“This nonsense must be, should be, has to be and will be opposed.”
Plans to shield Thames Water from new fines until the end of the decade have been met with disbelief and anger, fuelling claims that the regulator risks rewarding years of poor performance.
Recent reports suggest Ofwat is in talks with the company’s creditors over a deal that would effectively waive elements of the penalty regime during the current regulatory period, potentially until 2030. The aim is to stabilise Thames Water’s precarious finances and secure fresh investment, averting the threat of collapse or special administration.
Under the proposed arrangement, existing penalties would remain in place, but future fines could be replaced with legally binding commitments to improve performance, including cutting leaks, upgrading infrastructure and reducing environmental damage. Some targets may also be relaxed to reflect the scale of the company’s financial difficulties.
The Times noted how the move would infuriate critics and the bosses of other companies in the industry, who are likely to see Thames Water being treated as a special case with the offer of arrangements not available to the other privatised regional monopolies, “many of which have been recapitalising their balance sheets with shareholder cash injections to ensure they meet their regulatory commitments.”
And infuriate it has.
Thames Water has spent years under fire for sewage discharges, leaks and rising bills, all while servicing a debt pile of around £15bn, and the idea that it could avoid further financial penalties has struck many as indefensible.
Trade unions, campaigners and industry figures have warned that any such deal risks undermining accountability and creating a two-tier regulatory system.
Responding to the reports, GMB Union warnedsuch a deal risks undermining accountability. Cliff Roney, a former water worker, GMB activist, and contributor to Channel 4’s Dirty Business, said:
“All Thames Water customers know that after years of broken promises on bills, investment, and pollution, the company’s word is meaningless.”
“Ofwat needs to grow a spine and not let Thames Water off the hook yet again.
“Renationalisation is the only way to stop bill payers from being exploited and ensure our water industry receives the investment it so badly needs.”
Feargal Sharkey, a longstanding critic of the water industry, described the reported plan as “nonsense” that “must be, should be, has to be and will be opposed.”
Other pointed to the pitfalls of privatisation.
“Letting a company avoid fines for the next four years after decades of failing our rivers is a slap in the face to every billpayer. If a private company can’t afford to pay for its own failures, it shouldn’t be a private company,” was one response.
“We’re paying record bills not for better service, but to service £15bn in debt and decades of shareholder dividends. Privatisation has failed. The Green Party is right: we must bring water back into public hands so every penny of our bills goes into fixing leaks and stopping,” was another comment.
The outcry follows earlier polling of Thames Water, which found its own customers support for bringing the utility back into public ownership, with more than two-thirds backing nationalisation.
As one X user summed up:
“Water shouldn’t have ever been nationalised in the first place. Another hold over from Thatcher’s disastrous policies!”
Left Foot Forward doesn't have the backing of big business or billionaires. We rely on the kind and generous support of ordinary people like you.
You can support hard-hitting journalism that holds the right to account, provides a forum for debate among progressives, and covers the stories the rest of the media ignore. Donate today.