16/08/10
Changed times mean new opportunities for the water sector.
"A new dawn has broken, has it not?" No prizes for remembering the speaker and occasion of this famous question. It is still quoted by apologists and critics of New Labour and Tony Blair. No such ringing summary marked the arrival of the Coalition and David Cameron. But no sentient being in these islands can doubt that a new era has begun.
It is too soon to waste time on comparisons (politicians exempted) but not to try to understand and shape the spirit of the age.
To begin with, let's agree a name – any Age worth its salt deserves one. No problem here – before they were elected, ministers sent us advance invitations to the 'Age of Austerity'. What they didn’t know, however, was that a few weeks later they would also be welcoming us to the 'Age of Coalition'. My attempts at a satisfying blend have, so far, not borne fruit (Costerity?) but the Chancellor at least explained the double meaning in his mantra "We’re all in it together".
What exactly are we in? If we play our hands right, the two elements, separately and together, present opportunities as well as troubles.
Two elements
Austerity has meant tough times for at least two years. Many readers will have recently-opened files and folders for ex-colleagues. The impacts of a tough price control, big spending cuts and tax rises to come are felt everywhere. Anxiety and insecurity affect individual lives and corporate strategies. We know government had to act, but the knowledge makes it no easier to respond to or bear.
Fortunately, this isn't the whole picture.
Coalition, officially anyway, is helping make austerity more human and practical. But by requiring compromise and accommodation, it may also prove to be the late-arriving sibling of ideas already in the plan: the Big Society, volunteering, localism. These are hugely unknown quantities, but it is at least possible they will encourage collaborations and innovations that add value across the economy and society.
Look on the bright side. Even with the uncertain outlook, water companies and associates have a lot going for them. They are effective businesses, environmental leaders, and trusted public servants. Can such optimism be justified, and what must be done to realise the potential?
Effective business
Government and society will continue to demand more for less. Meeting efficiency challenges is a way of life for water companies and one well-suited to times like these. But higher productivity and ever more effective delivery are also part of the story. With the right incentives, we can extend the boundaries of business and innovation for the benefit of consumers and shareholders.
But in this political and economic landscape, we have another priceless asset – experience.
Ministers are determined to drive policy. Government officials and 'arms-length' bodies will be advisers and deliverers and regulators but much less policy-makers. Could we see an end to the days when the voice of business goes unheard, while governments adopt over-complex or impractical solutions? Best not get carried away; but with a mature, collective approach to policy advice, the industry has a real opportunity to help deliver better outcomes.
Environmental leadership
The Coalition has set out its store as 'the greenest government ever' but is cutting budgets, including on the environment. Conservation groups are appalled, but the dystopia they conjure up (“Reedbeds dry and clogged…heathlands vanished…wetlands dwindled….wildlife in decline…”)* may be counter-productive.
The water industry’s proper role is to protect its business by protecting the environment, and vice versa. This may not sound like leadership but it is. By explicitly pursuing sustainable development; by creating partnerships with industry, land managers and local authorities; by engaging consumers and reflecting their concerns, companies will indeed be among the strongest supporters and advocates of the natural world.
Trusted public servants
In anything but a naughty world, being a private-sector public service would be an advantage; yet it is often uncomfortable. Water companies are among the most trusted corporate public servants. The new era is a chance to build community benefit and enterprise value on the platform of self-sufficiency.
If the big society means anything, it will reach beyond the voluntary sector. To be welcome, water companies must continue to deepen their public sector ethos, while growing private-sector effectiveness. Happily, meeting efficiency challenges is not the only way of life around here.
A version of this article, by Barrie Clarke, appeared in Water & Wastewater Treatment magazine August 2010
* Don’t cut the countryside, Wildlife and Countryside Link, 14 July 2010
