Thursday, May 18, 2017

Lepep Not Mandated To Sell Any Part of the CWA

It’s Not in Their Manifesto
Page 19 has five points under the heading of “Fourniture d’eau”. One such point is “Remplacement à court et moyen termes les tuyaux désuets afin d’assurer une fourniture régulière 24 heures sur 24…” Basic common sense when we know that 1,600km of our pipes – some of which are over 50 years old – need to be replaced, right? Another one is “Aménager des barrages dans nos rivières pour récupérer autant d’eau que possible pour être canalisés vers les stations de traitement”. Who will disagree with this when we know we don’t capture enough of all the rainfall that we’re blessed to receive every year? The three other points deal with the Bagatelle dam, emergency water trucks and reforestation. No mention of privatisation of any part of the CWA or subterfuges like affermage. Didn’t see any plan for the CEB to create private companies to avoid the Central Procurement Board either.

Did Lepep Change Its Mind?
If it has it will have to ask voters for their permission on such a fundamental issue because there is no way it would have won 47-13 in December 2014 if one of its electoral pledges was to mess up our public utilities one way or another. It can do that in two ways. One is to call for fresh general elections and the other is to organise a referendum on the issue. A referendum is a lot better as it would enlarge our democratic space and enable Government to get the clearest of signals. 

What’s in the Government Programme
Which is what paragraph 257 of the 2015-2019 Government Programme promised in any case: “Nationwide referendums will be held on matters of utmost importance and relating to public interest as well as on critical amendments pertaining to our sovereignty or Constitution.” Very few issues are as important as what happens with our water. Besides managing water is so low in the food-chain that if a Government wanted to sell any part of it – a management contract is a sale – then it would certainly mean it’s a good-for-nothing Government and it has to let the people tell it about it. Straight in the eyes. But there doesn’t seem to be much support to mess up our utilities in Government. 

No, It’s Mostly Collendavelloo 
Who is Hopelessly Out of His Depth
The guy has been bad-mouthing the CWA almost nonstop. Obviously this hasn’t gone down well with Mauritian voters. Forget voters, even people from his own tiny party have threatened to provoke a by-election over his stance. And Collendavelloo’s persistence in privatising the CWA has only led to the booby-trapping of his party. As confirmed by a recent poll we ran on Kozelidir which indicated that only Gayan and Rutnah would follow him into the opposition if he got what he’s been looking for: the sack. That was before Mr. Rutnah confirmed that he’s a little fed up.

Straight From Cry Freedom
When I heard Collendavelloo make his idiotic statements about the CWA it generated some strong feelings of déjà vu. They reminded me of the closing credits of Cry Freedom, a must-watch 1987 Richard Attenborough movie on the life of Steve Biko, the South-African freedom-fighter. Here's some of what's in there:

By Act of Parliament in 1962 the South African government legalised imprisonment without trial. Since that time, the following are the official explanations for all [for some as we’re short of space] known deaths in detention:

September 19, 1963         B. MERHOPE          no official explanation
May 7, 1965                    N. GAGA                 'natural causes'
January 5, 1967               A. AH YAN              'suicide by hanging'
September 9, 1967          A. MADIBA             'suicide by hanging'
February 28, 1969           S. MODIPANE        'slipped in shower'
September 27, 1969        A. HARON              'fell down stairs'
October 27, 1971            A. TIMOL                'fell ten floors'
March 19, 1976               J. MDLULI              'fell against chair'
December 14, 1976         G. BOTHA               'fell down stairwell'
July 7, 1977                     P. MABIJA               'fell six floors'
September 12, 1977        S. BIKO                    'hunger strike'
December 20, 1980         S. MATALASI         'self-strangulation'
May 6, 1985                    A. RADITSELA       'fell from police car'

Of course it was not a hunger strike that killed Mr. Biko in Police Room 619. And thirteen years later the Truth and Reconciliation Commission denied amnesty to five policemen connected to this event.

Throwing the CWA Against A Chair
Collendavelloo started by saying that he will sell it because he doesn’t like its hotline before making a surprising visit to Call Services Ltd (CSL) and deciding they were not good enough to handle calls. He has fooled no one: if many calls are related to leaking pipes -- every year as many as 50,000 of them are – and these don’t get fixed promptly how long does it take for the CSL to appear through no fault of its own as a dead end to customers of the utility?

Then he moved on to stating that the CWA has "got good engineers, good staff, good workers but a structure which will never give satisfaction." So do you privatise a utility because you think that the structure is apparently not good? Or do you rather simply upgrade the structure? How dumb is this? It’s true that the Minister confessed in Parliament in March 2015 that “…I am not an engineer, I am not a technician and everything that I have done in my life is only law. So, I need expert advice and I am going to put experts and not politicians at the Head of the CEB and the CWA. I am not going to do appel international and all that.”

Ismael Joins in the Bad-mouthing Campaign
Yousuf Ismael, the General Manager of the CWA has also been imagining insurmountable problems albeit on a much smaller scale. During a televised debate with ACIM’s Jayen Chellum he told the nation that the CWA has great engineers -- a familiar tune isn't it? -- but many of them are retiring. As if we cannot hire a bunch of them on contract and pair them with younger engineers in a mentoring relationship to ensure that precious organisation wisdom is not lost.

Ivan Collendavelloo then announced that people waste water because it’s too cheap and that he also needs to raise tariffs to spark the interest of potential strategic partners. Well, he doesn’t have to go through all that trouble as the ultimate owners of the CWA – Mauritian citizens – already find it very interesting. And they want to keep it that way. 

Water About the Last Inexpensive Item
Water may be relatively cheap but it cannot be considered in isolation – the CWA clocked in a cumulative surplus of over Rs700 million between 2012 and 2014. Petroleum pump prices are definitely not cheap. In fact they have been disconnected from what they go for on the world market for over a decade now despite having a pricing mechanism that was apparently automatic. This has been especially evident when international prices crashed on two different occasions. They were kept artificially high to make up for a huge Government revenue shortfall which had ballooned to a cumulative Rs139 billion -- 15% of the Sithanen Toohrooh -- at the end of 2016.

Food is Not Cheap
Electricity is surely not cheap when you consider the kind of profits that the CEB has been making over the past couple of years. It’s in the billions. So, suddenly we find that the services of these public utilities are not exactly cheap. Food for sure is also not cheap. As are so many things thanks to the silly policy of continuous currency depreciation. This includes your overseas holidays. We shouldn’t also forget that an extra 22,000 of our citizens were thrown in poverty between 2007 and 2012.

Ministers Neither
Our ministers are definitely not cheap. Especially when we look at what some of them deliver. Collendavelloo has probably costs us around Rs10 million since December 2014. That’s pretty expensive for the kind of continuous crap he’s been uttering. Still, that’s small fry compared to all the time and energy he’s made a whole nation waste. Surely we had more pressing challenges to attend to.

Causes of Our Water Problems Are Well-known
Basically these are system inefficiency -- our water network loses more than 50% of its precious liquid partly because of the leaking pipes – tens of thousands of meters don’t work and climate change has affected rain patterns. Too many voters have not been enjoying adequate service levels because defective pipes have not been changed at a fast enough speed – only 281km of pipes were laid between 2010 and 2014. We should also remember that our economy has grown by two-thirds in real terms since the Midlands dam came into operation fourteen years ago. Although the coming into service of the Bagatelle dam should help it doesn’t mean that we shouldn’t replace leaking pipes at a faster pace. 

And Easy To Solve
Change leaking pipes and system efficiency will improve. To that effect our government has created a Public Sector Investment Programme (PSIP) item of Rs20 billion to change all of them over an eight-year period in the 2015-16 budget – an average of 200km every year. That’s a big investment of our tax rupees. On top of the billions we’ve invested into the CWA over the past 45 years. Why then should we consider giving away even a hair pin that belongs to the CWA and therefore to us citizens of Mauritius to a private operator? We shouldn’t.

It’s not different from the situation we’ve gone through recently with the CHCL: there you had an organisation that’s expanding nicely and investing a billion rupees of our tax money every year for five years and a Minister was in talks with foreign entities that promised to invest peanuts into the corporation. Many voters still don’t understand why we had to be subjected to this strategic rubbish for that long.

The Situation Has Already Been Improving
Ongoing replacement of leaking pipes has improved system efficiency quite a bit. It has been drastic in some areas of the Plaines Wilhems: water losses have been cut from 50% to 10% according to Mr. Ismael. So I guess one doesn't have to be particularly intelligent to figure out that our water problems have mostly been a money problem. Unlike what Ali Mansoor told us back in 2011 -- only 80km of pipes were laid in that particular year. Plus the ongoing replacement of tens of thousands of defective meters will allow users to better measure their consumption and make adjustments accordingly.

Why This Problem Has Lingered For So Long
Obviously because we didn’t change enough defective pipes. More recently the Sithanen flat tax has spun public finances out of control via an impressive string of low growth rates. Breaking down the revenue shortfall corresponding to the Sithanen Toohrooh is quite interesting. As the chart shows the shortfall accumulated by our Government over the first five years of the fiscal screw up was big enough to change 1,456km of the leaking pipes. That’s 90% of the leaking pipes. Let’s say that again. 90%!



Yet Another Proof That the Low 15% 
Flat Tax Has Broken Our Economy
We could have changed a total of about 2,000km of pipes between 2011 and 2012. In the single year of 2013 the revenue shortfall was large enough to change another 90% of the defective pipes. That’s because the flat tax has put government finances on the wrong side of compounding. This explains why an even greater length of faulty pipes could have been changed in 2014. And since Lepep took over 4,868km of pipes could have been fixed if the Sithanen growth forecasts of 8% had materialised.

All the Way To Chomolungma
The Rs139 billion revenue shortfall would have been enough to change a grand total of 11,585km of leaking pipes. This is like running a pipe from let’s say Raoul Rivet Street in Rose-Hill all the way to Mount Kilimanjaro 2,897km away. And another one 6,227km long to Mount Everest. After changing all the broken pipes.

This Circus Has to End
There is a very wide consensus in the country that the Ministry currently headed by Collendavelloo should be reassigned to someone else. There are two good reasons why the Prime Minister would want to do that. The first one is that he has barely started his Prime Ministership and privatising any part of the CWA could derail it beyond repair. The other one is that it would improve his majority as almost nobody from the ML is likely to follow its leader into the opposition. The PM can also organise a referendum -- which would immediately deepen our democracy -- to ask for our permission on this issue and a few others like whether we want the Metro Express, single member constituencies and party lists.

3 comments:

Sanjay Jagatsingh said...

I saw at paragraph 208 of the budget that changing 264km of leaking pipes will cost Rs2.3 billion. Or Rs8.7m per km. Given that I used Rs12m per km -- heard the GM of the CWA mention that on the radio once -- in the chart above you should increase the lengths we'd be able to change by 37%.

Sanjay Jagatsingh said...

So Collendavelloo is persisting with his completely crazy idea of giving a management contract to a foreign firm to run the CWA and we didn't see a lot of opposition to that in and outside of parliament by our MPs. Could we have expected more anyway? XLD wanted to privatise the CHCL because a foreign operator was promising to invest peanuts. Berenger has been very silent too. Well he was part of the team who privatised 40% of MT wasn't he? Not a lot of opposition from the Labour Party either. Ramgoolam Jr the socialist wanted to privatise it in his first mandate. And the DWC was closed during his second term.

For sure we can't keep on voting for these leaders. We'll have to be very careful who we send in parliament the next time.

Sanjay Jagatsingh said...

So Rs800m have been allocated to change 75km of leaking pipes. Two observations: 1. this is happening without the proposed affermage contract. Further proof that we don't need this totally crappy Collendavelloo idea. 2. Why can't the CWA change the leaking pipes itself? It would be interesting to find out when it stopped changing them and for which reasons.