Social partners split over ownership of Walloon water board

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Employers' organisations and trade unions may agree that they want more say over the new water board to be set up early in 1999 by the Walloon regional government in Belgium, but they disagree over whether the company should have public or private status.

The Walloon regional government wants to set up a Public Water Board (Société publique de Gestion de l'Eau, SPGE), which would be publicly controlled (50% plus one share) The remaining 50% would be split equally between private capital and public or private operators (production, distribution and purification firms).

Water is an important resource in Wallonia, with a production of 410 million cubic metres a year, 40% of which is exported to Brussels and Flanders. However, management and operations are widely dispersed amongst 87 water producers, several distributors and eight intercommunal purification bodies.

Trade unions fear that the reform will introduce a motive of "profit at any price" in water distribution, putting an end to guaranteed access for all to a reasonably priced water supply. The Belgian General Federation of Labour (Fédération Générale du Travail de Belgique/Algemeen Belgisch Vakverbond, FGTB/ABVV), the majority union in Wallonia, believes that water supply must remain totally under public authority management. The going-rate price of water, an essential commodity, must be maintained at its current level for normal consumption. It recommends that progressive rates may be introduced for consumption over this normal level, contrary to the current situation where they are reduced for heavier consumers. The union also fears that financial institutions may obtain a blocking minority shareholding. Finally, the union believes that there will insufficient representation of the social partners on the SPGE's controlling body.

The other main union confederation, the Confederation of Christian Trade Unions (Confédération des Syndicats Chrétiens/Algemeen Christelijk Vakverbond, CSC/ACV), stresses both the importance and the difficulty of maintaining public control. It demands a guarantee that the public sector remain pre-eminent, particularly in the event of the sale of stock to the private sector or the arrival among shareholders of private water distribution companies, such as Lyonnaise des Eaux which, through Tractebel, controls Electrabel, the company distributing water in the Verviers region. Moreover, for CSC, the cost and price of water should not be confused. It refuses to make households pay for everything. Like FGTB, it is opposed to the current regressive pricing which penalises small households. It adds that progressive pricing would encourage consumers to use water more rationally.

For the Walloon Union of Enterprises (Union Wallonne des Entreprises, UWE) and Union of Small Firms and Traders (Union des Classes Moyennes, UCM), on the other hand, private sector involvement should not be limited to 25%. For the employers' organisations, a larger opening to private capital would bring the financial means and know-how necessary if the objectives set for the SPGE are to be achieved. They also think that water has an economic role in production and that it is an important factor in competitiveness (for instance, in the water used for cooling in breweries, dyeing and the sugar industry). Therefore a "true price" must be set, while ensuring that social and competition factors are taken into account.

FGTB/ABVV accuses the Walloon government of not having taken into account the opinions of the Economic and Social Council of the Walloon Region (Conseil Economique et Social de la Région Wallonne, CESRW). The Council, a tripartite advisory body on social and economic policy, has repeatedly recommended the introduction of a progressive pricing system in order to reduce the cost to the more disadvantaged sections of the public while taking account of the situation of certain heavy consumers. It has also insisted on the central role to be played by the SPGE control committee (through, for example, significant social partners' representation and the right to issue binding opinions).

It is most likely that this dialogue will go on until the adoption of the decree setting up the new water management company.