Difference in Level of Service CUC: public vs. private sector

For purposes of discussion, let’s say that a private firm takes over the operations of the Commonwealth Utilities Corporation (CUC). Some positive things would benefit both investors and consumers:

• The utility rates would drop to $.06 per kilowatt hour versus $.11 under the current system.

• Excess staff would be cut and only those who know their trades would be kept on the payroll.

• Efficiency in service would descend in the overall operations of the utility company.

• Service for water, power, and sewer would expand beyond our wildest imaginings. It has too in order for the utility company to secure return on its investments.

• Definitely, the utility company would have to plan (in advance) the future requirements for utilities in these isles.

• It would employ technological changes to streamline all operations from bookkeeping to actual installation of utility services.

• Most importantly, it’ll be a savings in the millions of dollars for any and all taxpayers. It would enable local government to spend savings on the most essential in terms of public service.

Now, let’s assume that the current system is perpetuated. Then it means the following for all taxpayers:

• Waste will continue in “business as usual” fashion, waste that are passed on down to consumers whether we like it or not.

• More travels on “first class” would be taken where, again, the cost in first class tickets, ground transportation and per diem are passed down to taxpayers.

• Efficiency will continue to be a strange vocabulary for management and staff for as long as this agency is hidden under everything that we know of as government.

• Prompt service for water, power and sewer will continue to be treated with arrogance and waste installing these services during weekends to gather up overtime pay when it could be done during week days.

• Waste and the lack of accountability will continue to be problematic for as long as this agency remains a government agency.

You see, if and when the utility agency is run by a private firm, it either produces in order to make money or suffer the consequence red ink in its monthly financial statements.

It will not have sufficient funds for basic operational costs nor will it be able to even meet expansion and employee salaries.

If you wish to see the essence of privatization, you need not look further than Verizon. It was once a government-run agency. Its success is a perfect model to emulate in the privatization of government agencies best handled by investors.

It means a savings in the millions for taxpayers while in receipt of better utility services all year round. The role of government will not cease in that it would be around to guard provisions of the agreement and commitment made between the private firm and itself. It means better and expanded service, well, “beyond the call”.

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The Pohnpei State Government privatized its utility agency. It has succeeded in both quality and expansion of services beyond its wildest imaginings. It trained its local work force and continues to improve their skills as time progresses. It can be done here and it’s a matter that would benefit consumers beyond the naked eye.

Strictly a personal view. John S. DelRosario Jr. is publisher of Saipan Tribune.