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PSIRU NEWSLETTER
DECEMBER 2013 No 1
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The Public Services International Research Unit (PSIRU) investigates the impact of privatisation and liberalisation on public services, with a specific focus on water, energy, waste management, health and social care sectors. Other research topics include the function and structure of public services, the strategies of multinational companies and influence of international financial institutions on public services. PSIRU is based in the Business Faculty, University of Greenwich, London, UK.
Welcome
to the first issue of the PSIRU newsletter.
The aim is to provide information about where PSIRU researchers are
presenting their research, which reflects a growing interest in public
services, recent PSIRU reports, new
developments in companies working in the five main sectors (energy/ health and
social care/ municipal /water/ waste management) and proposed World Bank
projects ‘in the pipeline’. Company
updates and brief descriptions of ‘in the pipeline’ World Bank projects are to
provide information for PSI/EPSU affiliates and other interested groups.
There are four sections:
1.
Recent conferences and workshops attended by PSIRU researchers and
visitors to PSIRU
2.
New PSIRU reports
3.
Recent mergers, acquisition and sales by multinational companies
working in energy, health/ social care, municipal, water/ waste management/
water sectors.
4.
Proposed ‘in the pipeline’ World Bank Group projects in the
energy, health/ social care, waste management and water sectors.
HIGHLIGHT-
REMUNICIPALISATION
There
is a growing move towards re-municipalisation of water services throughout the
world. This is due to widespread
problems affecting water privatisation, the equal or greater efficiency of
public water services and reduced prices due to elimination of excessive
profits However, it is also due to the
comparative advantage of the public sector in realising the human right to
water and sanitation and achieving other social and environmental objectives. There is also a growing list of other
utilities and public services which are returning to public sector provision,
which PSIRU is documenting. PSIRU has
compiled 86 examples of water re-municipalisation. The report is available here.
Events attended by PSIRU
researchers
|
On
1 October 2013, a delegation from the Australian
Services Union (ASU) visited PSIRU to discuss local authority developments
in the UK and Australia as well as recent work on privatisation and public
services in the water, energy and healthcare sectors.
On
4 December 2013, Prof. Leo Heller,
from the Department of Sanitary and Environmental Engineering in the Federal
University of Minas Gerais visited PSIRU to discuss public participation and
the research and information needs of social movements.
Jane Lethbridge spoke at a fringe meeting of the
Labour Party Conference on 24 September 2013, organised by ‘We Own it’, to
discuss a proposed Public Service Users Bill and its inclusion in the Labour
Party manifesto.
On
20 November 2013 Jane Lethbridge
spoke to the European Affairs Committee of the Danish trade union, OAO, Copenhagen
on ‘the British experience of public-private partnerships’.
Emanuele Lobina spoke on water
remunicipalization in Europe at a conference organised on 21 September 2013 by
the Italian Forum of Water Movements to support the campaign for remunicipalizing
water in Turin, Italy. He also spoke at a workshop organised on 24 September
2013 by the Italian Forum of Water Movements to support the campaign for
remunicipalizing water in the Lazio region, Italy.
On
10 September 2013 Emanuele Lobina
presented a paper on reassessing corporatization in the European water sector
at an EU-funded workshop on New Public Management in Edinburgh.
Emanuele Lobina spoke on the merits of water
remunicipalisation at a seminar organised by the Lazio regional government (the
region including Rome), Italy on 11 November 2013.
Emanuele Lobina spoke at a seminar organised by ‘Economistas sin Fronteras’ on ‘Economía Crítica y Crítica de la Economía’ held
at the University of Grenada, Spain.
Emanuele Lobina spoke on ‘PUP in context: How do we define the Public-Public Partnerships
we want to promote?’ at the Reclaiming
Public Water Network’s strategy meeting, ‘The Future of Public Water’
Barcelona, 25-26 November 2013.
Emanuele Lobina
spoke on ‘Lessons from the ACP-EU Water Facility’s Partnerships
Initiative’ at the Global Water Operators Partnership (GWOP) Congress and
Global Water Operators Partnership Alliance (GWOPA) in Barcelona 27-29 November
2013.
David Hall presented a paper on 'Services
of general interest under regimes of fiscal austerity' for a
conference 'Beyond the Single Market – External and international
dimensions of services of general interest in EU law' held at Erlangen
University, Germany on 18 September 2013.
David Hall presented on 'Remunicipalisation' to
a seminar at the European Parliament organised by GUE/NGL/FSE (European United
Left/Forum Social Europe) on 'Reclaiming our commons, 'free trade' and trade
union strategy under neo-liberalism' 17 October 2013.
Steve Thomas spoke at an ESRC funded conference at Liverpool University ‘Going Nuclear
Seminar Series; Event 2: The UK and Nuclear Energy – Taking Stock’ on 1
November 2013.
Steve Thomas chaired and spoke at a seminar
‘The future of energy policy briefing' organised by Policy Knowledge in London
6 November 2013.
Steve Thomas gave a Guest Lecture at
EuroCollege, University of Tartu, Estonia on 'Nuclear power economics' in the
Jean Monnet module on Energy and Environment on 18 November 2013.
Steve Thomas attended the Franco-British Council
debate on European Energy Policy in Paris, 20 November 2013.
Steve Thomas was an invited speaker at King’s
College Think Tank seminar: 'The Future of Nuclear Power’ on 26 November 2013.
Steve Thomas was an invited speaker at a
conference organised by the Federation of European Progressive Studies (FEPS)
in Budapest 'Sustainable Energy policy for consumers, the solution in European’
promoted by the Hungarian Socialist Party, MSZP on 10 December 2013.
Steve Thomas has been interviewed regularly
on local and national radio stations to talk about UK energy pricing and
nuclear power issues.
New PSIRU
reports
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CIVICA Profile by Jane Lethbridge
This
report provides a profile of CIVICA, a company providing ICT and other management
services such as ‘agile’ working, Electronic Data Management and workflow to
local authorities and other public sector agencies in the UK, Australia, New
Zealand, Singapore, Canada and the United States. The report is
available here
Steria
Profile by
Jane Lethbridge
This report provides a profile of Steria, a French multinational company
operating in local and central government sectors in the UK, France, Germany, the
Nordic region and India. The report is
available here.
Challenges
of Digital Government by Jane Lethbridge and David Hall
This
report examines how digitalisation has affected employment in the retail sector
and how a group of countries - Singapore, Denmark, Germany and Japan - have
approached the digitalisation of government services. The recent experience of digitalisation in UK
government services is analysed as well as identifying issues faced by service
users. The report concludes that
training of civil servants is crucial for the success of digital
government. The report is available here
Tax justice briefing Asia-Pacific region
by Jane
Lethbridge
This
report provides a briefing on tax justice in the Asia-Pacific region,
highlighting the following issues: the importance of taxation, tax havens and
off-shore finance, tax base erosion and profit-shifting (BEPS) and ways of
addressing tax evasion. The report is
available here.
Tax justice
briefing on Africa by Jane Lethbridge and Sandra van Niekerk
This
report provides a briefing on tax justice in Africa, highlighting the following
issues: the importance of taxation, tax havens and off-shore finance, tax base
erosion and profit-shifting (BEPS) and ways of addressing tax evasion. The report is
available here.
International
Financial Institutions and Energy Investments by David
Hall, Sandra van Niekerk, Jenny Nguyen, Steve Thomas
This
report examines the activities of the international financial institutions
(IFIs) as they affect finance for the energy sector, through their preferences
for private companies and insistence on eliminating price subsidies, and how
investments to extend electricity networks and develop new electricity
generation depend largely on public finance.
The report is
available
Renewable
Energy by David Hall, Sandra van Niekerk, Jenny Nguyen, Steve Thomas
This
report analyses the relative role of the public and private sectors in
renewable energy, particularly the importance of the public sector, the
restructuring taking place in high income countries and the opportunities in
low income countries. The report is
available here.
Liberalisation, privatisation and
public ownership by David
Hall, Sandra van Niekerk, Jenny Nguyen, Steve Thomas
This
paper reviews the trends in privatisation and liberalisation in the energy
sector, and the development of remunicipalisation and renationalisation in
Germany and elsewhere. It is available here.
MNCs in Electricity and Gas 2013 by
David Hall, Sandra van Niekerk, Jenny
Nguyen, Steve Thomas
This
report provides updates on 29 multi-national companies active in the energy
sector in Africa, Asia-Pacific, Americas, Middle East and Europe. The report is available here.
Por qué la ANDE no der ser privatizada by
David
Hall and Mercedes Canese (Ministry of Public Works and Communications,
Government of Paraguay).
The
report explains by the Paraguayan Administración Nacional de Electricidad
(ANDE) should not be privatised. The report is available here
Recent
company changes
|
Health
care
Private equity company, Bridgepoint,
has sold Terveystalo, the largest private
hospital and healthcare chain in Finland, to EQT, a Nordic private equity company.[i]
UnitedHealth Group recently acquired a majority
stake in Amil Participações S.A., Brazil's
largest health care company, providing health and dental benefits, hospital and
clinical services, and advanced care management resources to more than 5
million people in Latin America. [ii] [iii]
Meanwhile, UnitedHealth Group is withdrawing from
the UK market, especially primary care.
Staff will be moved to Optum
Health and Technology, another subsidiary working across Europe. [iv]
Social
Care
Medica has bought Senior Living
in Belgium from Waterland, a private equity company. Analysts indicate that
Medica paid €280-290m for the group.[v]
In
December 2013, the Canada Pension Plan Investment Board paid €321m for a 15% in
French nursing home group Orpea,
bought from its founder Jean-Claude Marian. It also underwrote and took 30% of
a share issue to finance new growth. [vi]
Waste
management
Cheung Kong Infrastructure (CKI), a large multinational
group based in Hong Kong, has expanded into waste management with two major
acquisitions in 2013. It already owns electricity and gas distribution,
transmission and generating companies in China/Hong Kong, the UK, Australia, New
Zealand and Canada, and water companies in the UK.
In
January 2013 it bought Envirowaste,
one of the largest waste management companies in New Zealand, for
about USD$410 million.
In August 2013 CKI bought AVR, a waste-to-energy
incineration business operating in Netherlands and Belgium, from
the Dutch waste group Van
Gansewinkel, for SD$1.25 billion. Van Gansewinkel, which is owned by private equity firms KKR and CVC, continues to operate in other waste management
activities, including refuse collection: in 2012 it cut 600 jobs - 10% of
its workforce.[vii]
Water/
Energy/ waste management
In
March 2013, Veolia sold its water,
wastewater and electricity services business in Morocco, operated by
concession companies Redal and Amendis, to the private equity group Actis, for about €340 million. Veolia will continue to provide
technical support for Actis under a
3-year management contract. The contracts have been strongly opposed by local
people and unions. Actis is a private
equity firm, originally created by the UK government, with no experience of the
water sector, but has been widely condemned for its management of the Ugandan
electricity distribution company Umeme.
The water operations of CGEP
in Portugal, consisting of 4 concessions with 423 employees, were sold
by Veolia in March 2013 to Beijing Enterprises Water Group (BEWG).
BEWG is majority owned by the municipality of Beijing, China. This is its first
significant overseas activity in the water sector.
Veolia has bought the 50% share of Proactiva
previously held by the Spanish group FCC,
and so Proactiva now becomes a
100%-owned subsidiary of Veolia. Proactiva operates in water and waste
management in Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Peru
and Venezuela. It's main water management contracts are in Guayaquil (Ecuador)
- where there is a long-standing public campaign to terminate the contract -
Mexico City (Mexico) and Lima (Peru) and waste management in Buenos Aires
(Argentina), Caracas (Venezuela), São Paulo (Brazil) and Santiago
(Chile).It had sales of €541 million in 2012, and nearly
12,000 employees. [viii]
The
government of Berlin, Germany has bought Veolia’s
24.9% stake in the Berlin Water Company
for over €600million. This completes the re-municipalisation of Berlin’s water.
[ix]
World Bank
Group projects
‘IN PIPELINE’
|
The
World Bank and Renewable Energy
Since
‘sustainability’ became a major element of the World Bank’s policy towards the energy
sector, for example through the Sustainable Energy for ALL (SE4ALL) programme),
[x]
there has always been a large gap between the rhetoric of their support for
renewables and where their funding actually goes. This gap between rhetoric and
action is not unusual for the World Bank. Throughout the period from the
mid-1990s to the early 21st century, the policy of energy market
liberalisation talked about privatisation and introduction of competition, but
in practice the introduction of competition was forgotten so that the companies
were attractive purchases for private investors. The autumn 2013 edition of the
Bretton Woods Observer [xi] exposes in detail how investment
in the energy sector is now very much directed towards financing natural
gas-fired power plants, an option that is exposes developing countries to the
volatile and unpredictable world gas market, potentially locking them into very expensive imports of fuel.
World Bank projects – in
‘pipeline’ not yet approved (value $100m or more)
*Indicates
specific private sector involvement
**
Institutional strengthening
Health
**Romania Health Sector Reform P145174 $325.00m. This project will strengthen prevention and
health promotion, rationalize health service delivery, increase
secondary specialized ambulatory services, and
promote
improvements in treatment of the non-communicable diseases (NCDs) through use
of clinical pathways.[xii]
**Argentina Support to the Integral Strategy
for the Prevention and Control of Non-communicable Diseases Project P133193 $450.00 Institutional
strengthening for non-communicable disease prevention/ control.[xiii]
* Croatia Health System Quality and
Efficiency Improvement P144871 $103.50 To support the limiting of public expenditure on health, promote
competitiveness through outsourcing of medical and non- medical services as
well as increasing use of EU funds.[xiv]
Energy
Russian Federation Energy Efficiency Financing
Project P122492 $300.00 To improve the efficiency of energy use in Russia by scaling-up
commercial lending by banks for energy efficiency investments in the industrial
and public sectors [xv]
*
/ ** Vietnam Transmission Efficiency
Project (TEP) P131558 $500.00 Main objective to strengthen transmission network
and regulations as well as regional subsidiaries of EVN (the state-owned
monopoly in electricity). The regulatory body (ERAV) will also be consulted in
building an effective regulatory scheme for transmission and distribution.
There is no sign, or not yet, of any private sector participation as
transmission and distribution remain state-owned and state-controlled via EVN. [xvi]
Ukraine District Heating Energy
Efficiency P132741 $250.00 Project to improve energy efficiency
*/**
Serbia Public Enterprise Restructuring
DPL 1 P127408 $200.00 To reduce the scope of state involvement
in the enterprise sector by completing the privatization agenda and improving
the performance of enterprises which are likely to remain in the public domain
in the near to medium-term.[xvii]
Water/
waste management
*Nigeria Irrigation and Water Resources
Management Project P123112 $400.00 Creation of public-private partnership for
irrigation management.[xviii]
Lebanon-Water Augmentation Project
P125184 $125.00
India Bihar Flood Rehabilitation Phase
II P127725 $250.00
*Vietnam Second Ho Chi Minh City
Environmental Sanitation Project P127978 $450.00 The project includes a Wastewater Treatment
Plant. A Design
Build (DB) or a Design Build Operate (DBO) scheme is being considered where a
private company will design and build the system. [xix]
India Integrated flood and erosion
management in NE region P128421 $150.00
**Indonesia Metropolitan and Urban
Development Project P129406 $400.00
Institutional strengthening of municipalities and water resource management.[xx]
China Anhui Yellow Mountain New
Countryside Demonstration Project P129563 $100.00 Institutional support to improve service
quality and income generating opportunities.
Ethiopia Pastoral Community Development
Project III P130276 $110.00
**Sri Lanka Strategic Cities Development
Project P130548 $150.00 Improvement in urban services and municipal
institutional strengthening[xxi]
**Tunisia TN-Urban Dev. and Local
Governance P130637 $100.00
Strengthen role of
local
governments in planning, financing and delivering municipal facilities and
services.[xxii]
China Huainan Coal Mining Subsidence
Area Rehabilitation P133000 $100.00
China Guilin Integrated Environment
Management P133017 $100.00
China Shaanxi Small Towns Infrastructure
Project P133069 $150.00
China Sichuan Chongqing Cooperation:
Guangan Demonstration Area Infrastructure Development Project P133456 $100.00[xxiii]
*
Bangladesh Municipal Governance and
Services Project P133653 $410.00 –Criteria for success include cost recovery,
private sector participation and economic rate of return of at least 12%. [xxiv]
Sri Lanka Improving Climate Resilience
P146314 $110.00 Reduce environmental risks & improving government capacity
to respond to emergencies [xxv]
Jane
Lethbridge
16
December 2013
[i]
http://www.pehub.com/2013/09/bridgepoint-sells-terveystalo-eqt/
[ii]
http://jamaica-gleaner.com/gleaner/20121010/business/business9.html
[v]
http://www.reuters.com/article/2013/07/29/medica-idUSnBw285032a+100+BSW20130729
[xii] World Bank
(2013) PROJECT INFORMATION DOCUMENT (PID) CONCEPT STAGE Report No.: PIDC1044
[xiii] World Bank
(2013) http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2013/01/24/000231615_20130124134105/Rendered/PDF/PIDC6470SPANIS0020020130Box374312B.pdf
[xiv] World Bank
(2013) PROGRAM-FOR-RESULTS INFORMATION DOCUMENT (PID)
CONCEPT STAGE Report No.: AB7293
[xvi] World Bank
(2013) Integrated safeguards data sheet concept state transmission efficiency
project
[xviii] World Bank (2013)
http://www.worldbank.org/projects/P123112/irrigation-water-resources-management-project?lang=en
[xix] World Bank
(2013)
http://www.worldbank.org/projects/P127978/second-ho-chi-minh-city-environmental-sanitation-project?lang=en
