France Shows Why Water Privatization Is a Bad Idea

Food & Water Watch

Just 50 days before the World Water Forum and the Alternative World Water Forum take place in Marseille, France, the European Commission has announced formal anti-trust proceedings against French water companies Veolia, Suez and subsidiaries Lyonnaise des Eaux and SAUR.

The commission will examine whether companies have coordinated their behaviour in markets for water and wastewater services in France, in particular, with respect to elements of the price invoiced to final consumers. This follows several unannounced inspections at the companies in April 2010, where Suez was then fined €8 million for breaking a seal placed by the commission during the inspection.

“Food & Water Europe applauds the European Commission for its actions,” said Food & Water Europe Executive Director Wenonah Hauter. “This investigation shows why our water services should be publicly owned. The first priority of private water companies is shareholders, not communities. Private operators are known for trimming costs in operation, as well as cutting jobs and raising rates in communities they enter with no consideration for transparency.

“Even though there is strong public resistance to privatization, the public sector is helping the private water companies by providing finance, developing strategies, and even investing in these companies. At the same time, the ownership of private water companies in Europe has become all the more concentrated, overwhelmingly dominated by Veolia and Suez.

“In times of austerity measures and financial crisis, it is all the more important that there is transparency on the pricing of water services, especially when the business of these companies deal with a common good such as water.

“This comes at a bad time for the French water companies who are preparing the World Water Forum in the name of the World Water Council and have already seen their shares drop by around 5 percent following the commission’s announcement,” concluded Hauter.

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Food & Water Europe is a program of Food & Water Watch, Inc., a non-profit consumer NGO based in Washington, D.C., working to ensure clean water and safe food in Europe and around the world. We challenge the corporate control and abuse of our food and water resources by empowering people to take action and transforming the public consciousness about what we eat and drink.

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