Public Services International press release on Biwater

Public Services International, the global federation of trade unions representing 20 million public service workers, condemns Biwater, a privately-owned multinational company, for attempting to silence democratic debate about water privatisation in South Africa.

PSI calls on trade unions and democratic governments worldwide to reject Biwater's behaviour as unacceptable, and to encourage open and critical debate on privatisation

PSI is releasing a specially researched report showing that there are plenty of reasons for raising critical questions about the performance of Biwater - as with other water multinationals.

PSI has taken this action because Biwater has made a triple attack on free media in South Africa. The company issued a threatening letter after a critical TV programme broadcast by South African Broadcasting Corporation in November 1997, and in April this year threatened legal action against two internet sites for carrying a press release by the trade union SAMWU and a year-old article from a South African newspaper.

In each case Biwater spurned the opportunity to make its own comments and suggest corrections. Biwater refused an invitation to appear on the TV programme to comment on the criticisms, but chose instead to use its economic power to threaten hundreds of jobs unless the criticisms were retracted, stating: ["Until an apology and corrections are issued by SABC3, parent company Biwater plc in the UK has indicated its intention to withold its R200million investment in the proposed pipe factory in Brakpan, Johannesburg, which was to have created jobs for several thousand local people." (Biwater statement 17th November 1997)].

PSI general secretary Hans Engelberts said today:

"This behaviour is unacceptable bullying from any multinational. It is especially shocking that the owner and chairman of Biwater, Adrian White, is a governor of the BBC, whose World Service has enjoyed the reputation for objective broadcasting without fear of powerful corporate interests."

PSI notes that Biwater itself has issued seriously misleading statements claiming that it is 'one of the world's largest water companies, when in fact it is the smallest of those internationally active, and smaller than many public sector water companies around the world. Such statements should not pass unchallenged, and PSI urges Biwater to retract this misleading claim.

PSI advocates that any privatisation proposals should be subject to open, public and rigorous evaluation against public sector alternatives. This must include an honest and public scrutiny of the relative merits of private and public sector companies. PSI supports the right of trade unions throughout the world to engage in these debates and advocate alternatives to privatisation.

In South Africa, PSI affiliate SAMWU is urging that a public sector alternative plan must be developed, instead of introducing privatisation on ideological grounds. In developing countries, the growth of democracy requires free media and free trade unions. The interest of a multinational company should not be allowed to suppress the interests of South African citizens in a universal, efficient, democratically accountable water system.

As a contribution to the debate on the water privatisation proposals in South Africa, PSI has a special detailed research report on Biwater prepared by the Public Services Privatisation Research Unit, PSPRU in the UK. The report is a contribution to a critical debate on the proposals at Nelspruit, South Africa, not an attack on one particular company; if another company were selected in a water privatisation, then it would be appropriate to focus critical attention on their record. This press release, and the PSPRU report, are being released simultaneously in a number of countries around the world. It is also being published on a number of www sites, in collaboration with LabourNet.

Note: the PSPRU, which was established 12 years ago, carries out research on privatisation for trade unions in the UK and for PSI.

Key points from the PSPRU report:

Biwater have made the seriously misleading claims that they are 'one of the world's largest water companies', when they are the smallest of the private companies which are internationally active, and smaller than many public sector water companies in many countries, including South Africa.

A recent report by the UK regulator, OFWAT, puts Bournemouth Water, Biwater's water supply company in the UK, in the lowest category for customer service.

A World Bank report noted 'operational, financial, and political difficulties' with Biwater's sewerage concession in Puerto Vallarta, Mexico.

Biwater's overseas contracts for constructing water supply schemes in Malaysia and Nigeria have been the subject of disputes over satisfactory completion.

Biwater has relied heavily on support from British governments in winning contracts, and was a major beneficiary of trade-for-aid deals in the past.


PSPRU: David Hall, office phone: +44.171.388.2366; home
fax: +44.171.388.3646; email:
SAMWU: Anna Weekes, phone: 021 6971151/2/3; fax: 021 6969175.

Note to editors

Public Services International (PSI) is the International Trade Union Federation which represents public sector trade unions in 137 countries around the world. The affiliated unions, 513 in number, cover some 20 million public sector members. PSI is an autonomous body which works in association with Federations covering other sectors of the workforce and with the International Confederation of Free Trade Unions (ICFTU). PSI is an officially recognised non-government organisation for the public sector within the International Labour Organisation and has consultative status with ECOSOC and observer status with other UN bodies such as the UNCTAD and UNESCO. PSI has taken a number of initiatives over water privatisation.