In 1999, the public water supply (Berliner Wasserbetriebe) in Berlin was partially privatized. Its 49,9% stake was bought for 1,68 Mrd. Euros by the French cooperation Veolia (recent Vivendi) and the German cooperation RWE. The contract regarding the partial privatization was “top secret” and only few representatives of the parliament were able to look into the contract. Seemingly, the agreement did not have a deep impact. The Berliner Wasserbetriebe are still working badly although the private partners have the majority in the directorate and RWE and Veolia get a yearly dividend. If the Berliner Wasserbetriebe are in red numbers, the dividend is distributed among them.
The city proclaimed that after the privatization several points would be guaranteed, e.g. lower water prices, the shared dividend in halves between city and the other stakeholders, some shares for clients and employees and secured jobs. Obviously, the city didn’t keep its promise. Since the privatisation they have cut the investments and recently they have closed three water pump stations. That’s why Berlin has lost 30 km² of the ecologically important drinking water protection area. Over the whole time, the jobs have been reduced as well.
Seven years after the partial privatization, the local water initiative Berliner Wassertisch was founded. Their final goal is the nationalization of the public water supply. First, they want to achieve the disclosure of the contract to the public. Furthermore, they want to fight against the privatization in judiciary and parliamentary way.
The initiative opted for a citizens’ decision on the disclosure of the contract. To meet the mandatory quota, 171.000 signatures were to collect within four month. A big movement including the Berliner Wassertisch, local initiatives, the Greens and Young Greens, Campact and labour unions reached this goal. In February 2011, the results showed that 98,2 % of the citizens demanded the disclosure of the contract.
The arguments were on their side as all contracts between the public and the private sector should be published transparently because they affect the citizens. The Humboldt University of Berlin published a report stating that since the partial privatization the water costs have been rising faster. The Federal Cartel Authority assumes that the water prices in Berlin are about 25 % to rise. Some critics mention that the service as well as the maintenance of the pipe system have got worsen during the last seven years.
After the successful referendum, RWE noticed that the Berlin population was not so happy about the partially privatization and that the campaign image from RWE and Veolia was not in a good condition. RWE saw the opportunity by selling their parts back to the city for 618 mln. Euro to renew their image. But the Water-Initiative disagreed to the offer and didn’t like that the city should pay more then it would get ten years ago. Now, they prefer to buy it back for the same price or to look for alternatives to get the parts back. It’s to be assumed that the contract breaks the law and that the Berliner Wasserbetriebe is unlawful as well. The alternative should not cost more then the city got by the partial privatization and it is pointed out that the private partners earn so much money annually hence the city should not act silly another time.
Till today the public water supply has not come under the public control. The Water-Initiative is pursuing an alternative to the private water supply; the social, democratic and environmentally sustainable water recourse management.
Not only they are talking about the idea of a nationalization of the water supply, but also they have concrete ideas how to finance it. They proposed that not only the banks should get an easy and cheap money in consequences of the financial crises as they are relevant for the system. They wish the cities and community councils would get cheap credits as well from the European Central Bank. In consequence, Berlin were able to get a credit to buy the water supply back from the RWE and Veolia for 1,6 Mrd. Euros.
In October 2012, the government of Berlin bought the shares of RWE back for 618 million EUR and other contractual payments. The opposition said the price was too high and the financial model was risky. The Water-Initiative was afraid that the consumer would pick up the bill one more time.
The Water-Initiative is continuing to work on this topic and is looking for the best way of public water supply of Berlin. The citizens should be glad to have this Water-Initiative.