Svetlana Slesarenok of a women’s organisation called MAMA-86 in the Ukraine has first-hand experience of the privatisation of the water utilities in the seaport city of Odessa. She describes how the take-over by a French multinational took place, says why she is against it and what she proposed to European Water Initiative improve public control over public-private partnerships.
Poverty is increasing in the Ukraine, and one of the reasons is the huge price increases charged for water. At MAMA-86, we believe that international financial institutions, such as the European Bank for Reconstruction and Development (EBRD) and the World Bank do not promote access to safe drinking water nor the sustainable development of the local economy in Ukraine.
Depending on the source of the estimates, Ukraine has between 28% up to 63% of its people living in poverty. Contrary to expectations, both the extent and the depth of poverty have increased. The polarisation of the population has been amplified with the poor have become even poorer and the rich even richer.
One of the reasons for the increase in poverty is the direct consequence of recommendations of the International Monetary Fund (IMF). The IMF required a 100% increase for the payment of municipal services in the Ukraine. This is an infringement of our constitution, which guarantees a basic minimum for social needs and charges linked to a guaranteed level of satisfaction. The cost of water services in most countries is less then 1% of GDP. In Ukraine, we now pay between 3.3% and 6 % of GDP for water. With the new level of pricing, low-income families in Odessa have to pay up to 33% of their income for water!
The Odessa water utility, called "Vodokanal", has been trying for some time to get credit for necessary infrastructure improvements. In 1998, Vodokanal worked with the World Bank on a study of the necessary improvements. It estimated that US$64 million was needed, of which US$14 million would go to pay for foreign experts. Vodokanal then requested this amount of credit from the EBRD, who requested a warranty that the Ukrainian government could not give. Vodokanal then formed a closed joint-stock company to provide a warranty on the basis of its assets. Despite this, Vodokanal was again refused credit from EBRD. This was strange because although EBRD was not willing to offer US$64 million to Ukraine’s public enterprise, it was immediately willing to offer the French company, Suez-Lyonnaise des Eaux, a loan of US$200 million for the same project.
Harming democracy
Negotiation of the privatisation by the Odessa local authority and Suez-Lyonnaise des Eaux and was conducted in secret. MAMA-86 and other NGOs - nor even state structures - could not get any information. This is against the law in Ukraine.
Following the negotiations, the mayor of Odessa was invited to Paris by the French company, where he may have received other things to make him favourable to a take-over. MAMA-86 successfully lobbied for an open tender procedure but the conditions were not transparent and the time delay for responding was short. Only Suez-Lyonnaise was well prepared.
MAMA-86 is against the privatisation of the Odessa water service because even though Vodokanal is an old-fashioned, badly-functioning, non-transparent monopoly, it is better for Odesssa’s citizen’s if the utilities remain in local hands. It allows some potential for influence, lobbying and reform. Citizens can have no influence on a French boss whose headquarters are in Paris. The involvement by this French multinational has led to a rolling back of public participation and to the neglect of multi-stakeholder solutions.
As part of the European women’s input at the Kyoto meeting of the World Water Forum, MAMA-86 and Women in Europe for a Common Future had an opportunity to propose a way of making the environment in which private companies and public facilities negotiate fairer. We proposed that the European Union should provide free, high-quality legal services to local authorities, national authorities and civil society organisations involved in public-private negotiations . Such legal assistance would help ensure public control over public-private partnership.
Action against flooding succeeds
MAMA-86 has not so far been able to take on the water multinationals but it has been successful in more modest action plans. For example, an organised response to flooding in the Luzanovka district of Odessa, a residential area of 1,200 inhabitants, brought results. The flooding had become a regular feature of life caused by overflows of polluted water from the nearby oil-tanker washing station. MAMA-86-Odessa began discussions in the local community and involved 80 local residents in serving a writ against the local authority. This was the first time ever that local citizen’s had dared to go against the authorities of Odessa!!
The next step was to organise two general meetings where MAMA-86 encouraged participants to make use of their right to take part in local policy making. Taken together, the meetings attracted half the population of the Luzanovka district. Ten thousand signatures were collected for presentation to the mayor of Odessa. MAMA-86 also called demonstrations. The colourful banners of those taking part attracted public and media attention near ministerial offices and the Supreme Council of Ukraine. After that, the women of Luzanovka were invited to take part in developing a plan to solve the problem. This was eventually accepted by the Odessa City Council.
The solution comprised various actions and a commitment that the oil-tanker washing station would be closed by the year 2000. A sum of US$7 million was found to construct a new sewer system, and it began operations in 2000. Public participation had worked!
Water for kids
This initiative started back in 1995, following a trip to Lima by two Environmental Health Officers from Bradford as part of a European Union funded project to help alleviate the problems caused by cholera. Although completing their task to the satisfaction of all concerned they felt they wanted to "do something" for the many people they encountered without access to safe water. The charity, Water for Kids, was established in 1996. It has projects in Peru, Tanzania, Zambia and the Gambia. To learn more or contribute, visit http://www.waterforkids.org/index.html
The full presentation by Svetlana Slesarenok is included in "Why women are essential for sustainable development", Results of the European Women’s Conference for a Sustainable Future, Célakovice, Prague, 14-17th March 2002, available from Women in Europe for a Common Future (http://www.wecf.org).
MAMA-86 aims to moderate between the authorities and utilities responsible for drinking water provision and experts and funders who can help find realistic alternatives to the current situation.
