Hall, David ORCID: https://orcid.org/0000-0003-3574-8863 (2026) Why the GGF paper proposing mutuals for water is wrong. [Working Paper] (Unpublished)

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PDF (PSIRU Briefing) 54326 HALL_Why_The_GGF_Paper_Proposing_Mutuals_For_Water_Is_Wrong _(PSIRU BRIEFING)_2026.pdf - Accepted Version Download (445kB) | Preview

Abstract

The paper fails to make a convincing case for mutualisation instead of public ownership of water companies in England and Wales.
• It shows no awareness that when the same issue arose with the railway network 25 years ago, the Blair government tried creating Network Rail as a private not-for-profit ‘mutual’, which was later taken into public ownership because it did not deliver public control or economic efficiency.
• Internationally, water co-ops are marginal, used in some countries for thinly populated rural areas. The largest water co-op in the world serves less than 1m. people, in the Bolivian city of Santa Cruz.
• It mistakenly claims that Welsh Water and John Lewis are consumer mutuals, and fails to discuss the known governance problems of mutuals
• The GGF paper misrepresents its own polling results as supporting mutuals as the only option, whereas almost all groups except Reform voters preferred public ownership.
• It repeatedly assumes that public ownership would require compensation to the private owners, but somehow the shareholders would not demand compensation for mutualisation.
• It argues that mutualisation can provide public control, but insists that control by elected councillors must be kept to a minority
• It wrongly implies that public ownership would mean that costs would have to be covered out of taxes, whereas they would continue to be covered entirely by customer bills, as now.
• The proposals are driven by a UK rule about the debt of public companies which treats it as government debt, and so a new operator must remain private. But this rule is not used by EU countries and the USA, which have significantly lower borrowing costs than the UK.
• It makes proposals for ‘voluntary’ mutualisation, which could lead to company profits being used to pay shareholders instead of invested in water and sewer age systems.
• It contains some useful suggestions, for example setting rules for the levels of breaches of duty which would lead to a company being taken into public ownership – yet if applied, it would lead to the automatic Special Administration of Welsh Water – which the GGF use as a model for their proposed mutuals.

Item Type:	Working Paper
Uncontrolled Keywords:	water; privatisation; mutuals
Subjects:	H Social Sciences > H Social Sciences (General) H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HJ Public Finance
Faculty / School / Research Centre / Research Group:	Greenwich Business School Greenwich Business School > Executive Business Centre Greenwich Business School > Political Economy, Governance, Finance and Accountability (PEGFA) Journal of Economic Literature Classification > Political Economy, Governance, Finance and Accountability (PEGFA) Greenwich Business School > Political Economy, Governance, Finance and Accountability (PEGFA) > Public Services International Research Unit (PSIRU) Journal of Economic Literature Classification > Political Economy, Governance, Finance and Accountability (PEGFA) > Public Services International Research Unit (PSIRU)
Last Modified:	03 Sep 2026 13:04
URI:	https://gala.gre.ac.uk/id/eprint/54326

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