Abstract
This article analyzes the provision of urban water in Australia’s three east coast capital cities—Sydney, Brisbane, and Melbourne—from the big dams of the post–World War II years to recently completed desalination plants. We trace how major statutory authorities and their engineers built up both their organizations and their water storage and distribution assets in the Fordist 1950s and 1960s, before these bodies were restructured under the guise of neoliberal notions of accountability and profitability. In their quest to break apart the key institutional pillars of the mid-twentieth-century city, some Leftist critics of the Fordist state may have inadvertently sown the seeds of the neoliberal city of the early twenty-first century. We conclude that the new market-driven organizations are just as interested in their own survival as were their predecessors, and demonstrate even less trust in the general public’s knowledge and practice around water use and conservation.
In a September 1976 speech marking his retirement as chief engineer of Melbourne’s water, sewerage supply and planning agency, the Melbourne and Metropolitan Board of Works (MMBW), Alan (Robbie) Robertson acknowledged the assistance and support he had received over the years from a range of semigovernment organizations similar to his own. 1 While singling out the State Rivers and Water Supply Commission (SRWSC), the Country Roads Board (CRB), and the State Forestry Commission (SFCV) for special mention, were he of a mind to Robinson could have added a long list of other innocuous-sounding boards, commissions, and agencies, including the State Electricity Commission of Victoria (SECV), the Housing Commission of Victoria (HCV), the CRB, the Gas and Fuel Corporation of Victoria (GFCV), and the Melbourne and Metropolitan Tramways Board (MMTB), whose task it was to keep the modern city watered, powered, housed, and moving. Most of these organizations were statutory authorities, with their own boards, and some autonomy from the government of the day. Their acronyms and the tasks they performed were a familiar element of daily life in Melbourne for much of the twentieth century, with similar organizations operating as the dominant providers of urban services to city residents across Australia and indeed around the Western world.
Mostly founded in the late nineteenth and early twentieth centuries, these organizations were integral to the process of modernization and governmental attempts to alleviate the physical and social problems of rapid urbanization. As in the case of Melbourne’s Board of Works, the provision of safe drinking water and the removal and treatment of sewerage were central to these objectives. Historical geographers and cultural historians have recently sought to locate the almost simultaneous emergence of water and sewerage provision within newer understandings of the modern “networked” city that emerged in Europe and North America in the last decades of the nineteenth century. As Matthew Gandy has argued, “water is inextricably linked with the idea of infrastructure as a technical and organizational domain that underpins the functional dynamics of urban space.” 2 Similarly, Richard Dennis has suggested that water and sewerage provision were an integral component of a project to modernize and “network” the unruly and potentially dangerous city. Alongside new or massively upgraded transport and communications systems, water supply and sewerage systems had both literal and symbolic meanings to the modernizing city. While all were about linking disparate districts and communities into one overarching functioning whole, an efficient water and sewage disposal system “implied a city that was also morally cleansed, where the subterranean no longer threatened civilization” with disease or revolution. 3
Australia was part of this process, and in the last decades of the nineteenth and first decades of the twentieth centuries, a number of semigovernment “networking” organizations similar to the MMBW sprung up in cities across the country for much the same reasons—the rapidly expanding capitalist city required the guiding hand of the state to function efficiently. Several decades, a depression and two world wars later, ideas about the central role of the state in ordering the efficient city became near universally accepted, having been strengthened and augmented by the apparent success of centralized planning during wartime and in the early years of reconstruction, and later by the apparent success of Keynesian economic ideas in the postwar era. 4 Usually dominated by engineers and other technocratically educated “practical men,” these organizations became central to the efficient running of rapidly expanding postwar metropolises, adapting to the impacts of what has come to be known as “Fordism”—mass affluence, based on consumption, suburbanization, and mass car ownership. By the middle of the twentieth century, the senior managers of these semigovernment organizations had become, like the heads of similar bodies in many cities across the world at this time, prominent and powerful, albeit in the Australian case, unelected players in urban policy and politics. 5
Understanding the cultures of such organizations, and the men who ran them, then, is central to an understanding of the mid-twentieth-century Fordist-era city. Drawing on ideas and training in modern, rationally conceived, scientific principles, the engineers who dominated these organizations were convinced their solutions would inevitably lead to good outcomes. As urban historian Graeme Davison has argued, the culture and ethos of the engineers who ran these utilities were fundamentally rational and Modernist in approach and outlook: “like market research, scientific management, project building and other new American forms of expertise that were transforming the urban environment,” engineers believed their task was to “reduce uncertainty, effort, dead time and wasted space; to streamline decision-making and to increase the volume and accelerate the flow of transactions, trips and decisions.” 6 As with the traffic engineers for whom the freeway was the rational response to road congestion, and the architects and planners who saw the solution to the problem of inner city slums in demolition and replacement with high-rise towers, so too for “Big Water” engineers the logical solution to the problem of urban water shortage and the “thirsty” city was the ever-larger dam. 7
Until the 1970s in Australia, as in many other jurisdictions, these “big government” organizations were integral elements of the postwar (or Fordist) settlement, but in the 1980s and 1990s most were “reformed” beyond recognition or privatized outright, succumbing, we argue, to the cult of neoliberalism and the “small state.” Those that remain are often at the forefront of attempts to involve the private sector in the provision of what were until recently almost universally recognized as public goods and are thus symbolic of the triumph of market-oriented ideas about governance, policy, and provision in the contemporary era. It is a mistake, however, to assume that it was just the advocates of the free market who were responsible for the demise of organizations such as the MMBW. Other forces and ideas were also a factor and were alluded to by Robertson toward the end of his retirement speech. Expressing both exasperation and sadness at the increasing attacks on the culture and behavior of the MMBW by the media and influential members of the professions and the public, Robertson, like his counterparts elsewhere, seemed quite bewildered by a growing chorus of criticism of what he and his colleagues saw as the rationally conceived and delivered plans and urban improvement projects they had brought to the city and the state. 8 Such criticisms became common in the 1970s as the social democratic Left began to target these organizations as out of touch, undemocratic, and economically inefficient. As Renate Howe, David Nichols, and Graeme Davison have recently argued, by the 1970s these semigovernment organizations were routinely dismissed by their critics as “bureaucratic silos, unresponsive to democratic influences,” and new ideas about governance and accountability. 9 Later, in the 1980s and beyond, many of these same criticisms were taken up by the neoliberal Right who were less interested in democratic accountability than in aping market rigor and profitability.
Histories of Australian water utilities have been well told in a number of mostly official histories, commissioned from the 1960s to the 1990s, usually to reflect an anniversary or other major institutional milestone. As official histories, their emphasis is on leadership and administrative structures, engineering achievements, and a healthy water supply, although workplace culture and some sense of cost–benefit analysis are present in the better ones. The first of these was Aird’s heroic account of the Sydney Metropolitan Water Sewerage and Drainage Board, which celebrated the opening of the Warragamba Dam in 1960. The large cloth-bound volume celebrated “the never-ending task of providing water, sewerage and storm water drainage for an ever-growing metropolis.” 10 As studies of extant organizations, written at a time which we now recognize as the end of the Fordist era, these histories by definition cannot historicize the values of the organizations they extol. Twenty years on, such analysis is central to any attempt at understanding the culture, dynamics, and the grand projects of the Fordist years, but perhaps more importantly how many more recent infrastructure projects—from privately owned tolled freeways to desalination plants—have come to symbolize the triumph of neoliberal ideas and policies in the contemporary city.
In this article, we document the fundamental changes in the cultures of a number of these organizations in Australia over more than half a century, as they morphed from bastions of “state socialism” in the interwar and postwar years to staunchly neoliberal in the present. 11 We do so by first outlining the technocratic, engineering-focused “big water” cultures of the water supply agencies of Australia’s three major east coast cities, Brisbane, Sydney, and Melbourne, from the 1940s to the 1970s. 12 We then explore the restructure or demise of a number of these organizations in the 1980s and 1990s as they came under assault from critics from first the Left and then the Right, both of whom increasingly dismissed them as insular, arrogant, undemocratic, and unresponsive to new ideas and attitudes toward the public and the marketplace. Finally, we examine the reemergence of technological responses to water shortage issues in the form of privately funded desalination plants in the early 2000s. In uncovering these urban water histories, we have two main aims: first, to both locate the east coast Australian experience of the provision of urban services within emerging national and international scholarship on the history of public versus private provision of urban services, and, second, to show how in the Australian case, this seemingly interminable search for “solutions” to the most efficient and effective way to provide wet-climate levels of water to cities must inevitably bump up against the problems of doing so in a “dry” continent. 13 By historicizing the ideas and circumstances that created cultures of statist organizations in the postwar era, we also suggest that in their quest to subvert, democratize, and break apart some of these key institutional pillars of the mid-twentieth-century city, some 1970s-era Leftist critics of the Fordist state may have inadvertently sown the seeds for the triumph of the market-driven neoliberal city of the early twenty-first century.
The 1940s to the 1970s: Drought in the City, Water Engineers to the Rescue
All of Australia’s capital cities experience periods of drought, as does most of the continent. In rural areas and on the periphery of each city, there is a high consciousness of water use because most people still rely on tank water in more isolated locations. On acreage blocks, so popular with the cashed up middle class not only wanting access to the city but also desiring rural ambience, tanks are still being installed because of the astronomical cost of connecting such low-density settlements to “town water.”
Sydney
Sydney, the largest Australian capital city, experienced one of its most severe droughts between 1934 and 1942. The atmosphere in the city and the far-flung suburbs is well captured by Marjorie Barnard in her short story “The Dry Spell”:
It was the third waterless summer, and the heat had come down like a steel shutter over the city . . . The sun had beaten the Emu Plains to a black brown on which the isolated houses and the townships themselves drifted like flotsam on a dead sea . . . In the wealthy suburbs of the North Shore and Vaucluse a change had taken place too . . . all the fine houses that had nestled so comfortably in the contours and in the greenery, were forced up into the light . . . The shores of the harbour were lion-coloured or drab grey. Sand hills showed a vivid whiteness. Only the water was alive and brilliant. And it was salt.
The dams built by the Metropolitan Water, Sewerage, and Drainage Board in the early decades of the twentieth century—Avon, Cordeaux, Cataract, and Nepean—simply could not keep up with either population growth or industrial demand. Average daily consumption increased 70 percent between 1925 and 1935, while the population only increased by 8 percent. In May 1940, the Water Board introduced severe water restrictions, the longest in its history, lasting two and a half years. In response to this crisis, the Board’s engineers started work on a scheme to dam the Warragamba River and flood the Burragorang Valley, which would create Australia’s largest urban dam. A local defense league formed, advocating that the valley should be turned into a national park, “the final link in a circle of scenic splendor” from Katoomba to Bulli Pass. These calls fell on deaf ears. Most people, including successive state governments, thought that the needs of a massive city far outweighed the bleatings of a few farmers and holiday makers, at a time when few paused to consider the ecological implications of flooding valleys.
It took twelve years to build Warragamba (1948-1960), and many of the workers, including migrants, moved to this Western Sydney site from the Snowy Mountains Hydro-electric Scheme. Both projects were held up to primary and secondary school children as examples of how engineers were improving Australia with hardwork and ingenuity. The official opening brochure, under the auspices of Labor Premier Heffron, acknowledged the landscape destruction. The brochure admitted that the drowned valley “was once the secluded haunt of aborigines and later, a fertile farming district and popular holiday resort.” It noted that farms, guesthouses, schools, and churches had all been demolished, their flooding “inevitable in the cause of progress,” the dam “essential to the future of Sydney,” and the health and livelihood of the people. 14 Warragamba, with a capacity of over 500 billion gallons, had more than three times the storage capacity of all of Sydney’s previous dams added together. The Water Board told residents that Sydney would now always have a plentiful supply of water. 15
Melbourne
In Melbourne, the task of providing water and sewerage became the responsibility of the MMBW, founded in 1891. By the time of the outbreak of World War I, the Board had made great headway in dealing with the backlog of water supply and, according to its official historians Dingle and Rasmussen, “five to seven thousand houses each year” were being connected to Melbourne’s water supply system. 16 In the interwar years providing water for a growing and spreading population saw the MMBW’s engineers embark on a series of major dam-building schemes. Such projects included the Maroondah (5.8 billion gallons) in 1927, the O’Shannassy (792 million gallons) in 1928, and the Silvan Reservoirs (10.6 billion gallons) in 1932, all of which were located in the Upper Yarra catchment zone. 17 Between them, these three projects more than doubled the metropolitan water supply. In the postwar period, the Board built more and ever-larger dams, usually in anticipation of population growth but also at various times as a reaction to drought and water shortages. The Upper Yarra Reservoir (52.8 billion gallons) was completed in 1957. Tarago, a small dam (9.9 billion gallons) designed to service the rapidly growing outer southern metropolitan regions of Westernport and the Mornington Peninsula, was completed in 1969 before being enlarged in 1971. The Cardinia Reservoir (75.8 billion gallons), located in the outer southeastern suburbs, was completed in 1973, the same year as the Greenvale (7.1 billion gallons), which services the outer northwest of the city. Each of the reservoirs had been long planned, but their development was hastened by the major drought of 1966-1967 when Melbourne experienced its driest year on record (up until then). In 1967, only 15 inches of rain fell on the city, less than 60 percent of the annual average. The February figure was less than 10 percent of the average. Water shortages and restrictions on use were implemented to cope, but in a technocratic age, new dams were considered the ultimate solution to all such problems.
In response, “droughtproofing” the city became a catchcry of policy in the 1970s. The development of the Sugarloaf Reservoir (25.3 billion gallons) to service the northern, western, and central suburbs, which was completed in 1981, and the massive Thomson Reservoir, with a capacity of more than 264 billion gallons, which came on stream in 1984, were all part of this strategy. In building the Thomson Reservoir, the MMBW and the government more than doubled Melbourne’s water storage capacity and had, it was believed, permanently solved the water shortage issue. As Dingle and Rasmussen show, relatively good rainfall in the 1970s meant that lessons about conserving water learnt during the late 1960s were largely forgotten in the following decade. So, too, the belief that the Thomson Reservoir would soon “droughtproof” the city meant that water use, especially for domestic purposes, was allowed to grow faster than population. While industrial use of water stabilized in the 1970s, partly as a result of deindustrialization and the growing importance of services over sometimes water-intensive manufacturing production, domestic consumption inside the home went up by 15 percent across the decade. More troublingly, domestic water consumed outside the house rose by 52 percent during the same period. 18 Thus, while the on-demand hot water services, dishwashers, multiple bathrooms and toilets, and daily or twice daily showers that became the suburban norm in affluent postwar Australia were responsible for a rapid increase in water consumption, the biggest problem was not these luxuries but the continued use of potentially scarce potable water for industrial use, watering gardens, and cleaning driveways and backyard swimming pools. Melburnians obviously loved their gardens, but because water charges were mostly based on the ratable value of a property, and only minimally on actual usage, such wasteful use of a scarce resource meant that such behavior came at minimal or no cost to the householder. This was especially the case if they lived in a big, expensive house which attracted high rates and thus abundant “free” water.
Fifteen years on, the drought of 1982-1983 was, like that of 1967, to be a major catalyst for change. But as the 1980s wore on rather than seeking to “droughtproof” the city by building newer and larger dams in the traditional manner, a series of new initiatives were tried, the most successful of which was an advertising campaign that warned against being a “Wally with water,” by not turning off taps and using water to clean driveways. 19 Combined with later policies such as pricing water use, the campaign helped to reduce per capita consumption throughout the 1980s and beyond, an idea and a policy that as we shall see was especially useful in the drought of the early 2000s. More than thirty years later, the Thomson remains the last reservoir to be built for Melbourne.
Brisbane
Without a statutory authority with the expertise to be found in the MMBW and the Sydney Water Board, Brisbane’s dam history has been fraught with overlapping responsibilities and bedeviled by how to handle huge floods, the only state capital to face that problem, as Brisbane is built along a riverine floodplain. With Australia’s only capital city metropolitan council, Greater Brisbane exerted enormous power over land use, electricity, public transport, roads, housing, and water and sewage disposal. The equivalent in Melbourne or Sydney would have been combining the powers of the MMBW or the Sydney Water Board with over twenty municipalities. Sydney’s move for metropolitan government failed a number of times, while Melbourne’s sole attempt failed by one vote in the conservative upper house in 1955.
Somerset Dam (1959) and North Pine Dam (1974), both northwest of the city center, were administered by the Brisbane City Council (BCC), not least because the Council feared that the State Government’s Water Supply and Irrigation Commission would favor farm use over urban consumers. A continuing gerrymander delivered disproportionate power to country voters. In 1971, the Coordinator General’s report was titled Future Brisbane Water Supply and Flood Mitigation, recommending a dam at Wivenhoe to hold over 300 billion gallons, 20 three times the size of Somerset—it did not happen soon enough to save Brisbane from the 1974 flood, the worst since 1893. All of the central business district and all of the suburbs built on the floodplain, including not just those abutting the Brisbane River but its tributaries, were inundated.
Having had its electricity operation taken off it by the Queensland State Government, the BCC fought bitterly against the establishment of a Brisbane and Area Water Board (1979), fearing it would be dominated by rural shires, and it was. Those shires had the ear of Country Party Premier Bjelke Petersen and Minister for Local Government Russ Hinze. Nonetheless, the BCC, its Town Clerk a proud traffic engineer, continued to own and operate the dams that enabled both industry and residents to use water in a profligate manner. In the 1980s, both the major political parties in the BCC agreed that they would stop installing water meters, so residents had no idea how much water they used, and were not charged for water usage, simply rated on the unimproved capital value of the land they occupied. 21 Brisbane did not introduce a two-part tariff for residential water, with the price rising the more one used, until 1997, over a decade after Melbourne and Sydney had opted for price signals as one way of curbing demand. 22
Forty miles from the city center, and 93 miles upstream via the Brisbane River, Wivenhoe Dam, according to the minister in charge at the opening in 1985, would make water available “at the turn of the tap.” 23 No wonder the City Council could give up on issuing more water meters to residents. With a capacity half that of Sydney’s Warragamba Dam, but designed to serve a city with only one-third of Sydney’s population, Brisbane seemed to have water forever, a perception reinforced by the 1974 flood. Wivenhoe had another role, to store up to 400 billion gallons of floodwater. This mitigated the impact of the January 2011 flood but did not prevent known flood prone areas from succumbing to the nearly 15 foot flood. Successive state governments have had neither the bravery nor the foresight to compulsorily acquire such land, even though after a flood it can be resumed very cheaply. Many an engineer recommended such a course of action, but engineers’ advice is much more likely to be taken when recommending a bold new structure—be it a dam or a desalination plant—than an intervention in the ownership and appropriate use of privately owned land. 24
The 1970s: The Social Democratic Challenge
The era of the “big dam” came to an end in the 1980s, most notably in Melbourne, in part because from the mid-1970s until its demise in the early 1990s, the MMBW increasingly lost its legitimacy as a provider of public infrastructure, mainly as a result of its heavy-handed engineering culture. What was seen internally as the organization’s greatest strength—its rationality and technocratic responses to issues and problems—increasingly came to be seen by critics as pigheadedness and inability to listen and respond to genuine public concern. While most criticism related to the Board’s major function as the city’s planning- and freeway-building agency rather than its role in water supply and sewerage disposal, it also reflected growing disquiet about the ethos and high-handed attitude of Fordist-era semigovernment organizations, whose interests seemed increasingly at odds with those of the public and the times. In the case of the MMBW, the abrasive personality of Chairman Alan Croxford (“Big Al” or “Mr. Chairman”) did not help matters, but more there was a sense that an organization created to provide a public good in the 1890s, had by the 1970s become a bloated, undemocratic monolith, out of touch with modern democratic attitudes and public-sector management ideas. 25 The story of the MMBW in the 1970s and early 1980s which follows then is thus a useful case study of how an organization that, if never actually loved by the public, came to increasingly symbolize much that was seen to be wrong with Fordist city governance.
By the time of Alan Robertson’s retirement as Chief Engineer in 1976, the Board was under attack from the Left via residents of the gentrifying inner city who objected to its freeway-building agenda and pro-development planning policies, and the social democratic Australian Labor Party (ALP), which was increasingly dominated by professionals who saw the MMBW as an essentially unreformed and undemocratic shadow government. While in the late 1960s longtime conservative Premier Henry Bolte had threatened to disband the Board, or at least strip it of many of its powers in the wake of its perceived poor response to the recent drought, it managed to survive and prosper. It went on to withstand a scandal over conflicts of interest between Croxford’s private property development interests and his professional role at the MMBW and the replacement of Bolte as Premier by the modernizing Rupert Hamer in 1972, to remain a powerful force well into the new decade. 26
Pressure for change continued to grow throughout the 1970s, however, as the Board came under increasing criticism for its behavior, attitudes, and policies. In 1975, in response to a decision to unilaterally increase water service charges and rates, the state leader of the ALP, Clyde Holding, suggested that the Board had all the “trappings of the de facto government” and a “one-man band orchestrated by an all-powerful chairman.” 27 Two years later, the longtime urban affairs reporter for the Age newspaper David Wilson described the MMBW as a “dinosaur in the modern world,” with the same “administrative structure as it did when it was established in 1891.” Further describing it as a “monolithic mini-parliament,” Wilson noted that the Board had a “staggering $989 million in debts.” For every dollar received in rates, 51 cents went “toward paying off their debts” and a further 17 cents on “the administrative costs of the board.” 28 A few months later in September 1977, when giving evidence to an inquiry into the Board’s current structures and future roles, architect, Methodist Minister, community activist, and later state ALP Water Minister Andrew McCutcheon labeled the MMBW a “‘bureaucratic dinosaur’ producing antiquated policies and programs.” 29 As the ALP mayor of inner urban Collingwood McCutcheon was perhaps simply echoing party policy, which called for the Board to be stripped of its planning functions and ultimately abolished, but as a future state ALP parliamentarian and minister, he should also be recognized as a representative of the new residents of the rapidly gentrifying inner city who were loudest in their calls for reform of the MMBW and similar organizations.
By the early 1980s, the prospect of the election of the first ALP-led government in Victoria in twenty-seven years meant that the Board’s days and that of Croxford as Chairman were numbered. While throughout the 1970s the ALP had vowed abolition, its 1982 election manifesto only pledged to “act promptly to replace the Board of Works with a Melbourne Metropolitan Authority more responsive to the needs of Melbourne residents.”
30
Political scientist Tony Dalton sees in this shift evidence of a “waning commitment” to local democratic representation and “centralist tendencies” within the upper echelons of a party concerned to first ensure election and to enshrine new governance structures. According to Dalton,
there were two ways in which the MMBW could have been restructured and the power of Croxford and his group challenged. One was in line with policy, namely a democratic metropolitan authority. The second option was to bring the functions of the MMBW under greater ministerial control.
31
It was the latter that was followed, largely at the behest it seems of the new Premier John Cain who writes in his memoirs that alongside the other organizations of the Fordist city, the MMBW had been “largely left” to “determine the shape of their development and growth as they saw fit, often without regard to other responsibilities of government.” Obviously referring to Croxford, Cain wrote that “in some cases they were managed by assertive individuals who wished to leave their own stamp on everything that the authority undertook.” 32 The solution adopted by the new government was to immediately strip the MMBW of its planning role, make it accountable to a Minister and force the resignation of Croxford, which he did in May 1982.
While the new ALP government shied away from abolishing the Board, it did force it to adopt a user-pays water pricing system, and new accounting practices, including returning dividends to the government. Such moves reflected the growing influence of new public sector management ideas in English-speaking countries at that time. In Australia, ALP governments at state and national levels were at the forefront of moves in these directions, while later radical free-market conservative governments broke up and privatized many of the former organs of the Fordist city. 33 This path had been set by the New South Wales ALP Premier Neville Wran, who after being elected in 1976 insisted that semigovernment organizations there, including the Sydney Water Board, adopt new management and accounting practices, including using debt rather than retained income to fund projects, requiring them to achieve an agreed “rate of return” revenues, and to use these to pay dividends to the state. Wran argued that these policies were social democratic in orientation and benefited working people by allowing the government to better utilize money that had been “squirreled away” in “hollow logs” by inefficient and undemocratic organization beholden to no one. 34 Premier Cain similarly argued that the policy was designed to ensure that these organizations, which “were put on business footing, with real rate of return accounting,” became more responsive to the needs of consumers and citizens. The new government also “took steps to see that [these organizations] were managed by people who would understand and respond to government policies and strategies.” 35
The 1990s: The Neoliberal Challenge
While in the 1970s the greatest critics of semigovernment organizations such as the MMBW were the mainstream Left, whose ideas reflected those of inner urban political and social activists who sought to impose democratic accountability on them, by the early 1980s another important group had emerged who insisted that these organizations could never be made responsive to consumer and business need while they remained in public ownership. In Australia, these ideas were taken up on the emerging neoliberal wing of the conservative Liberal Party, who from the late 1980s onward increasingly voiced objections to both what they saw as the economic inefficiency of state-owned organizations such as the MMBW and the very existence of these as a relic of outmoded “state socialism.” Increasingly influenced by neoliberal economists and free-market think tanks, growing numbers of conservative commentators and politicians argued that these organizations could by definition never be made really accountable and that the only solution to what they saw as their intractable problems was contestability, competition, and ultimately private ownership. One of the strongest advocates of this thinking was local economist Michael G. Porter (not to be confused with American scholar Michael E. Porter), who became an influential figure in Australian public policy in the 1980s and 1990s. 36
At the height of the 1990-1991 recession, Porter’s privately funded Tasman Institute released a report commissioned by employer groups that essentially became the blueprint for the economic policies implemented by the free-market Liberal (conservative) government elected in 1992. The breakup and privatization of semigovernment organizations and utilities were central to these ideas and policies. Porter’s report, Victoria: An Agenda for Change, argued that “government failure is more not less than a problem than market failure,” and that accordingly, “there is a strong rationale for vastly reducing the role of government in running businesses and the direct provision of some other services.” 37 Much of the report was directed toward the alleged inefficiencies of the state-owned or managed organizations that Robertson had so lauded in his 1976 retirement speech: the Gas and Fuel Corporation, the SECV, the MMBW, and the Port of Melbourne, which between them “manage assets valued at over $27 billion and employ more than 32,000 people.” 38 While the other three were recommended to be essentially privatized once they were broken up into their component parts, in the case of the MMBW, Porter and his team called for reform along the lines of that recently instituted in Britain and France to encourage “greater competition, and establish commercial incentives for water and sewerage enterprises aimed at reducing costs, improving capability to undertake capital investments and providing more scope for entrepreneurial management.” 39
In the 1990s, under the regime of the radical conservative Kennett Liberal government, elected in late 1992, much of this neoliberal agenda was put in place. While in the final years of ALP government the MMBW had been restructured to and renamed Melbourne Water, a state-owned corporation, under Kennett, it along with the electricity and gas utilities was broken up into wholesale and retail components with the intention that all would eventually be sold off to the private sector. But while privatization was the fate of the gas and electricity providers, for electoral reasons Melbourne Water remained in government hands and to this day retains its responsibilities for water catchments, sewerage, and the wholesale supply of water. Three state-owned retail water supply corporations sell and supply water and sewerage to residents and businesses within defined geographic zones of the metropolitan area. 40
Similar policies were implemented in Sydney. The Greiner Liberal government slashed the workforce of the Water Board and demanded a better return on capital. The new Sydney Water Corporation Ltd. was charged with protecting the environment and public health and operating in a commercial manner, promoting user-pays pricing to encourage water conservation. Ecological risk assessments were to be done in conjunction with the Environmental Protection Agency. 41 The new corporation did not perform well in these tasks. In 1998, an outbreak of Cryptosporidium and Giardia in Sydney’s water supply saw regular headlines in the Sydney Morning Herald reminding residents that they had to boil their drinking water. 42 The Chair of the corporation resigned and yet another body, the Sydney Catchment Authority, was set up to manage dams, reservoirs, and catchment areas. The Authority, which has presided successfully over water quality for 4 million consumers over the last decade, sacked five of its six most senior scientists in a cost-cutting move in February 2016, an act much more likely to be taken in a corporatized body than in a traditional statutory authority. 43
The 2000s: Desalination and Financial Engineering
While contamination of the water supply in the 1990s demonstrated some of the problems inherent in corporatized and neoliberal solutions to urban services, the following decade was to provide evidence of the folly of combining the technological fix with the profit motive. All of Australia’s coastal capital cities faced a dire water crisis in the first decade of the twenty-first century. Perth saw its largest dam fall to just 17 percent capacity in June 2002. Following the apparent success of desalination plants in Singapore and California, and assuming that the general public would not embrace recycled water for drinking, the Western Australian Government opened Australia’s first major desalination plant for residential consumption at Kwinana in 2006. The urban drought did not threaten the other coastal capitals until 2006-2009. Sydney’s Warragamba Dam never fell beyond a third of its enormous capacity, but Brisbane’s Wivenhoe fell to just 15 percent in August 2007, and Melbourne’s Thomson to 16 percent in July 2009. In response, neoliberal-influenced state ALP governments in New South Wales, Queensland, and Victoria, and their by now market-oriented water utilities, scrambled to come up with solutions. Severe water restrictions were imposed, tank installation was made mandatory for new dwellings, and businesses were forced to draw up water plans and recycle where possible.
The most high-profile solution in each case involved the building of expensive desalination plants. Dams had long been off the policy agenda in Sydney and Melbourne. In Queensland, the Bligh Labor government proposed a Traveston Dam on the Mary River, near Gympie in 2006. Concerted opposition from both farmers and the environmental movement saw the Labor federal government reject the proposal under its environmental powers over endangered species. The Tugun desalination plant, abutting the Gold Coast airport, and funded by the state government, opened in 2009 but was capable of providing only one-quarter of the region’s water needs. There is some irony in the fact that the Hinze Dam, just 12 miles northwest, can take in more water in a few days of heavy rain that the desalination plant can manufacture in a year. 44 New South Wales came up with a hybrid financing model, leasing their desalination plant at Kurnell to a consortium, including the Ontario Teachers’ Pension Plan. While this almost paid off the 2 billion dollar construction price, the government is locked in to a fifty-year deal where the plant will continue to cost money whether mothballed or not. 45 The finance industry revels in such deals because of the enormous fee they get to set up leasing consortia.
At Wonthaggi, 82 miles southeast of Melbourne, the largest desalination plant in Australia, with triple the capacity of the Tugun plant, and almost double that of Kurnell, became a public–private partnership with the firm Aquasure. This enormously expensive proposition, rightly questioned by hardheaded economists on both the right and the left, will cost the Victorian taxpayer more than 6 billion dollars, more than has been spent on all the other Australian desalination plants combined. In almost all cases, these desalination plants are now seen to be expensive follies. Within less than two years of their opening dates, the main dams in Sydney and Brisbane had returned to 100 percent of their capacity, and the Thomson Dam in Melbourne reached 85 percent of capacity. Equally important, water restrictions had made metropolitan populations much more conscious of how they used water and how they could conserve water. Residents of Brisbane got their per capita consumption down to 30 gallons per day at the height of the drought, Melbourne to 38, while more profligate Sydney, with its enormous dam capacity, sailed through on a minimum of 61. The residents of Brisbane installed ninety thousand new tanks, so that one-quarter of all households now have tank water to complement reticulated supplies. If they add a filter, the water is also potable, otherwise it can be used for garden watering, laundry, and toilet flushing.
The desalination plants for Brisbane, Sydney, and Melbourne were all promptly mothballed, with maintenance costs and rusting often featuring in the press. State governments embraced desalination because it appeared to the electorate to be technologically savvy, and in the case of Victoria and New South Wales, the true cost not only of construction but of operating the plants, with massive electricity usage, was hidden behind commercial in-confidence deals. The Auditor-General in each of these three states has expressed concern about the financing of the plants. While able engineers masterminded the construction and reverse osmosis technology, private companies seized the opportunity to make money, with their respective government clients as fallbacks if the water was no longer needed. 46 Well-publicized attempts at cosmetically restarting some of these plants merely demonstrate how embarrassed successive government ministers and key bureaucrats were that they had not done their cost–benefit analysis in a rigorous fashion. 47 In Victoria, the public will pay for this for decades to come. The private consortia will turn the plant on from time to time in an effort to justify their excessive annual fee to the state government, and household water rates will be increased to cover that. 48
Conclusion
Until the 1980s, the statutory organizations that oversaw water, sewerage, and storm water in Australia’s three major east coast capitals were centers of engineering expertise and usually able to distance themselves from point scoring by the major political parties and the whims of government ministers. They supplied water largely through dams and reservoirs, using water restrictions and later pricing mechanisms as a way of curbing demand during drought periods. But they were not accountable to the public in any very obvious way, and in the 1970s and beyond were perhaps rightly criticized for their democratic failings. Nonetheless, their capital works were usually sensible, and none of these instrumentalities, we suggest, would have embraced the knee-jerk decision making that gave us expensive and promptly redundant desalination plants. Some people feared that climate change might see a continuing decline in rainfall in the east coast capitals, but that has not eventuated. A lot more hydrological modeling and planning went into designing the dams that will continue to supply most of urban Australia with water, especially if residents and businesses continue to moderate their use of potable water.
From the 1980s onward, a combination of neoliberal pressure, allegedly making such bodies more accountable, meant that these bodies were regularly reconstructed, and their semicommercial guises often moved from one ministry to another, especially when the commercial relationship went sour. During the Sydney water quality crisis of 1998 and the recent urban drought, the respective capital city publics began to doubt the wisdom of these new bodies, supposedly created to provide information as to what was actually happening to water consumption and water quality. Many residents embraced water tanks as a more decentralized means of providing their own water supply, and using recycled water, especially from the laundry, for their gardens. While the weather is a daily topic of conversation, most people only tend to think about water during times of restrictions. In recent years, Australian urban dwellers have gotten used to using less water and have shown themselves willing to adapt their usage to new climate conditions. It may well be that the better solution to the problems of “Big Water’s” high-handedness and technocratism was not corporatization or privatization, but the education of and trust in the public’s good sense to accept conservation and recycled water to deal with drought and water shortages at the household or neighborhood level. 49 Pressure from the Greens political party has encouraged more public debate about both solar energy and rainwater capture with on-site tanks. Except in times of drought, the market-oriented water authorities, reliant on water usage for their income, are wary of promoting tanks, nor does the widespread take-up of tanks suit state governments who paid far too much for desalination plants, that, in most instances, have become symbols of excessive expense and commercial profiteering, not lasting public infrastructure.
Footnotes
Acknowledgements
The authors are grateful to Margaret Cook, Lionel Frost, Pete Minard, Ruth Morgan, and Chris Salisbury for their assistance.
Declaration of Conflicting Interests
The authors declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The authors disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This study was supported by the Cooperative Research Centre for Water Sensitive Cities.