The only way to solve the water crisis is a meter in every home

Core values by John Blundell in The Business

IT IS strange how a national disgrace is also a comedy. Our “shortage” of water attracts every fallacy of economics. It also attracts barmy solutions. I particularly enjoy docking Arctic icebergs off Essex. I chortled that Yorkshire Water’s possible new corporate logo could be a cactus. May I suggest the natural water engineer – the beaver – would be the perfect mascot of competence for any water company?

When anything is scarce any economist will tell you it must be priced. A precious moment there – unanimity among economists. Water use is not priced. If we had no electricity bills or gas bills I promise you we would have power shortages. We would be exhorted not to make toast or to take baths with our best friends or perhaps enjoy cold showers alone. Putting a price on an item transforms our appreciation of it.

I saw this vividly from my own younger son. When we lived in Virginia in the US we had a water meter at the front of our home. One of my son’s domestic duties was to water the plants. He diligently turned the tap off after filling each can. After we moved back to Britain I noticed he no longer turned the tap off. When I questioned him he said as there was no meter, it didn’t matter anymore. As he was only five at the time I was impressed he had grasped a truth that eludes our older policy­makers.

I have other memories of the cultural difference when pricing is present. My American neighbours washed their cars with buckets. Brits use hosepipes. In one sense pricing is such an obvious response I feel slightly ashamed of the banality of the idea. How much more exciting to offer all sorts of poetically beautiful but economically daft ecological water solutions.

What would the great Victorian engineers who gave every city huge volumes of water make of our feeble but comical stories of sustained drought? They do not seem to have even recognised the problem. If a town prospered it was obvious – erect reservoirs. Some fine valleys in Wales were dammed and great tunnels watered ­Birmingham, Manchester and Liverpool.

These were not the first water management triumphs.

The 18th century canal engineers did not complain of water shortages. They built supplies. Where I was brought up in Cheshire, nearby Rudyard Lake was my playground – a feeder reservoir for the canal network that nourished the Industrial Revolution.

I do not doubt that the water companies have a sort of excuse in that the weather has not brought the rains they might have expected –but with water meters they could raise the price and human nature would correct the shortages. Markets have a cybernetic quality.

Naturally “privatisation” is blamed by many commentators. Vicious profit-­seeking water companies are “uncaring” as well as incompetent. Yet it seems to me the evident underinvestment is a badge of the decades of public ownership rather than capitalist squalor. The uniform tales of ancient pipes leaking more water than they deliver to customers is part of our shared appreciation of the water companies. Yet why are our water pipes not renewed? We would be ferocious if electricity or gas were stuttering through old pipes. Britain has been rewired for our digital services. What is the difference?

Are water company staff self-selected or filtered to be inept? Phones and every other domestic utility are priced – they are information rich. They have feedback.

Why can the water companies not meter their precious resource? Can you not guess? Here be politicians. Water meters frighten local and national politicos. Even during the privatisation process – which should have been all about commercial freedom to act – water