Resisting austerity in Greece: The Thessaloniki water referendum.

In this guest post, written on request, Jan Willem Goudriaan, Deputy General Secretary of the European Federation of Public Service Unions (EPSU), updates the experience with the European Citizens’ Initiative (ECI) on the Human Right to Water. Based on a discussion of the struggles over water privatisation in Thessaloniki/Greece, he assesses how the ECI has been linked with local struggles and demands for an alternative Europe (for the earlier post see European Citizens’ Initiative on Water and the alternative to Austerity Europe).

We were sitting with George, the President of the Thessaloniki Water Workers’ Union at a restaurant in the Plaka tourist district of Athens. He had to go home by bus that evening and we were grabbing a sandwich and French fries. It was after the demonstration that had brought thousands of activists to Athens for the Alter-Summit 8 June 2013.  Many other protesters as well as people that had participated in a gay pride parade were moving through the narrow streets looking for a place to eat. Crisis-hit Greece looked far away. But George brought us back to reality. He was explaining the process of the privatisation of the water company in which he works, the concerns of the workers as well as those of the municipalities and people. George and others had worked to propose alternatives to the privatisation such as Initiative 136. This initiative would allow the citizens of Thessaloniki to buy the company. However these proposals were turned down by the agency responsible for the privatisation plans in Greece, the Hellenic Republic Asset Development Fund (Taiped). He also explained how groups have joined in a campaign to keep the company public. The campaign SOSte to Nero received support from EPSU and a huge banner was hung on the offices of the municipality in defence of public water.

The Thessaloniki Water Company is highly profitable and it pays dividends to its shareholders, the state and municipalities. The privatisation of the company through the selling of a concession would lead to loss of income for the state.  George was enthusiastic about a documentary that would be shown on television later that week to argue the case for public water. The documentary was made by SaveGreekWater, another water movement group. He expected that it could lead to another wave of protests. Water privatisation is very unpopular in Greece, as shown by opinion polls. We also talked about the success of the Greek water unions and the water movement in collecting signatures for the European Citizens Initiative Right2Water. Greece would pass the minimum threshold. The initiative and its demands to legislate on the human right to water and that the Commission should not liberalise water services were seen as part of the same struggle. The ECI had over 1 million signatures and already more than 7 countries over the minimum threshold and was the first ever successful ECI that June. Even before the end of the ECI it had influenced the political process when in February 2013 European Commissioners Barnier and Potocnik declared that Water is a Public Good and stated that the EU would not privatise water services. Subsequently the Commission removed water services from the concessions directive, something that was criticised by the private water industry lobby organisation, AquaFed. It was later shown to have actively influenced the European Commission not to legislate on the human right to water and sanitation.

Brutal closure of ERT

That documentary of the Greek water movement would not be broadcast, however. Just a few days after our meeting, the government shut down the public broadcasting company. The brutal closure of the Greek public broadcasting station ERT caused widespread anger across Greece and Europe.  On 11 June, with a simple announcement more than 2500 people were dismissed. Greek people came out in defence of the ERT and a general strike was organized by the two trade union confederations on 13 June 2013. EPSU reacted sharply and called it a scandal in a letter to the Greek Prime Minister Samaras arguing that his government was attacking a public good and public service.  Following broad protests as well as an ambiguous court decision that the closure was not legal, Dimar (Democratic Left party) of Fotis Kouvelis decided to leave the coalition government. It was a move seen by some as cynical as the party continued to support the policies of the coalition to implement austerity even though these have thrown the country deeper into recession and poverty. The latest figures from Eurostat showed that the economy had continued to shrink in 2013, 2 in 3 young people unemployed. That this is not seriously addressed, and that no serious efforts are being made to invest to create jobs is outrageous and will have long-term and lasting impacts on Greek society and the EU. And it is similar for Spain and other countries.

Photo by campact

Rich Greek families

Closing the public broadcasting station reveals the agenda of the austerity measures and who benefits. In this case that is the private broadcasting stations, and some owners have close ties with Prime Minister Samaras. One of his most important connections is with the Bobolas family. The father, George Bobolas, owns a large media empire via the publishing company Pegasus. One of the central pieces of this media empire is Mega Channel. It is a mouth piece of government and right-wing propaganda, similar to the Berlusconi media in Italy. This company was seen as the main beneficiary of the ERT closure. Son Leonidas, in turn, is the owner of the construction company Ellaktor. This construction company was the vehicle for the family to get involved in the mining sector. It had shares in the venture to exploit the Haldiki mines.  The Courts had ruled in a similar case that the economic gains were not worth the potential loss in biodiversity. According to the local population and concerned environmental and other groups, the rules for granting such mining concessions, which should provide the government with funds and would give private capital the ownership of natural resources, were not followed. Large protests were organised to stop the mining programme but were met with police violence on several occasions. The police classically defended the interest of capital over those of the local citizens. George and others in the Greek water movement joined the demonstrations. 

Privatisation of Greek water companies: EYATH

And the interests of George and the Bobolas family were again to clash as Bobolas are potential beneficiaries of the austerity agenda. As part of the Troika programme the Greek government has been forced to draw up a long list of companies which are deemed fit to be privatised. On the list are electricity and water companies such as the Thessaloniki Water and Sewage company. There were two consortia interested, one around the Israeli public water company Mekorot, and the other one around the French multinational company Suez Environment. Both consortia also involve Greek interests, with Suez teaming up with Ellaktor of Bobolas junior and Mekorot joining hands with the Apostolopoulos holding, which owns a large number of clinics together with German private health care company Asklepios.

Photo by campact

Greek, European and international action groups have asked these bidders to withdraw their interests in a joint letter, July 2013. They are not wanted in Thessaloniki. Local activists started to reflect on a referendum as a way to mobilise support. The Greek government made clear it is set against a referendum. It has argued that the privatisation programme is a national issue with the Thessaloniki case being a local implementation. Hence, there can be no local referenda. It is easy to understand that if the Greek government would allow local people to express themselves, large parts of its privatisation programme would unravel. And that would upset the Troika as debt reduction and loan payback would not be achieved. The Eurozone President, Dutch Finance Minister Dijselbloem has explicitly welcomed the progress the Greek government was making with the privatisation of the two Greek water companies, 17 December 2013. And I add: progress in their logic.

One person that embodies the austerity logic more than others is European Commissioner for Economic and Financial Affairs, Olli Rehn. He has been a staunch advocate of cuts in public spending as the measure to address public deficits and of reduction of wage costs to restore the competitiveness of economies. On his blog he argued that Spanish workers would do well to accept drastic cuts in their wages and accept more labour market flexibility.  And for him anything that hinders this flexibility needs to be abolished and that includes national and sectoral collective agreements and minimum wages. For a growing group of economists this whole austerity programme makes less and less sense as countries are plunged into recession. They see the social misery it has caused in the EU as preventable. The predictable negative impact on public health, increase in poverty and crime are well documented now for Greece.  

European Citizens' Initiative Right2Water and the Thessaloniki Water Referendum

At about the same time as Minister Dijsselbloem was revealing the Troika support for the privatisation of Greek water companies, the Right2Water European Citizens' Initiative delivered over 1.8 million signatures to European Commissioner Sefkovic, 20 December 2013 (see also European Citizens’ Initiative on Water and the alternative to Austerity Europe). The ECI had been immensely successful with a campaign that started on 9 May 2012. On 9 may 2013, more than 1 million signatures had been collected and 7 countries had passed the minimum threshold. Following initial problems with the process, the campaign ran for another six months and in the end, close to 1.9 million people supported the ECI. The minimum threshold was passed in 13 countries. Greece was one of these, thanks to the work of George and his Thessaloniki union colleagues, the unionists of the Athens Water Company as well as the Greek Water movements. The ECI now obliged the Commission and European Parliament (EP) to organise a discussion with Right2Water. The hearing in the EP took place on 17 February 2014, generating overwhelming public interest including a large delegation of the Athens water workers. It was organised by the EP Environment Committee. Representatives of all political parties expressed their support of the demand of the ECI to recognise the human right to water and sanitation and legislate on it. Several conservative and liberal MEPs did not support the demands of the ECI to prevent liberalisation of water services, and to exclude them from trade agreements. Many MEPs expressed their opposition to privatisation of water services. The private water company lobby Aquafed reacted bitterly as they were not invited as an interest group. There is no shame in business groups if it is about protecting profits. As if they had the support of nearly 2 million citizens! Further information also revealed how the private water companies have sought to influence the European Commission and actively spread misinformation to counter the citizens’ demands. The Thessaloniki water groups watched the public hearing together and took the decision to go ahead with the local referendum despite government opposition.

The Commission published its conclusions on the ECI 19 March 2014 and again there was a large interest from the media. The response was disappointing though. I have said that the Commission lacked ambition. The Commission did not represent proposals to legislate on the Human Right to Water and Sanitation. Neither did the Commission indicate how it wished to exclude water and sanitation services from the EU-Canada free trade agreement (CETA), the EU-US agreement (TTIP) and the secret negotiations to come to an global agreement on trade in services (TISA), all of which link with the TransPacific Partnership negotiations (TPP).  All these agreements have come under increasing scrutiny and criticism from global coalitions of unions and other campaigning movements as social and democratic interests are traded away.

The Final Stretch for the Thessaloniki Water Referendum

George and his colleagues continue their local struggle. With leaflets, local radio interviews, discussions with people and support from a broad range of actors including from the Greek Orthodox Church, they try to mobilise the people to come out and vote Yes for the public water company on 18 May. They seek to convince people that there are no merits in the selling of the control over the company. Based on extensive research there are no efficiency gains to be made with private interests. And with the consortium around Mekorot not having registered a bid following the critique, the Greek government cannot even get a good price as only Suez Environment is interested. This company is actively campaigning to convince the people of its position but its role is well documented  It looks certain that Suez will face years of local resistance as in other places across the world such as in La Paz, Bolivia and Buenos Aires, Argentina and Jakarta, Indonesia, all places where Suez was ultimately driven out by local people due to price rises, lack of promised investment, or just because people wanted to control the company that provides that most essential of public services: drinking water and sanitation.

On Sunday 18 May the people of Thessaloniki will determine the future of their company and the vote will have a large symbolic value for all the many people that fight neo-liberal policies and want a change in Europe. A group of EPSU affiliates will monitor the referendum, ensuring that it takes place in a fair manner. An international group of observers will be on the spot from countries such as Austria, Bulgaria, France, Germany, Italy, Netherlands and Sweden. Many others are expressing support recalling their experience with privatisation like in the UK or drawing attention to the wave of re-municipalisations. They stress that private operation of water services is not about ensuring the human right to water, nor about doing good for local people, but about making profits and paying dividends to shareholders. The local referendum, like the Right2Water European Citizens' Initiative, is another experiment in participatory democracy. Suez should be concerned about running businesses against the interests of citizens. The people of Alcazar de San Juan in Spain took their experiment in democracy a step further when just collecting signatures did not prove enough. They engaged in direct action to make their views known and stopped privatisation. And rather than oppose the local people, the Greek government should welcome the active engagement of citizens and take the Italian province of Lazio as example where public management is promoted. Or the Spanish city of Zaragoza, which will ensure that the running of its water company is based on the participation of many local groups. These are all signs of a vibrant European social movement capable of resisting and fighting the austerians and developing concrete and practical local examples to build an alternative as well as to show and demonstrate European solidarity across borders.