Official portrait of Jeremy Corbyn. Photo: Chris McAndrew/Wikimedia Commons

Canadian pension plans with holdings in for-profit water utilities in England are likely thinking about the ramifications of the next general election in the United Kingdom and the possibility of Prime Minister Jeremy Corbyn.

That’s because the Canada Pension Plan Investment Board (CPPIB), the Ontario Teachers’ Pension Plan (OTPP), the Ontario Municipal Employees Retirement System (OMERS), and the Quebec Deposit and Investment Fund (CDPQ), a.k.a. the Caisse, all have shares in for-profit water companies in England.

In 2006, the CPPIB invested $1.05 billion in Anglian Water, which sells water to 6 million customers. In 2010, the Caisse invested $259 million in South East Water, which has 2.2 million customers. The OTPP owns 27 per cent of Northumbrian Water, which has 3.3 million customers. And last year OMERS increased its stake in Thames Water — which has 15 million customers — with a 1.35-billion-pound investment along with the Kuwait Investment Authority.

But the U.K. Labour Party manifesto in 2017 stated, “Many basic goods and services have been taken out of democratic control through privatization. This has often led to higher prices and poorer quality, as prices are raised to pay out dividends.”

It notes:

“Water bills have increased 40 per cent since privatization… Labour will learn from these experiences and bring key utilities back into public ownership. We will replace our dysfunctional water system with a network of regional publicly-owned water companies.”

In the June 2017 general election, Corbyn’s Labour Party won 40 per cent of the popular vote, while the Conservatives under Theresa May failed to secure a majority government with 42 per cent of the popular vote.

Last month, the Observer reported that an opinion poll found that the two parties were deadlocked at 39 per cent of the vote each.

While the next general election is scheduled for May 5, 2022, it could come much earlier given the precarious nature of minority governments.

Next year marks the 30th anniversary of the legislation introduced by former prime minister Margaret Thatcher’s government that facilitated the privatization of water services in the U.K. Canadian pension plans swooped in after Thatcher’s move to make money off this privatization and have been undeterred by reports of an increase in water poverty.

In fact, it would appear that the pension plans were drawn by the lure of high profits. When the CPPIB invested in Anglian Water in 2006, The Globe and Mail exuberantly reported, “Returns on water companies have outpaced oil in the past two years.”

The reality that the disconnection rate tripled in the first five years after privatization does not seem to have raised ethical concerns for the pension funds.

The rip-off continues to this day.

Last year, the Financial Times reported, “Consumers in England are paying 2.3 billion pounds more a year for their water and sewerage bills under the current privatized system than if the utility companies had remained in state ownership, according to research by the University of Greenwich.”

Canadians, as well as teachers and municipal employees in Ontario and government employees in Quebec, should not want their pension income to be based on profits extracted from a human right.

Ethics and the public interest have not stopped Canadian pension funds profiting from water. Hopefully Corbyn will.

Brent Patterson is a political activist and writer.

Photo: Chris McAndrew/Wikimedia Commons

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Brent Patterson

Brent Patterson is a political activist and writer. He has worked in solidarity with revolutionary Nicaragua, advocated for the rights of prisoners in jails and federal prisons, taken part in civil...