22 April 2015

Last Saturday (18th) the Belfast Workers Discussion Group hosted its first meeting.  Around twenty people came to An Realta Civic and Social Space where they were addressed by the writer and researcher Conor McCabe on the theme of “Water: a public resource or private commodity?”  The main focus of his talk was the creation of Irish Water and the introduction of water charges.  While it was not an activist meeting it did give some insight into the forces that anti-water charges campaigners are up against. 

For Conor the bond market and bondholders were the key elements in understanding the workings of Irish Water.  He outlined how bond markets operated in general, how governments (and companies) borrowed money from private sources and were committed to paying interest on these borrowings as well as the principal sum.  With taxes on business being cut and more large companies moving their money into the bond market the capitalist class was gaining in every way.  By contrast the working class was paying out more and more to service these bondholder debts.   
     
The business model of Irish Water is to issue bonds which will be financed through revenue in the form of water charges.  In order to establish Irish Water as a commercially viable company, and to create the conditions for private investment, it was necessary to establish a company that was separate from the state and to introduce a charge that was distinct from general taxation and set at a rate that produced the returns demanded by bondholders.  These are the financial dynamics at work in Irish Water.

According to Conor the business model of Irish Water was fatally flawed because, as it stood, it could not generate the necessary returns on the bonds it would issue.  This was in part due to the level of opposition to water charges that had forced the Government to reduce their rate.  Irish Water, on the criteria set by the EC, cannot be classified as a viable commercial company.  This means that the Irish government has to keep it on the public books which then has implications for meeting other financial targets set by the Troika.  

Conor also highlighted various interests that were bound up with Irish Water such as the trade unions. For him the company was typical of the “corporatist model” of capitalism that had been in existence in Ireland for a long period.  

When the meeting was opened up for discussion the issues raised included the experience of water privatisation in Bolivia; the purpose of water metering; how Ireland fitted into European capitalism; and whether the Irish waste and water system was inefficient.

Overall, Conor’s talk was informative and gave much needed theoretical ballast to the activism of the anti-water charges campaign.  It was a successful start for the Belfast Workers Discussion Group.