Lok Raj Sangathan (Maharashtra Committee) calls on you to support the just struggle of the MSEB workers !

Citizens! The first major step towards privatization of the electricity supply is likely to be taken by the state government soon. By not later than June 10th, the Maharashtra Government is seeking to trifurcate the MSEB into three separate companies – one each for Generation, Transmission and Distribution. Going by the experience of other states, it is clear that trifurcation is a prelude to privatization. It is well known that many foreign and Indian monopoly houses, e.g. the Tatas, Reliance, etc. are looking at the power sector as a source of super profits, as the notorious Enron did earlier.

How convenient for the big capitalists! However, all the unions and associations of MSEB workers, staff and officers have decided to unitedly oppose this move. Our organization, the Lok Raj Sangathan, fully supports them and calls upon the Maharashtra government to halt the process of privatization immediately. The LRS has steadfastly opposed the privatization of PSUs as an anti-people and anti-national step and thoroughly exposed the real motives of privatization – to serve the demands of Indian and foreign monopolies to hand over all the lucrative public assets cheaply to the private monopolies for plunder. The move to privatize MSEB has the same motive.

The Maharashtra government is accusing the MSEB employees of opposing trifurcation and privatization out of selfish motives. “Divide and Rule” has been the usual tactic of the government, and it is using the same in this case too. It is trying to isolate the electricity employees. However, apart from electricity employees in Maharashtra, lakhs of people and dozens of people’s organizations have actively opposed privatization. The experience of the power sector the world over, including in India, has been extremely negative for ordinary users, for the working people.

The background

Until 1948, electric supply was completely in private hands in our country, and hence it was supplied to only a few cities where it was profitable to do so. The Electricity Act was passed in 1948 in Parliament. Apart from the many other aims of the Act, one clearly stated aim was “to ensure electric supply to all consumers at rates affordable to them”. As per the figurers available, till 2001, 5 lakh villages and 125 lakh pump sets were electrified. In various Five-Year Plans, Rs.3 lakh crore were spent to establish electricity generation and distribution. In 2001 the market value of these assets was at least Rs.12.5 lakh crore. All this would not have been possible if electric supply had been left in the hands of the private sector, whose sole motive is profit.

After the formation of Maharashtra on May 1, 1960, the MSEB was established on June 20 of the same year, in accordance with the Electricity Act, 1948. Until 1992, along with the MSEB, a few private companies that existed in 1960, like Tata Power and the BSES, continued to operate. In 1992, the first Act of the Electricity privatization drama was unfolded, when the Maharashtra government invited Enron Corporation of the US. The people of Maharashtra know very well the thoroughly anti-people role that the Congress, BJP and Shiv Sena have all played in this drama. Since then the Enron Company has gone out of business following the exposure of its corrupt deals in the US, leaving the Maharashtra government, the MSEB and many other government institutions in India with thousands of crores of rupees of wasted expenditure. All this resulted in massive people’s opposition to the privatization of power in Maharashtra. The opposition was so intense, that on December 13, 2002 a tripartite agreement was reached between the employees’ organization, the MSEB management and the Maharashtra government, to the effect that the trifurcation and privatization of the MSEB would not be done without the consent of the MSEB employees. Similar opposition all over the country was jeopardizing the electricity privatization drive.

A surreptitious deed in the parliament

In the last summer session of parliament, the Electricity Bill, 2003 was surreptitiously introduced at 11 in the night! This bill of such importance was passed without any debate! According to it, all the state governments have to complete trifurcation of generation, transmission and distribution within one year. Otherwise, as per the Act, there would be no Electricity Board from June 10, 2004, since this new Act annulled the Electricity Supply Act of 1948! Instead of “the supply of electricity to all people at rates affordable to them”, the Central and State Governments seem to want to “supply the monopoly capitalists with super profits through squeezing the people!”

The manner in which the Electricity Bill, 2003 was passed once more brings up the most important question of decision-making. Who should decide such important issues? How should they be decided? The LRS has often pointed out that even our elected representatives should not have the mandate to take such major decisions on our behalf. It is only the people as a whole, by way of informed debate and discussion, who should have the right to take such decisions. Such consultations and referendums have been held in many countries even on issues like electricity privatization.

Experience of Privatization is invariably bitter for the common people

Apart from Maharashtra’s experience with Enron, other states like Orissa, Andhra Pradesh and Rajasthan have had bitter experiences with electricity privatization. In Orissa the first trifurcation was done in 1996. The generation and distribution were handed over to big Indian and American companies, while transmission was kept with the state government. When the rising power prices resulted in mass anger and a popular upsurge, the government had to appoint the Kanungo Commission. The Commission in its report clearly stated that the electricity losses had remained the same as before, that the losses had increased despite increased tariff, that the private companies did not make any new investments, and that the debt of the government transmission company increased from Rs.820 crore to Rs.3300 crore. The American distribution company AES ran away without paying hundreds of crores of rupees to the transmission company of the Orissa government. The experience in Rajasthan and Andhra Pradesh has been no different – privatization has led to steep increase in the tariff, more losses to the state exchequer, and more problems for the common consumers like workers and peasants. In Andhra Pradesh in 2001, lakhs of people came out on the streets to protest the massive increases in their electricity bills. The State responded with brute force and fired on the demonstrators, killing 19 people in Hyderabad.

What is the root of the problem?

No one can claim that everything is fine with the way the MSEB functions. Not only the common people, but also the MSEB employees acknowledge that ills like theft of electricity, unpaid bills, transmission and distribution losses, etc. need to be eliminated. However proponents of privatization blame the employees for these ills and say that the solution to these ills is privatization. This is completely wrong. The reason for bankruptcy of the SEBs is that although they were supposed to provide for the larger public good, in actual fact the big capitalists, landowners and other vested interests, using their political and economic clout, were draining them. For example it is reported that a big monopoly capitalist, in one of his factories in Madhya Pradesh, had installed a special magnetic device, which would counter the electricity meter of the Madhya Pradesh Electricity Board and show minimum consumption of electricity in his factory! Power thefts, unpaid bills and transmission and distribution losses, which are the real reason for the bankruptcy of the SEBs, are the direct result of the collusion of these vested interests with the top officers and management of the SEBs. The power sector is already being run for the private interests of the very rich. The aim of the privatization program is to bring about a change from one form of private loot and plunder to another, more openly private, form.

The root of the problem of electricity supply is the type of economic and political system that operates in India. Fifty of the biggest business houses in India – the Tatas, Birlas, Ambanis etc. – control 20% of India’s total Gross Domestic Product. It is these big capitalists who dictate the economic policies. At the time of India’s independence these capitalists were not big enough and did not have the capital to invest in electricity, transport, telecommunications, railways etc. Through the Congress Party, which they controlled, a policy of public investment in these sectors was implemented immediately after India’s independence. The government invested massive amounts of people’s money to develop these sectors, the infrastructure and economic backbone of the country. At the same time conditions were created for the rapid growth of the big capitalists. The output of the public sector units was made available to the big capitalists at highly subsidized rates.

Now after more than 50 years, the Indian big monopoly capitalists have grown big enough and want to take over these industries, built with the people’s money, for a song. For example, the first Indian public sector company that was sold was Modern Foods, which was sold to the multinational Hindustan Lever for just 106 crores rupees, when the value of the land and machinery of the over twenty factories of Modern Foods located in all the major towns of India is over 2000 crores of rupees!

Fight for empowerment of the people!

The solution to the problems of the power sector lies in empowering the people. If the masses of workers, peasants, working intellectuals, women and youth take charge of the affairs of society, they can ensure that the State fulfills its duty of guaranteeing sukh and suraksha to the people. They can ensure that all necessities including power supply are made available in adequate quantity and quality and at affordable rates to all the people. They can ensure that corruption and theft of all kinds are eliminated.

The Lok Raj Sangathan calls upon all the citizens and organizations to demand that

• MPs and MLAs should not be allowed to take decisions on such vital issues.
• Only the people should decide on matters of vital concern to them.
• The Maharashtra Legislative Assembly pass the necessary legislation before June 10, 2004.
• The immediate recovery of arrears from, or else disconnection for, all the big customers who have defaulted in paying their dues, starting with factory owners, private institutions, public agencies and the rich farmers, be carried out.
• Support the struggles of public sector employees everywhere against privatization in their respective industries! Unequivocally oppose the trifurcation and privatization of the MSEB!

The times are calling for the Indian people to develop a new vision for India, a vision consistent with the 21st century, an India whose economy is oriented towards fulfilling the needs of the majority of its people, the working people - the workers, peasants, scientists, teachers, doctors, office employees, nurses, etc. - and not an India where only the rich minority grows richer at the expense of the working people. Lok Raj Sangathan calls on all organizations to come together to realize this vision by putting forth a program around which we can rally all the working people and challenge the rule of the rich!