Elizabeth Brubaker
National Post
October 31, 2002

When the Ontario government received the final report of the Walkerton Inquiry in May, it promised to take action on each of Commissioner Dennis O’Connor’s recommendations. Tuesday, as part of that promise, Environment Minister Chris Stockwell introduced a Safe Drinking Water Act.

But don’t be fooled into thinking that the government is, at long last, acting to protect Ontario’s drinking water. Constrained by conflicts of interest that prevent it from strictly regulating systems that are largely publicly owned, operated and financed, the government has introduced weak legislation coddling those who fail to provide safe water.

The most glaring discrepancies between Commissioner O’Connor’s report and the government’s response concern the enforcement of laws and regulations governing drinking water. Time and again, the commissioner stressed the importance of strict enforcement, calling it “essential” and a “primary principle.” He elaborated, “those involved in the provision of drinking water must understand that deviation from the regulations and lapses in safety will not be tolerated. This message is best reinforced by a strict enforcement policy, in which the failure to follow the requirements of the system will be prosecuted and will have serious adverse consequences for those responsible.”

It is no coincidence that the commissioner was concerned about enforcement. An abysmal lack of enforcement had contributed to the Walkerton tragedy. Although Walkerton’s water system had been out of compliance with provincial standards for years, regulators in the Ministry of Environment had never bothered to enforce the standards. Nor have they done so elsewhere in the province. Unsurprisingly, the culture of non-enforcement within the ministry has bred a culture of non-compliance within municipalities. Inspections conducted shortly after the Walkerton tragedy revealed deficiencies at more than half of Ontario’s municipal water treatment plants.

And so, Commissioner O’Connor issued his simple and unambiguous recommendation on the subject: “The Ministry of Environment should increase its commitment to strict enforcement of all regulations and provisions related to the safety of drinking water.”

MOE claims that the enforcement provisions in the Safe Drinking Water Act are “based on” and “guided by” this recommendation. Nothing could be further from the truth. The Act does nothing to increase MOE’s commitment to strict enforcement. It leaves enforcement decisions to the discretion of bureaucrats, saying that provincial officers “may” investigate offences and “may” prosecute persons believed to be guilty. Although it commits the minister to making regulations governing compliance, inspections and investigations, it sets out neither the content nor even the tenor of the regulations.

It gets worse. Although officers and directors may issue orders requiring compliance, the Act provides for orders that impose on water providers interim conditions that are less onerous than the requirements under the Act. Likewise, in setting out conditions for licensing water providers, the Act empowers a director to provide “relief from the duty of strict compliance with a regulatory requirement.”

A sympathetic director may even protect the most egregious violators of the Act, its regulations or orders made under it. Rather than subjecting a violator to a full, public, independent court process – and, if convicted, to fines of up to $10-million a day and/or imprisonment – a director may simply require the scofflaw to pay an “administrative penalty” of no more than $10,000 a day. As long as the modest fine is paid, no charges will be laid.

It seems clear that the government is not prepared to strictly enforce laws ensuring safe drinking water. Instead, it will continue to shield utilities from responsibility for providing bad water.

And little wonder, given the tangle of conflicts pulling it in different directions. Committing itself to strict enforcement would mean prosecuting its own operating arm, the Ontario Clean Water Agency, which frequently violates standards. It would mean prosecuting municipalities to which it is closely tied – so closely that municipalities are often referred to as “children” of the province. And it would mean handing over large sums of cash to municipalities that claim they cannot afford to make the capital and operating improvements required. (Even in the absence of strict enforcement, the government expects to spend $500-million on drinking water in the next two years.)

Until the government gets out of the business of operating and financing drinking water systems, conflicts will continue to impede enforcement. Fortunately, getting out of the business should be easy: The private sector has repeatedly demonstrated its readiness to assume both operating and financing responsibilities. And it has demonstrated impressive expertise – expertise so tragically lacking in Walkerton’s PUC and in so many other municipal water systems.

If the government adopts the no-nonsense approach recommended by Commissioner O’Connor – requiring the owners of drinking water systems to develop viable operating and financial plans and holding them accountable for the performance of their systems – many municipalities will realize that they are not best qualified to finance, operate or even own their systems. Inevitably, many will want to turn to the private sector for assistance. Nothing will do more to free up the government to regulate.

On Tuesday, Mr. Stockwell reaffirmed his government’s commitment to “ensuring that Ontario has and enforces the best and toughest clean water policy in the world.” The legislation he introduced brings us no closer to that goal. Not until the private sector provides water service and the government strictly regulates it will we have a truly sustainable system.

Sidebar: Saving Privatization 

Hidden in the Ontario Ministry of Environment’s preliminary version of the Safe Drinking Water Act were several provisions that could have prevented municipalities from privatizing their drinking water systems. These flaws, pointed out during the public consultation process, have been removed from the proposed Act.

The proposed Act will, quite rightly, require the owners of municipal systems to engage accredited operating agencies, either internal or external. But the definition of such an agency in the preliminary version of the Act included the provision that it be “in management and control of a municipal drinking water system or a part of a municipal drinking water system.” Whether it reflected sloppy drafting or insidious intent, this requirement could have prevented the accreditation of new private entrants in the market.

This potential impediment to privatization defied the advice of Commissioner O’Connor, who wrote: “The decision whether to engage an external operating agency is best left to municipalities to determine in light of local circumstances … From the perspective of protecting water quality, the Province should adopt a position of neutrality with respect to the decision of municipalities to engage, or not to engage, private operating agencies to deliver water services. The provincial government should ensure that this neutrality is reflected in provincial legislation and regulations.”

A second provision preventing privatization was the requirement that the owner of a municipal drinking water system obtain written consent from every user before decommissioning the system and replacing it with a private system or breaking it up into smaller, private systems. This requirement would have been completely unworkable.

A third anti-privatization provision concerned the degree of legal responsibility maintained by a municipality that chose to sell its system. The owner of a municipal system would have been held to a statutory standard of care if it sold its system to the private sector, but not if it sold its system to another municipality. Such a rule would have created strong disincentives to put systems into private hands. Only by handing responsibility to a neighbouring municipality would a system’s owners have been able to fully protect themselves.

Privatization’s advocates should be relieved that the Safe Drinking Water Act will not include blatant anti-privatization provisions. Whether the government has simply moved the provisions to the regulations promulgated under the Act remains to be seen.

Elizabeth Brubaker is executive director of Environment Probe, a Toronto-based think-tank. Her book, Liquid Assets: Privatizing and Regulating Canada’s Water Utilities, will be released next week by the University of Toronto’s Centre for Public Management.