“Water today cannot be regarded merely as a strategic resource – European auditors see it as a form of national wealth. That is why national governments need long-term strategies for the development of water infrastructure, with clearly defined financial coverage and protection of the public interest. Every public institution must act proactively and preventively, not only when it is time to put out fires,” emphasised Ľubomír Andrassy, President of the national authority for external audit.

Climate change, high temperatures and increasingly dry weather are having a growing impact on water availability, and consequently on public safety and regional development. More than one-third of Europe’s territory is already affected by drought, while outdated infrastructure causes losses of drinking water at nearly 33%. By 2050, water demand is expected to rise by up to half. In Slovakia, the modernisation gap in the water and sewage network exceeds €10 billion. Over 400 out of 2,927 municipalities still lack access to a public water supply, and only three-quarters are connected to a public sewerage system.

The European Commission has therefore adopted a Water Resilience Strategy this year to help member states prepare for chronic water scarcity and extreme weather fluctuations caused by climate change. The document highlights the need to create strategic partnerships and to combine state, public and private investments in water supply and sewage systems, with a particular focus on expanding and modernising existing networks. Responsibility for developing strategic water infrastructure lies jointly with the state and local governments. While municipal water companies, under the control of municipalities, are responsible for managing and maintaining the systems, the development of infrastructure through sustainable financing is primarily the responsibility of the state.

“In Slovakia, almost one-third of drinking water leaks into the ground through damaged pipes before reaching consumers. Therefore, competent institutions – including the Ministry of Environment and the Regulatory Office for Network Industries – must seek ways to finance the development of water infrastructure. This is also vital because insufficient resources could lead to hidden privatisation, with private capital taking control of public utilities and public oversight becoming severely limited,” noted Ľubomír Andrassy.

Foreign experience confirms that the diversion of financial resources from water companies has led to deterioration of water and sewage systems in cities such as Paris, Berlin, as well as in the United Kingdom and the neighbouring Czech Republic. A similar situation exists in some Slovak water companies. To ensure access to drinking water and prevent environmental pollution, these European cities were eventually forced to repurchase or retake control of water utilities, spending billions in the process. European auditors warn that national governments have a duty to limit capital outflows from the water sector and to create a financially sustainable, multi-source system that directs more funds towards maintenance, repair and development of the state’s critical infrastructure. Limited finances are too often drained through dividend payments, bond yields, overpriced services, or through marketing and consultancy campaigns.

In Slovakia, the Supreme Audit Office has also contributed to strengthening public interest protection. Following an audit of water companies and public appeals highlighting the critical situation in the sector, Parliament adopted an amendment to the Act on Public Water Supply and Sewerage Systems. The amendment tightens control conditions and the management of water assets, and the SAO stresses that the state’s role in this area must continue to be reinforced. Auditors from more than 40 European countries agree that, due to climate change, water is becoming a strategic commodity of increasing value. If the state fails to manage and protect it actively, it risks losing control over its most valuable natural resource.

“If the state is to invest hundreds of millions of euros in this strategic infrastructure, it has an obligation to ensure oversight of how these resources are used, how renewal and development of water systems are carried out. Only through active state supervision and clear legal rules can we guarantee that water remains public wealth, not the profit of narrow lobbyist groups,” concluded Ľubomír Andrassy, President of the Supreme Audit Office of the Slovak Republic.