Can public utilities be accountable?

Elizabeth Brubaker

Last week, Manitoba Conservation and Water Stewardship announced three charges against the City of Winnipeg for polluting the Red River with partially treated sewage for seven weeks last Fall. Two of the charges concern the pollution itself, which exceeded levels permitted in the sewage plant’s licence. The third charge concerns the city’s failure to report the pollution for more than three weeks, despite its legal obligation to report malfunctions immediately. If convicted, the city may have to pay as much as $1.5 million in fines – $500,000 for each of the three charges.

In explaining the decision to prosecute, Minister of Conservation and Water Stewardship Gord Mackintosh cited the need for accountability. But if the city can pass fines along to taxpayers or ratepayers, is it really being held accountable for its errors?

Many think not. Here’s a sampling of comments from the Winnipeg Free Press and CBC News web sites: “Guess who is going to lose a lot of money? If you guessed you you’re right.” … “So, we’re paying for the city’s f**k up in spewing sh!t into the Red?” … “This is not much of a deterrent for the city to stop sewage spills, as it’s really the taxpayer that pays the fine!” … “The city has been dumping raw sewage for decades, they refuse to build the three plants to current standards, they are always behind and have zero accountability.”

So what can be done to hold Winnipeg and other sewage polluters accountable? One reader suggested requiring the engineers responsible for the pollution to “do some of the clean up on weekends.” Otherwise, the lesson here is that “the engineers still have a job and can do it again.” Another likewise noted, “No one lost their job or was even reprimanded for this as far as I understand.” Still another suggested, “How [about] suing the people who caused the glitch, not the taxpayers.”

Here’s another proposal: Privatize sewage systems, and make them subject to tough economic regulation. Public utilities are inherently unaccountable, since they can pass along the costs of non-compliance to taxpayers and ratepayers. In contrast, the regulators of private water and sewage companies in England and Wales routinely forbid the companies to pass fines on to their customers. Under such regulation, the companies’ shareholders pay penalties when their firms break environmental laws. Nothing can create more powerful incentives to perform well.

For more on the Winnipeg sewage spill, see Debunking the myth of public-sector accountability.

Read Manitoba Conservation and Water Stewardship’s Review of the City of Winnipeg
Response to a Process Failure at the South End Wastewater Pollution Control Center.   

 

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