to pay for the blundering and corruption of successive Governments. The real tragedy in all of this is that it appears there is no way out of this deal and we will have to keep paying for this desalinated water even if all our rivers begin to run free with potable water.

How could Government expect the public to continue blindly trusting its judgment?  Does Government really feel justified in asking the public to meet the cost for the supply desalinated water, which is the reason being advanced for the proposed rate increase? Isn’t this story reason enough to insist on integrity, accountability, transparency and most importantly intelligence from our leaders? Are there not many, many more decisions like it? The result of this wheeling, dealing and blundering is that the industrial users got their water and you and I are being called upon to pay for this and also pick up the tab for the wheeling, dealing and blundering of successive Governments. There are two other factors relevant to the argument against any increases in water rates. The first relates to the leakages in the water transmission and distribution system that result in a loss of around 45 percent of our supply. The second is the lack of an independent regime that monitors and measures the performance and efficiency of WASA so as to assure the public that, inter alia, the folly does not persist and that leakages of money do not approximate that of water.

The comedy of errors described above straddled both the parties currently on the scene with the same players still very much present and active and audaciously telling the public that it now has to pay for their folly and/or corruption. Because of this neither has the moral authority to challenge the other so there will be no true representation of the people’s interests from within Government or the Opposition on this issue.  Cabinet, in its esteemed wisdom, made all the decisions that have led to the current crisis and I would say, and most would agree, that Cabinet must be made to find a way to get us out of this crisis in a manner that does not further burden the public. In other words, like we all have to, Cabinet must be made to accept responsibility for its actions.

Eugene A Reynald,
Port-of-Spain