MPs call for Thames Water to be ‘put out of its misery’
Members of Parliament tore into Thames Water today, urging the government to put the struggling company ‘out of its misery’.
This follows the publication of an interim report on the UK water industry which examines the state of Thames Water and other water companies in the UK.
The report examined alternative ownership models but said it would not recommend nationalisation, a decision in line with the government’s stated refusal to consider the public ownership of UK water companies.
Fielding questions in Parliament on Tuesday 3 June, Secretary of State for Environment, Food, and Rural Affairs Steve Reed was bombarded with calls from MPs for the government to bring Thames Water and the water sector as a whole into public ownership.
This follows after US alternative asset manager KKR & Co pulled out of Thames Water’s equity raising process in a fresh blow to the beleaguered company, increasing its risk of collapse.
A number of MPs argued that the utility should be placed under a special administration regime, which would allow the government to take over operations and continue delivering critical services during the insolvency process.
Reed noted that this type of intervention was not nationalisation, and would not see the government take back ownership of the company.
Others called for a stronger position, arguing that the company should be nationalised and that the current private model has resulted in the enrichment of foreign investors at the expense of British customers.
Reed refused these arguments, responding that nationalising the water industry would cost over 100 billion and was far too expensive an option to consider.
“The problems facing the water sector are to do with failures of governance and regulation. We need to tackle the actual problems, not the imagined ones,” he said.
“If we were to seek to nationalise the water sector, that would cost in excess of £100 billion that would have to be taken away from services such as the national health service or education.”
“I think it is time we put this company out of its misery, but we must do so in a way that does not bring the debts it has run up on to the taxpayer or the bill payers,” added Labour MP Clive Efford.
‘Public goods should be publicly run’
Jeremy Corbyn, Independent MP for Islington North MP and former leader of the Labour party, argued that the government could afford to be much tougher in negotiating with those who ran Thames Water into the ground.
“I find it deeply depressing to hear the Secretary of State say that somehow or other there is a market solution there for Thames Water,” said Corbyn.
“We have had 35 years of excessive profits, pollution and rising bills. He knows he will have to take Thames Water into public ownership at some point.”
“He quotes this strange figure of £100 billion in compensation, but surely if we took it into public ownership, Parliament would set the price at which we would purchase the company, taking into account excessive profits, pollution, damage and the destruction of so many people’s lives through the way Thames Water has behaved,” Corbyn said.
Green Party MP Ellie Chowns echoed this sentiment, criticising the government’s willingness to allow private monopolies to control public goods.
“We know allowing privatised monopolies to control water leaves infrastructure crumbling, waterways running with sewage, sky-high bills, and shareholders laughing all the way to the bank,” Chowns said.
“Given this obscene and fundamental failure, why will the Government not even consider bringing water back into public hands, where it belongs?”
Reform MP Richard Tice also called for the government to buy Thames Water for £1, which he said would be a good deal for the taxpayer as the company is essentially bankrupt.
Calls for nationalisation weren’t restricted to the opposition benches, with Labour MP Rebecca Long Bailey citing research from the University of Greenwhich, which she said showed bringing water into public ownership would pay for itself within around seven years.
After that point, she said, the public ownership of water would save the public purse up to £2.5 billion per year.
