“Private investment is a myth. Nearly every penny of investment privatization has come from our bills, and borrowing has been taken on to pay for dividends to shareholders,” said Matthew Topham, We Own It’s water lead.
“Pretty much every other country in the world uses public financing for water. It’s cheaper, and it provides consumers better quality.”
Topham called for the government to put failing companies into special administration. Thames Water has already been put into unprecedented special measures as it struggles under £15.2bn of debt.
“Thames Water, for example, has broken the terms of its license three times in the last month alone. When you have a company that is likely insolvent or is insolvent, and is also breaking its primary duties as a water company, the government has a power called Special administration.
“It can appoint someone to run the business until you can get competent owners in charge, because clearly, its current owners are incompetent.”
“They wouldn’t have to provide compensation to shareholders. Which even the Treasury – a bulwark of centrism – has agreed.”
The Treasury’s blueprint for special administration for Thames Water would see debts written off if they were accumulated “in bad faith”. Other solutions include beefing up the punitive powers of the water regulators. This is the option supported by the Liberal Democrats.
“It’s an absolute outrage that British families face sky high bills that continue to rise, while water firm CEOs pocket millions of pounds in bonuses, and all the while filthy sewage continues to destroy our seas and rivers,” said the party’s environment spokesperson Tim Farron.
How much will water bills rise in England and Wales?
Water bills will rise in England and Wales – the question is by how much.
The regulator’s “draft determination” last month set out a budget of £88bn for the sector and called for the average bill hike over 2024/25 to 2029/30 to be capped at £94 – or £19 a year.
Water companies accused Ofwat of “getting it wrong” and asked the regulator for permission to spend a total of £104.5bn over the next investment cycle. This would cause the average household water bill to climb by £144 over five years.
“It treats bill payers with absolute contempt, to assume that they should fork out to cove all the mistakes that these companies have made,” Topham said. “Bill payers are being asked to stump up to pay, again and again.”
Ofwat will release its final decision on bill increases in December.
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