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#108894 - 10/03/05 04:33 PM GOB Takes Over BWSL on Monday
Marty Offline
Today, Belize's water company reverts back to Belizean ownership. Not sure what this means for the country exactly but the GOB should be the new owners starting today.

GOB Takes Over BWSL on Monday

On Monday the government will take over management and control of BWSL,
making it the first time that the government has re-nationalized a company
after privatization and in this case its one that bears the hallmark of a
failed privatization. On Monday the government will pay Cascal US$14.9
million equivalent to 60% percent of the company's share capital. That
US$14.9 million comes in a soft loan from the Taiwanese government.
Government will finance from Cascal the acquisition of the remaining
shares
valued at US$10.9 million over the remaining four years.

It's a big money deal but the bottom line for consumers is that it does
not
mean lower rates, in fact those rates may continue to increase. But, still
this morning in the national assembly when the government presented a
motion
to formalize the buy back, the PUP members called it an opportunity to
restore Belizean control to a national utility...while for the opposition
it
was only a way to salvage a costly commercial misadventure.

Rt. Hon. Said Musa, Prime Minister
"Madam Speaker the taking back of the controlling ownership, or majority
control, of BWSL by government, and eventually by the Belizean people, is
being done in response to popular demand. As a responsible and responsive
government we have heeded the call of the Belizean people."

Hon. Patrick Faber, UDP Collet Area Rep.
"Why is it that the government is in this instance trying to make it seem
like they are heeding the demand of the public out there when in fact the
public on so many other occasions have made cries and pleas to the
government."

Rt. Hon. Said Musa,
"I listened to the member for Collet and the truth of the matter is he was
uttering, and I don't think this is un-parliamentary, rubbish. He was
uttering pure unadulterated rubbish when he tried to suggest, well first
of
all he doesn't understand basic words much less concepts."

Hon. Francis Fonseca, Freetown Area Rep.
"That privatization has not satisfactorily met our goals as a government
and
so today we are doing the right thing, we are doing the right thing in
this
55th year of the life of the People's United Party, the greatest most
successful political movement in Belize. We're doing the right thing
because
our people have asked to do the right thing and we're doing the right
thing
because we understand the critical importance of ensuring that we have
good
effective water services in Belize."

Hon. Dean Barrow, Opposition Leader
"You will turn around, come to this National Assembly, beat yourself on
your
chest, and expect us to congratulate you for, you say, attempting to set
right this most grievous error that you committed back in 2000? Give us a
break please Madam Speaker. Cascal kept asking for increases in rates and
got several increases in rates so when the government comes as though well
we have not missed a beat: we sold the water services in 2000, we're
taking
it back in 2005, and Glory Hallelujah nothing has happened. In the
meantime
consumers have been burdened by increased rates Madam Speaker without any
commensurate increase in the quality of services. But Cascal was in a
position where it could claim the moral high ground. Cascal could say to
the
government, or say to the people of Belize it is your government that sold
us a bill of goods. It is your government that therefore has to give us a
rate of return, has to guarantee us dividends of $7.9 million I think it
is
annually because if they don't do that we will take them to court, that is
what has obliged the buyback. Cascal said to government either you will
pay
us millions by way of damages at the end of the arbitration process,
because
clearly the government was sure to lose, or you will relieve us from this
burden, you will take back the bill of goods that you sold us on the basis
of fraud. And that is why the government has to buy back the water
services.
Cascal wants to rid itself of the water services because of what it found
when it got there contrary to the representations that had been made by
this
government. So don't come here and play righteous with the Belizean
people.
Belizean people need to be very conscious of what is happening here and
the
government cannot be allowed to get away with their smoke and mirrors act
trying to portray what is in fact a fiasco as some kind of triumphalist
deal
that they have engineered."

Hon. Ralph Fonseca, Minister of Public Utilities
"Belizeans do want to own BWSL so we can start on that premise, we all
agree
to that, and that is what this government is accomplishing that no other
government has accomplished with any privatized entity for whatever
reasons.
So it is a fantastic accomplishment. The Prime Minister has been very
clear
that the majority of these shares will be going to Belizeans and he has
defined Belizeans as being Belizean individuals and Belizean companies
that
are majority owned by Belizeans."

Rt. Hon. Said Musa,
"I believe this is a very historic motion that we are passing today in
this
honorable House. Instead of giving credit for the meritorious work of this
government in putting the water company back into the hands of Belizeans,
they prefer to gripe on the other side about things that may have happened
in the past, a lot of it totally distorted as they have put it, and as the
Minister for Public Utilities has clearly laid out the facts, I believe
this
House will be guided by the facts and will give an overwhelmingly support
to
this motion."

Top
#108895 - 10/03/05 04:33 PM Re: GOB Takes Over BWSL on Monday
Marty Offline
from a friend:

Now that Belize has purchased back their water system, there are several things that should be done in my humble opinion (Opinion based on 30 years experience in the design and operations of water and sewer utilities). First, this system operation should be divided and transferred to "Water Service Districts" under the control of local government or newly created rural water service districts. This will truly place the operations and cost/service levels/rates under local control. The same water districts should be responsible for sewer service since these utilities are closely related for proper operations and maintenance responsibility. These new "Water and Sewer Districts" should stay within and not cross the current government district and municipal town limits for proper local government oversight. When responsibility is given to local people, they will then be in a position to accept this responsibility and stop pointing fingers at the GOB. This could be an ideal opportunity for the GOB to delegate responsibility directly back to the people of Belize who will then have to seek solutions to problems themselves with no finger pointing at others. The best government is local government in my opinion. The best control of water and sewer system operations is local control and responsibility in my opinion. When local people have the responsibility of utility operations, the elected or appointed Water and Sewer Boards will have the responsibility to ask the right questions and respond as demanded by the local people. This leads to better planning for economic development that will then benefit the country as a whole. The larger more populated cities such as San Pedro, Belize City, Belmopan, etc. should have their own Water and Sewer Boards and begin master planning the proper improvements and expansion of the water and sewer systems within their Town Limits. Meetings of these boards should be held on a regular basis and be open to the public for input at board meetings. With local boards, meetings become more accessible to the local utility customers for input. For larger towns, the town council can serve as the local "Water and Sewer Board" or this Board can be another appointed or elected group with specific duties to manage the water and sewer system. For rural districts, new boards would have to be formed.

The idea of privatization of utilities is an idea that has been tried in the United States to some extent. The theory is that private companies can do a better job of providing service than local government. It has been my experience, over the last 30 years, that is this not the case. Local government, with input from local citizens, has the potential to do a much better job of local utility service. Many private water and sewer utilities in Florida have been purchased back by local governments when it was found that the private utilities primary goal was to make a profit at the expense of deferred maintenance. Deferred maintenance and lack of system replacement leads to a significant reduction in service levels over time.

Belize is faced with a significant opportunity to improve water and sewer service if this new system ownership is properly delegated to local control of the people. Along with local control comes local responsibility. It will be interesting to see how the GOB handles this new opportunity.

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