"In most countries, the expansion of modern water and sanitation systems happened as a result of public ownership and investment in response to increasing demand and public health concerns in urban areas. In the 1990s, however, many countries privatised their water and sanitation services, particularly in the South, as a result of strong pressure from neoliberal mindset governments and international financial institutions, to ‘open’ up national services.
The promises that privatisation would improve the provision of drinking and wastewater services soon faltered. Many of the privatised operations quickly began to show weaknesses as they missed targets for expanding and upgrading networks, introduced excessive tariff increases alongside connection fees which were unaffordable for low-income families. Management activities were not transparent and accountable. As a result numerous contracts with private operators were terminated often following popular unrest. Many cities, regions and even countries have chosen to close the book on water privatisation and instead embarked on remunicipalisation or renationalisation of water delivery, in which the aim is not to return to the pre-privatisation realities but to develop public-water systems that satisfy citizens’ needs.
Remunicipalisation is happening not only at municipal and community levels (such as in France or the US) but also at regional levels (as in Buenos Aires and the Santa Fe provinces in Argentina) and national levels (such as Uruguay and Mali). Around 40 municipalities and urban communities in France have already taken water services back into public hands over the last ten years, resulting in cheaper tariffs and improved services. Also cities in the US, large and small, have remunicipalised their water services as a reaction to poor service and excessive rates. In both countries, some of the private operators used sophisticated and dishonest management and financial practices to increase profits."
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