#Thames Water

[theinconvenientlifestyle]

[stillnaomi]

it's ridiculous that Thames Water is only being fined £104m, and that that has to be paid by the business, not by the people who've been pocketing the dividends while the company systematically failed to invest in infrastructure

not to worry, the government will probably temporarily take it into public ownership before selling it off again 🙄

it's time to take the whole economy into public ownership for good and remove the profit motive

[eaglesnick]

“Leverage is the reason some people become rich and others do not become rich” - Robert T Kiyosaki

The privatised water companies have been demanding price rises of between 24% and 91% over the next five years according to the Consumer Council for Water. The mainly foreign owned "English" water companies want to invest £96bn in water and sewage restructuring between now and 2030. New reservoirs, the first for over 30 years, will be built, leaks will be reduced and less sewage will be pumped into our waterways and seas.

Amen to that! But wait…

“English water firms have handed £57 billion to shareholders in the 30 years after privatisation.” (The London Economic: 28/10/21)

We, the consumer, having generously contributed to foreign share dividends for three decades to the tune of £2 billion per year, are now expected to part with even more money to pay for 30 years of private water company neglect. Meanwhile, the CEO’s of these private companies gave themselves a 20% pay rise for the year 2021-22, pocketing £24.8 million.

None of these facts are particularly new but what really irked me yesterday morning was an interview on BBC’s “Today" programme with David Henderson, CEO of Water UK, the organisation that represents all of the privately owned water companies.

Stressing the country’s need for “economic growth", Henderson said this would not be possible unless the water companies were allowed to drastically raise the price of water to cover the cost of investment needed to upgrade our water infrastructure. Talking of the need to increase water supply he stated:

“We have not built a reservoir in 30 years, even though our population has risen by 20% in that time. And that’s because we have been blocked by regulators and by planning officials around the country.”

The cheek!

According to New Civil Engineer magazine (01/09/22)

“There is a seemingly direct link between the 1989 privatisation of water companies in the UK and the ceasing of new reservoirs being built. While there have been a number of flood alleviation reservoirs built by the Environment Agency in this time, the water companies have not invested in potable drinking reservoirs.”

While I have no doubt that some applications for new reservoirs have been refused by planning authorities the main reason for inadequate reservoir capacity is the reluctance of the privately owned water companies to spend money on investment. Despite what David Henderson said on the Today programme this is a headline from the Express:

“Water firms ‘sold off reservoirs that could have eased drought' - Profit ahead of supply" (10/08.22)

In defending the private water companies Henderson was merely doing his job - after all that is what he is paid to do - but unfortunately their behaviour is indefensible. The reason that our waterway infrastructure is near collapse is not because investment plans have been blocked by “regulators and planning officials" but because of greed.

When Margaret Thatcher privatised the previously publicly owned water companies she sold this national asset for a grand total of £7.6bn. In addition she gave the newly created privately owned water companies a “green dowry" of £1.5bn. At time of purchase the water companies were totally debt free.

Fast-forward and what do we find?

“Water firms’ debts since privatisation hit £54bn as Ofwat refuses to impose limits.” Guardian: 01/12.22)

The water companies have spent the last few decades borrowing money, not to improve the water supply and sewage disposal infrastructure, but to pay dividends to shareholders. According to Ofwat’s own figures the water companies have been running ratios of debt to capital value as high as 80%. Water company share holders (70% owned by foreign investors) have received £65.9bn in dividends and it is calculated that 20% of household water bills go towards paying for the debt that rewards these shareholders.

Rachel Reeves much heralded national wealth fund is supposed to be a central plank of the Labour governments “Green Prosperity Plan” but Labour’s earlier promise to nationalise the dysfunctional private water companies has now been abandoned.

David Henderson has issued what in effect is a blackmail ultimatum to the new Labour Government that without massive price rises in consumer water bills, the Labour Party can kiss their dreams of economic growth goodbye.

Today Ofwat, the water regulator, sanctioned an average increase in water bills of 21%, some companies charging as much as 44% more over a five year period. This is a third less than what the water companies demanded, but even a 21% rise over five years is an increase of 4% a year, twice the inflation rate target of the Bank of England.

An interesting case study will be that of Thames Water which has dire financial problems due to building up a debt of £14bn (while still paying out tens of millions in dividends to its shareholders). It remains to be seen if Thames Water will be allowed to go bust or whether the new Labour Government will step in and bail it out but maybe this headline gives us a clue:

“Labour abstain on bid to criminalize water companies for sewage pollution” (Canary: 17/05/24)

[thoughtlessarse]

Thames Water, the UK’s largest water company, is teetering on the brink of financial collapse, raising the prospect of a taxpayer-funded bailout. The company, which serves 16 million customers, is struggling to secure crucial investment to repair its ageing infrastructure and deal with its mounting debt. There have now been reports that the Government is considering bailing out Thames Water as a last resort, which could see water bills rise by hundreds of pounds a year.

continue reading

So, they now expect taxpayers around the country to bail out a water company that only serves one part of the country, the richest part. The rest of the country, which has still not recovered economically from the pandemic, is essentially paying money to the only region on mainland UK that recovered and then some. (Northern Ireland also recovered, thanks in large part to continuing trade with the EU.)

What's the difference between Sunak taking “Levelling Up” meant for poorer regions to benefit his south-east constituency and Starmer taking cash from poorer regions to prop up a failing water company, again in the south-east? Both widen inequality. It's more austerity which opens the door for the far-right.

[willcodehtmlforfood]

"Exclusive: Concerns over effect on UK’s finances lead officials to believe utility should be renationalised before general election"

[freenorthnow]

Thames Water is just one of many public utility companies being rewarded for their failure.

Making utilities publicly owned is just common sense, private companies have proven they can't be trusted to take care of them.

[everything-is-interesting-ldn]

#PoliticsIsInteresting

The general public has been let down by water companies that have paid out £85 billion to shareholders for what is a vital utility. And now, Thames Water has a debt of £15 billion. Once again, it’s the taxpayer set to pay the price.

#ThamesWater

[insidecroydon]

Croydon Road's sewer works completed ahead of schedule

Works (almost) complete: Croydon Road A232 sewer works yesterday, just waiting for the new tarmac to settle before the road can re-open Emergency road works to fix a broken sewer on the A232 Croydon Road have been completed ahead of schedule, with the major road set to re-open to all traffic as soon as tomorrow, Sunday October 20. Inside Croydon reported at the end of September how Thames Water…

[skeletonoli]

had an average day in London today (had to rearrange my entire travel plan for the day because a Thames water pipe burst)

[timharrold]

The Armageddonites (14-17.5.24)

[theinconvenientlifestyle]

[prose2passion]

that's what privatising utilities gave us: rivers of shit

[fitzrovianews]

Over a hundred mains water leaks every year in Fitzrovia

Goodge Street has been dug up more than 11 times since January 2023 to repairs water mains. Photo: Fitzrovia News. Thames Water are digging holes in Fitzrovia streets a rate of more than twice a week every year to repairs leaks, councillors in Camden have been told. “In Fitzrovia, there are frequent bursts (of varying sizes) leading to between 100 and 150Thames Water road openings in the area…

[nextwavefutures]

Paying for clean water

Maybe it’s time to rethink the way we pay for sustainability investment. Water infrastructure could be the place to start. New post.

I hadn’t really planned to write about the British water industry again, but the current crisis in Thames Water seems to be more than a local political difficulty. The accountant Richard Murphy has a post on his blog which looks beyond the detail of the failure of Thames Water to the wider issue of the “environmental bankruptcy” of the British water sector. The post is a summary of a longer…