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Devolution honeymoon short-lived as NI Water announces 500 redundancies

JM Thorn

12 May 2007

The “feel good factor” surrounding the restoration of the power-sharing executive at Stormont proved to be short-lived.  The bubbles had barely left the champagne used to toast the coronation of Ian Paisley as First Minister when news broke that up to 500 jobs were to go in the local water industry.  NI Water’s management, emulating the New Labour tactic of selecting good days for bad news, sneaked out a press statement in the late afternoon announcing the redundancies.  Its current workforce of about 1,900 is to be cut to 1,400 as part of a new strategic business plan.  The five hundred jobs, which will go over the next three years, are to be lost from the company’s industrial division as well as engineering, administration and scientific divisions.

This represents a major assault on public sector workers.  Some of those facing redundancy are probably among the most highly skilled and experienced in the North.  They will also have relatively good pay and conditions.   In the case of the water service, it would have been expected that such workers would have played a crucial role in the much-needed upgrade of the water and sewage system.  The fact that they are facing redundancy gives some indication of where the water service, and the public sector more generally, is being steered.   This is towards privatisation, a reduction in spending and mass redundancies. For anyone who has listened to the pronouncements of senior civil servants, Government ministers, business leaders and the local parties, this should come as no surprise.  They all believe that the northern economy’s reliance on the public sector has to be dramatically reduced, and reoriented towards growing the private sector and attracting foreign investment.  The quickest route to achieve this is through privatisation, and this is what the British Government has been doing, through Private Finance Initiatives (PFIs) and outsourcing, over the last number of years.  Creating a Government owned company to take the Water Service out of the public sector and introducing a separate water charge are part of this process. 

Given this background, the redundancy announcement from NI Water should have come as no surprise.  This did not prevent the usual response of shock and dismay from trade unions and local politicians.   Peter Bunting from the Irish Congress of Trade Unions slammed the announcement, claiming that it “put us further along a slippery slope that will lead to the introduction of household water charges and the privatisation of the industry.”  Only a few weeks earlier, when addressing an anti-water charges rally, he claimed a partial victory in the battle against charges.  The trade unions also went immediately into lobbying mode with Albert Mills from the Transport and General Workers Union calling for an urgent meeting with the new Regional Development minister Connor Murphy.  He also claimed that it was the “the unions that led the fight against water charges” and that they would “continue that fight”.  However, any review of the opposition to the water charges would should this to be untrue.  The trade unions did not lead a struggle.  Within the Water Service itself there was no struggle at all.  The main focus of their activity was in negotiating terms for their members in the new company.  They also facilitated a reduction in the workforce by negotiating the transfer of almost 300 workers to other parts of the Civil Service.  The fact that this safety net is no longer there may account for the more urgent tone of the trade unions this time.

If the strategy of the trade union leadership is to plead to ministers it is one that is doomed to failure.  They only thing more incredulous than the shock of trade union leaders was that of the new executive ministers.  Despite preparing for their ministerial positions for six weeks, none of ministers knew about the redundancy announcement. Connor Murphy, whose department is responsible for water, claimed that he was “somewhat removed” from the decision due to the creation of the new Government owned company.  The most that the executive could offer was a 12-month delay in the introduction of water charges, and a review of how the water and sewage system in the north should be financed.  Although Murphy said that the review would “put everything on the table” he immediately rowed back by claiming that he was “not sure what scope there is for changing the structures that have been put in place”.    There was no indication that the redundancies would be halted in the meantime.  Significantly, politicians have tried to shift the discussion on water charges issue towards the concept of “double taxation”, which would allow for a separate water charge (just don’t call it a tax) and the privatisation of the water service. 

The tactic of ministers announcing a review is familiar from the last executive in which almost every issue was under review.  Indeed, it was from one such review that the idea of water charges emerged.  The current executive is only one week old and already three reviews have been instituted.  In addition to the one on water charges there are reviews of the rating system and prescription charges.  These reviews are really a substitute for action from the executive, designed to give the impression that something is being done to address the public’s concerns.  Given the lack of financial support for devolution, and the decisions that have been already been taken by NIO ministers (decisions designed to avoid local politicians taking the flak for bringing them in themselves), it has very little room for manoeuvre.  For example, water charges have already been factored into the long term budgets of government departments. 

The British treasury hasn’t been forthcoming with the financial support that would enable the executive to make even minor reforms.  After announcing the same financial package on a number of occasions Gordon Brown finally came up with some extra money.  But this amounts to one billion pounds over three years, £75 million of which is to be used to defer water charges.  The health minister Michael McGimpsey has already conceded that there is no extra money - “We're on our own - it's the block grant and it's dealing with resources that we can see." 

This is hardly the “fuel” demanded by Ian Paisley to power the devolution train.  Indeed, the lack of financial support will likely have a destabilising affect as it will sharpen the sectarian scrap over limited resources.  It is not difficult to envisage the DUP’s Gregory Campbell demanding a breakdown of which areas are not paying their water charges. Anybody who thinks that a non-payment campaign will cut across sectarian divisions will be disappointed.  We shouldn’t build up illusions, as trade union leadership has been doing, that the executive can deliver on water charges or any other issue.  The only way water charges and privatisation can be challenged is through building a mass working class based campaign.  It is certain that such a campaign will find itself in conflict with a Stormont executive. 

Anti–water charges campaign

There are number of very important lessons arising from the water charges campaign to date.

The first is the weakness of the opportunist strategy adopted by the majority of left organisations. The socialist groups tried to dodge the hard political issues and make up for their own weakness by focusing on a non-payment tactic on the grounds that the main issue was double taxation.  When government leaks made it abundantly clear that the issue was privatisation they conceded the political point but argued that the best way to defeat it was through the non-payment tactic.  Some called for the expulsion from the campaign of anyone not fully in support of non-payment!

It was claimed that spontaneous anger would generate a mass campaign and overcome the sectarian divisions in the North.

Finally leadership of the campaign remained firmly in the hands of the union bureaucracy without any questioning or challenge from the left.

Every aspect of this strategy was wrong.

The postponement of the issue for a year leaves the non-payment tactic high and dry.  In the meantime sections of the water service have been privatised, a Government company has been set up that can be privatised at the flick of a pen,  A private company is collecting water charges, (paid for the first year from taxes), and skilled workers are loosing their jobs.

As for the power of water to wash away sectarianism , there was a mass vote on sectarian grounds in the assembly elections and as soon as Sinn Fein and the DUP announced the postponement of charges the issue disappeared off the radar for the vast majority of their supporters.

For the trade unions the non-payment campaign deflected attention from their own lack of activity on the industrial front and privatisation rolled onwards. Now the play-acting comes to an end with a final performance of incredulity and wonder as workers face the sack.

Privatisation won’t go away. Water privatisation is simply the sharp edge of a whole series of attacks on public service, all of which will now be led by the local parties.  Socialists and working class activists really have no choice but to stand and fight on the hard ground of defence of working class rights and for the self-organisation of the class independently of capitalist politicians and union bureaucracy.



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