Should Water supply be privatised?

When water is not treated as an economic good, it is wasted. On a domestic level, unmetered access to water means that consumers do not pay according to the quantity they use and so they will use it wastefully. At a national level, subsidised water for farmers and industry encourages wasteful methods and inappropriate crops (e.g. growing water-hungry cotton in California or Central Asia, both naturally areas of semi-desert), often with a damaging impact upon the environment. Pricing water according to its true cost would promote more efficient and environmentally-friendly practices, e.g. the use of drip-irrigation or dry farming in agriculture.
 
Water privatisation was undertaken in 1989 by the government of Margaret Thatcher which privatised the ten previously public regional water and sewerage companies in England and Wales through divestiture (sale of assets). At the same time the economic regulatory agency OFWAT was created, following the model of infrastructure regulatory agencies set up in other sectors such as telecommunications and energy. The Drinking Water Inspectorate (DWI) was set up in 1990 to monitor water safety and quality.
 
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