Shocker! New poll reported in the Daily Mail and Politics Home reports that public support for bringing water into public ownership has halved. People – apparently – have seen the error of their ways. They don’t, after all, want a government to bring water into public hands.
Great headline, but let’s dig a bit deeper. When we do, we’ll see that these figures aren’t worth the paper they’re written on.
1) This polling is funded by the water industry
You can see more of the ways these companies have failed the public on our website, while raking in the profits. It's clear that they benefit directly from privatisation, and don't want to lose out through public ownership.
2) The polling confuses ongoing spending commitments with smart public investment
describes nationalisation as public spending, and then asks people to choose between spending money on the NHS, the police, schools and so on – vs bringing water into public ownership. But this completely misses the point.
Bringing water into public ownership is not an ongoing spending commitment. It’s a wise investment that will bring in £2.3 billion in savings
every year for the public purse. It would pay for itself within about 10 years. So it’s a great deal for the public purse and for everyone who uses water (that’s everyone).
3) The polling is based on false information about the cost of buying back the water companies
The polling refers to the Social Market Foundation report
which claims that renationalisation would cost £90 billion. This report was itself funded by Anglian Water, Severn Trent, South West Water and United Utilities!
And its claim is simply not true. Parliament can decide how much to compensate shareholders. We can compensate shareholders for the money they’ve actually invested in the industry, not for full market value. So that would cost us around £18 billion, not £90 billion. Then we would SAVE money, year after year
, because we wouldn’t be paying out dividends to shareholders, and investment in infrastructure would be better value because of the lower cost of capital.
As Professor Dieter Helm points out
‘The actual nationalisation process is relatively straightforward…The SMF seems to count investment as a public expenditure, whilst neglecting to count revenue as public income’. He says its analysis is ‘nonsense’ and that the number of £90 billion should not be taken seriously.
Yet it’s this £90 billion figure that the polling mentions, contrasting it with a lower number of £18 billion dividends given to shareholders in the last decade, before asking people for their views on public ownership.
It's our water, and we'll be taking it back
Water privatisation is an 'organised rip-off' according to the FT. And we’ll be taking back OUR water as soon as we can.
Photo credit: Balaji Chandran