John Tamihere and water – flaky opportunism
If there was any doubt – and there has been a lot of it about in progressive circles – that John Tamihere was much more than a flaky opportunist then those doubts have surely sunk without trace with his mayoral campaign announcement that he wants to sell 49% of Auckland’s Watercare to overhaul water infrastructure and make Auckland beaches swimmable.
Privatisation of water supply – like all privatisations – would accelerate inequality in Auckland just as Labour and National’s privatisation policies of the past 35 years have done so.
Auckland’s current Mayor Phil Goff is right to point out that it’s a dumb idea and makes no sense.
He (Goff) said a buyer would want a return of 7-10 percent on the investment, and that would be added to Aucklanders’ water rates, disproportionally hurting families with children and low-income residents.
“What this will effectively to is push up every Aucklanders water rates by two to three hundred dollars a year,” he told Morning Report.
“It takes an essential service, water, which is a monopoly out of public control and accountability and you pass control to private sector which is focused on the return that they make on that investment.
It’s a pity Goff didn’t use this simple insight when he joined Labour’s charge to sell state assets in the 1980s. Goff was one of the most right-wing of the fourth Labour government’s MPs and will be forever remembered as the MP who introduced the most vicious, regressive tax imaginable – GST – and as the person who first forced students to pay fees for tertiary education.
Goff is holding back on selling water services – not for any philosophical reasons – but because he knows it’s an unpopular policy. (It’s worth remembering in passing that there has never been a public majority for the sale of ANY public assets since 1984 – not that that worried Goff back then)
Selling the shares to ACC or the Super Fund as Tamihere proposes would not alleviate the regressive character of the sale or its impact on those who pay the most for water charges in Auckland – large Maori and Pacifika families.
So the Auckland mayoralty is shaping up as a right winger Vs a far right winger.
You can decide for yourself which is which.
They are both just so awful.
Oh, you are sounding so much better Zack. That’s a relief.
Privatising monopoly assets is just stupidity, without competition prices will get ramped up and up by revaluing assets to replacement cost, marginal cost of replacement or even market value. This enables constant price increases to provide the acceptable level of return on assets.
This is exactly what has happened with electricity generation assets, where dams that produce energy at a cost of 4 cents per kWh have been revalued upwards to reflect the marginal cost of electricity generation via gas turbines and this value then used to justify 34 cents per kWh charges or whatever it is.
And it is exactly what has happened with the electricity lines network in Auckland as well.
The other issue with a privatised monopoly that can generate a set return on assets is that it is to their advantage t have more expensive assets, so you end up with inefficient infrastructure and the builders of that infrastructure making obscene profits at the expense of ratepayers.
The public is going to have to get used to hearing about local and central government project regularly exceeding $1 billion dollars. These unicorn projects although rare in the past is dependant on those negotiating the terms of these unicorns. Top of the list of demands should be secure drinkable tap water plus a renegotiation clause. And if those demands are not meet then the city can just walk away from the project.
Y’know and local and central planners have new budget resources at there disposal. As long as the minimum wages is lifted to $20.20 and indexed to inflation then sharp costs of living should be manageable.
Minto is onto it. There is no future for screwed up Auckland, he must have known, hence he moved to the south.
Thank goodness for John Minto. If Tamahere is your answer then the question wasn’t worth asking.
I’ve given up! Next year I will go to a voting booth AND ….. invalidate my voting form by writing on it “A PLAGUE ON ALL YOUR HOUSES!” IMO, it doesn’t matter what “colour(s)” government “we” have, no government truly gives a S..T about the people. Look at the annual increase in MP’s “pay” which we – the people – never have any say in – let alone the gold-plated super scheme that EVERY MP voted FOR in the dark of night back when?! I am more than disgusted!