MUNICIPAL WATER SUPPLY GOVERNANCE IN ONTARIO: NEOLIBERALIZATION, UTILITY RESTRUCTURING, AND INFRASTRUCTURE MANAGEMENT by KATHRYN FURLONG B.Eng., Carleton University, 1999 M.Sc., The University of Oxford, 2000 A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY in THE FACULTY OF GRADUATE STUDIES (Geography) THE UNIVERSITY OF BRITISH COLUMBIA December 2007 © Kathryn Furlong, 2007 ABSTRACT This thesis examines the interaction of political-economic restructuring, sustainability, and the governance of municipal services in the province of Ontario, Canada. Two issues are studied: the restructuring of business models, and programs for sustainable infrastructure management (focusing on programs for the reduction of water consumption and production). The primary data are derived from a province-wide expert survey, archival research, a one-day expert workshop, and seven municipal case studies. Since the early 1990s, political-economic restructuring in Ontario predominantly reflects processes and policy orientations consistent with neoliberalization. Two strands of research posit particular relationships between neoliberalization and sustainability. One (associated with political ecology) asserts that neoliberalization yields negative outcomes for environmental policy. The other (ecological modernization) asserts that neoliberal restructuring leads to environmental improvements. This thesis tests and complicates both sets of claims. Specifically, neoliberalization does not necessarily induce improved programming for sustainability and can, hinder its development. Neoliberalization, however, is not the unique hindrance to progress on sustainability. Rather, a techno-physical approach to service delivery combined with governance arrangements that neither empower nor compel a variety of necessary actors presents a key barrier to sustainability. In terms of the restructuring of business models, I find that the primary neoliberal strategy is the depoliticization of governance through the pursuit of arms length business models for service delivery. This, however, is not readily accomplished in complete or straightforward ways. Municipal governments and anti-neoliberal alliances have complex relationships to neoliberalization that prove important in restructuring outcomes. Specifically, neoliberalization is also contested within municipal government and for ii environmental advocates, although their best option, the municipal department model remains unsatisfactory. Concerning sustainable infrastructure management, the thesis finds that uptake of supply and demand management in Ontario has been limited to date. This results from incentives created by policy processes associated with neoliberalization (specifically new public management) and technically-driven management methods in the water sector. Moreover, where programs for sustainable infrastructure management currently occur, they are rarely motivated by sustainability concerns. Importantly, however, sustainable infrastructure management is underdeveloped for reasons other than neoliberalization; governance arrangements and the continuing supply-side orientation of water utilities are other factors. iii TABLE OF CONTENTS Abstract.................................................................................... ii Table of Contents .................................................................... iv List of Tables ........................................................................... ix List of Figures........................................................................... x List of Abbreviations ............................................................... xi Acknowledgements ................................................................xiv Dedication ...............................................................................xv 1 Introduction ........................................................................ 1 1.1 OVERVIEW AND CONTEXT .................................................................1 1.2 METHODOLOGY ........................................................................... 14 1.2.1 Research Design................................................................. 14 1.2.2 Data Collection................................................................... 25 1.3 DESCRIPTION OF THESIS AND CONTRIBUTIONS ..................................... 29 Part I – Concepts and context ................................................ 33 2 Conceptual Approach ......................................................... 33 2.1 INTRODUCTION ........................................................................... 33 2.2 POLITICAL-ECONOMIC RESTRUCTURING AND SUSTAINABILITY .................... 35 2.2.1 Political-economic Restructuring ........................................... 35 2.2.2 Sustainability: Concept and Connections ................................ 47 2.2.3 New Public Management: Reforming Public Sector Governance . 54 2.3 WATER PURIFICATION: RESTRUCTURING BUSINESS MODELS ..................... 63 2.3.1 Rationalizing Municipal Water Governance.............................. 63 2.3.2 Alternative Service Delivery: Tools of Rationalization ............... 70 2.3.3 The Complexities of Government .......................................... 76 2.3.4 Learning from Anti-Neoliberal Advocacy ................................. 79 iv 2.4 SEEKING SUSTAINABILITY: NEOLIBERALIZATION, GOVERNANCE, AND TECHNICAL CHANGE .......................................................................................... 84 2.4.1 Technical Change: A Social Studies of Technology Approach ..... 84 2.4.2 After State-Hydraulic: Concepts for Technical Change .............. 91 2.4.3 Techniques, Technical Regimes and Governance ..................... 96 2.4.4 Supply and Demand Management - Where the Challenge Lies. 103 2.5 3 CONCLUSIONS .......................................................................... 107 Big Blue Machine, Common-Sense and Beyond – Ontario Since 1970 ........................................................................... 110 3.1 INTRODUCTION ......................................................................... 110 3.2 ONTARIO FROM DAVIS TO RAE (1971-1995) .................................... 112 3.2.1 Provincial Governance and the Federal Relationship............... 112 3.2.2 Municipalities and Municipal Water Supply............................ 117 3.3 RESTRUCTURING ONTARIO: HARRIS TO MCGUINTY (1995-PRESENT) ........ 124 3.3.1 The Harris Years: Restructuring Governance & Municipalities .. 124 3.3.2 The Harris Years: Restructuring Municipal Water Supply......... 130 3.3.3 After Common Sense: Legislation, Studies and Patience......... 137 3.4 NEOLIBERALIZATION: ONTARIO AND THE LITERATURE ........................... 143 3.4.1 Variants and Stages of Neoliberalization .............................. 143 3.4.2 Rationalization: Methods, Reasons and Limitations ................ 151 3.5 CONCLUSIONS ...................................................................... 157 Part II – Business Models..................................................... 159 4 Restructuring Water Supply: Rationalization and Depoliticization .................................................................... 159 4.1 INTRODUCTION ......................................................................... 159 4.2 IMPETUSES FOR WATER SECTOR RESTRUCTURING ................................ 161 4.2.1 Legislative and Fiscal Changes............................................ 161 4.2.2 Municipal Restructuring ..................................................... 167 4.3 THREE CASES OF RESTRUCTURING .................................................. 173 4.3.1 Hamilton ......................................................................... 173 v 4.3.2 Kingston ......................................................................... 178 4.3.3 Toronto ........................................................................... 190 4.4 4.4.1 A Self-Justifying and Multi-Scalar Strategy ........................... 200 4.4.2 The Role of Politics in Service Delivery................................. 205 4.5 5 FURTHER CONSIDERATIONS .......................................................... 200 CONCLUSION ........................................................................... 211 Complicating Rationalization: Governments, Alliances, and the Limitations of Neoliberalization...................................... 214 5.1 INTRODUCTION ......................................................................... 214 5.2 COMPLICATING RESTRUCTURING: COMPLEXITY OF GOVERNMENT .............. 216 5.2.1 Branches of Municipal Government: Conflicting Experiences with Neoliberalization ......................................................................... 216 5.2.2 5.3 Provincial Efforts at Rationalization: Inter-scalar Challenges ... 223 CONTESTING RESTRUCTURING: PUBLIC INTEREST GROUPS ..................... 227 5.3.1 Background ..................................................................... 227 5.3.2 The Alliance, The Public Trust, and The Common Sense ......... 229 5.3.3 The Challenge of Alternatives ............................................. 237 5.4 CONCLUSIONS .......................................................................... 243 Part III – Sustainable Infrastructure Management .............. 246 6 Competing Policy Positions.............................................. 246 6.1 INTRODUCTION ......................................................................... 246 6.2 SUPPLY AND DEMAND MANAGEMENT: STATUS AND APPROACHES .............. 249 6.2.1 Development of the Demand Side Management Concept ........ 249 6.2.2 Reframing the Efficiency vs Conservation Debate .................. 251 6.2.3 A Conceptual Matrix for Techniques and Policy Paradigms ...... 255 6.3 THE EFFECTS OF OVERLAPPING AND COMPETING APPROACHES ................. 262 6.3.1 The Interaction of the Sustainability, Techno-Physical and Market Environmental Approaches ........................................................... 262 6.3.2 Effects on Particular Techniques: Metering and Pricing ........... 268 6.3.3 Effects on Governance....................................................... 273 vi 6.4 6.4.1 The Mandate of Utilities ..................................................... 277 6.4.2 Incentives and Disincentives: Retrofits and Public Education ... 284 6.5 7 7.1 INTRODUCTION ......................................................................... 292 7.2 NEOLIBERALIZATION AND GOVERNANCE RESTRUCTURING ........................ 294 7.2.1 Effect on Utility Priorities ................................................... 294 7.2.2 Evaluating Performance..................................................... 297 7.2.3 Municipal Restructuring ..................................................... 300 UTILITY ORGANIZATION .............................................................. 302 7.3.1 Inter-departmental Dynamics............................................. 302 7.3.2 Business models............................................................... 308 7.3.3 Exogenous Governance: Wholesalers and Distributors ........... 310 7.4 GOVERNANCE ACROSS SCALES ...................................................... 314 7.4.1 Legislative and regulatory matters: Provincial and Federal...... 314 7.4.2 Political Issues: Municipal Government ................................ 317 7.5 DISTRIBUTED GOVERNANCE .......................................................... 323 7.6 CONCLUSIONS .......................................................................... 328 Conclusions ..................................................................... 331 8.1 INTRODUCTION ......................................................................... 331 8.2 CONNECTING THE CASE STUDIES ................................................... 331 8.3 RESEARCH SUMMARY .................................................................. 333 8.3.1 General Findings .............................................................. 333 8.3.2 Detailed Findings .............................................................. 335 8.4 9 CONCLUSIONS .......................................................................... 289 Governance Models and The Technical Regime ................ 292 7.3 8 UTILITY: A TECHNO-PHYSICAL AND MARKET ENVIRONMENTAL FOCUS......... 277 FURTHER ISSUES....................................................................... 341 8.4.1 Investigating Political-economic Restructuring ...................... 341 8.4.2 Asserting a role for politics in water delivery......................... 342 Bibliography .................................................................... 344 9.1 BIBLIOGRAPHY ......................................................................... 344 vii 9.2 GOVERNMENT AND MUNICIPAL DOCUMENTS ....................................... 364 9.3 LEGISLATION AND REGULATIONS .................................................... 369 9.4 MEDIA ARTICLES ....................................................................... 370 9.5 OTHER SOURCES ....................................................................... 372 10 Appendix A - Survey ...................................................... 377 10.1 RESPONSE RATE AND DISTRIBUTION .............................................. 377 10.2 COPY OF THE SURVEY ............................................................... 379 11 Appendix B – List of Interviews ..................................... 396 12 Appendix C – Expert Workshop...................................... 398 12.1 DESCRIPTION AND LIST OF PARTICIPANTS ....................................... 398 12.2 WORKSHOP AGENDA................................................................. 401 13 Appendix D – Ethics Approval Form ............................... 403 viii LIST OF TABLES Table 1-1: Comparison of Three Governance Models for Municipal Service Delivery ........................................................................................9 Table 1-2: Business Models for Water Supply Infrastructure in Ontario ...... 14 Table 1-3: Options for Municipal Water System Restructuring ................... 17 Table 1-4: Business Model Features of the Case Municipalities .................. 18 Table 1-5: Distribution of Supply and Demand Management Programs in Ontario According to Scale ............................................................. 22 Table 1-6: Physical Features & Indications of Sustainable Infrastructure Management in the Case Municipalities ............................................ 23 Table 2-1: Types of Alternative Service Delivery ..................................... 72 Table 2-2: Types of Alternative Service Delivery Continued ...................... 73 Table 4-1: Utilities Kingston Mission Statements and Goals .................... 182 Table 4-2: Utilities Kingston, Results of Employee Consultation Process ... 183 Table 4-3: Comparison of Governance Options and Objectives for the City of Toronto Water and Wastewater..................................................... 194 Table 5-1: Concerns expressed at the Public Meeting Regarding the Establishment of the MSB in Toronto, November 6, 2002.................. 233 Table 6-1: Matrix of Water Supply and Demand Regulation Techniques.... 258 Table 6-2: Expectations and Responsibilities of Owners and Operators of Municipal Water Systems ............................................................. 278 Table 6-3: Survey Correlations Part 1: Degree to which Programs should be Adopted Correlated with Organizational Goals ................................. 287 Table 6-4: Survey Correlations Part 2: Degree to which Programs should be Adopted Correlated with Organizational Goals ................................. 288 Table 10-1: Survey Respondent Distribution ........................................ 378 Table 11-1: List of Interviews ............................................................ 396 Table 12-1: Breakdown of Workshop Participants.................................. 398 Table 12-2: List of Workshop Participants ............................................ 399 ix LIST OF FIGURES Figure 1-1: Map of Case Study Sites ..................................................... 16 Figure 3-1:Ontario: Capital Fund Revenue Breakdown 1977-2005 ........... 135 Figure 3-2:Province Wide Water and Sewer Billings vs. Total Expenditures145 Figure 3-3: Ontario: Municipal Revenues as a Percentage of Total 1977-2005 ................................................................................................ 146 Figure 3-4: Ontario Grants to Municipalities 1977-2005 ......................... 154 Figure 4-1: Kingston Water Utility Budget Data 1979-2005 .................... 188 Figure 5-1: Councilors Need Replacing along with Infrastructure ............. 241 Figure 6-1: How much can the following techniques improve environmental sustainability in the water sector? ................................................. 264 Figure 6-2: How much can the following techniques improve environmental sustainability in the water sector? Weighted Averages of Response Groups ...................................................................................... 265 Figure 6-3: Water Pricing: To what degree does your organization support the following?............................................................................. 272 Figure 6-4: Implementing DSM: How important are the following goals? .. 281 Figure 6-5: Uptake of Conservation Measures: to what degree are these drivers or inhibitors? ................................................................... 283 Figure 6-6:Uptake of DSM in Your Municipality ..................................... 285 Figure 7-1: Restructuring: Effect on the level of the following ................. 296 x LIST OF ABBREVIATIONS Abbreviation Reference ABC Agencies, Boards & Commissions AMMCTO Association of Municipal Managers, Clerks and Treasurers of AM0 Ontario Association of Municipalities of Ontario ASD Alternative Service Delivery ASR Aquifer Storage and Recovery AWWA American Water Works Association CAO Chief Administrative Officer CARL Current Annual Real Losses CBC Canadian Broadcasting Corporation CCPPP Canadian Council of Public Private Partnerships CELA Canadian Environmental Law Association CEU Toronto Civic Employees Union CFO Chief Financial Officer CIELAP Canadian Institute for Environmental Law and Policy CSR Common Sense Revolution CUPE Canadian Union of Public Employees CWWA Canadian Water and Wastewater Association DSM Demand Side Management EA Environmental Assessment ENGO Environmental Non-Governmental Organization FCM Federation of Canadian Municipalities GATS General Agreement on Trade in Services GOCO Government Owed but Commercial Operated organization HR Human Resources HUC Hamilton Utilities Corporation IBEW International Brotherhood of Electrical Workers ICI Industrial Commercial Institutional ILI Infrastructure Leakage Index (CARL/UARL) xi KEDCO Kingston Economic Development Corporation KIG Kingston Infrastructure Group MEA Municipal Engineers Association MPIR Ministry of Public Infrastructure Renewal MSB Municipal Services Board NAFTA North American Free Trade Agreement NDP New Democratic Party NPM New Public Management OCWA Ontario Clean Water Agency OEB Ontario Energy Board OFL Ontario Federation of Labour OMB Ontario Municipal Board OMWA Ontario Municipal Water Association OPSEU Ontario Public Service Employee Union OSPE Ontario Society of Professional Engineers OSTAR Ontario Small Town and Rural Development Program OSWCA Ontario Sewer and Watermain Construction Association OWRC Ontario Water Resources Commission (1956-1972) OWWA Ontario Water and Wastewater Association PC Progressive Conservative Party PPP (P3) Public-Private Partnership PTTW Permit to Take Water PUC Public Utilities Commission PUMC Philip Utilities Management Corporation PUSI Peterborough Utilities Services Incorporated RFP Request for Proposals RPWCO Regional Public Works Commissioners of Ontario SDWA Safe Drinking Water Act SLA Service Level Agreement SOA Special Operating Agency SOW Save Ontario Water Coalition SSS Social Studies of Science xii SST Social Studies of Technology SWSSA Sustainable Water & Sewer Systems Act TQM Total Quality Management TRCA Toronto Region Conservation Authority TWB Toronto Water Board T-WES Toronto Works and Emergency Services UARL Unavoidable Annual Real Losses UK Utilities Kingston W&WW Toronto Water and Wastewater Services xiii ACKNOWLEDGEMENTS Many have contributed to the advancement of this work and to my ability to produce it in its current form. First and foremost among them is Karen Bakker, my doctoral supervisor. I would recommend her unreservedly to anyone with the guarantee that they will learn a great deal, though they will need some stamina. My committee members have also dedicated much time and insight to this work. These are John Robinson, Barbara Lence, and Jim Glassman. Juanita Sundberg also contributed as a member of the comprehensive examination committee. John Robinson has been particularly engaged; his discerning contributions and the collegial manner in which they were made cannot go unmentioned. Finally, I would like to acknowledge the voluntary contributors who have given generously of their time. I would like to thank my family Erica, Kieran and Pat Furlong, as well as Fredrik Thomasson and my roommates Sarah Banting and Tasha Reilly. I could list editing, formatting and various other practical tasks for which they gave their help, but this wouldn’t really do anyone justice. xiv DEDICATION To teachers and other educators. I’ve had many. xv 1 INTRODUCTION 1.1 OVERVIEW AND CONTEXT Political-economic restructuring in Ontario has been instrumental in prompting significant and varied change across the province’s water supply industry. Sustainability concerns have also been important in guiding and instigating innovations in governance. Yet, while a variety of new business models for water delivery have been adopted, progress on programming for sustainable infrastructure management1 has not advanced remarkably. With the objective of further understanding the relationships between politicaleconomic restructuring and sustainability, this study examines the competing and complementary influences on the restructuring of business models and programs sustainable infrastructure management in Ontario’s water sector. The theoretical project undertaken in this thesis seeks to understand the impacts of political-economic restructuring from different perspectives, such that sustainability challenges might be more effectively addressed. Three inter-related concepts constitute the core of the theoretical framework: governance, business models, and sustainable infrastructure management. The application of this theoretical framework is underpinned by the understanding that recent political-economic restructuring has created a variety of challenges for municipal governments, which in turn, have had an impact on the delivery of water services. The thesis documents these challenges and impacts, seeks to understand their interpretation, and suggests improvements, focusing on modifications to governance. In doing 1 I take a broad definition of infrastructure that integrates the analysis of both physical techniques and programs for regulating their use and performance; this is in keeping with Infrastructure Canada definitions (cf. Infrastructure Canada 2004b). Sustainable infrastructure management refers to the management of infrastructure for social-environmental sustainability through the reduction of water produced and consumed in municipal water services. Specifically, this includes the adoption or techniques for supply and demand management. 1 so, the analysis attempts to be sympathetic to the different and sometimes conflicting mandates that municipalities must meet. With respect to the analysis, three terms merit discussion and definition here (although they are explored in greater detail in subsequent chapters): neoliberalization, sustainability, and governance. In brief, the term ‘neoliberalization’ refers to strategies for and processes of political-economic restructuring that seek to improve the regulatory environment for business through reduced taxation and minimized governmental regulation. With respect to the public sector, neoliberalization seeks improvements in governance through the incorporation of business management principles. Economic regulation and/or market-simulating regulation replace governmental regulation. This term is important because, in the context of Ontario, the analysis focuses on the neoliberal aspects of political-economic restructuring. This is because policies described as neoliberal in the literature dominated provincial policy development throughout the 1990s. In adopting this approach, I am cognizant that neoliberalization and restructuring are not equivalent. The thesis does not assert that all political-economic restructuring in Ontario has been neoliberal in character; restructuring, of course, involves broader and more fundamental changes in governance.2 Nonetheless, given the predominance of neoliberal orientations in policy and legislative reform (and the debate which this has provoked), the focus on neoliberalization as a means of describing political-economic restructuring is, I believe, merited. 2 With respect to water supply restructuring specifically, changes in governance include processes at both the provincial and municipal scales. Provincially, important examples in Ontario include amalgamation, new legislation, and evaluation procedures directed at achieving accountability, transparency, and improved performance. Municipally, changes in business models are important. These include organizational changes such as asset ownership, the legal framework and operational responsibilities. 2 The second term that requires brief discussion here is ‘sustainability’. Conceptually, sustainability integrates social, environmental and economic concerns. It seeks changes in governance, technology, and individual behaviour for the purposes of the maintenance and protection of ecological services and environments in ways that are socially just. Economic development is promoted in ways that meet these goals. Following from this definition, a water utility’s engagement with sustainable infrastructure management is an indicator of the degree to which it undertakes programming that is protective of ecological services and environments without harming user access or safety, while insuring its economic capacity to provide such socio-environmentally sound water services. In this research, policies and programs for the reduction of the production (supply) and consumption (demand) of water are analyzed as representative indicators of sustainable infrastructure management. Programs for supply and demand management provide a useful means of analyzing sustainable infrastructure management in that these programs can further each of the three criteria of sustainability – environmental, social, and economic – but that they will do so is not given. It is not only the existence of programs that matters; how they are implemented, organized, and financed influences their implications for the different dimensions of sustainability. Moreover, analyses of supply and demand management programming reveal the politicaleconomic orientation behind the programming. As such, the integration of neoliberalization into utility policy and its relationship to progress on the socio-environmental aspects of sustainability can be discerned. Analyzing the interrelationship between these two issues - neoliberalization and sustainability - constitutes one of the core foci of this thesis. In undertaking this analysis, I focus on the social and environmental dimensions of their interaction.3 There are two general schools of thought on the 3 This is because the form of economic governance is already assumed in theories that posit particular relationships between neoliberalization and sustainability, i.e. 3 relationship between neoliberalization and the environmental dimension of sustainability. From the perspective of ecological modernization, strategies associated with neoliberalization have positive consequences for environmental sustainability. For example, economic principles such as the discipline of competition are understood to stimulate efficiencies that lead to environmental protection. Environmental governance requires flexible regulation that the economy, as opposed to the state, can provide. Other research, however, has been critical of this position. Aspects of the political ecology literature (such as the ‘neoliberal nature’ school) have argued that policies associated with neoliberalization have led to both decreased environmental and social protection (socio-environmental sustainability). The environment benefits only when the price is right, which does not frequently occur. 4 The analysis conducted in this thesis engages with both of the above approaches, critiques them, and refines them. Moreover, the analysis also acknowledges that in analyzing the interacting effects of neoliberalization and sustainability, it is important to study the concepts broadly in the context of other important policy approaches. For example, with respect to neoliberalization, several authors have critiqued the literature for an overly economistic analysis of political-economic restructuring (e.g. Larner 2003; Castree 2006; Barnett 2005). According to these critiques, because other political positions have also been influential in producing the political, economic, and social changes commonly associated with neoliberalization, the transitions are not attributable to neoliberalization alone. As such, Castree calls for studies of ‘neoliberalism-plus;’ that is, for researchers to the neoliberal impact on the economic dimension of sustainability would be neoliberalization and this is either associated with positive or negative (or mixed) consequences for socio-environmental sustainability. 4 Much research has been dedicated to neoliberalization, sustainability and their interaction. This is explored in depth in Chapter 2. 4 incorporate the array of factors in addition to neoliberalization that are relevant to their study (Castree 2006). One of the limitations to adopting the term neoliberalization as an analytical tool is that it is reflective of a body of literature that is inherently critical of the form of political-economic restructuring which it describes. I am sympathetic to these critiques, and this disposition has drawn me to conduct research on the topic. To address the inherent potential for bias, I establish neoliberalization as important in political-economic restructuring in Ontario in Chapter 3 but I do not assume that neoliberalization is the only important policy process affecting the water sector in Ontario, nor that it produces effects that are purely neoliberal and unmediated by other policy concerns. The degree to which restructuring in the water sector in Ontario has been influenced by and is reflective of neoliberalization is examined rather than assumed. As such, when investing the outcomes produced through neoliberalization in the water sector and how they relate to sustainability, one cannot assume that neoliberalization is the sole or even the most important factor. Emerging issues in Ontario’s water supply sector speak to issues of municipal services governance under the competing and complementary influences of neoliberalization, sustainability, environmental and union politics, and technically driven approaches to governance. While critiques of the neoliberalization literature direct us to the fact that a great deal of neoliberal-type change is a product of neoliberalization combined with other challenges to existing political-economic arrangements, I also find that the variety of factors inter-mingling with neoliberalization can result in outcomes that do not appear distinctly neoliberal. In such instances, the tactics of neoliberalization can shift, and seek new methods for policy restructuring. 5 The third term requiring definition and explanation is ‘governance’, because it is through governance that neoliberalization and sustainability can impinge on business models and sustainable infrastructure management in ways that are amenable to analysis. Governance refers to both diffused and networked authority beyond government as well as to the organizational methods of management. Governance is the process through which decisions are taken within or among organizations, including: who is involved, the assignment of responsibility, the prioritization of goals, and the rendering of accountability.5 In practice, governance is codified through an associated governance model, which includes ‘the agreements, procedures, conventions or policies that define who gets power, how decisions are taken and how accountability is rendered’ (Graham, Amos and Plumptre 2003: 1).6 Political-economic restructuring in Ontario has altered many elements of the governance models through which municipalities deliver water services. These include changes in legislation and funding opportunities, in methods of evaluating the services provided by municipalities, in the types of knowledge deemed appropriate for decision-makers, to the degree and type of responsibilities held by municipalities, and to municipal size and borders, among others. Changes in governance have prompted changes in business models and changes in governance and business models influence the manner and degree of the development of programs for sustainable infrastructure management. 5 Key tenets of accountability include ‘transparency, standards, open evaluation, [and] a capacity to learn and correct deficiencies when they become apparent’ (Gross Stein 2001: 79). 6 Good governance expresses a set of principles which governance models are orchestrated to achieve. Typically principles of good governance include ‘accessibility, accountability, transparency and efficiency’ (Global Development Research Centre). Participation, the rule of law, responsiveness, consensus orientation, equity, and strategic vision are others (for a discussion see Bakker and Cameron 2002a). 6 Fiscal constraints and political-economic restructuring have led to many changes that impinge upon municipal water services in Canada and Ontario. These include: provincial-to-municipal devolution of fiscal responsibilities for public service provision (Graham, Phillips and Maslove 1998: 9); a shift in the ownership of infrastructure from higher levels of government to municipalities between 1961 and 2002 (Harchaoui, Tarkhani and Warren 2003); the increasing use of the private sector to support the provision of public services (Bradford 2003); and funding and employment cutbacks to the public sector, especially environmental ministries (Pearse and Quinn 1996; Prudham 2004) and municipalities (cf. Graham and Phillips 1998). Ontario is an apt study area for this research for a number of reasons. The province has seen significant and diverse political-economic change since the mid-1980s. These shifts respond to a variety of interacting pressures including neoliberal restructuring both internally and at higher scales of government. Neoliberalization has induced significant reorganization in the delivery of municipal water supply across the province through its effects on provincial legislation, provincial-municipal rescaling, municipal governance, financing for municipal services, and the requirements of and standards for municipal service provision. Municipal water supply presents an interesting case for examining the shifting effects and strategies of neoliberalization in relation to sustainability. It is a sector facing a number of pressures stemming both directly and indirectly from neoliberalization, as well as anti-neoliberal campaigns, sustainability, and techno-physical approaches to management. Under these pressures, restructuring of water supply delivery has occurred in many municipalities across Ontario and a variety of choices have been made. As such, Ontario presents a rich array of experiences and choices with respect to municipal services governance under ongoing political-economic restructuring. 7 These experiences provide the data for exploring the links among neoliberalization, sustainability and governance in terms of business models and sustainable infrastructure management. In the literature, approaches to governance help to draw connections between the three conceptual themes of this research, neoliberalization, sustainability and governance. Empirically, several examples can be drawn from the Ontario case to highlight their interactions. These theoretical and empirical connections are presented briefly below. Theoretically, in terms of resource management, Bakker differentiates governance from institutions and organizations as distinct sites for potential neoliberal reform. Institutions refer to ‘the laws, policies, rules, norms and customs which govern resources use,’ organizations to ‘the collective social entities that govern resource use,’ and governance to ‘the process by which organizations enact management institutions; the practices by which … we construct and exploit resources’ (Bakker 2007: 4). In this framing, in the global North, institutions are structured by a legal model, organizations by a business model, and governance by a governance model.7 Variations in governance models arise from different prioritizations of goals and associated differences in governance principles, which can include neoliberal and sustainability related objectives. Notably, variations are likely even when goals coincide due to the existing norms and institutional settings in which the governance models evolve and operate (K. Bakker 2003c). Business models are closely related to governance models and the choice of business model can constrain choices for governance and vise versa (K. Bakker 2003c: 5, 18). Indeed, the adoption of a new business model requires a shift in governance, as it connotes new arrangements in ‘who does what,’ new lines of accountability, incentives, and often a new philosophy of operation (K. Bakker 2003c: 5, 18). Whereas governance reflects processes 7 I acknowledge Karen Bakker for this clarification. 8 through which decisions are made and a governance model is a formula for achieving the desired principles of governance in decision-making, business models define arrangements for getting things done once decisions are taken. More specifically, a business model delineates features such as ownership, organizational structure, and the risks and responsibilities for the management of the organization and its improvement (typically defined through the principles of good governance).8 All of these can influence sustainable infrastructure management. Borrowing from the work of McGranahan et al. (2001), Bakker and Cameron (2002) present three generic governance models for municipal service delivery: the planning model, the commercial model, and the community model (Table 1-1). Table 1-1: Comparison of Three Governance Models for Municipal Service Delivery Planning Model Organizational Civil service Commercial Community Model Model Corporation Association/ structure Accountability network Hierarchy Contract mechanism Community norms Primary Administrators, Individual Leaders and decision- experts, public households, members of makers official experts, community companies organizations 8 This discussion is adapted from K. Bakker (2003c: 5). 9 Planning Model Primary Goals Key Incentives Commercial Community Model Model Guardian of public Maximization of Serve community Interest; profit; interest; Effective Conformity with Efficient performance legislation/policy performance Expert/managerial Price signals Agreements and feedback in public (share shared goals; policy process; movements or Community Voter/ratepayer bond ratings); opinion opinion Customer opinion Key Sanctions State authority Financial loss; Livelihood needs; backed by Takeover; Social pressure; coercion; Litigation Litigation (in some cases) Political process via elections; Litigation Consumer role User & citizen User & customer User & community member Participation of Collective, top- Individualistic Collective, consumers down Cognate Municipally-owned Private corporate Community co- business utility utility operative bottom-up models Source: Bakker, Karen, and David Cameron. Good governance in municipal restructuring of water and wastewater services in Canada. Toronto: Munk Centre for International Studies, University of Toronto, 2002. Taken from Bakker and Cameron (2002: 38). © Karen Bakker, 2002, by permission. 10 In practice in Ontario, these models overlap (Bakker and Cameron 2002b: 38-39). Neoliberalization strategies, for example, that demand full cost recovery from user fees while still under government-led management, inject principles of commercial models into the traditional planning model. Further, persons managing utilities run as departments of municipalities – ostensibly under the planning model – have sought contractual obligations with service providers, greater autonomy from municipal government, and are motivated by the ‘business case’ in decision-making. These express principles of the commercial model. Similarly, under neoliberalization, distributed participation – a feature of the community model – can also align with commercial principles of, for example, customer focus. As such, this research concentrates on features of governance models, rather than ideal-type governance models per-se. Important elements of governance models that have changed in Ontario include the provincial legislative frameworks for municipal service delivery, the scope of service delivery through amalgamations, the degree and importance of user input through distributive governance, and the exigencies of the new public management, which prioritize particular conceptions of efficiency, ‘businesslike’ operations, and have generated increased interest in exogenous governance. In terms of the empirical evidence of the association between neoliberalization, sustainability and governance, I provide three examples: Walkerton,9 infrastructure deficits in Ontario, and municipal fiscal pressures. These are presented in turn. With respect to Walkerton, neoliberalization policies vis-à-vis the environment were heavily implicated in the event (cf. O'Connor 2002 b). Funding cuts to the Ministry of environment were deemed particularly important because they reduced the Ministry’s capacity for water 9 The town of Walkerton, Ontario is the site of a water contamination calamity in which seven people died and thousands became permanently ill in June of 2000. 11 quality testing and inspections. The Walkerton Inquiry, which responded to the disaster, yielded new legislation for the protection of pubic health, the environment, and the financing of municipal water services. The legislation contains many elements, some reflective of a neoliberal business-like approach to public services and some oriented toward sustainability, which alter governance and require changes in the delivery of water supply. In terms of infrastructure, many municipalities in Ontario are facing an infrastructure deficit. The Federation of Canadian Municipalities (FCM) defines the infrastructure deficit as the difference between the quality and capacity of the infrastructure that is in place and the quality and capacity of that which is needed. They measure the deficit according to ‘the cost to build, maintain and repair essential infrastructure.’10 Published estimates of the deficit’s magnitude in Canada vary widely (Infrastructure Canada 2004a). The Canadian Water and Wastewater Association (CWWA) estimates a required investment of $88.4 billion for the period from 1997-2012 (CWWA 1997). Under neoliberalization, it is expected that these issues are addressed through utility self-financed full cost accounting and that sustainable infrastructure management should only be applied where cost-benefit criteria are met. For example, programs for supply and demand management can extend the useful life of infrastructure by reducing requirements for increased capacity. In several cases in Ontario, however, these are deployed only to a point where the programs cost less than one third of the cost of building new infrastructure. The above situation also interacts with fiscal pressures that municipalities are experiencing. Neoliberalization strategies in Ontario have increased the fiscal burdens of municipalities and reduced funding to them. As a result, municipal 10 Infrastructure deficits stem from infrastructural age and chronic underinvestment in maintenance and repair, due to incomplete accounting for the costs of long-term infrastructure upkeep. The deficit is especially serious in the older municipalities of eastern Canada, whose infrastructure is an average of 60-75 years old (Mirza and Haider 2003). 12 governments have greater incentives to seek funding for water related municipal services from utility rates. Utilities, in turn, face financial challenges that they must meet through cost recovery (e.g. implementing the post-Walkerton legislative requirements and addressing infrastructure deficits). In many cases, this fosters a situation in which supporting water related municipal services through utility budgets is seen as no longer affordable. This, in turn, fuels the popularity of arms length models for water delivery that reduce the influence of municipal governments and reflect neoliberal principles. In response to changes in governance, many municipalities in Ontario have adopted new business models for water supply (Bakker and Cameron 2005). This transition in water governance at the municipal scale has been rapid and has yielded a wide array of new and distinctive models for water delivery across the province including public-private partnerships (P3s), a municipal corporation, hybrid models involving public commissions, and delegated management (Bakker and Cameron 2005) (Table 1-2). 13 Table 1-2: Business Models for Water Supply Infrastructure in Ontario Business Model Example Municipal Department Most Municipalities Municipal Business Unit Toronto Municipal Board/ Commission (PUC) Peterborough Regionalization Chatham/Kent PUC Regional Government Waterloo Region Corporatized Municipal Utility Kingston Delegated Management (public operator) Peel Region to OCWA Delegated Management (another Smith-Ennismore-Lakefield to municipality) Peterborough PUC Delegated management (private Hamilton (1994-2004) operator) Source: Bakker, Karen, and David Cameron. Good governance in municipal restructuring of water and wastewater services in Canada. Toronto: Munk Centre for International Studies, University of Toronto (2002: 6). © Karen Bakker, 2002, by permission. The array of different restructuring options taken in Ontario provides a range of complementary material for the study of neoliberalization, sustainability, and the effects of governance on municipal water services delivery. Benefiting from the diversity in arrangements for the delivery of municipal water supply in Ontario, I selected seven municipalities for in depth study. The methodology used in this research is elaborated in the next section. 1.2 METHODOLOGY 1.2.1 RESEARCH DESIGN This research includes a large sample survey, field research in seven municipalities (involving in depth interviews and archival research), and a one-day expert workshop. The survey results enable the assessment of broad 14 trends and issues. The survey was directed at the range of water related organizations within Ontario, providing an overview of key issues and trends as perceived from different groups. In depth case research, on the other hand, allows researchers to control for a greater number of potentially intervening variables (Collier and Mahoney 1996: 70), and allows for in depth analysis through open-ended expert interviews. The workshop was employed as an opportunity to scrutinize and refine the research results. This research controls for differences in governance due to provincial jurisdiction by focusing on the single province of Ontario. Controlling for provincial jurisdiction is important because Canada’s provinces are among the most autonomous sub-national divisions in the world (Paehlke 2001). Municipalities, natural resources, and many environmental regulations, for example, all fall within the purview of the provinces. A recent overview of water related legislation across Canada’s thirteen sub-national jurisdictions demonstrates the degree of legislative divergence between them (Hill et al. 2006). As stated above, the research focuses on two themes to examine the interacting strategies and effects of neoliberalization and sustainability in Ontario’s water sector: the restructuring of business models and programming for sustainable infrastructure management. By way of investigating these issues, I have selected seven municipal case studies that reflect a diversity of restructuring processes, governance challenges, and programs for sustainable infrastructure management. This is in keeping with case study design methods using examples or sub-cases to illustrate the phenomena occurring within a more general case (cf. Yin 1994). The selected municipalities include the Cities of Hamilton, Kingston, Peterborough and Toronto, and the Regional Municipalities of Peel, York and Waterloo (Figure 1-1). Together these municipalities comprise 52% of Ontario’s population. In terms of restructuring, these municipalities are 15 representative of the 6 most common business models for water supply delivery in Ontario, the remaining 2 being rare (Table 1-3). Justice O’Connor identifies these eight models according to a matrix of three choices of operating agency and two to three restructuring options (choices of business model) for each type of operating agency (Table 1-3) (O'Connor 2002b). Figure 1-1: Map of Case Study Sites Produced by Eric Leinberger, Dept of Geography, UBC, by commission. 16 Table 1-3: Options for Municipal Water System Restructuring Type of Operating Restructuring Options Agency (Business Models) Municipal Operating • Municipal Department (Toronto) Agency • PUC/Municipal Services Board (Peterborough) • Municipally Owned Corporation (Kingston) Regional Water • Regional Governments (York, Waterloo) Provider • Intermunicipal Agreements – (Rare) External Operating • Another Municipal Government - (Rare) Agency • Public External Operating Agency (Peel) • Private External Operating Agency (Hamilton) Source: Adapted from Karen Bakker. Good governance in restructuring water supply: A handbook. Ottawa: Federation of Canadian Municipalities & Program on Water Issues (2003c: Table 1). © Federation of Canadian Municipalities, 2003, adapted by permission. Original Source: O'Connor, Dennis. Report of the Walkerton Inquiry part 2: The events of May 2000 and related issues. Toronto: Queen's Printer for Ontario (2002b: Table 10.1). © Publications Ontario, 2002, adapted by permission. Possible operators include: the municipality, a regional water provider, and an external operating agency. In terms of a municipal operating agency, the three restructuring options comprise: a municipal department (Toronto), a municipally owned corporation (Kingston), and a public utilities commission (Peterborough).11 In terms of external operating agencies, three 11 Peterborough provides an example of a restructured PUC that involves characteristics associated with corporate models. The PUC is contracted by Peterborough Utilities Services Inc. to run the water supply. The Peterborough model 17 restructuring options also are available: delegation to another municipal government (rare), delegation to an external public operating agency (Peel), and delegation to an external private operator (Hamilton 1994-2004). In Ontario, 25% of municipalities operated their services under some form of delegated management at the time of the Walkerton Inquiry. Of this 25%, 95% of the contracts (mostly in small rural areas) went to the Ontario Clean Water Agency (OCWA),12 and 5% were contracted to private operators (O'Connor 2002b: 55). The features of each of the business models are outlined in Table 1-4. Table 1-4: Business Model Features of the Case Municipalities City Toronto Business Municipal Model Department Operator Municipal (Infrastructure) Peterborough PUC (hybrid) Kingston York Municipal Municipal Corporation Utility Delegated to PLC as Region Board and PUC by permanent Committee Council municipal concessionaire and corporation Department Board Public works Utility Executive of Regional Composition and Management UK and CAO Transporta- Infrastructure and tion and Committee Appointees of works Council Committee Council Extensive Moderate Minimal Extensive Public Agency Public Agency Corporation Public Involvement Operator's legal status Agency has been described as a hybrid municipal corporation/PUC (Bakker and Cameron 2002b). 12 OCWA is a provincial crown corporation. It is discussed in greater detail in section 3.2.2, 3.3.2, and 7.3.2. 18 City Legal Toronto Peterborough Kingston York Public Public Corporate Public n/a n/a Local Gov n/a framework Owns Shares City Waterloo Hamilton Peel Business Regional Private Public operator Model Government operator 1994- (OCWA) 2004 Operator Regional Temporary Provincial (Infrastruc- Committee and private Crown Agency ture) Department concession- as temporary aires concessionaire Board Regional Committee of Regional Public Composition Planning and Council and Works Works Private Board Committee of Committee of Council Council Council Extensive Minimal Moderate Public Agency Corporation Public Agency Public Corporate Public n/a Private n/a Involvement Operator's legal status Legal framework Owns Shares Shareholders Source: Adapted from Karen Bakker. Good governance in restructuring water supply: A handbook. Ottawa: Federation of Canadian Municipalities & Program on Water Issues (2003c: Table 1). © Federation of Canadian Municipalities, 2003, adapted by permission. The concerns with board composition and council involvement are the author’s addition. 19 The seven municipalities were also selected according to their potential to illuminate issues with respect to the relationships between sustainable infrastructure management, neoliberalization, and governance. In this respect, it was important that each municipality had some level of engagement with sustainable infrastructure management, as represented by the adoption of techniques for supply and demand management. In Ontario, the uptake of supply and demand management techniques in the water sector has not been extensive. It is generally restricted to larger municipalities and is induced by an effort to cope with scarcity, be it economic, infrastructural or environmental. Environment Canada published a survey in 2001 that includes data on the adoption of supply and demand side management techniques across Canadian municipalities. Analyses that I have conducted on the data demonstrate the dearth of uptake nationwide. These data include binary data for whether or not a water provider has adopted eight listed measures. The eight measures are: ICI sector advice, public advertising, increases in water meter coverage, installation of efficiency equipment, home water audits, the distribution of water efficiency kits, lawn watering by-laws, and other. I summed the number of programs in each municipality such that they received a score of 0 though 8, where 0 indicates no programs and 8 indicates all 7 programs plus additional others. In order to organize and present the data, I have utilized Environment Canada’s scalar and regional categories. Environment Canada divides Canadian municipalities into 6 population scales numbered 1-6: 1, less than 1000 population; 2, population 1000-1999; 3, population 2000-4999; 4, population 5000-49 999; 5, population 50 000-499 999; and 6, population 500 000 plus. No municipalities of category 1 were included in the Environment Canada data. Regionally, they organize the provinces according to Atlantic, Quebec, Ontario, Prairie and Pacific Regions. 20 There are several limitations to the data. First, some non-responding municipalities may have programs but appear as 0. Second, the development of programs since 2001 is not reflected in the survey (this pertains to Peel, for example). Third, the range of programs included is not extensive. Fourth and finally, the binary data do not indicate the degree of development of the program and, as such, municipalities with very different levels of adoption can share the same or similar scores. Still, the data provide an indication of the level, dispersal, and motivation for supply and demand management programs in Ontario. In Ontario, the majority of municipalities have no supply and demand management programming. The percentage of municipalities with a score of 0 is 71%. Of the 91 municipalities (29%) that have implemented one or more supply or demand management measures, 64% have a score of 1 or 2. Sixteen municipalities have a score of 4 or greater (i.e. an adoption of half of the measures included in the survey). This is indicative of a low-level of adoption across the province. Adoption is greatest in larger municipalities. Table 1-5 indicates that while most of the municipalities across Ontario with a score of 4 or greater are in population size category 5 (50 000-499 999 inhabitants), the scale with the greatest percentage of its municipalities having a score of 4 or greater is scale 6 (greater than 500 000 inhabitants) with 50%. As such, larger municipalities tend to have more developed programs. 21 Table 1-5: Distribution of Supply and Demand Management Programs in Ontario According to Scale Municipal Population Size Category 2 3 4 5 6 0 0 37.5 50.0 12.5 50.8 10.0 1.3 3.8 25.8 50.0 (2-6) Percentage of municipalities that have 4 or more programs located in each population category (%) Percentage of municipalities in Ontario in 12.3 25.6 each population category (%) Percentage of Municipalities in each 0 0 population category that have 4 or more programs (%) Source: Compiled by the author using data from the Municipal Water Use Database (Environment Canada 2001) In Ontario, at the time of Environment Canada’s data collection, sixteen municipalities had a score of 4 or greater. Of these, six are experiencing infrastructural capacity pressure from population growth as part of the GTA ‘Places to Grow.’13 Two are experiencing both physical water scarcity and infrastructural capacity pressures from population growth. Another is experiencing both economic and infrastructural capacity pressures, and yet another economic pressures. The case study municipalities all fall within the population sized categories of 5 or 6, thus their level of adoption is not prejudiced by their size. That is, they are in the most likely size categories to have adopted programs. Yet, they express a range of levels and timing of adoption. Of the seven cases, only Kingston and Peterborough are not facing some form of water quantity related pressure, be it from infrastructural capacity, population growth, or physical resource stress. This is a limitation in controlling for variables for 13 cf. Chapter 3. 22 which sustainable infrastructure management programs would be expected. Tellingly, these two municipalities have the least developed programs. Still, their experiences offer insights into the relationships between governance, neoliberalization and sustainable infrastructure management. A variety of physical features and indicators of sustainable infrastructure management in each of the study municipalities are shown is Table 1-6 below. I do not list their conservation score because, for some of them, their programs began after Environment Canada’s data collection and for others common scores betray differences in programming. Table 1-6: Physical Features & Indications of Sustainable Infrastructure Management in the Case Municipalities Toronto Peterborough Kingston Hamilton Population 2,397,000 70,500 113,000 322,252 Source Lake Otanabee River Lake Lake Ontario Ontario Ontario 239 368 277 467 45.5 84 92 74 Metered 73% 0 100% 65% Rate Type Flat Rate & Flat Rate Declining CUC Domestic Water Use (l/d) System Loses (l/c/d)* CUC*** Block Rate (3 blocks) Price/m3 $1.07 N/A Infrastructure High Low Fair High High Medium-Low Low Medium $0.87 Pressure Supply & Demand Management 23 Peel Waterloo York Region Region Region Population 878,800 497, 600 729,000 Source Lake Ground Water Mixed Ontario Sources 434 223 285 107** 36 26.5 Metered 99% 93.5% 99% Rate Type Flat Rate & CUC CUC Domestic Water Use (l/d) System Loses l/c/d CUC Price /m3 $0.88 $1.53**** $1.10**** Infrastructure Fair Fair High High High Medium- Pressure Supply & Demand High Management *l/c/d – litres/capita/day **Does not include data for Caledon; *** CUC – Constant Unit Charge; **** Weighted averages for prices across the region’s local municipalities Sources: The data was compiled from Environment Canada databases (Environment Canada 1999, 2000, 2001) 24 1.2.2 DATA COLLECTION The research makes use of both primary and secondary data. The primary data include archival research, a province wide expert survey, fifty-three interviews involving fifty-seven participants, and an expert workshop in which 38 water supply professionals of various backgrounds participated. More detail on the expert survey, the interviews, and the workshop can be found in the appendices. The secondary data comprise bibliographic research and reviews of relevant policy reports and documents. PRIMARY DATA Archival Research • Extensive archival research was conducted, focusing on relevant municipal documents, reports, provincial and federal policies and legislation, and news articles. • Not all of the municipal case studies had equivalent data available. The Peel archive, for example, had few documents. In Peterborough, many historical PUC reports had been damaged due to flooding. Expert Survey • The survey was directed at municipal water operators, conservation authorities, environmental NGOs, business and professional associations, municipal organizations and government departments concerned with water supply in Ontario. The first two thirds of the survey were general and responded to by all participants. The final third was directed solely at municipal water operators. • Respondents were located using the Internet and a CWWA database of municipal water operator contacts. Three hundred and forty surveys were sent by mail and 82 responses were received. The response rate was 24%, with a total of 82 responses. Reasons for non-responses, beyond the norm, included a feeling of a lack of expertise in some of the small municipalities whose services were operated externally, and certain problematic questions that were sometimes ignored. 25 • Although the response rate for the survey was high, several questions proved problematic. Most frequently, these were the ranking questions. In general, participants stated that rankings could not be given because all of the options given were important. There were limited responses to the open-ended questions. • Analysis of the survey results was done using the SPSS statistical software and Excel. • Details on respondent distribution as well as a copy of the survey are located in Appendix A. Expert Interviews • The experts interviewed included municipal councilors, municipal water services personnel, locally active environmental, labour and business lobby groups, and relevant bureaucrats at the federal and provincial scales. The interviews followed an open-ended format that allows new lines of enquiry to be pursued as needed. Each interview was approximately 1 hour in duration. • The initial interviewees were located through preparatory research on the provincial context and the municipalities in question. From there, snowball sampling, whereby subsequent interviewees are contacted upon the recommendation of persons interviewed earlier in the process, was used to locate further interviewees. • The limitation to the data collected through the interviewing process is that different numbers of interviews were conducted across the municipalities. Five interviews were conducted in Hamilton, Kingston, Waterloo and Peterborough and eight interviews involving 11 people in Toronto. In Peel and York, on the other hand, 3 and 2 interviews were conducted respectively. This discrepancy was largely related to the difficulty of securing interviews in some municipalities. • Appendix B contains an anonymous list of interviews, stating the respondents’ type of employment only. 26 Expert Workshop • The “Water Governance in Transition: Utility Restructuring and Demand Management in Ontario” workshop was held April 13, 2007 at the Peter Wall Institute, UBC. Thirty-eight people attended the workshop. Further details on the workshop, including a list of participants, are located in Appendix C. • Prior to the workshop a preliminary policy report on the thesis research was circulated among the participants to stimulate discussion and gain feedback for the research. • The one-day workshop comprised two half-day plenary sessions. The first plenary focused on sustainable infrastructure management, and the second on the restructuring of governance and business models. • The sessions each had four parts: o A presentation on the plenary topic, to open the session. o A breakout session where participants were divided into six preassigned groups and directed to discuss a specific sub-topic and respond to a set of questions. The breakout groups were given one hour to discuss and prepare answers to the questions. The groups, topics and questions were pre-assigned. o Group presentations followed, where each of the breakout groups presented the results of their discussions to the larger group. o An open discussion was held where participants could engage with the responses of the other groups. SECONDARY DATA – BACKGROUND RESEARCH Background Research • Extensive background research was conducted on the state of infrastructure, environmental regulations and policies, and politicaleconomic restructuring in each of the case sites and at the provincial and federal scales. 27 CONTEXTUALIZING AND USING THE DATA This section addresses how the data are mobilized throughout in the thesis and how the data contribute to available data on the research topic. The sections of the thesis draw on the data collected in different ways. The contextual material addressing political-economic restructuring in Ontario, discussed in Chapter 3, was developed using the secondary data as well as some of the archival and interview material. The arguments developed with respect to the restructuring of business models in Chapters 4 and 5 are largely deduced from the interview and the expert workshop data. At the workshop, a half-day plenary session was devoted to the issue. Archival material and secondary data were also used. The survey material was used to help develop hypotheses and questions to be pursued in the interviews but was not utilized to draw conclusions with respect to the restructuring of business models per se. All of the interviews conducted had some focus on governance. The case study of sustainable infrastructure management draws extensively on all types of data collected. All of the interviews conducted discussed supply and demand management programming to some degree depending on the expertise of the research participant. Eleven of the interviews were conducted specifically with utility supply and demand management staff. In the expert survey 8 of 25 questions (32%) related to supply and demand management programming and techniques, or to environmental improvement. Finally, a half-day plenary session at the expert workshop was exclusively devoted to discussing water supply and demand management. Contributions to empirical data on water supply in Ontario are made through the expert survey and the expert workshop. The contributions from the workshop include a workshop report and a policy report (see Appendix C). In terms of the survey data, several Canada-wide surveys of water utilities have already been conducted. Environment Canada produces the ‘Municipal Water 28 Use Database,’ which has been updated every three years from 1989 to 2001, the ‘Municipal Water Pricing Database’ updated every three years from 1991 to 1999, and the ‘Industrial Water Use Database’ updated every five years from 1976 to 1996. The Canadian Water and Wastewater Association produced the ‘Water Efficiency Experiences Database’ (2004), which is not comprehensive but is updated on-line with municipalities adding their own experiences. Finally, Waller has surveyed water residential efficiency programs for a small set of larger municipalities across Canada (Waller 1998). My survey adds to these earlier and ongoing data collection efforts in a number of ways. First, by focusing on Ontario alone, I was able to ask questions about the impacts and impressions of important aspects of provincial policy that have instigated restructuring in the water sector. Second, the more comprehensive databases from Environment Canada collect data simply on what is being implemented, water consumption and quality, and rate structures. This survey asks the relative levels of implementation of different programs, which are considered more effective, and about the relative difficulty of implementation. This information can then be contextualized within the stated goals of the respondents for water provision. Thus, while the Environment Canada databases have very extensive data, the survey for this study adds data about the political and economic context in which the programs have been pursued and the impressions about how these programs have performed. 1.3 DESCRIPTION OF THESIS AND CONTRIBUTIONS The thesis is organized in three parts. Part I contains the conceptual and contextual material of the thesis. Part II examines the restructuring of business models for municipal water supply in Ontario. It argues that while the predominant neoliberalization strategy vis-à-vis business models is the rationalization of governance through the propagation of arms length 29 business models, the outcomes have been varied and partial. Challenges to neoliberalization are made by a diversity of actors that have complex relationships to the neoliberalization strategies in question. Part III addresses sustainable infrastructure management through a focus on techniques for supply and demand management. It argues that the low uptake of supply and demand management programming directed at improving sustainability results from complex interactions between market environmental, technophysical and sustainability approaches as well as shortcomings in governance. The thesis makes both empirical and conceptual contributions to the literature. The empirical contributions are concentrated in Part III and pertain to supply and demand management. Empirically, the research adds nuance to perspectives on the relationships between neoliberalization and sustainability in the water sector. Limitations are evidenced in both the market-environmental perspective that predicts increased programming for environmental sustainability with neoliberalization and the perspectives critical of neoliberalization that posit negative consequences for the same. This is important because, although such arguments are frequently advanced, little empirical research has been conducted to test them. In Part III evidence is presented that shows that, first, with respect to the market-environmental position, the influences of neoliberalization are limiting to programs for supply and demand management. Second, with respect to positions critical of the neoliberal effect on sustainable infrastructure management, evidence establishes that neoliberalization is not the only or most significant factor in engendering the low uptake witnessed. Established techno-physical approaches to infrastructure management and existing governance arrangements are equally important. Moreover, changes in governance could alleviate some of the unfavourable effects of neoliberalization on sustainable infrastructure management. 30 The conceptual contributions of the thesis are principally found in Part II, addressing the restructuring of business models. There, evidence is provided that demonstrates that rather than flexibility, neoliberalization strategies in the water sector are directed toward the rationalization and standardization of governance. This is in contravention to common descriptions of neoliberal policy, which argue that through reduced government regulation, flexibility in governance is generated. I argue, through the findings in Part II, that the reduction of government influence through the adoption of alternative service delivery business models actually is intended to produce governance that is more rationalized, predictable, and technocratic. The thesis also finds that actors involved in neoliberalization – including those that challenge it – have complex relationships to neoliberalization strategies. Due to the complexity of the relationships to neoliberalization, the realization of neoliberalization strategies is not guaranteed and its achievements are generally partial, having non-neoliberal elements. The governing bodies that are responsible for enacting neoliberalization are comprised of differing sets of interests with respect to neoliberalization and its outcomes. Alliances that contest neoliberalization share a neoliberal critique of government. This complexity can obfuscate the fact that neoliberalization, in the cases studied in this thesis, is pursued as a means of addressing governance challenges resultant from prior neoliberal restructuring at the provincial scale. This is significant; while it is important to challenge neoliberalization as a solution to prior-neoliberalization, it is equally important to recognize that responses are necessary and that these may require changes in governance. Each part of the thesis contains two chapters. In Part I, Chapter 2 provides the conceptual framework for the thesis. There, I develop the arguments for the analysis of the data presented in Parts II and III. Chapter 3 describes the recent political-economic history of Ontario, from 1970 to the present, as it relates to the reorganization of municipal water supply governance. 31 In Part II, Chapter 4 presents evidence in support of the finding that the prominent strategy of neoliberalization in the water sector is rationalization. Chapter 5 demonstrates the complexity of relationships that municipal governments and anti-neoliberal alliances have toward neoliberalization and that neoliberalization, therefore, does not present a straightforward and readily achievable policy strategy. In Part III, Chapter 6 shows that the particular philosophical position through which one approaches supply and demand management has important consequences for the uptake and performance of supply and demand management techniques. Sustainability as well as the techno-physical and market environmental approaches is examined. In Chapter 7, empirical evidence is presented that demonstrates the links between a variety of governance issues and programming for sustainable infrastructure management. Chapter 8 concludes the thesis. 32 PART I – CONCEPTS AND CONTEXT 2 CONCEPTUAL APPROACH 2.1 INTRODUCTION This chapter establishes the theoretical framework through which the thesis explores the relationships between political-economic restructuring, sustainability and the governance of municipal water services in Ontario since 1990.14 Within this topic, two issues are studied. These are the restructuring of business models and programs for sustainable infrastructure management. Understanding how governance is shifting and the pressures upon it is instrumental in the analysis of both topics. As such, the organizing concepts for this thesis are political-economic restructuring (that is reflective of policies associated with neoliberalization in the literature), sustainability and governance. The first issue, the restructuring of business models for water supply, speaks to issues of municipal governance and service delivery under neoliberal political-economic restructuring. There has been a sustained debate in geography and cognate disciplines over the past two decades about the effects of neoliberal reforms on local governments, local government services, and environmental governance. This thesis contributes to these debates in the following ways. It identifies a new phase of neoliberalization emergent in Ontario that is marked by hesitation and patience. It finds that one of the primary strategies of neoliberalization vis-à-vis municipal services provision is their rationalization through the diminution of the roles for political actors (their depoliticization). Where neoliberalization posits increased flexibility in governance through the reduction of government 14 This is the period of focus, although the data employed to analyze and contextualize this period goes back to 1970. 33 influence, in the water sector this tactic rather pursues a systematization of service delivery. Finally, it is found that neoliberalization is not guaranteed. Rather than hegemonic, in the water sector, it is limited in its appeal to both the public and to some branches of municipal government. The second case, sustainable infrastructure management, addresses a void in the literature. This is with respect to the relationship between neoliberalization and technical change, especially technical change for sustainability. To address the relationship between sustainable infrastructure management, neoliberalization and governance, I introduce theories from the social studies of technology (SST). I examine competing and overlapping policy positions for sustainable infrastructure management including market environmentalism (a subset of ecological modernization focused on the water sector), a techno-physical approach (associated with engineering), and sustainability. The analysis demonstrates that the limited development of programs for sustainable infrastructure management stems from the interaction of market environmental and techno-physical approaches as well as current governance arrangements that are limiting toward progress on sustainability. The above arguments are developed in three sections. In Section 2.2, I provide the theoretical context for the questions raised in this thesis with a discussion of each of the central concepts of the thesis: neoliberalization, sustainability and governance. This involves engaging in ongoing debates with respect to: (1) neoliberalization, setting them in the context of politicaleconomic restructuring in Ontario; (2) sustainability and its relationship with neoliberalization; and (3) how governance is affected by neoliberalization, focusing on the theories of new public management as they have been of particular important with respect to shifts in governance in Ontario. In Section 2.3, I examine the strategies, tools, and outcomes of neoliberalization with respect to business models for water supply. I begin by 34 theorizing the reasons for pursuing rationalization at the municipal scale and the associated strategies. I argue that it is a response to both the relative independence of the municipal scale from pursuing neoliberal restructuring enacted at higher scales of government, and to the challenges created by provincial rescaling on the part of utility management. I follow with an analysis of alternative service delivery (ASD), which I argue is the primary tool for the rationalization of business models in the water sector in Ontario. I conclude with two sections that investigate the limitations to neoliberal rationalization for water sector restructuring. In section 2.3, I turn to sustainable infrastructure management. There I examine the interacting effects of techno-physical, market-environmental and sustainability policy paradigms on the uptake, dissemination and performance of techniques for supply and demand management. The SST literature alerts one to the importance of governance in technical uptake and change. It highlights the fact that technical regime change in the water sector and well as current governance arrangements favour the market environmental and techno-physical approaches over sustainability. The interaction of the market environmental and techno-physical approaches is one whereby a limited range of techniques for supply and demand management is encouraged and their implementation is not necessarily supported in ways necessary to improve sustainability. 2.2 POLITICAL-ECONOMIC RESTRUCTURING AND SUSTAINABILITY 2.2.1 POLITICAL-ECONOMIC RESTRUCTURING NEOLIBERALIZATION IN THE LITERATURE Political-economic restructuring in the late 20th century has been widely characterized as neoliberal in character. In the literature, neoliberalization15 15 Jamie Peck and Adam Tickell argue for the use of the term ‘neoliberalization,’ for the reason that neoliberalism has been found to be a process and strategy rather 35 is used to describe processes that reflect a shift from a Keynesian-Fordist state-market16 relation to one that is oriented toward the facilitation of apparently unfettered markets for commodities, including labour and environmental services.17 These have been found to have different effects across space, to be mediated by a number of factors, and to result in outcomes that are not entirely neoliberal in character. In this section, I begin by delving into the theorization of processes of political-economic change across the global North that began in the late 1960s. I focus on literature that approaches this restructuring through the lens of neoliberalization. In general neoliberalization in the global North is understood to include a range of potential strategies directed toward the dissolution of the social contractual commitment between the state, capital and labour realized in the early post-War period. That commitment meant that the state intervened in the market for the provision of a variety of welfare related services and to ensure the social wage. Still, limited government interference in the market was deemed preferable (Gordon 1991; Mansfield 2005). Under neoliberalization, by contrast, it is argued that markets and market logics are used to understand, regulate and streamline all aspects of social life (Gamble 1988; Lemke 2001). Under neoliberalization, the role of the state is altered from one of regulating the economy in the maintenance of Keynesian-Fordist compromises to one of regulation for the free functioning of the economy. This is accomplished through strategies such as the devolution of state functions to other scales of government and to non-state actors, the movement from regulation via the state to regulation via the economy, the than a program of set of policy prescriptions that exist in a static state (cf. Peck and Tickell 2002). 16 Neoliberalization, however, does not require a Keynesian-Fordist base from which to take growth. Neoliberalization has also marked political-economic shifts from authoritarian and colonial rule in a variety of locations in the global South (cf. Peck 2004: 399; Harvey 2006; Gregory 2004). 17 Polanyi refers to these as ‘fictitious commodities.’ The three fictitious commodities identified by Polanyi are land, labour and money (Polanyi 1944). 36 commodification of public goods and services,18 and the reformulation of citizens as consumers. There are several presentations of the reasons behind the decline of Keynesian-Fordist governance. On the one hand, the decline is presented as a response to the failures of the Keynesian compromise. Within that group, perspectives differ on what those failures entail. Authors have placed emphasis on economic downturns across the global North beginning in the late 1960s and early 1970s. In his widely read work, the Fiscal Crisis of the State, O’Connor argues that there is an inherent contradiction in KeynesianFordism whereby the costs or production are socialized and underwritten by the state, and the profits are accrued privately. As a result, a ‘gap’ develops between government revenues and expenditures, and the ‘fiscal crisis of the state’ develops in turn (O'Connor 1973). This reasoning does not call for a neoliberal response. Other authors, however, attribute falling rates of profit experienced across many countries in the global North to bloated and inefficient welfare states. Key issues in this line of reasoning included the wage gains made by unions that business was said to no longer be able to afford and state welfare provisions (cf. Kolko 1988). From such lines of reasoning, neoliberal restructuring emerges as an appropriate response (e.g. Nozick 1975; Friedman 1962). From another perspective, political-economic restructuring away from Keynesian-Fordist policy is taken as a strategy to establish neoliberal forms of governance (i.e. restructuring is not necessarily related to problems of Keynesian-Fordist governance). In terms of strategy, Block places the origins of the defeat of ‘national capitalism’ [Keynesianism] in favour of an ‘open world economy’ by the US in the late 1950s, prior to any post-War economic downturn (Block 1977: 10). Duménil and Lévy, moreover, show 18 Many such goods, for example water supply, were delivered privately in the many parts of the global North including Ontario until the early 20th century at which point they were taken under government management (Benidickson 2002). 37 neoliberalization in the United States, France and the UK to have returned power and wealth to the financial class rather than to have addressed the failures of Keynesian-Fordist governance (Duménil and Lévy 2004). Harvey makes a similar argument with respect to the economic crisis in Argentina in the early 1990s (Harvey 2006: 104-106). Weber and Rigby have analyzed economic growth and decline across several states from 1960 to the early 1990s. Their work puts arguments that place neoliberal policy reform as a necessary response to overspending welfare states into question. They argue that the periods of ‘rising or sustained growth output’ ended at different times across the global North, and that the first ‘busts’ following post-War growth varied between countries by more than a decade. The US, for example, experienced its first bust in 1970, whereas Canada’s was not until 1982 (Webber and Rigby 1996: 59-60). For these authors, there was no definitive shift in the rate of profit that would mark distinct periods of growth and downturn; rather there were undulations that continued to occur after the 1970s. Moreover, such undulations are inherent in the system itself rather the fault of any policy, technical change, or group influence (Webber and Rigby 1996). Research that would ascertain the origins and objectives of neoliberalization at the provincial scale in Ontario has not been conducted in this study. The position taken here is that political-economic restructuring that is keeping with descriptions of neoliberalization in the literature was pursued ideologically in Ontario from 1995-2002. From 1970 to 1995, neoliberalization was also an important element of political-economic restructuring in the province. In that period, however, neoliberal policy adoption proved difficult to avoid, even for social democrats, due to restructuring at higher scales of government. The particularities of neoliberalization in Ontario are pursued in Chapter 3. How neoliberalization in Ontario reflects and differs from neoliberalization in the literature is explored in the second part of this section. 38 This research focuses on the municipal scale, in particular the governance of municipal water supply. Research demonstrates that neoliberalization can yield a range of outcomes at the local scale. I add to this argument that neoliberalization at the local scale can be motivated by a range of aspirations, which include coping with neoliberalization enacted by higher scales of government. For Jessop, neoliberalization strategies from higher scales of governance have not everywhere led to neoliberalization on the ground, but rather to a variety of coping responses (Jessop 2002). In Canada, neither Keynesian-Fordist governance nor recent neoliberalizations of governance have been uniform in time or across space. Rather multiple responses to federal and global political-economic realignment, and a range of predilections for neoliberalization across the provinces continue to emerge from the varied provincial experiences with Keynesian-Fordist governance. In fact, spatial variety in terms of the manifestations of neoliberalization at the local scale is a key theme in the neoliberalization literature. The phenomena has been termed ‘actually existing neoliberalism’ (cf. N. Brenner and N. Theodore 2002) and is contrasted to ‘neoliberalism in general’ (cf. Peck 2004). This variation has prompted some researchers to question the analytical utility of neoliberalization (cf. Barnett 2005; Castree 2006; Larner 2003). The central conundrum is whether or not something that expresses such a diversity of changing spatial manifestations can be simultaneously understood as a global phenomenon of epic scope and virtually hegemonic purchase. A second challenge calls on research into political-economic restructuring to distinguish between the particular influences of neoliberalization and those of other challenges to contemporary forms of governance. Castree asks researchers to respect the ‘impurity’ of neoliberalization at ‘all scales’ arguing that it is ‘axiomatic that it is never ‘neoliberalism’ alone that causes anything, but always “neoliberalism-plus”’ (Castree 2006: 5 emphasis in original). This 39 is because, as Barnett has reminded students of neoliberalization, the restructuring that has been witnessed across many states over the last 25-30 years is a product of a variety ‘socio-cultural processes,’ which he details as ‘changing consumer expectations,’ ‘the decline of deference,’ ‘the refusals of the subordinated,’ ‘the politics of difference,’ and ‘the emergence of contested inequalities’ (Barnett 2005: 10 emphasis in original). In a related way, Forsyth has critiqued work in political ecology for economism in analyses of environmental degradation, arguing that a wider range of forces need to be accounted for (Forsyth 2003: 7, 103). These interventions highlight the importance of sustainability, and other critiques from the left, in political-economic restructuring since the late 1960s. I characterize Barnett’s criticism as a ‘reminder’ because authors have long pointed out the impacts of a variety of leftist critiques of Keynesian state-led governance on political-economic restructuring that has been neoliberal in form (e.g. Harvey 1990). The politics of sustainability have been included among these. In Barnett’s critique, he notes that, in this regard, ‘environmental politics and the politics of sustainability … cannot be ignored’ (Barnett 2005: 10). Important in their influence have been their critiques against ‘rigid’ and centralized state-led management in favour of ‘autonomy, equality and participation’ (Barnett 2005: 10). With respect to urban service delivery, in particular, Graham and Marvin list ‘new structures of feeling’ – including feminist, environmental and post-colonial critiques – together with neoliberalization as instrumental in the break down of the modernist ideal associated with urban planning under the welfare state (Graham and Marvin 2001: 92, 96, 123). Reversing the arrow, Gandy sees urban environmental change as not simply related to technological or economic growth but also as the ‘outcome of sharply different sets of political and economic interests’ (Gandy 2002: 4). 40 Being attentive to these relationships as well as those of scale is rightly highlighted as requisite for analysis. Neoliberalism need not be the only player on the field to contribute to social, political and economic change in important ways. It need not even always and everywhere be the dominant player. This thesis endeavours to examine the interactive outcomes of neoliberalization and sustainability upon the governance of municipal water services. In attending to those interactions, this thesis shows that other policy positions are important and must also be attended to. These include environmental and union politics, and a techno-physical approach to water service provision. I examine theories pertaining to the relationship between neoliberalization and sustainability in the Section 2.2.2. SITUATING THE ONTARIO CASE Having presented theories of neoliberalization in this section I focus on their relationship to political-economic change in the Canadian and Ontario contexts. I begin by discussing the periodizations (or ‘phases’) of neoliberalization advanced in the literature. Following these discussions, the neoliberalization strategy of rescaling is discussed in terms of its importance for approaching the analysis of the municipal scale in section 2.2.2. Finally, I explore two features of neoliberalization that are of relevance to the case of municipal water supply restructuring in Ontario. By way of defining a temporal profile for neoliberalization, Peck & Tickell advance three stages: experimental proto-neoliberalizations of the 1970s; the shallow roll-back neoliberalizations of the 1980s; and the deep roll-out neoliberalizations beginning in the 1990s (Peck and Tickell 2002). The authors, and the many that have followed their typology, focus on ‘roll-back’ and ‘roll-out’ neoliberalizations. Roll-back neoliberalization refers to the dismantling of Keynesian-Fordist state institutions. Subsequent to this apparent retrenchment of the state, neoliberalism is then ‘rolled-out’: it is concerned with the implementation of new ‘institutional hardware’ that 41 combines ‘technocratic economic management and invasive social policies’ (Peck and Tickell 2002: 389).19 Stemming from her work on New Zealand, Larner advances a periodization more in keeping with the phases of neoliberalization found in Ontario. In the 1980s, state withdrawal is coupled with an attempt to preserve ‘and even extend – the welfarist and social justice aspirations associated with social democracy;’ in the 1990s, a more ‘punitive phase’ accompanied by neoconservative programs in terms of social policy is deployed; and, in the late 1990s, neoliberalization is characterized by a “partnering” ethos in both economic and social policy’ (Larner 2003: 510). Importantly, these phases are ‘hybrid;’ each ‘is associated with distinctive ideologies, policies and programs, only some of which are unequivocally neoliberal’ (Larner 2003: 510). In Canada, the Fordist compromise – referred to as ‘permeable Fordism’ – was somewhat different from many countries in the global North. According to Jenson, permeable Fordism was based on a nationalist discourse of social welfare rather than on the capital-labour relationship (Jenson 1989, 1990). The class compromise was one between the ‘left’ and capitalist forces. It focused on an ideological project of nation building through redistributive social justice and was mediated through federalist institutions (Jenson 1989, 1990). This meant that in Canada, this social contract was not simply between the state, capital, and labour, it was also between the provinces. Economically powerful provinces – chiefly Ontario – provided subsidies to socalled ‘have-not’ provinces in exchange for primary materials, markets for manufactured goods and political favour federally (Clark 2002). This history of permeable Fordism has influenced transitions to neoliberalization in terms of workfare policies (Peck 2001: 214) and social reproduction (I. Bakker 19 Such technocratic management, while founded on economic logics, is not restricted to the economy but extends to non-economic aspects of society (Barry, Osborne and Rose 1996; Lemke 2001). 42 2003). Tellingly, Ontario is both a forerunner in terms of neoliberalization in Canada and, since the early 1980s, has ardently sought withdrawal from its Fordist compromise with the Canadian state (cf. Chapter 3). In terms of the ‘phases’ of neoliberalization, there is both inter-provincial and inter-scalar variation in Canada. These issues are discussed in greater detail in Chapter 3. Time-wise, neoliberalization in Canada is considered to have lagged behind that of the US and UK by approximately a decade (Cameron and Simeon 1997). This is in keeping with the above neoliberal periodization in that, at the federal scale, Canada has continued to see the ‘roll-back’ phase defined by Peck and Tickell.20 This has much to do with the decentralist tendencies of Canadian federalism that are discussed in Chapter 3. At the provincial scale, however, experiences of neoliberalization have been various and, in the case of Ontario, expressive of a much greater match to Larner’s typology. The NDP government of 1991-95 attempted to temper the social affects of neoliberalization that it seemed helpless to avoid, the conservative government 1995-2002 aggressively pursued a neoconservative variety of neoliberalization in the face of strident opposition, and the liberal government of 2002 to today has retreated significantly from such tactics. These periods have not been uniform, and it is not uniquely changes in government that have motivated changes in neoliberalization strategy. In terms of education policy, Basu refers to three ‘periods’ of neoliberalization in education in Ontario all occurring within the neo-conservative ‘roll-out’ phase: aggressive implementation; dissent and chaos (social protest); and 20 Examples include the retreat of the federal government from unemployment insurance, for example in canceling their contributions to the Canadian Assistance Plan (CAP), reducing transfers to the provinces for social housing, and Medicare etcetera. These were driven by a desire to pay down the federal debt, with a view to Canada as a site of global investment. In the late 1990s, the federal government also devolved capacity for governance upward to the international scale through the signing of NAFTA and its prioritization of private profits over domestic legislation for environmental and social protection (cf. McCarthy 2004). 43 quiet anticipation (a year of pre-election ‘calm’) (Basu 2004: 623, 631). This ‘calm,’ however, is rather an extended period of abeyance on the part of the provincial government; it began as early as 2000 and has lasted well after the transition to a liberal government in 2003. Here, Jessop’s work is helpful. He argues that the ‘unexpected social costs’ of ‘neoliberal regime shifts’ in states formerly characterized by ‘Atlantic Fordism’ have instigated alternative paths of political-economic and social restructuring that do not mark a major reversal in the global neoliberal project’ but rather a rethinking of strategies (Jessop 2002: 123). An important aspect of Ontario’s transition from Fordism to neoliberalism is an ongoing realignment of responsibilities between scales of government and the introduction of new actors into roles previously reserved for government. These processes are common throughout neoliberal transitions and together are referred to as the rescaling of the state and the transition from government to governance (cf. Jessop 1995, 1998, 1999). They are related and coincident processes. Government functions are shifted to other scales of government (global and sub-national), and to non-state institutions (e.g. private sector, NGOs, voluntary organizations) (MacLeod and Goodwin 1999). This ‘rescaling’ is characterized as non-linear, and not necessarily (or even commonly) associated with a diminution of state power. The state (at various scales), it is argued, becomes engaged in new activities, in new ways, and often with new goals (Jessop 1997c; MacLeod and Goodwin 1999). Although new actors and new configurations of responsibilities are developed and redeveloped, the state is seen as maintaining a central role in determining the nature and form of their organization. What we have are ‘changes in the articulation of government and governance,’ rather than a diminution of one in favour of the other (MacLeod and Goodwin 1999: 522 emphasis in original).21 According to MacLeod & Goodwin, this may be less 21 Referring to Jessop (1997b: 23). 44 true in the United States, but in Europe and the UK “little can happen subnationally without [the national state’s] cooperation, acquiescence or benign ignorance” (MacLeod and Goodwin 1999: 508).22 Still, states are said to operate within a newly configured set of options that are attendant to transnational economic forces, entailing politics oriented towards markets and a ‘shift of power from voters to capital’ (Leys 2001: 1,6). In Canada and especially Ontario, the nature of the provincial-municipal relationship is such that the power of the provincial government is assured over and throughout rescaling. At the same time, while the constraints on governments in terms of pursuing ‘market driven politics’ have been clearly witnessed, some governments are rather constrained by domestic realities in their drive to pursue market driven politics to the nth degree. The elements and consequences of rescaling encountered at the municipal scale can be quite distinctive from those experienced at higher scales of governance. A striking example is that although the state remains central in governance throughout the rescaling of the state, municipal governments often find their capacities to govern and provide services financially weakened, their policy flexibility reduced, and their roles in the provision of municipal services circumscribed. Accordingly, Jessop finds that cities have been the most severely impacted by neoliberalizations. Not only have they acquired new responsibilities on the level of servicing (stemming from rescaling), they are also responsible for mitigating the social ills associated with neoliberal restructuring (Jessop 2002). This ‘rescaling’ of responsibilities has been found, all too frequently, to be without a corresponding shift in capacity (resources), power (J. Peck 2001), entitlements (Raco and Imrie 2000), or legitimacy (Raco and Flint 2001). In Canada, this is compounded by the constitutional arrangement whereby municipalities are wards of the provinces and, as such, are restricted in their 22 Referring to Harding (1997: 308). 45 fund-raising and policy maneuverability to address neoliberal programmatic changes emanating from national and provincial governments. In Ontario, the provincial government has actually uploaded certain responsibilities from municipalities as well as downloaded responsibilities to them. What is important to note is that all responsibilities are not equal in either their public sentiment or their financial management. Shifting roles means shifting the nature and type of activity in much more than just a programmatic sense, it implies a shift in the public relationship to and sentiment toward municipal government and municipal services. Finally, I highlight two features of neoliberalization that are important in the case of municipal water supply restructuring in Ontario. These are the ‘governmentalization of government,’ and the presentation of neoliberalization as the solution to the challenges created by the fiscal constraint resultant from neoliberalization itself. The ‘governmentalization of government’ refers to a continual critique of the authority and ability of governments to govern (Dean 1999: 174). It demands that the means of government be supervised and subjected to the logic of the market, by which the governmental field of action is to be regulated, evaluated, and codified. Second, paraphrasing Peck and Lemke, neoliberalization claims to respond to circumstances that already exist when it is, in fact, instrumental in their creation (J. Peck 2001; Lemke 2001: 203). Thus, the state draws on the global scale of governance to legitimate its policies of governance at the national and sub-national scales, making it logically difficult for lower scales of governance to operate in a fashion that is not coincident with neoliberalization. As McAllister points out, however, ‘although municipalities have been subject to similar forms of politicaleconomic restructuring from higher scales of governance, municipalities have distinctive political cultures and therefore respond differently to changing global and domestic environments’ (McAllister 2004). 46 2.2.2 SUSTAINABILITY: CONCEPT AND CONNECTIONS In this section, I discuss the concept of sustainability. I draw on theories from political ecology and ecological modernization to frame the debate on the relationship between neoliberalization and the socio-environmental dimensions of sustainability. These also serve to contextualize this research and its findings. There are two primary conceptualizations of the relationship between neoliberalization and sustainability. First, ecological modernization and its water sector subset, market environmentalism, argue that policies described as neoliberal in the literature improve, in particular, environmental sustainability. Second are approaches that argue the opposite – that neoliberalization acts, at best, as a deterrent to sustainability and, at worst, to subvert it. In the literature, such positions can be found in work falling under the umbrella of political ecology. In this section, I first present some of the theory on sustainability itself. I follow, with a discussion of the two strands of theory linking neoliberalization and sustainability. I begin with those of political ecology and conclude with an examination of ecological modernization. From the outset, it must be acknowledged that environmental theory is extremely broad and has been the subject of significant debate. For example, Macnaghten and Urry contrast ‘environmental realism,’ ‘environmental idealism,’ and ‘environmental instrumentalism’ to argue that environmental approaches must avoid concepts of single nature, but see ideas about nature as produced through contestation and social process (Macnaghten and Urry 1998). Avoiding the reification of nature has been a widespread concern in the literature (e.g. Harvey 1996; Cronon 1996; Braun 2002; Braun and Castree 1998; Moore, Kosek and Pandian 2003; Smith 1984). In general, these authors seek an environmental politics that recognizes nature as socially constructed and produced in relation to human activity and that, in keeping with this, is motivated by environmental justice and not simply justice to nature (cf. Agyeman, Bullard and Evans 2003). In Braun’s words, the focus is not on nature preservation, but rather ‘on how future natures are 47 to be produced, and with what consequences for humans and non-humans alike’ (Braun 2006: 210). The concept of sustainability likewise marks a major shift in environmental thought from discourses of conservation and austerity in the face of environmental limits. The concept of sustainability rests on a conjunction of environmental, social and economic sustainability (Dryzek 1997: 130). Rather than retaining current lifestyles, however, sustainability posits the necessity for political, social and technical change to achieve economic welfare, social justice and environmental protection. Robinson, for example, advocates that sustainability be used as an umbrella term to encompass both the technical fix (which he qualifies as sustainable development) and value change (which he qualifies as sustainability) programs for achieving environmental goals (Robinson 2004). Also necessary, of course, are institutional change and changes in governance. In terms of Braun’s statement above, sustainability does espouse particular goals for the production of nature whose achievement will require fundamental changes in the human relationship to the environment. It remains, however, inherently flexible, and cognizant of the diversity of socio-natures. To paraphrase Robinson, sustainability is a political project rather than a scientific axiom and, as such, evolves through debate, experience, and experimentation (Robinson 2004: 379). In the water sector, the fundamental demand for change associated with sustainability is most clearly visible in concepts of the ‘Water Soft Path’ (Brooks 2005; Brandes and Brooks 2005). The water soft path is defined as a program ‘that complements centralized physical infrastructure with lower cost community-scale systems, decentralized and open decision-making, water markets and equitable pricing, application of efficient technology, and environmental protection’ (Gleick 2003: 1524); it is not the techniques deployed per se, but ‘different socio-political choices about human relationships to, and thus governance of, natural resources’ (Brooks et al. 48 2004: 12).23 Here, one can clearly see the demand for changes in technology, individual behaviour/values, institutions and governance. Although sustainability posits the potential for a mutually supportive relationship between economy, environment and social justice, it is not to be conflated with ecological modernization. This is important because ecological modernization inherently asserts a particular relationship between sustainability and political-economic restructuring that is coincident with policies described as neoliberal. Although sustainability and ecological modernization have been critiqued for adhering to capitalist modes of production (e.g. Harvey 1996), the relationships they posit between environment, economy, and society differ. The lack of integration of economic principles that promote business and economic growth into discourses of sustainability has been identified as the reason for its lack of policy uptake as compared to the uptake enjoyed by ecological modernization (Dryzek 1997: 136). McCarthy differentiates the two approaches according to the abandonment of sustainability’s social-justice component in ecological modernization (McCarthy 2004: 328; see also Dryzek 1997: 146). As discussed above, sustainability in conjunction with other critiques from the left has had an impact on the form that political-economic restructuring has taken in the late 20th century. Still, most literature that examines the interaction between neoliberalization and sustainability in an in-depth fashion is rather concerned with how neoliberalization modifies, incorporates or mobilizes sustainability or, in a more interactive framing, how the biophysical characteristics of resources interact with neoliberalization to modify or limit the outcomes of neoliberalization on the environment or environmental services. In general, although often adopting an interactive approach, work that broadly falls under the umbrella of political ecology comes from a political position that the influence of neoliberalization upon 23 Here, Brooks is referring to earlier work by Holtz and Brooks (2003). 49 sustainability is a negative one, although certain bio-physical characteristics of resources may limit or modify the outcomes. Work in ecological modernization, by contrast, advances the reverse argument – that neoliberalization improves (environmental) sustainability. Political ecology is focused on the relationship between political economy and the environment. Early work focused particularly on land degradation in the global South, finding capitalist relationships – particularly those leading to impoverishment – to be important in environmental degradation, leading to further impoverishment (e.g. Blaikie and Brookfield 1987). Subsequent authors called for a more coherent conceptualization of political economy that also paid attention to the impacts of affluence and took more environments into account, including the urban (Peet and Watts 1996). Many authors took up this call through examinations of neoliberalization and the environment and expanded the case studies to include the global North (e.g. Robertson 2004; Prudham 2003; McCarthy 2002). The work that I focus on examines neoliberalization or recent politicaleconomic restructuring in relation to environmental governance. The work simultaneously takes an interactive approach between neoliberalization and the environment and posits neoliberalization to have negative consequences for sustainability. In terms of an interactive approach, the work endeavours to account for the distinctness of various environments as sites upon which neoliberalization policies are enacted. As such, different resource and environmental sectors interact with neoliberalization in different ways. In the forest sector, for example, authors find that capital can subsume nature but that ‘real’ subsumption can lead to ‘surprises’ from the part of nature (Boyd, Prudham and Schurman 2001; Prudham 2003). In the water sector, research has demonstrated that water is an ‘uncooperative commodity’ (K. Bakker 2003a). 50 Other work demonstrating an interactive approach draws on Polanyi’s theory of the ‘double movement’24 to examine the relationships between neoliberalization and environmental governance. Such work has demonstrated the double movement to operate to protect environmental resources and socio-environmental relationships from the effects of neoliberalization (Mansfield 2004; Dubash 2004 respectively). Notably, neoliberalization has also been shown to change strategies to accommodate such challenges. Smith, for example, finds the substitution of corporatization for privatization to advance neoliberalization in South Africa’s water sector (Smith 2004). Despite their interactive approach, the studies understand the biophysical characteristics of resources (or the double movement) to act to mollify the otherwise deleterious consequences of neoliberalization upon the environment. In general, there is no premise that neoliberalization might be of benefit to environmental goods and services or their sustainability (e.g. Peet and Watts 2004; McCarthy and Prudham 2004; Darier 1998). One exception is Bakker’s finding that under neoliberalization, environmental externalities were substituted for social externalities (K. Bakker 2003b: 194).25 Where sustainability includes social and environmental justice, however, Bakker’s finding does not constitute that neoliberalization results in improved sustainability. In contrast to the above approach is ecological modernization. Ecological modernization is considered to have gained prominence among theories of 24 Specifically, Polanyi argues that land, labour and money constitute three ‘fictitious commodities’ that require regulatory action by the state to protect them from market forces (Polanyi 1944). This protects the market in turn, as fictitious commodities can never be fully commodified without profound injury to both society and the market itself (Polanyi 1944). 25 That is, in the UK, while significant environmental improvements especially with regard to wastewater effluents were achieved, equitable access to water declined significantly in the initial years following privatization. 51 environmental improvement in the state and private sectors as well as in various academic disciplines such as sociology. In the water sector, for example, ecological modernization’s subset (market environmentalism) is considered the most prominent approach to the incorporation of environmental issues (K. Bakker 2003a: 27). Ecological modernization is generally understood to be a theory of environmental progress through industrial transformation that is coincident with economic growth. In this formulation, state economic policies that facilitate innovation in the private sector are preferred. What the ecological modernization literature suggests these are tends to be compatible with policy prescriptions described as neoliberal in the literature. For some authors, the above definition might appear limiting. This is because ecological modernization is not a coherent theoretical or analytical paradigm; rather it comprises a range of similar research conducted under the designation of ecological modernization (Mol and Spaargaren 2000; Weale 1992). Murphy, for example, identifies 6 strands in the literature and Buttel presents 4 (Buttel 2000; Murphy 2000). In their reviews of the literature, both Murphy and Buttel associate the most central work in ecological modernization with the contributions of authors such as Arthur Mol, David Spaargaren and Martin Jänicke. Respectively, they refer to this work as ‘technology, entrepreneurs and the transformation of society’ (Murphy 2000: 2), and as the branch that is in particular an ‘identifiable school of ecological modernizationist/sociological thought’ (Buttel 2000: 58). In his own review of the ecological modernization literature, Mol – a central figure in the dominant strand – identifies four ‘core features.’ First, the institutions of science and technology are pivotal in terms of achieving ‘ecological reform.’ Second, the approach emphasizes the heightening of the role for markets, economics, innovators and entrepreneurs in ‘ecological restructuring.’ Third, it sees a ‘redirected’ rather than a diminished role for governments in environmental management. This means a demand for 52 change ‘from curative and reactive to preventative, from “closed” policy making to participative policy making, from centralized to decentralized, and from dirigistic to contextually “steering”’. Fourth, and finally, new social movements are repositioned vis-à-vis the state and the market as their roles transition; they shift from being critical commentators to critical participants in the policy debate (Mol 1997: 140-142). These tenets, particularly as they pertain to the roles of the state and the economy, posit ‘ecological reform’ through political-economic restructuring of a form that mirrors exigencies characterized as neoliberal in the literature. As such, it can be said that ecological modernization proposes a neoliberal politics for the realization of an ecological society; neoliberalization improves environmental sustainability (see also Mol 1995; Anderson and Leal 2001; Sonnenfeld and Mol 2002). Although work in political ecology is critical of this link, Dryzek finds that ecological modernization is the commonality between the top environmentally performing countries (Germany, Japan, Netherlands, Norway and Sweden), where corporatist governance facilitates the development of related policy (Dryzek 1997: 137).26 The apparent success of ecological modernization may also be due to its widespread uptake, which some research has attributed to its compatibility with existing political-economic and social circumstances.27 According to Hajer, the adoption of ecological modernization in the Netherlands, for example, had little to do the veracity of its precepts or with the degree to which they could be realized. Its uptake stemmed rather from how it fit into 26 York and Rosa advance a critique of the ecological modernization approach that merits noting. Chiefly, ecological modernization needs to show that institutional change leads to environmental improvement, that the switches to ecological production are frequent, that industries reducing their impact are not simply transferring to other sectors or abroad, and that the pace of efficiency exceeds the pace of increased production (York and Rosa 2003: 273). 27 This is relevant in terms of the social studies of technology (SST) approach that this thesis pursues in Section 2.4. 53 existing social, political and institutional discourses (Hajer 1995). Buttel advances a similar argument. He states that ecological modernization’s ‘rapid rise to prominence’ is attributable to how it ‘accorded particularly well with a number of intellectual and broader political-economic factors’ rather than its degree of coherence as a social theory (Buttel 2000: 58). Among these wider intellectual and political-economic factors, Buttel includes the rise of environmental movements in the 1980s, the limitations of sustainability and sustainable development, and a focus in American sociology on capitalism as a cause of environmental degradation (which many found limiting to the advancement of environmental concerns) (Buttel 2000). To this list, I would add the coincident rise to prominence of the theories of political-economic restructuring associated with neoliberalization. 2.2.3 NEW PUBLIC MANAGEMENT: REFORMING PUBLIC SECTOR GOVERNANCE The concepts of NPM are important in understanding how the water sector is affected by political-economic restructuring, in terms of business models and sustainable infrastructure management. NPM is a knowledge production technique targeted at furthering the strategies of neoliberalization in the public sector. In Ontario, the application of the theories of NPM to the public sector is instrumental in altering governance. As argued above, governance is a central element in the production of the relationship between neoliberalization and sustainability in the water sector. In this section, I explore NPM as a technique for the intellectual and practical propagation of neoliberalization. I discuss how NPM relates to governance and governance models for municipal water supply and how it affects business models and sustainable infrastructure management in turn. The inclusion of NPM approaches facilitates the adumbrating of political roles in water supply management. This has implications for both business models and sustainable infrastructure management. Anticipating these discussions, I finish this section by drawing on work in the social construction of science and nature, which demonstrates that politics is inherent in the production of 54 technical knowledge and artifacts. Beyond this, I argue that politics is an important element of technical management. As such, the concern is not how to purify the technical from the political (which cannot be done); it is rather to find ways of openly engaging politics in the management of what are sociotechnical services. Often, as is the case in Ontario, neoliberalization at the municipal (and other) scales involves deploying the techniques of New Public Management (NPM) to introduce private sector management methods into the public sector. For Clark, NPM processes are the expression of neoliberalism upon the public sector in the global North (Clark 2002). Neoliberal restructuring and the ideological prominence of NPM have been among the key drivers in contemporary pursuits of new governance and business models for water services in Ontario. Neither governance nor business models are politically neutral; they reflect a move towards particular political positions and strategies for the relationship between government, the private sector, and citizens. In general, NPM strategies promote the operation of government on business principles and simulated business practice. As such, NPM marks a significant realignment of decision-making criteria, the relevant actors and their roles, and the general philosophy of governance. Some examples of NPM activities that have gained prominence are Municipal Benchmarking, Total Quality Management (TQM), and the Triple Bottom Line. In terms of municipal water services, this is exemplified in terms of the trend in governance toward NPM, whose objectives are much more consistent with business models that include corporate mandates for governance. For sustainable infrastructure management, such concepts include environmental goals in conjunction with meeting economic, social and technological ones. They are more inclined toward principles of ecological modernization than sustainability per se. 55 Researchers have theorized NPM according to its general type and the categorization of its strategies. In terms of type, Clark distinguishes between neoliberal and neostatist variants. The neostatist, typical of France and Quebec, accepts neoliberalism as a challenge to the public service while the legitimacy of the state is sustained – it is described as ‘managerial rather than ideological’ (Clark 2002: 774). The neoliberal variant, typified by the UK, Ontario and Alberta, involves the doctrinal application of neoliberal policies (Clark 2002: 774).28 With respect to strategies, Hansen purports the features of NPM to have two orientations: market and management (Hansen 2001: 107-108). Vertically, NPM restructuring involves a downward move from hierarchy to market and, horizontally, it pushes management from regulation to autonomy. A focus on Hansen’s ‘vertical’ restructuring is in keeping with Clark’s neoliberal variant of NPM. It is favoured in the Anglo-American countries, and includes: ‘privatization, contracting out, purchaser-provider models; free choice/exit opportunities; [as well as] competitive and economic incentives.’ A focus on ‘horizontal’ restructuring is reminiscent of Clark’s neostatist variant. It is favoured in Europe (especially Scandinavia) and involves: ‘decentralization of decision making competence and responsibility; user influence; goal steering/management by objective; joint forms of strategic leadership, efficiency monitoring, service and quality management systems (Total Quality Management, benchmarking, and the like).’ On the vertical axis, the methods of NPM combine changes to both governance and business models, but mostly business models. On the horizontal axes, changes pertain to the reorganization of governance models. In this sense, both have implications for sustainable infrastructure management (Chapter 7). 28 This, however, does not necessarily apply to the municipal scale and can change over time. This thesis finds that, while the approach at the provincial scale was ideological in the 1990s, the approach at the municipal scale in terms of water supply governance since 2000 is more aptly described as managerial. 56 In the context of Ontario, these models and implementation strategies have not been singularly applied. Contemporary neoliberalization in Ontario could be conceived as seeking the rationalization of the state, i.e. neostatist (2002present) versus the replacement of the state that was pursued through the conservative government in the 1990s, i.e. neoliberal (1995-2002). The overlap of NPM policies and their relationship to municipal service provision is all the more visible through Rhodes’ categorization of the NPM tool-kit. Rhodes is concerned with NPM strategies as directed at service evaluation versus those that are directed at service provision. With respect to the former, he makes the following list: explicit performance standards, results based management, value for money, and knowing the customer. In terms of the latter, NPM is found to stipulate: market-mimicking incentive structures, the disaggregation of bureaucracies, contracting out and quasimarkets to increase competition, and customer choice (Rhodes 1997: 48). These types of prescriptions are obviously compatible and are often combined in the water sector in Ontario. Still, there are apparent contradictions within NPM that Isin likewise identifies in neoliberalization generally. But as Isin argues, rather than contradictions per se, these are part of neoliberal strategy for ‘governance without government’ (Isin 2000: 150, 154-155).29 In terms of municipal water governance, this translates into depoliticization through the strict definition and circumscription of the roles of municipal politicians in water service provision. The primary tools for this are business models arranged along the principles of ASD, which are discussed in Section 2.3. In the remainder of this section, I discuss these ‘contradictions’ and how they relate to strategies for the reorganization of the roles of elected municipal politicians. 29 Peck also refers to this strategy as one of “less government and more governance,” but notes that it is spatially and temporally contingent in its manifestations, degrees, and effects (Peck 2004: 395). 57 The apparent contradictions in NPM stem from its opposing drives to centralize authority and to further pursue (decentralized) governance, as well as from its approach to citizens. The former is exemplified through Hansen’s finding that NPM promotes a shift from centralized to decentralized management (government to governance) on the one hand and from hierarchy to market on the other. Tellingly, Pollitt and Bouckaert describe NPM as a ‘shopping basket’ of somewhat discordant reforms citing its focus on ‘efficiency, markets and competition, accountability for results, and devolution’ (Pollitt and Bouckaert 2000).30 The tension in NPM is generally expressed as the ‘centralizing tendencies of contractualism’ as against the ‘decentralizing tendencies of managerialism’ (Christensen and Laegreid 2002: 270). Both present challenges to accountability (Christensen and Laegreid 2002: 270-271). Where these policies inhibit government involvement and regulation, they also present challenges to sustainable infrastructure management. As shown empirically in Chapter 7, government regulation is an important, but missing, element in the advancement of programming for sustainable infrastructure management. The contradiction stemming from NPM’s ‘customer’ approach to users of public services presents three difficulties in relation to public services and public sector mandates. Customers, or the targets of a service, are not necessarily readily identifiable or easily delimited in terms of public services, customers desire ‘total satisfaction’, and the business or market oriented relationship to customers is ‘stratified’, ‘manipulative’ and ‘profit seeking’ (Aberbach and Christensen 2005). The ideology of ‘citizen as customer’ also serves to place the need for elected officials to represent them under question: customers are better served by private sector models that are ‘flexible’ to their desires rather than ‘determinate’ of their needs.31 30 Referenced in Aberbach and Christensen (2005: 226). 31 The literature promoting NPM and ASD often characterizes government in this way (e.g. Fyfe 2004). 58 With respect to the depoliticization of municipal governance, NPM encourages the separation of actors and functions at the municipal scale. Specifically, NPM principles relegate municipal politicians to ‘steering,’32 and exclude them from the operational aspects of service delivery. Scholarship has found this to also be a strategy of neoliberalization, with the state seeing its role less in the delivery of services and more in terms of directing how those services are delivered through markets and according to market logics (Lemke 2001). At the municipal scale, these principles of NPM are brought together in and promoted through the concept of ‘enabling government’ (Barnett 1996: 67). Harvey discussed these changes at the municipal scale in terms of a shift from managerialism to entrepreneurialism, which promotes distance from governance and regulation (Harvey 1989).33 This division of roles is seen as responding to some of the challenges of municipal politicians. According to Hansen, in the 1980s there was a mixing of roles of politicians and administrators at the municipal level, an overload of detailed matters, and increasing sector specialization by councilors (Hansen 2001: 117).34 These led to a welcoming of the NPM mandate that would make the roles of councilors and administrators distinct, by confining councilors to a strictly ‘political’ role. The process involves new and circumscribed roles for the myriad of actors involved in local governance: citizens are reproduced as users, employees as producers, administrative heads as leaders and managers, central administrative staff as consultants; administrative chiefs as directors; and local councilors as goal-steering decision makers (Hansen 2001: 114-115). 32 cf. Osborne and Gaebler (1992) 33 This remains an ongoing phenomenon (cf. Brugue and Valles 2005; Hansen 2001). 34 See also Barnett (1996). 59 Under NPM, ‘political’ and ‘administrative’ decision-making must not mix. In this new formulation, ‘[p]oliticians must not interfere with the detailed matters of service delivery and task performance’, these rather fall to ‘administrative and professional staffs and units of the municipality’ (Hansen 2001: 115). The project of relegating elected officials to the ‘political’ proved elusive in Denmark and, ironically, inefficient. Hansen finds two reasons. First, he finds the role of ‘goal-steering’ to be ill suited to the realities of democratic governance structures at the municipal level. Second, service institutions become ‘their own masters,’ resulting in ‘weak contact and missing information and knowledge’ about the operation of institutions and the experiences of users (Hansen 2001: 118-119). As such, councilors have ‘become bystanders and anything but policy makers’ (Hansen 2001: 119). The challenge is how to make the plurality of governance entities accountable, not only to their particular issue, ‘but to the common concerns of the municipality’ (Hansen 2001: 119). Ontario’s experience is mixed in this regard. On the one hand, municipal departments run by committees of council have been the norm in service provision, thus mixing the political and administrative (where the drive is now to separate them, Chapter 4). On the other hand, the political issue of sustainability in the water sector has been left to utility management (Chapter 6). The effect of the lack of political involvement has been low progress on sustainability, confirming Hansen’s findings. In Ontario, it is often new actors that have emerged in the diffusion of governance who seek the rigorous delineation of roles for elected officials and technical experts (e.g. in fields of law, economics, administration, engineering, expert consultancy and auditing). Isin has similarly found municipal governments to be excluded from the orchestration of this strategy as their capacities and roles are adumbrated (Isin 2000: 156-157). In this research, it is found that the provincial government has also become less engaged in this process. This does not mean that municipal politicians and – 60 especially service managers – are absent from the process, rather as Uitermark finds, municipal actors interact with other scales of governance in a variety of ways to attempt to manage the processes of neoliberalization (Uitermark 2005). This delineation of the technical from the political and the presumption that technical knowledge is derived and applied objectively have been widely critiqued and refuted in the literature on the social studies of science and the social construction and production of science and nature (e.g. Demeritt 2001, 2002; Prudham 2003; Fitzsimmons 1989; Harraway 1991; Latour 1993; Pinch and Bijker 1984; Braun and Castree 1998). The presumed division of the technical and the political in NPM is based on such premises, which allow persons operating from systems technical of knowledge (e.g. economics, engineering, law) to be legitimized as apolitical, rational decision-makers. In work in the social construction of nature, Demeritt identifies two main methods for contesting claims that discursively depoliticize physical objects and knowledge about them. The first is ‘construction as refutation,' which focuses on exposing particular ‘claims about the world’ as false. The second – ‘construction as philosophical critique’ – endeavours to critique various ‘understandings of nature and society’ from a philosophical position (Demeritt 2002: 786). For these literatures the purpose is to demonstrate that neither nature, nor science, nor technology are objective realities ‘out there,’ but that they are rather enmeshed in the social world and that this has consequences for how we understand things that are apparently apolitical. This research demonstrates that, in practical ways, it is actually rather difficult to separate political and technical decisions in water supply governance. The challenge of specifying what is political and what is technical is foreshadowed in Latour’s argument that ‘we have never been modern.’ That is, rather than an alienation of the social or political from the technical, 61 the socio-political and the technical are actually deeply intertwined and mutually constructed in our societies (Latour 1993). This goes someway towards explaining Hansen’s finding that where governments are relegated to the political function of ‘steering,’ as defined through NPM, they rather become alienated from governance altogether (Hansen 2001). In response to this, I argue that the inclusion of politics in the production of science and technology is an important and necessary element of the use of technology and technical knowledge. They should not be separated but openly linked. As such, simply proving that technology is constructed risks the impression it is somehow less tenable because of the role of the social and political in its production. Rather, the involvement of politics bears important consequences for how techniques are deployed, with what goals, and producing which consequences (cf. Section 2.4); politics is important and necessary for socially just and non-exploitative constructions and productions of technology to emerge. Approaching the political character of science and technology from the perspective of defining governance arrangements that serve (among other functions) the progressive and open use of politics in technological development and decision making can help to address Latour’s worry that, in the critique of science, ‘matters of concern’ have been lost to ‘matters of fact’ (Latour 2004: 232). That is, in the critique of science for its political influences, the valuation of scientific findings that reflect ‘matters of concern’ has been harmed. 62 2.3 WATER PURIFICATION: RESTRUCTURING BUSINESS MODELS 2.3.1 RATIONALIZING MUNICIPAL WATER GOVERNANCE In terms of the restructuring of business models in Ontario’s water sector, I argue that the most prominent strategy is that of the rationalization of service delivery by commuting the roles commonly held by politicians to appointed experts in technical fields (2.3.1). The primary tool of this strategy is the propagation of alternative service delivery (ASD) business models (explored in Section 2.3.2). In this process, however, neoliberalization faces limitations and, in more than one instance, rationalization is circumvented. A primary reason for this is the action of alliances that contest these forms of restructuring (Section 2.3.4). This, however, is not the only reason. Other key reasons include gaps in neoliberal hegemony, contestation within municipal government, and contestation between scales of government (Sections 2.3.3 and 2.3.4). In this first sub-section, I use theories of neoliberalization at the municipal scale to argue that a primary aspect of neoliberalization in Ontario’s water sector includes strategies to rationalize the governance of municipal water supply delivery. I begin this section by theorizing the motivations for this strategy using theories of actually existing neoliberalization, Jessop’s neoGramscian approach to urban regimes, and ideas from the public administration literature. The tools that are mobilized for this strategy are both discursive and practical. They include the neoliberal feature of upholding technically driven forms management, new public management (NPM), and alternative service delivery (ASD). Two important and related reasons for the strategy of municipal rationalization are (1) the difficulty of rationalizing municipal politics and (2) conflicts within municipal government stemming from neoliberalization. The municipal scale in Canada is far less subject to neoliberal policy compliance than the provincial or federal scales. Therefore, additional strategies are necessary to render the governance of municipal services rational, 63 standardized and predictable according to neoliberal logics. On the second point, due to rescaling from higher scales of government, municipalities have found themselves grappling for ways to cope with the effects of neoliberalization. Responsive policies can entail further neoliberalization and/or policies that threaten the ability of water services providers to meet their new neoliberal assessment criteria. This leads to intra-municipal conflict and a desire for distance from municipal council on the part of utility management. This issue is addressed in detail in Section 2.3.3. Municipal politics in Canada are comparatively difficult to systematize according to the ‘techniques of government.’ At higher scales of government (provincial and federal) politicians do not retain the same autonomy from the dictums of neoliberalization; municipalities have a distinctly greater capacity to circumvent and morph the prescriptions of neoliberalism (Cameron and Simeon 1997: 172). The lack of political parties at the local scale in Ontario and the frequency of issue-specific electoral campaigns increase the autonomy of local politicians from the rationalizing elements to which their provincial and federal counterparts are typically subject (cf. Collin et al. 2003: 41-43).35 The rationalization of provincial governments in accordance with neoliberalization strategies is acutely exemplified by the failure of the New Democratic Party (NDP)36 to follow a non-neoliberal program while in office in several Canadian provinces during the 1990s (cf. Carroll and Ratner 2005). The particularities of the municipal scale under neoliberalization are not strictly a Canadian concern. Both the need for distinct policies for neoliberalization at the municipal scale and the distinct reactions of municipalities to the pressures of neoliberalization have been theorized 35 Amalgamation in Ontario is also seen as an effort to rationalize governance at the municipal scale on the part of the provincial government, see Chapter 3 for details. 36 The NDP is Canada’s social democratic party. 64 elsewhere (e.g. Jessop 1998: 42, 2002). According to McGuirk, in research on neoliberalization, the municipal – particularly urban – scale has become the focus of considerable scholarship ‘as a strategically important scale at and through which neoliberal accumulation and regulatory strategies can be institutionalized and pursued’ (McGuirk 2004: 1022). For Brenner and Theodore, ‘cities have become increasingly central to the reproduction, mutation, and continual reconstitution of neoliberalism itself during the last two decades’ (N. Brenner and N. Theodore 2002: 28).37 Jessop finds that municipalities have adopted ‘a wide range’ of different institutional adaptations to neoliberalization at the urban scale – including neocorporatism, neostatism, and neocommunitarianism – as opposed to full neoliberalization (Jessop 2002).38 This last fact – that the outcomes of neoliberalization strategies at the local scale cannot be guaranteed – is arguably among key incentives to attempt to rationalize municipal governance. This is one of the key points in Jessop’s original formulation of the neo-Gramscian approach to the ‘regulation of urban regimes’ (Jessop 1995, 1997a). This approach has been found instrumental in advancing the literature concerning neoliberalization at the municipal scale (McGuirk 2004: 1022). In Jessop’s neo-Gramscian formulation, it is important to see state power as relational between state institutional forms and the fluctuating array of political forces with which they interact (cf. Jessop 1997a). Thus, while new policies and institutions put forth at the local scale can be seen in the context of ‘continuing attempts to forge 37 See also Larner who points out that neoliberalization includes flexible programs for the reform of the welfare state that take shape through and shift according to particular local conditions, new challenges, and differing political orientations (Larner 2000). 38 Such a phenomenon has been visible in the water sector in Ontario where municipalities have adopted a variety of new and innovative business and associated governance models for the delivery of water services (Bakker and Cameron 2005). 65 and “sustain” a successful political project, “results” cannot be guaranteed’ (MacLeod and Goodwin 1999: 515, 516).39 In Ontario, I argue that since the neoliberal rescaling in the 1990s, the province and actors in governance have continued to seek methods of rationalizing the responses of local government to their new politicaleconomic and social pressures. Here, Brenner and Theodore’s approach of ‘actually existing neoliberalism’ is helpful. Actually existing neoliberalism, as a concept, stems from the same findings described in the two preceding paragraphs. As the authors state, ‘neoliberal programs of capitalist restructuring are rarely, if ever, imposed in a pure form, for they are always introduced within politico-institutional contexts that have been molded significantly by earlier regulatory arrangements, institutionalized practices, and political compromises’ (N. Brenner and N. Theodore 2002: 14). What Brenner and Theodore suggest in terms of analysis is of particular relevance. They advocate the study of ‘actually existing neoliberalism’ in terms of ‘two dialectically intertwined but analytically distinct moments: the (partial) destruction of extant institutional arrangements and political compromises through market-oriented reform initiatives; and the (tendential) creation of a new infrastructure for market-oriented economic growth, commodification, and the rule of capital’ (N. Brenner and N. Theodore 2002: 15). In Ontario’s water sector, these two moments are clear. The budgetary pressures created by rescaling, downloading and funding cuts in the 1990s have engendered a situation whereby the neoliberalization of business models is presented as necessary. This connects to theories that argue that neoliberalization creates the conditions for its further propagation. In Ontario’s water sector, the moments identified by Brenner and Theodore 39 They argue, moreover, that the approach avoids ‘economism,’ i.e. economic reductionism (MacLeod and Goodwin 1999). 66 are related, in that the neoliberalization of business models is seen as a remedy to the challenges created by rescaling and fiscal constraint. Public administration literature also has something to contribute to an analysis of the rationalization of municipal governance. In the public administration field, municipal scale research often looks to the specificities of local government operations (e.g. taxing and revenues arrangements, bureaucratic structures, alternative services delivery), as opposed to the broader processes discussed above (e.g. rescaling, neoliberalization). An examination of the more detailed public policy literature in the context of the geographical concerns with neoliberalization can generate a more detailed and nuanced picture of how and where these processes occur. There is specificity to municipal functions, such that the degree of restructuring experienced under neoliberalization is relative to the municipal responsibility/process in question. The public administration literature and municipal governments commonly distinguish (a) between physical services (e.g. transportation, water and sewage) and social services (e.g. welfare, cultural activities), and (b) between revenue and non-revenue generating services. Here, I focus on the latter distinction, as it is the more pertinent to the analysis of water supply (information on the distinction between physical and social services can be found in the footnote).40 40 Inter-municipal competitiveness under neoliberalization has had different effects on physical and social services. Harvey, for example, identifies the retreat from social service provision under neoliberalization (cf. Harvey 1989). Physical services, however, are bound-up in both complementary and competing ways with the neoliberal focus on the economic development function of municipalities (Sharp 1990). Pertinent to water supply, an economic development focus serves to divert investment away from physical services, especially infrastructure (or at least competes with them for financing) (Sharp 1990). On the one hand, physical services provide part of the competitive edge of municipalities in their newly entrepreneurial and competitive roles (e.g. transportation). Water, however, is generally considered too cheap to affect business decisions. 67 In terms of revenue and non-revenue generating services, in large municipalities in Ontario, water and sewer services tend to be revenue generating and self-funding (along with parking and electricity for example). This creates a push-pull effect, which is exacerbated by the constrained financial situations of municipalities. Municipal governments seek to retain control over such services, while those running utilities and some engaged in governance at the provincial scale seek to have the services distanced from elected officials, specifically trough ASD. Municipal governments and corporate staff have incentives to retain the services because so much of their capacity in other areas has been diminished and because of opportunities to shift funds from such services to other services in the municipal portfolio. In response, those engaged in utility governance seek to neuter the influence of municipal governments and corporate staff over these services through the diminution of political involvement in their provision and by commuting their management to the realms and knowledges of ‘experts’ in technocratic fields such as engineering, economics and law. The penchant toward rationalized management is identified in the literature on neoliberalization. One predominant approach to ‘techniques’ as an element of neoliberalization is in the Foucaultian sense of ‘technologies of government’ – programs and incentives directed at the rationalization of populations (cf. Gordon 1991), local governments (Raco and Imrie 2000), and other sectors and agencies involved in governance (Barry, Osborne and Rose 1996). In general, this approach refers to the ‘techniques’ of governing chiefly in relation to the economy and economic bases of regulation and management (e.g. Peck and Tickell 2002; Larner 2000; Keil 2002). In Raco and Imrie’s research on local government in the UK, they find state deployed technologies for ‘self-monitoring and reporting’ to create ‘calculable spaces of action for policy makers’ (Raco and Imrie 2000: 2198-2199). Barry et al. make a corresponding analysis in terms of ‘technologies of government’ that serve to extend the power of the state through the ‘enrolment’ of ‘sectors and agencies distant from the center’ yet linked to the centre through 68 ‘complex alignments and translations.’ This is accomplished through ‘techniques’ that ‘produce a degree of “autonomization”’ through “responsibilization” and “empowerment.” Such ‘technologies of government’ include: ‘law, expertise, statistics, economics, architecture etc’ (Barry, Osborne and Rose 1996: 8-9, 15). In the Canadian context, Isin characterizes similar processes as the ‘changing technologies of power’ (Isin 2000; Isin 1998).41 He notes that ‘regimes of government depend upon professional and expert forms of knowledge to monitor, enact, evaluate and reform both the subjects and objects of government,’ to establish and preserve the ‘routinization of practices’ (Isin 2000: 149). In what he calls a ‘paradoxical double movement’ of neoliberalism’s ‘shifting techniques of power,’ central governments have simultaneously enhanced their control over the municipal scale while devolving responsibilities (Isin 2000: 150, 154-155). This involves both a ‘new relationship between expertise and politics’ based on ‘enumeration, calculation, monitoring and evaluation’ and ‘new technologies of power’ that take shape through ‘the shifting of responsibilities from governmental agencies and authorities to organizations without electoral accountability’ (Isin 2000: 155-156). Rationalization, like neoliberalization, is conditioned by local circumstances. This is also true of the ASD models through which rationalization is pursued. As such, with ASD one also witnesses diffusion rather than convergence of approaches at the local scale (Radaelli 2005; Pollitt 2001; Ford and Zussman 1997: 13). It is to ASD and business models for local service delivery that I turn next. 41 This work is also discussed in the work of Keil (2002). 69 2.3.2 ALTERNATIVE SERVICE DELIVERY: TOOLS OF RATIONALIZATION Alternative Service Delivery is both an instrument of and a response to neoliberalization.42 It is a response to neoliberalization in that its uptake has been driven by neoliberal fiscal restraint and rescaling, directing municipalities to do more with less. In the resultant state of insufficient resources to meet unrealistic goals, ASD is put forward as the solution to the problem – the method of managing to do more with less (Ford and Zussman 1997: 10).43 ASD exhibits several of the tendencies of neoliberalization: it draws on previously existing ideas and systems for its propagation, and it is malleable, changing over time to fit new circumstances. ASD draws on concepts of neoliberalization and NPM for its justification and then serves to further readjust governance along neoliberal and NPM lines. In this section, I elaborate on these arguments. I begin by examining the definitions and methods of ASD. I follow with a discussion of the relationships between ASD and the rationalization of municipal governance. Finally, I address ASD’s relationships to accountability and transparency. In general, ASD involves restructuring from service delivery led by municipal governments and organized in municipal departments, to special purpose bodies like agencies, boards and commissions (ABCs). Such models generally seek to put increased distance between ‘politics’ and service delivery – ‘steering’ and ‘rowing’ (cf. Osborne and Gaebler 1992). Unsurprisingly then, ASD includes a diversity of models and a diversity of definitions. Definitions tend to be rather general – e.g. ‘the many and varied organizational forms and delivery mechanisms governments use to achieve their objectives’ (Wilkins 2003: 173) – and ideological – e.g. ‘a creative and dynamic process of public sector restructuring that improves the delivery of services to clients 42 It is also service dependent – see Hobson (1996: 125-126, 130). 43 ASD has been identified in World Bank literature as a Canadian concept that evolved from the practicalities of federalism and has spread across many parts of the world (cf. Wilkins 2001). 70 by sharing governance functions with individuals, community groups and other government entities’ (Ford and Zussman 1997: 6). Inherent in the latter definition is the devolution of the authority and responsibility of elected officials at the municipal scale, and hence the rationalization of municipal services. Through an analysis of the debates on ASD definitions, Paquet concludes that ASD can be described as ‘a framework aimed at ensuring that new technologies, management practices and organizational structures are used to optimize service delivery.’ Within this, however, ASD remains ‘a new incarnation of the post-war view that pubic administration is essentially a technical profession’ (Paquet 1997: 32-33). He cites a ‘technocratic illusion’ whereby there exists a ‘one best technical solution to all delivery problems’ and that reform of the policy process can be achieved through modification of the delivery mechanisms alone (Paquet 1997: 37 emphasis in original). ASD purports a technocratic neutrality: it is simply the most efficient design for service delivery once the question of ‘who does what’ has been answered (e.g. Hobson and St-Hilaire 1996: viii). The assumption that there exists a formulaic and predictably functional response once questions of policy have been decided (such as who does what) results in a situation whereby the field of action itself must be rendered predictable to fit the policy response. As such, the unpredictability of the political (electoral) must be confined to roles of minor influence.44 As with NPM then, there is a separation of policy and administration under ASD. This separation proves problematic. Paquet calls this separation ‘misleading’ in that it both suggests that the logic for policy objectives is explicit and well understood and that the mechanisms of ASD are ‘simply a means to that end’ (Paquet 1997: 33). 44 This is in many ways reminiscent of Rouse’s argument that science seeks to recreate laboratory conditions in ‘nature’ rather than the reverse (Rouse 1987). 71 The various options for ASD are delineated in Tables 2-1 and 2-2. The tables present the litany of options for government services. They also show that conceptually ASD spills over into questions of governance (e.g. cost recovery). The options pertinent to municipal water supply are highlighted in bold. In terms of the restructuring of business models for local water supply, the options that have been adopted in Ontario are presented Table 1-2. Table 2-1: Types of Alternative Service Delivery Partnerships/Devolution Government Other Levels Departments of Government Private Sector Not-for-Profit Sector Single Window Devolution Employee takeover Contracting Co-location Co-Location Privatization out Common service Single window Commercialization Executing SOA* Agencies Crown Corporation GOCO* *SOA - Special Operating Agency; GOCO – Government owned but commercially operated organizations Sources: Adapted from Ford, Robin, and David Zussman. "Alternative service delivery: Transcending boundaries." Alternative service delivery: Sharing governance in Canada. Eds. Robin Ford and David Zussman. Toronto, ON: KPMG Centre for Government Foundation & Institute of Public Administration of Canada (IPAC), (1997: 6). © David Zussman, 1997, by permission. 72 Table 2-2: Types of Alternative Service Delivery Continued o Table 2-2 has been removed due to copyright restrictions. o The information removed is found in Langford, John W. "Power sharing in the alternative service delivery world." Alternative service delivery: Sharing governance in Canada. Eds. Robin Ford and David Zussman. Toronto, ON: KPMG Centre for Government Foundation & Institute of Public Administration of Canada (IPAC), (1997, 63). o Table 2-2 listed the types of ASD models available under three scenarios of government involvement: 1) where the government is responsible for outcomes; 2) where there is joint-responsibility; and 3) where there the government retains full authority. Notable among the models listed is – as Hefetz and Warner rightly point out – the absence of the options of ‘contracting back in’ (Hefetz and Warner 2004). As such, the potential for policy reversals is ignored. I would argue that this stems from the discourse of ASD as improvement and progress. In keeping with the goals of NPM for the public service, such ‘improvement’ must be presented as unidirectional (away from government and politics) and as apolitical. It is an important point of this thesis that, whereas ASD is typically taken as a straightforward process of policy progress, the data indicate that ASD is also enacted as a step-wise process toward longer-term goals. The gradual pursuit of neoliberal models for governance includes reversals along the ASD continuum toward less governmental involvement. Thus, instead of seeking immediate solutions in a political negotiation with the public, politically realizable options are selected with the expectation that they are temporary. ASD, in its evolving form in Canada, is a reinvention of a long-held model of service delivery developed under Canadian federalism. Wilkins dates ASD’s 73 origins in Canada to the railroad partnerships of the 1840s, but puts its ‘modern roots’ in the mid-1980s and early 1990s, with a focus on contracting out and cost cutting through delegation to SOAs (Wilkins 2003: 176). He states that the ‘public service has changed dramatically in the last decade,’ with ‘55% of the public service operat[ing] outside of traditional departments’ the alternative has become the norm (Wilkins 2003: 176-177). In Ontario, the provincial government boasted a movement of 14 000 jobs from the public sector to ASD arrangements and the elimination of 6000 more jobs between 1996 and 2000. One hundred and thirty countries visited Ontario to learn about its approach (Ontario Public Service Restructuring Secretariat 2002: 13).45 In terms of ASD business models for the water sector, the appropriation of pre-existing policy paradigms is also visible. PUCs, for example, were prevalent throughout the latter part of the 20th century, virtually eliminated in 1996, and then re-legislated as Municipal Services Boards (PUCs with appointed rather than elected boards) in 2001. ASD models also raise issues of accountability and undermine the economies of scope upon which municipal corporations depend to support various internal services.46 In terms of economies of scope, Slack sees the proliferation of distinct bodies responsible for individual services as missing the traditional municipal purpose of making the necessary tradeoffs between the various services that a community needs (Slack 1996: 105). This is reminiscent of the NPM approach to citizens as clients that ‘do not share any common purpose with the community but are acting on an individual basis seeking personal advantages’ (Ford and Zussman 1997: 9); 47 individual 45 Cited in Wilkins (2003: 178). 46 Such economies of scope are developed when all municipal departments purchase corporate services (e.g. printing, accounting etcetera) that municipal corporations must provide irrespective of how many departments avail of them. 47 Ford and Zussman cite the government approach to individuals as citizens versus clients as ‘one of the most critical and fundamental changes taking place in Canadian society today’ (Ford and Zussman 1997). 74 municipal departments act for their distinct financial well-being to the neglect of the corporation as a whole. In terms of accountability, several issues emerge. Langford, for example, predicts ‘lapses in accountability as the use of alternative service delivery mechanisms spreads’ stemming from ‘overlaps and confusion among the functions of policy making, program design and program delivery’ (Langford 1997: 9). Another concern is that ASD bodies are deemed to generally break the link between spending decisions and the municipal councils that collect taxes. Hence, a lack of fiscal accountability and transparency to citizens develops, which to Slack translates into a lack of efficiency (Slack 1996: 106).48 Neoliberalization raises issues of accountability more generally. It induces a shift from electoral to networked accountability with, for example, the appointment of boards under ASD and the proliferation of actors under governance (Rhodes 1997: 21). It simultaneously poses several problems for functional networked accountability, most notably by reducing governmental capacity for oversight.49 Issues also arise with respect to the transparency and fairness with which actors are included, the relative power and responsibilities that actors are given, by whom they are given and for what purposes (Swyngedouw 2004: 45; Swyngedouw, Page and Kaïka 2002: 122; Gross Stein 2001). Gross-Stein predicts that changing concepts of accountability will be ‘one of the most important battlegrounds for democratic debate and development’ (Gross Stein 2001: 80). 48 Furthermore, transparency has also fallen victim to strict economic criteria, whereby it is defined as fiscal clarity between local benefits and local costs to taxpayers (e.g. McMillan 1996: 43). 49 See for example Harrison on the shift toward voluntary as opposed to government-led environmental regulation, and Prudham on the gutting of oversight bodies in the drive to eliminate duplication (Harrison 2001; Prudham 2004). 75 ASD, however, has not necessarily materialized where it might have been expected or as it was planned. It is an important point of this thesis that whereas ASD is typically taken as a straightforward process of policy progress, in circumstances of challenge, ASD – like neoliberalization – emerges as a pliable and strategic process. In their efforts to pursue ASD as rationalization, where necessary, utilities approach ASD as a stepwise process toward longer-term goals. The gradual pursuit of neoliberal models for governance includes reversals along the ASD continuum toward less governmental involvement. Thus, instead of seeking immediate solutions in a political negotiation with the public, politically realizable options are selected with the expectation that they are temporary. 2.3.3 THE COMPLEXITIES OF GOVERNMENT In Ontario, achieving the above neoliberal style restructuring of water supply governance is far from guaranteed, in neither the degree of its achievability nor the will and influence of the various actors involved. Restructuring for ASD presents neither a straightforward procedure nor straightforward outcomes. Studies have drawn attention to the ways in which processes of neoliberalization are shaped and reshaped at the local scale (e.g. Jessop 1997c, 2002; Boudreau et al. 2007; Wilson 2004, see also 2.3.1). Work has also highlighted the importance of contestation in reforming neoliberalization in urban spaces (e.g. Leitner, Peck and Sheppard 2007a). The work of redgreen alliances in Ontario is highlighted in the next section (2.4.4). Contestation, however, need not be the sole purview of social movements, non-governmental actors, or locally concerned citizens. One striking aspect of the process of rationalization and the contestation it engenders is that both are active at most any scale of governance. While some groups tend toward one more than the other, contestation is not the strict purview of activists or citizens and rationalization is not the strict domain of government. Within municipal government (often understood as unitary), utility management, municipal corporate staff and municipal 76 politicians have distinct mandates that are affected differently by neoliberalization. As such, their views of rationalization differ and often conflict. In this section, I argue that contestations within municipal government and between scales of government are likewise important in mollifying the outcomes of neoliberalization at the local scale. Governments do not necessarily act in concert toward the achievement of neoliberal goals. Conflicts arise between the branches of municipal government and between scales of government with respect to rationalization. In addition to the relationships within and between governments, two other issues with respect to government are important. These are that the provincial government’s approach to neoliberalization has become one marked by abeyance and hesitation, and that the task of specifying non-overlapping, discrete functions for political and technical actors in water governance is implausible and not without consequences. These issues were addressed Section 2.2, only the emerging hesitation toward neoliberalization will be (briefly) developed further here. As discussed above in Section 2.2.1, in Ontario a third phase of neoliberalization is ongoing. This phase is marked by a new hesitation on the part of government to pursue neoliberal programs – even ones that are widely supported such as full cost recovery for water supply.50 With respect to water supply, abeyance has been ongoing and oscillating since at least 2002, divorcing it from the particular circumstances of an election to which Basu attributes Ontario’s 2002 neoliberal slowdown with respect to education (Section 2.2.1). In keeping with Harvey’s statement that crisis ‘can be followed by slow reversals as the unpalatable aspects of neoliberalism become more evident’ (Harvey 2006: 87), the abeyance apparent in Ontario 50 An issue like full cost recovery is supported across public interest groups as well as the private sector, although it may place greater strain on council relationships with rate paying constituents. 77 is perhaps better related to events that have marred neo-conservative neoliberalization in Ontario, e.g. Walkerton and the negligent homicide of Dudley George.51 This does not mean that neoliberalization is not ongoing. If neoliberalization is not simply taken as emanating strictly from the centre (i.e. federal or provincial government), then it need not be presumed that neoliberalization comes to a halt when the centre displays a reluctance or reduced capacity for neoliberalization – ‘the continued emphasis on neoliberal techniques does not necessarily come from government agencies’ (Larner and Butler 2005). In Ontario, actors empowered through governance and utility management are particularly interested in ASD business models for water supply. What is important to highlight is that for utility management, this is generally not an ideological endeavour but rather one that is directed at addressing the challenges created by neoliberalization in the 1990s. Research on the municipal scale recognizes that it is comprised of a variety of actors in governance. In general, however, it does not differentiate between different groups in interaction within the governing body itself, i.e. elected politicians, corporate management, and departmental management. In the Canadian context, for example, Leibovitz argues that ‘the local state’ is ‘broadly understood to encompass both public agencies and the institutions of civil society’ (Leibovitz 1999: 200). As such, the key interactions at the local scale are ‘between different levels of government, and between government and different interest-groups’ (Leibovitz 1999: 206). This is a common approach to research on neoliberalization at the municipal scale (e.g. Kipfer and Keil 2002; Jessop 2002; Uitermark 2005) and of definitive research on the local scale in the UK (cf.Cockburn 1977). Approaching the ‘local state’ as a singular entity is, in general, reflective of how the local state is perceived and of how it acts. 51 Further details of these events are provided in Chapter 3. 78 Municipal government, however, is made up of diverse interests and contestations exist among them. In their research on Columbus Ohio, for example, Cox and Jonas demonstrate that the local government is a political actor in urban conflict, and that its different branches have divergent interests that shift over time (Cox and Jonas 1993). There, these negotiations proved important for the expansion of water networks as a means of annexing adjacent municipalities, and in defining school board districts. In the case of water supply in Ontario, important branches with divergent incentives and interests are the elected governing council, officials in corporate management (e.g. finance, and corporate governance), and water department/utility management. As discussed above, within the local state, it is primarily managers of water supply divisions and departments that seek the neoliberal rationalization of water supply governance through the adoption of ASD business models. The reason is that neoliberalization creates different and, sometimes conflicting, challenges and incentives for the utility managers, municipal corporate staff, and municipal politicians. Understanding the local state as an agglomeration of branches with diverse interests is fruitful for the analysis of water management. It can generate alternate and more nuanced solutions for governance that need not be antagonistic to the local state. In misreading the municipal scale as homogenous, potential avenues for political engagement and alternate governance approaches are missed. 2.3.4 LEARNING FROM ANTI-NEOLIBERAL ADVOCACY In Canada in recent years, resistance to restructuring in the water sector has been successful in several major Canadian cities including Moncton, Toronto, Hamilton and Vancouver. In Ontario, ‘Water Watch’ alliances have contested the rationalization of business models in Toronto and Hamilton. In this section, I argue that such contestation against the neoliberalization of business models reveals: (1) that such campaigns can prove instrumental in 79 altering the proposed outcomes of neoliberalization; (2) that, whereas neoliberalization is often considered to occupy the ‘common sense,’ this not the case for all of its facets; and (3) that the obvious business model alternatives (arms length or municipal department) are unsatisfactory, especially for environmental advocates. Articulating additional options, however, is difficult; solutions may be more fruitfully sought through changes in governance. Many have argued that neoliberalization constitutes an effective policy and ideological hegemony. Brenner and Theodore note that although other approaches to capitalist restructuring exist, they cannot be compared to neoliberalization in terms of ‘political influence, ideological reach or institutional shape’ (N. Brenner and N. Theodore 2002: 14).52 Peck cites assertions that ‘neoliberalism has established “an ideological and de facto policy monopoly” and “as a set of principles [neoliberalism] rules undivided across the globe” (Peck 2004: 395-396).53 Agnew and Corbridge contend that market liberalism or neoliberalism forms the primary ‘hegemonic ideology’ of the contemporary geopolitical order (Agnew and Corbridge 1995: 17). Harvey, similarly, asserts that ‘neoliberalism [has] penetrated “common sense” understandings’ such that increasingly in many locations it is seen ‘as a necessary, even wholly “natural”, way for the social order to be regulated’ (Harvey 2006: 41). Increasingly, however, work seeks to temper this view of neoliberalization. Work on the contingency of neoliberalization at the local scale (attributable to several of the authors cited above) can be seen in this light (cf. Section 2.3.1). Such contingency has also been emphasized with respect to the water sector (e.g. Bakker 2005). In a recent volume on ‘contesting neoliberalism,’ the authors preserve the approach to neoliberalism as hegemony, while 52 They list the neo-corporatist and neo-statist as alternative approaches. 53 Here Peck cites Centeno (2001) and Anderson (2000) respectively. 80 seeking to ‘decenter’ neoliberalization in analyses of contestation and urban restructuring. They argue that neoliberalism’s ‘rise to hegemony’ cannot be studied through examinations of neoliberalism alone but only in conjunction with the contestations that have shaped it (Leitner et al. 2007: 8). This responds to recent critiques of work on neoliberalization discussed in Section 2.2.1 (e.g. Castree 2006; Barnett 2005; Larner 2003; Larner and Butler 2007). An examination of particular policy goals associated with neoliberalization and how and where they find favour (and disfavour) can be a way of approaching this problem (of hegemony and contingency). Although the contingency of neoliberalization is often highlighted, it is infrequent to examine specific features or policies of neoliberalization that may or may not form part of the common sense in particular instances of ‘actually existing neoliberalism.’ Contestation indeed proves a force for limiting neoliberalization in many instances. Successful contestation, however, may at times actually reflect existing weak points in the neoliberal common sense that have been capitalized upon rather then newly created. These weaknesses may stem from other contestations, earlier negative experiences with these forms of neoliberalization, or other shifts in the political-economic and social landscapes. The ‘common sense’ was defined by Gramsci to describe commonly held systems of belief and understanding that are somewhere between folklore and the practices of science (philosophy, economics etc.), with which it is ‘continually enriching itself’ (Gramsci 1971: 630). It is therefore ‘inherently relational, as well as practical and dynamic’ (Eagleton 1991: 115). According to Eagleton, hegemony is more than a vastly pervasive system of thought or ideology; hegemony has ‘various ideological, cultural, political and economic aspects’ and incorporates ‘the unconscious, inarticulate dimension of social experience as well as the workings of formal institutions’ (Eagleton 1991: 114-115). Given that hegemony is relational, dynamic, and in need of 81 institutional support, spaces open for the common sense to differ across contexts, issue areas and in interaction with other political approaches. The gaps in the neoliberal common sense for water sector restructuring in Ontario are made evident through the alliance’s use of particular neoliberalization strategies in order to subvert others. In particular, the alliance draws on privatization. In terms of neoliberalization, privatization has been identified as a central tenet. Harvey, for example, ‘emphasizes privatization, calling it “the cutting edge of accumulation by dispossession”’ (Glassman 2006: 620).54 In water supply, however, privatizations have met with strong criticisms and social protest of heroic proportions (cf. Swyngedouw 2005). It is fair to say, that in terms of the neoliberal ‘common sense,’ privatization – though a prominent tool – has not gained (or has lost) purchase in water supply. By articulating restructuring that does not involve privatization as this archetypical neoliberal moment and effectively halting the proposed neoliberal restructuring thereby, the alliance highlights the fact that neoliberalism has not achieved hegemonic status in all its forms. Privatization has become such anathema to water governance in the Ontario public common sense that it can be used to stymie other tactics of neoliberalization in that sector. The limited uptake of neoliberalization as the common sense for business model restructuring is also exemplified by the monopoly the anti-neoliberal alliance holds over the public trust. In the water sector in Ontario, where active, public interest groups have proven better able than utility management at mobilizing the public around their particular articulations of appropriate business models. The efforts of those that oppose the neoliberalization of business models also demonstrate that, while the municipal department (status quo) model limits 54 Glassman is citing Harvey (2003: 157). 82 the achievement of their policy goals, advancing alternatives to the status quo is difficult. This is most acutely an issue for environmental advocates, whose work involves continuous lobbying of municipal government for the incorporation of environmental concerns into water supply management. In Toronto, unable to articulate an alternative to the municipal department or arms length models, opponents of neoliberalization are left simultaneously critiquing and advocating municipal-led management. The result is that, although dissatisfied with current governance of municipal water supply, their actions serve to sustain the status quo business model for water governance in Ontario. This situation is not unique. For example, Filion finds that in Toronto participatory empowerment in governance does not necessarily lead to alternative forms of urbanization. Instead, it often perpetuates Fordist forms (Filion 1996: 1654). More generally, Miller argues that contestations over neoliberal restructuring are frequently focused on ‘the defense of particular lifeworld traditions, as well as new movements attempting to carve out new realms of self-determination’ (Miller 2007: 233). Specifying such lifeworld traditions, other authors argue that responses or contestations of neoliberalism can reflect ‘agendas and alternative imaginaries that predate or exceed neoliberalism, such as progressive liberalism (Keynesianism), socialism, radical democracy, or nonmarket forms of economic organization’ (Leitner, Peck and Sheppard 2007b: 319). That opponents of the neoliberal rationalization of water supply governance find themselves both upholding and undermining local state-led water supply governance attests to the difficulty of presenting alternatives to state-led Keynesian Fordism and market-led neoliberalism. In Glassman’s words, The geography of global capitalism embraces all scales and spaces, in complex ways, and this inherently makes both understanding and struggling to overcome capitalist alienation deeply complicated. (Glassman 2006: 16) 83 Anti-neoliberal campaigners in water governance in Ontario are caught in a paradigm that lacks alternatives to state or market based governance. Some authors have argued strongly for the recognition of approaches to governance and economics that transcend these state-market paradigms (e.g. Gibson-Graham 1996, 2006; Larner and Walters 2004). The water sector – as a monopoly service that brings together a wide variety of stakeholders and professional skills – is amenable to some of the features of ‘post-capitalist politics’ that Gibson-Graham highlight. Gibson-Graham state: In a diverse community economy, it is the capacity to produce social surplus in a variety of forms, and not just surplus value, that is of interest, as it is this surplus that can be used to replenish and expand the commons and the productive base. (Gibson-Graham 2006: 98) In the water sector, we might imagine social surplus to include source water protection (as is being developed in Ontario), protection of ecosystem services, funding for public uses of water services, and socially equitable access for all income groups. The accrual of ‘social surplus’ in water supply is strongly related to governance models and to a lesser (but not unimportant) degree to business-model variance. As such, while anti-neoliberal advocates find only limited solutions with respect to business models, fruitful avenues for progress are available with respect to governance. These issues are explored further with respect to innovation for sustainable infrastructure management in the next section. 2.4 SEEKING SUSTAINABILITY: NEOLIBERALIZATION, GOVERNANCE, AND TECHNICAL CHANGE 2.4.1 TECHNICAL CHANGE: A SOCIAL STUDIES OF TECHNOLOGY APPROACH In the remainder of the chapter, I extend the discussions of neoliberalization and sustainability to an examination of techniques and programs for sustainable infrastructure management. This is done through the theories of the social studies of technology (SST). This first subsection introduces the 84 SST approach that frames the discussion throughout the following subsections of 2.4. In the presentation of the theory and how it illuminates issues in the development of sustainable infrastructure management, I move from generality to increasing specificity with each subsection. In this subsection, I begin by demonstrating that there is a lacuna in the literature on neoliberalization in terms of an analysis of the relationship between neoliberalization and the uptake, diffusion, and performance of technology, especially with respect to sustainability. I follow by introducing theories from SST to fill this void. These help to conceptualize the interaction between technology and social processes. In the next section (2.4.2), I use SST to examine the transition from the state hydraulic regime for water supply and the factors that are affecting the degree and method of a transition to a technical regime marked by sustainable infrastructure management. Following that, in Section 2.4.3, I employ SST to develop insights into the adoption and performance of specific techniques for supply and demand management. In the final part of this section (2.4.4), I draw the discussions together to explain the low level of uptake of programs for sustainable infrastructure management in Ontario. In this thesis, I am concerned both with techniques directed at regulating governance (Section 2.3) and with technical artifacts, focusing specifically on the impact of neoliberalization upon technical innovation for sustainability. Ellul links these through the concept of ‘technique.’ He defines technique as ‘any complex of standardized means for attaining predetermined results’, including artifacts and methods of rendering behaviour (in terms of the individual and the collective) deliberate, rationalized and predictable (Ellul 1964). The literature on neoliberalization has addressed the former extensively, mainly focusing on the concept of governmentality to interpret the techniques or ‘technologies of government’ (e.g. Larner 2000; Lemke 2001; Raco and Imrie 2000; Dean 1999; Gordon 1991). The latter – techniques as artifacts – has received distinctly less attention. 85 In general, the literature on neoliberalization has had little to say regarding the relationship of neoliberalization to techniques as artifacts. In terms of techniques as artifacts, studies have generally focused on how technical change has served to further neoliberalization through its impact on labour relations, communications, the mobility of production, and the creation of differential levels of technical flexibility and advancement between countries (cf. Brenner 2006; Kolko 1988; Harvey 1990; Leys 2001). Employing an inverse causality, Swyngedouw theorizes how the mobility of capital leads to the continual decimation and reformation of space-technology nexuses (Swyngedouw 1992). With respect to municipal governance, discussions on inter-urban competition under neoliberalization make useful but limited comment on infrastructure. The neoliberalization literature posits a shift from a focus on service provision to one on economic development under neoliberalization (Sharp 1990; Hubbard and Hall 1998), yielding heightened inter-urban competition (cf. Jessop 1997a; Harvey 1989; Hall and Hubbard 1998). Peck & Tickell discuss how cities are placed in competition with one another for funding to realize their new responsibilities, arguing that one of the consequences is the increased challenge of providing infrastructure (Peck and Tickell 2002: 394). This study’s concern with technology differs in that it examines the relationship between neoliberalization, governance, and the uptake, diffusion and performance of innovative technologies for advancing sustainability in the water sector. This refers to the adoption, deployment and performance of the various techniques for managing the production of and the demand for water. The adoption of such techniques has been addressed in the literature on neoliberalization in the water sector, to a limited degree. This literature, however, has focused on empirical findings, for example, with respect to leak detection and demand management (e.g. Kaïka 2003; K. Bakker 2003a) or infrastructure quality across space relative to neighbourhood income levels 86 (cf. Swyngedouw 2004). Findings from these studies point to a direction and need for analysis, but present neither a theoretical approach nor a detailed survey of the techniques involved. Theories from SST are well placed to fill this lacuna. With respect to technical change for sustainable infrastructure management in the water sector, SST debates on the uptake, diffusion and performance of techniques are of particular relevance. Moreover, stepping outside of the neoliberalization literature also helps to pursue an analysis that does not privilege neoliberalization. SST emerged from a field of inquiry called the sociology of scientific knowledge (SSK). SSK has its roots in Kuhn’s ‘Structure of Scientific Revolutions,’ which challenged positivist assertions that scientific knowledge was derived purely from objective observation of the world (Kuhn 1962). In the late 1970s, critiques charged that the program had traded scientific determinism for social determinism. This gave rise to work in the constructionist approach that sought to demonstrate a more reciprocal relationship between scientific ‘facts’ and social values. Notable here is the work of Latour, which seeks to collapse the science/society dualism by treating the two as mutually constitutive (e.g. Latour 1993). SST finds its roots in these debates but, rather than focusing on scientific knowledge, SST asks how technology is embedded into society and how it is formed by and formative of social processes. Certain authors argue that both the social studies of science and of technology should be approached together because technical and scientific programs of knowledge building are interacting, mutually constitutive and not separate. Still they acknowledge differences between the relationships of technology and scientific knowledge to society: technology is considered much more malleable to social influences in society at large and more external to the social projects of scientists or engineers (Pinch and Bijker 1984). 87 SST is apt for this work because it provides a theoretical approach for analyzing the ways in which the relationships between techniques and systems of governance and cognition (1) facilitate and inhibit the diffusion of techniques, and (2) alter their functionality. This is fitting for contemporary technosocial shifts in the water sector. These transitions are about the diffusion of techniques into changing systems of governance and the impact of competing conceptualizations of the usefulness of techniques on their propagation, rather than the de
UBC Theses and Dissertations
Municipal water supply governance in Ontario: neoliberalization, utility restructuring, and infrastructure… Furlong, Kathryn 2007
Notice for Google Chrome users:
If you are having trouble viewing or searching the PDF with Google Chrome, please download it here instead.
If you are having trouble viewing or searching the PDF with Google Chrome, please download it here instead.
- 24-ubc_2008_spring_furlong_kathryn.pdf [ 2.01MB ]
- JSON: 24-1.0066159.json
- JSON-LD: 24-1.0066159-ld.json
- RDF/XML (Pretty): 24-1.0066159-rdf.xml
- RDF/JSON: 24-1.0066159-rdf.json
- Turtle: 24-1.0066159-turtle.txt
- N-Triples: 24-1.0066159-rdf-ntriples.txt
- Original Record: 24-1.0066159-source.json
- Full Text