It is a problem largely created by granting them property rights instead of franchises or operating agreements. In a democracy we can never remove the risk of the next government messing it up, but as long as they grant time limited or restricted contracts the opportunity for reversal is there.
Which, incidentally, the cynic in me would suggest is the reason for why e.g. the water privatisation was done the way it was.
Compare to the train privatisation, where after the failure of Railtrack brought the infra itself back under government control, time limited franchises means that the government can at least regain control over time at low cost by simply ending the issuing of new franchises (and where the government have operated many franchises for various lengths of time due to outright failures of the franchise-holders to meet their obligations). You can even see it as allowing for shifting governments to change their mind without it becoming big all or nothing decisions (though the original franchise model is utterly messed up in how it aligns the incentives).
To be clear: I think the rail privatisation was also an utter disaster, but it's current incarnation is not nearly as bad with the water companies - largely, incidentally, because large early failures like with Railtrack ended up with the undoing of some of the worst parts of it. It's still shit, though.
They are both ridiculous propositions. There cannot be any meaningful competition where 99% of the involved activity is effectively fixed (water pipes and plants, rail tracks, rolling stock, even the ticketing system now). It's all an ideological play supported by big money.
Indeed, but the water privatisation is as things currently stands (but only because Railtrack crashed and burned so we're already rid of that abomination) worse in the sense that there's no automatic exit mechanism because the water companies own the infrastructure. The rail franchises at least expire so the "cheap" out is to just let them run their course.
But when the best you can say about one over the other is that it's cheaper to get out of it, not getting into it in the first place would've been preferable.
Which, incidentally, the cynic in me would suggest is the reason for why e.g. the water privatisation was done the way it was.
Compare to the train privatisation, where after the failure of Railtrack brought the infra itself back under government control, time limited franchises means that the government can at least regain control over time at low cost by simply ending the issuing of new franchises (and where the government have operated many franchises for various lengths of time due to outright failures of the franchise-holders to meet their obligations). You can even see it as allowing for shifting governments to change their mind without it becoming big all or nothing decisions (though the original franchise model is utterly messed up in how it aligns the incentives).
To be clear: I think the rail privatisation was also an utter disaster, but it's current incarnation is not nearly as bad with the water companies - largely, incidentally, because large early failures like with Railtrack ended up with the undoing of some of the worst parts of it. It's still shit, though.