We oppose subsidies to resource use. Resource subsidies encourage waste, often directly promote environmental harm, and, as a tool for delivering political favours to select constituencies, promote the abuse of power. Where society favours subsidies to ensure social equity, we favour subsidizing disadvantaged people with direct payments, untied to their level of consumption, rather than providing subsidies that lower the apparent cost of resources.

The Principle in Practice:

• In some regions of Canada, water is becoming increasingly scarce. And across the country, water and wastewater systems are undersized and in need of repair. Because Canadians pay so little for water, they have few incentives to conserve, and utilities have insufficient funds to improve their infrastructure. Environment Probe is campaigning to promote full-cost pricing to protect public health and the environment.

• Probe International, working with Chinese environmental groups, published the seminal report on Beijing’s crippling water crisis on the eve of the 2008 Beijing Olympics. Pollution and dams have destroyed Beijing’s traditional river system forcing the city to drain its aquifers faster than they can be recharged. Meanwhile, low water prices perpetuate the waste of water by car washes and ski hills with artificial snowmaking machines while discouraging efficiency improvements and recycling. Chinese environmentalists now advocate market mechanisms – prices and tradable water rights – as a solution to the dire water shortage China’s capital city faces.