“Can’t he be tough with it for once and say water is a human right? And it should be publicly owned and publicly run.”
MPs have urged the government to bring water companies into public ownership following this morning’s announcement that Thames Water’s potential buyer had withdrawn from the deal.
During urgent questions this afternoon, Clive Lewis, who has introduced a private members’ bill to nationalise water companies, said that private equity giant KKR pulling out of the Thames Water takeover “exposes the complete bankruptcy of the privatised water model”.
Lewis pointed out that the government-commissioned review, the interim Cunliffe review, describes the water system “as too risky for investment”.
Yet, he pointed out that “it didn’t seem too risky when shareholders were siphoning off billions in dividends while letting the pipes rot, rivers choke and the debt pile up.”
Lewis added: “When will the government stop fiddling, put Thames Water into special administration, strip out the debt and begin the job of returning our water system, not just Thames back into public ownership.”
The government is currently not considering nationalisation
The Environment Secretary Steve Reed ruled out nationalisation, claiming that it would cost over £100 billion, which would have been taken away from other public services such as the NHS to be given to the owners of water companies.
In reality, there is no legal obligation for the government to pay market value to companies when nationalising industries. Both Labour and Conservative governments have nationalised without paying full compensation.
Labour MP Rebecca Long-Bailey cited University of Greenwich research showing public ownership pays for itself in about seven years and after that saves taxpayers £2.5 billion per year.
She said: “So is the Secretary aware that by immediately bringing Thames Water into special administration and permanent public ownership, it will cut the company’s massive debt mountain in half, stop the payment of huge dividends [..] and within just several years would actually start turning a profit for the people of this country.”
Jeremy Corbyn MP said that he found the response from the Environment Secretary “deeply depressing”, when he claimed there is a market solution there for Thames Water.
Corbyn said that under 35 years of water privatisation, the country has had to put up with excessive profits, pollution and rising bills.
‘If we took it into public ownership, Parliament would set the price’
He added: “He knows at some point he’s going to have to take Thames Water into public ownership and instead of quoting this strange figure of £100 billion in compensation, surely if we took it into public ownership, Parliament would set the price.”
Corbyn said the price should reflect “excessive profits, pollution and damage”. He then urged Reed: “Can’t he be tough with it for once and say water is a human right? And it should be publicly owned and publicly run.”
Green MP Ellie Chowns also questioned Reed on why public ownership is off the table.
She said the Greens have long campaigned for it “because we know that if you allow privatised monopolies to control our water, it’s left infrastructure crumbling, waterways running with sewage, sky-high bills and shareholders laughing all the way to the bank.”
Chowns added: “So can I ask the Secretary of State, given this obscene and fundamental failure, why is it that the government will not even consider bringing water back into public hands, where it belongs?”.
Reed responded that Thames Water’s issues are about governance, not ownership, and reiterated that nationalisation would cost over £100 billion and divert money from services like the NHS.
Olivia Barber is a reporter at Left Foot Forward
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