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The social control of privatization

A seminar organized by the São Paulo Legislative Assembly and FAPESP debates the regulating of public services

FAPESP is betting that the São Paulo universities and research institutes have a large contribution to make in the evaluation of the impact of public services privatization and in the performance strategies of the regulating agencies. Consequently, in partnership with the Legislative Assembly of São Paulo, it is sponsoring a series of debates on the rights and duties of users and of the concessionaire companies, the forms of social control of quality and price of these services of the different sectors and the prospects for the universalization of access to privatized public services.

The first round of discussions on the theme took place during the seminar Regulation of Public Services, that took place on the 3rd and 4th of August in the Legislative Assembly itself. It aimed to evaluate the results obtained by concession of public services in Brazil. The event was part of the agenda of the São Paulo Forum, Century 21. The public, composed of specialists from various sectors, opinion makers, representatives of consumer defense institutions, among others, packed the Teotônio Vilela auditorium, beating the expectations of the organizers.

Directors of the regulating agencies explained their performance and the difficulties found by the organizations created for the control of the concessionaires. The director of the National Petroleum Agency (ANP), Júlio Colombi Netto, stated that all of the legislation should have greater dynamism in order to follow the technological evolution that is going on in the modern world. “Many of the problems faced in the area of regulations are fruits of errors committed during the preparation process of the concessionaires contracts”, said Colombi. Marcelo Poppe, a special advisor with the National Agency of Electrical Energy (Aneel), explained that the Agency is acting rigorously with the companies. In his opinion, the sensation of lack of measures happens because of the large number of companies that contest the applied fines. “The concessionaires are contesting the fines so as not to run the risk of losing the concession” he explained.

Regulation model
However, there was no lack of criticism for the process of privatization of public companies. For professor Márcio Wohlers, from the State University of Campinas (Unicamp), the current regulation model has not taken into account questions that are coming forth from society. “The changes and the technological advances that are taking place in the world oblige the agencies to carry out a permanent re-evaluation of their performances”, he stated. In his opinion, these institutions need to be always incorporating new issues that come up on a daily basis. “The Internet is a good example. When we are speaking about the universalization of the telephone, there is already new social demand for Internet access, that as yet has not been planned”, stated Wohlers.

Flávia Lefevre Guimarães, the law coordinator of the Brazilian Institute of Consumer Defense (Idec in the Portuguese acronym), said that the population wants to understand what is happening in the privatization process, but emphasized that the scarcity of information at this moment.

Steve Thomas, from Sussex University in England, a country that has already lived through the experience of privatization, appraised that many of the problems that come up in the concession of services, arise from the quickness of the transference process of the public companies to private initiative. He suggested that the regulating agencies here in Brazil evaluate the experiences of various other countries so as to avoid making the same mistakes.

For the secretary of Science, Technology and Economic Development, José Aníbal, the great challenge of the regulating agencies is to create instruments so that society interacts with the privatized companies in a beneficial manner. “The interest awakened by this event clearly demonstrates that a lot still needs to be done to make the model of the agencies implanted in Brazil attend the population needs.” José Geraldo Piquet Carneiro, a member of the Public Ethics Commission of the Federal Government, emphasized that the concept of Regulating Agencies has still not been assimilated into Brazil. He recalls the case of the privatization of the transport sector, which until today, does not have a supervisory agency. “It’s wrong to privatize first and regulate afterwards. The correct process is the reverse.” Afterwards he alerted to the necessity that the Agencies possess “decisive independence”, without which they will be contaminated by government organizations and interests. “The function of the agencies is to stimulate competition and to improve the quality of public services”, he concluded.

Creation of knowledge
The participation of FAPESP in the organization of the seminar is a reflection of the institution’s interest in the creation of knowledge. The president of the Foundation, Dr. Carlos Henrique de Brito Cruz, emphasized that the need for advances in the public power sphere and the incorporation of knowledge are fundamental in the current stage of Brazilian society. “Many people think that FAPESP only finances research into laser beams, genomes, molecular biology and computers”, he said. He recalled that, in order to attend to the public sector, the institution maintains the Support Program of Research into Public Policies, which gives incentive to partnerships between universities, research institutes and government development organizations, and the analysis and the diagnosis of public policies and even for their application on a pilot scale.

“The event was very important and worked as it presented a balance of the situation of privatized companies”, said Francisco Romeu Landi, director president of FAPESP. He explained that, through promoting the seminar and the debates on the theme, the Foundation had as its objective the stimulation of the development of research that supports the diverse sectors involved.

Special publication
As a continuation of the seminar, meetings on each area will be organized in which work groups will detail out institutional proposals and will make suggestions for research into diverse sectors of the public sectors involved. The results of the seminar and the debates of the work groups will be brought together in a special publication, edited by FAPESP in partnership with the São Paulo Legislature.

The parliamentarian Arnaldo Jardim (PPS- SP -Popular Socialist Party), secretary to the São Paulo Forum, Century 21, said that the meeting functioned as a spring board to stimulate the interest of new researchers for this area of society. “I believe that the number of researchers from the academic world is multiplying and the seminar stimulates professionals towards this end”, he said. “The work on these questions tends to increase in number and depth”, estimated Jardim.