'Explosive' ruling on water companies

A HIGH COURT ruling that privatised water companies are still state authorities and therefore subject to directly enforceable European laws regulating government activities was described as 'explosive' yesterday by unions and environmentalists.

Unison, the country's largest trade union, insists the ruling by Mr Justice Blackburne 'may well have blown a hole in the Government's entire privatisation programme'.

Dave Prentis, the union's deputy general secretary, said all privatised public utilities including gas, electricity and British Telecom, could find themselves subject to many European directives which would not apply to private industries.

Friends of the Earth said last night that the judgment might help its campaign to clean up British coastlines by forcing water companies to make public information relating to sewage and the quality of bathing water. Liana Stupples, its water campaigner, said: 'When the water companies were privatised their information was privatised with them and we've been having a big battle with them to try and get information into the public domain.

Mr Justice Blackburne made the ruling while considering an attempt by Unison to save the jobs of 120 South West Water staff facing redundancy. The union lost its fight, but the judge's ruling that water companies remained 'emanations of the state' was described as 'sensational' by Unison officials.

Val Cooke, the union's legal officer, said directives on quality of services, environmental issues, health and safety and sex discrimination could now be directly enforceable against privatised bodies.

The judge ruled that South West Water was in law 'a state authority as against which a person may rely upon provisions of EU directives in domestic courts and tribunals. The question is not whether the body in question is under the control of the state, but whether the public service in question is under the control of the state.

'The legal form of the body is irrelevant. The fact that the body is a commercial concern is also irrelevant.

'It is also irrelevant that the body does not carry out any of the traditional functions of the state and is not an agent of the state. It is irrelevant too that the state does not possess day-to-day control over the activities of the body.'