The Environment Select committee’s report, published on 16 June, struck a welcome note when it concluded that “billpayer funds are being used irresponsibly,” and recommended that the Government ends the profit-driven water company model by making English companies non-profit. At last some sense on the water front!
But what are the chances Steve Reed will listen to this committee when he is under such pressure from the new creditor consortium that he is relying on to turn Thames around now that KKR has pulled out?
The ‘regulatory easements’ being called for as a condition of the latest bailout offer are quite astounding in the mockery they make of any efforts to reform the water sector. The new group bidding to get their hands on the Thames Water cash cow is demanding that:-
- Thames Water and its management team be given immunity from prosecution for serious environmental crimes
- Ofwat reverse the £254m in fines and penalties that have been imposed on Thames over the past two years for “significant” sewage and wastewater failures and illegally paying dividends.
- A specific clause be included in the restructuring agreement to protect the water company from the risk of campaigners bringing a judicial review or civil litigation.
In a classic example of greedy investor double speak a spokesperson from the consortium said that the risk of campaigner litigation would be “highly prejudicial to the sustainable recovery of turnaround water companies” and suggested helpfully that it could be “significantly mitigated by clear government direction to the EA (Environment Agency) and the EA setting out a clear framework for prioritising environmental betterment over punitive enforcement (the latter having little or no positive environmental benefit).”
It remains to be seen whether Steve Reed will cave in to this sort of investor bullying. He certainly has a record of siding with the equity investors rather than the environment or the beleaguered water users. Last Thursday in Parliament he was still claiming that Thames Water “remains financially stable” which is laughable given that the private equity giant KKR pulled the plug on their £3billion bailout loan just a few weeks ago.
At the same time as the “financially stable” claim Reed announced that he was ready for all eventualities “including special administration regime if that were to become necessary.”
If the only way to attract private investment is to relieve water companies of all duties to the environment with impunity then that Special Administration Regime (SAR) has already become necessary. It is clear that private water is not working and once the government has used its (SAR) to clean up Thames Water’s mess we want to see our precious water system remaining in public ownership where it is safe from the overpriced loans and environmental vandalism we have seen getting worse year on year.
I have not been paying the wastewater element of my water bills for some time now because of the failures in wastewater treatment and the lies about what my payments are used for. Now I’m withholding all payment because I can no longer, in all conscience, aid and abet the criminal environmental damage and the illegal shareholder and bonus pay- outs that Thames Water cannot operate without.
When water is back where it belongs, in public hands, I will be quite happy to pay what I really owe for the water services I receive but I will not fund the bonuses, the fines and the shareholder pay outs arranged by a bunch of greedy incompetents bent on “restructuring the balance sheet”. See our template letters and boycotting advice if you want to take similar action.
