In June 1993, a Lithuanian water privatisation proposal was stopped dead in its tracks. With less than a few years of experience in traditional trade union industrial action under their belt, PSI Lithuanian affiliate, the Trade Union Federation of Local Industry and Service Workers, foiled a water privatisation proposal by a major French multinational company. How did they do it?

In 1989, the government of Lithuania decided that certain enterprises, including water, were too important to privatise. In total, the water services employ about 7,000 workers. Nationally, the water system needs considerable investment to bring it up to environmental and other quality standards.

However, in the capital, Vilnius, the municipal authorities could not fund such investments and were easy prey to a proposal from the French water company, Lyonnaise des Eaux, which offered to become a partner. Lyonnaise would take 51 per cent of the joint venture company's shares, control the services and determine water prices. The proposed agreement would levy penalties on industries which exceeded agreed levels of pollution. Prices would rise over the foreseen future and the proposal included a reduction of the workforce with no 'social guarantees'.

The union, being part of a coalition with other organisations opposed the deal. PSI affiliates in Spain, the United Kingdom and France provided advice and information. The coalition worked on getting the Vilnius Council's resolution reversed and one council member went on a 30-day hunger strike as part of the protest.

The media gave full coverage to an information picket which the union mounted outside the municipal offices. The resolution in favour of the joint venture proposal was reversed in June 1993.

Not that this deterred Lyonnaise. Its 1992 annual report described the deal as 'done' and Lithuanian President Brazauskas declared that he was considering dissolving the Vilnius City Council, specifically for its anti-Lyonnaise decisions!

The union has continued its campaign. It has set up new trade union branches in water companies all over the country. In November 1994, with PSI support, it organised a meeting involving union members, members of Parliament, municipal councillors, the news media and government representatives - PSI assisted by bringing the expertise of one of the UK affiliates and an independent German expert to the meeting. They reported on effects of water privatisation in the UK, describing alternatives to privatisation. The union has continued to note that it wants improvements to a service which is far from efficient and needs investment.

In February 1995, the Lithuanian Parliament passed a law allowing partial water privatisation. The subsequent municipal elections saw the defeat of the pro-privatisation party and the election of anti-privatisation elements. They will not privatise water; some councils have declared that they will keep water public until the year 2000. Lyonnaise is still there, but now their 51 percent proposal is down to 30. How much will it take to bring it down to zero.

For further information, see PSI website at http://www.world-psi.org/