The Council of Canadians - Winnipeg Chapter


Hold Veolia Accountable

Posted by Winnipeg Chapter on April 28, 2011 at 4:28 PM

In light of City Hall's 30 year commitment to Veolia, the Council of Canadians Winnipeg Chapter is dedicated to remaining civically vigilant. The agreement overview provided by the City portrays a less objectionable deal than was previously contrived, but we must continue to hold the City and Veolia accountable to Winnipeggers for the claims of transparency, uncompromised service for Winnipeg citizens and the ability to meet environmental standards.

Eleven months after being approved in principle by City Hall, the City of Winnipeg has finally concluded its contract talks with the transnational firm Veolia to oversee the much needed and provincially mandated upgrades to two of the City's wastewater treatment plants.

  North End Water Pollution Control Centre


South End Water Pollution Control Centre


For those of us who had laboured long, hard and valiantly against this arrangement, particularly during the last civic election when there had been some hope of holding councillors in favour of the deal accountable, this occasion is tinged with sadness. One of the world's most notorious water profiteers has secured a role in directing an important infrastructure project, which may well have consequences not only for efficient management of a vital local service, but for the world-wide battle for public control of water and waste services.

There is good news however. The summary document which was released last Wednesday (April 20, 2011), makes it reasonably clear that control of our wastewater services will remain in public hands. In fact the document was explicit about this. The France based firm will see its role restricted to consultation. Veolia has clearly convinced the city that their decades of experience and various innovations will supply the department with invaluable expertise which can be embraced or rejected at the discretion of the Director of Water and Waste.

The contract “permits the City to make unilateral decisions in certain areas without incurring financial penalty.” However, the contract also makes explicit the idea that Veolia would not be “unfairly penalized because of a City decision” presumably at variance with Veolia's assessment of how to meet target costs. In other words, if the city chose to reject a recommendation, say, to cut corners on parts or raise rates, decisions that could adversely affect stakeholders in the name of meeting the bottom line, the city would lose the ability to share their risk with the firm. Arguably, this could create an institutional incentive to embrace Veolia's “expertise” just to keep their “skin in the game” to borrow a quote from the Mayor.

The document talks about “incentives for meeting or exceeding quality targets on key performance areas...set by the City...” This means Veolia would get rewarded financially if there is service excellence in areas such as human health, safety, waste reduction and GHG mitigation among other areas. Like waving a carrot in front of a mule, Veolia will be motivated to work wonders with our city sewage treatment otherwise they won't get paid as much.

Given Veolia's track record this is not much of an insurance policy. Moreover, one should recall that Veolia is a huge company with operations in hundreds of communities in seventy countries around the world. Chances are they would be less adversely affected by a financial hit in one jurisdiction than, say, the City of Winnipeg would in the event of an accident.

The document seems to have been designed to mitigate the possibility of lawsuits. The Agreement contains an alternative dispute resolution provision. As an advisory body, Veolia teams up with City employees and arrives at a consensus before sending recommendations up to the City Manager. If a dispute should arise however, mediation and binding arbitration can be requested by Veolia.

According to the summary document, the City can back out of this thirty year arrangement without cause, or for convenience, if it is willing to pay Veolia a sum of $5 million. This is a substantial bargain compared to the more than $24 million the City of Indianapolis is on the hook for in their struggle to be free of the French firm.

Within the Council of Canadians, and some of our partners in Winnipeg Water Watch, there is a recognition that the deal announced last week is far superior to the “water privatization” that many of us saw on the horizon back in the spring of 2009. During her Earth Day speech in Winnipeg at the Fort Garry Hotel, Council of Canadians National Chairperson Maude Barlow made a special effort to highlight how the activism of the local chapter and other citizen groups in Winnipeg made a difference.

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Maude Barlow in Winnipeg on Earth Day 2011           


In this regard, the Winnipeg Chapter would like to thank all of our friends, both within the Water Watch alliance and as individuals, who worked with us to alert Council and the general public as to the significant hazards associated with these sorts of public-private partnerships.

We have taken a step back by introducing a profit motive into our public wastewater system. Cities around the world have fought for years to eventually end their contracts with Veolia. As Winnipeg will undoubtedly come to the same conclusion we remain steadfast in our determination.

Contributor: Michael Welch - Chair, Council of Canadians - Winnipeg Chapter


Categories: Wastewater Treatment Plant Upgrades, What's the deal with VEOLIA?

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