Cllr Paul Donovan wants water returned to public ownership

This particular Thatcherite masterstroke was allegedly about bringing more money through private investment into the water industry.

It was said to be a revived infrastructure serving all needs, from investors to consumers - so much for the fantasy. 

The reality has seen more than 40 years of unscrupulous private investors asset stripping the sector.

Investor dividends have been prioritised, while debt has piled up. 

Leaking pipes, building reservoirs and dealing with sewage outfall have all been put at the bottom of the priority list by water companies.

The result is a water system that is an embarrassment to the country: sewage in the waterways, creaking infrastructure and higher bills.

The system has been mismanaged, while some greedy people have got very rich at the expense of everyone else.

Privatising public utilities has always been a nonsense.

Cllr Paul Donovan says that privatising public utilities is a mistake (Image: Paul Donovan) It does not bring competition and efficiency, but private monopolies with a license to exploit vital public resources. 

The only way these privatisations would work is if they were so tightly regulated that little profit was made. However, then the benevolent investors wouldn’t put their money in in the first place. 

Fortunately, things are beginning to change, with tighter regulation of water companies.

Directors have been made personally responsible for the damage, whilst rewarding failure has been restricted by withholding bonuses.

Although in the longer term, these vital public entities need to be put back into public ownership. This process is now underway in the rail industry.

Faltering water companies, like Thames Water, need to be taken into administration on the road to public ownership - no more bailouts or hitting the customer with higher bills.

Neither should the model adopted with the banks in the crisis of 2008 be repeated.

Then, the institutions were taken into public ownership, but once revived (at public expense), they were handed back to the privateers to probably do the same thing again.

There are encouraging signs of change, but the privatisation of water has created such chaos across our waterways that it will take time to resolve.

The whole infrastructure needs renewing, with building reservoirs and fixing leaks, as well as dealing with sewage outfall, all needing to be prioritised.

Above all, the industry needs to be run for the common good of all, not for the benefit of the few.

• Paul Donovan is Labour councillor for Wanstead Village ward, Redbridge Council and a blogger (paulfdonovan.blogspot.com).