The statement ‘nothing of note has happened over the Christmas period’ in my last post now looks rather foolish. When I wrote it, thousands of people had already been without water for several days, and since then the crisis has (I hope) peaked but not yet been entirely resolved. Many people have been working very hard to improve the situation, including Belfast City Council, the Red Cross, lots of politicians from all parties, Stephen Nolan and others in the media, and of course the employees of Northern Ireland Water.
It’s been announced that there will be a full inquiry into the ‘operational failure’, and ominously, the Secretary of State is making noises about changes to the structure and financing of water services in NI, making it clear that privatisation should be on the agenda. But the real difference between NI and elsewhere in the UK is that, in NI, large-scale investment is more recent. Scotland’s water isn’t privatised and they have coped better.
As well as an inquiry into the event itself, a strategic review is needed which should cover the following five points, which seem to me as a voter, taxpayer and water consumer to form a suitable framework for delivering an efficient water service:
1. A safe supply: this hasn’t currently been an issue here, but ask Galway residents about the possibilities. Safety must always be the first priority.
2. Conservation measures: Reservoirs have been low or empty recently due to burst pipes, but could be so in future due to heavier usage. The water agency needs to put out the message that water conservation does not have to affect health. The people who know about this are the Australians.
3. Method(s) of investment in infrastructure: The issues here are how to increase investment levels, how to implement a programme of improvements more quickly, and how investment will be repaid. It also seems odd that there are plans to sell off reservoirs.
4. Methods(s) of payment for water: This is currently the most controversial and politically unpopular aspect of water policy, although in future conservation measure may take over. A review should look at all options for revenue generation, including water rates; other rates and tax options; water meters; and penalties for businesses and landlords who cause significant loss of water through poor maintenance. The basic principles of water charging should be that the less well off are not penalised disproportionately, and the most difficult aspect of this is how to create a fair charging system that takes into account different household sizes. A means-tested water charge for minimum use per person plus a top-up meter system might work. Whatever about the detail, water rates should not be ruled out for populist reasons. The best argument against water rates is that it creates a separate revenue stream for the service, which then makes privatisation easier. I’m not aware that any politician in NI wants a privatised water supply, in which case the favoured option may be an increase in the regional rate.
5. Day to day management of the supply: need I say more? Review governance and leadership capacity as well as structure and communications.
It’s been interesting to observe the buck-passing once calls for resignations started. The Minister is blaming NI Water senior management and says he has no cause to resign. Senior managers are blaming the weather and under-investment. There have been a few comments elsewhere about recent changes in Board membership, but no suggestion that non-executive Board members should resign or be replaced (again). This incident should provoke a debate about accountability in Government Owned Companies.