ACTION ALERT: Stop the OTPP purchase of Chilean water companies

Dear activists,

As reported by Chile's Business News Americas on May 15, "Canada's Ontario Teachers' Pension Plan...has agreed to purchase 50.01% of Chilean water utilities Essbio...and 100% of...ANSM... (from Southern Cross Group, a Latin American private equity firm). Essbio is Chile's second largest water and wastewater service utility, and provides services to over 610,000 customers, while ANSM provides services to over 195,000 customers..."

According to the Ontario Teachers' Pension Plan these two water companies, "represent approximately 20 percent of the regulated water and wastewater market in Chile."

As noted in an October 2005 Public Citizen report on RWE/Thames Water, "Modeling its economic policies after those of former British Prime Minister Margaret Thatcher, Chile began to deregulate and privatize its water sector in the late 1990s...In December 2000, Thames Water won the concession contract for ...ESSBIO...In November 2001, Thames Water was awarded the 30-year concession contract for (what is) now...ANSM."

The report also notes, "There has been significant political opposition to water privatization in Chile, especially among trade unions and consumer groups. Some political parties also opposed the sale of the regional water companies which were considered, even by the World Bank, to be models of efficiently-run public companies, providing income to the Chilean state."

Specifically they note, "According to the local citizens group...Movement for Consultation and Citizens Rights there has been a large, unsubstantiated increase in tariffs (in their region). One in three people can no longer afford to access potable water services...These situations led the citizen group...to decide to organize a poll. The question asked was: “Do you think water and sanitation services should return to public control?” 136,783 people participated in the poll in 22 different communities. 99.1% of the people voted “yes”."

The full report can be read at www.citizen.org.

The Ontario Teachers' Pension Plan (OTTP) should not be investing in private water corporations that seek profit over the fundamental right to water. The Council of Canadians is calling on the OTTP to end its bid to invest in for-profit water.

The OTTP "invests the pension fund’s assets and administers the pensions of Ontario’s 167,000 elementary and secondary school teachers and 104,000 retired teachers." The Council of Canadians encourages these teachers to oppose the investment of their pensions into for-profit water.

Those concerned are encouraged to e-mail Claude Lamoureux, President and Chief Executive Officer of the Ontario Teachers' Pension Plan, and state that the OTTP should not be investing in private water corporations. Mr. Lamoureux's e-mail address is claude_lamoureux@otpp.com.

You may also want to raise the concern that in April 2005 the OTTP purchased a 25 percent interest in Northumbrian Water Group PLC, a publicly traded water and wastewater services company that provides services to 4.3 million people in the United Kingdom, from Suez. (In their book Blue Gold, Maude Barlow and Tony Clarke write, "Between 1989 and 1995, Northumbrian's water rates increased by 110 percent; the CEO's salary increased by 150 percent; and the company's profits increased by 800 percent.")

Chile's securities regulator was informed of the sale of Essbio and ANSM on May 15 and the Chilean news report indicates that, "all transactions are expected to close within the next three months...", so we would estimate around August 15.

Please see the OTTP media release "Ontario Teachers’ Pension Plan to acquire interests in two Chilean water companies".

Brent Patterson, Director of Organizing, The Council of Canadians