Nationalise Thames Water now: Stop the sickening dividends, foreign investors fixated on profit and sewage spills spiralling - immoral and outrageous

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It is time to give power back to the people and bring debt-riddled Thames Water back under public ownership.

Water companies should not be motivated by profit or owned by foreign investors. The time of water firms being in the hands of private companies targeting profit needs to end.

The clock is ticking on Thames Water. In its annual report it has warned that it will not have enough money by the end of next June. Its debt has now swelled to more than £15 billion and yet its profit has increased to £75.4 million and the firm has paid two fresh dividends worth £158.3 million in March. The dividends have not been paid to shareholders, but to two of its holding companies, Kemble Eurobond and ThamesWater Limited, which are in financial trouble - showing that the system is not working.

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The company is gaining profits, riddled with mounting debt, paying off millions in dividends, all while its pollutions and sewage discharges are increasing. Our precious waterways, rivers and seas, are paying the price for greed and a water industry that is all wrong. Our natural resource is being ruined and damaged while the water firm gains profits and still pays millions to shareholders while knowing its debt is swelling - it is outrageous and privatisations means that customers are currently paying the dividends and paying to clean up sewage.

The water company’s annual report revealed a catalogue of missed targets and under-performance. Chris Weston, chief executive officer at Thames Water, admitted that the firm’s “performance in pollutions and sewage discharges is not where it should be or where we want it to be”, adding that “the number of reportable pollutions increased during the year to 350 from 331.”

It is time to give power back to the people and bring debt-riddled Thames Water back under public ownership. (Photo: NationalWorld/Kim Mogg)It is time to give power back to the people and bring debt-riddled Thames Water back under public ownership. (Photo: NationalWorld/Kim Mogg)
It is time to give power back to the people and bring debt-riddled Thames Water back under public ownership. (Photo: NationalWorld/Kim Mogg) | NationalWorld/Kim Mogg

Thames Water blamed the increase in pollutions on the increased rainfall. Mr Weston said: “In 2023, we saw 40% more rain than the year before, causing a spike in pollutions. The prolonged heavy rainfall also led to an increase in sewage discharges to 16,990 from 8,015”.

But in the same vein, Mr Weston said that the “state of our assets is poor” and “after decades of underinvestment, it will take time to restore asset health to the level we expect and require”. But, according to Sky News a Thames Water insider said that a £37.5m payout was made to shareholders last autumn. Shareholders have sucked out billions of pounds from the company over the past two decades - money that could have been re-invested back into the company to improve its infrastructure and assets.

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Australian bank Macquarie and a string of offshore pension funds bought Thames in 2006 and controlled the business for a decade. Over that period, they took out about £2.7bn in dividends using a complex financial structure which was ultimately underpinned by money paid into Thames Water by bill payers. In one year alone, Thames paid a £656m dividend which pushed the firm into the red.

Thames Water has paid over £200m in dividends to other companies within the group in the past five years. Thames Water is currently owned by a group of investors spanning four continents. The largest is the Canadian pension fund, OMERS, with 31.8%.The second-largest is the Universities Superannuation Scheme, with 19.7%, a pension fund for UK academics. Other investors include sovereign wealth funds from China and Abu Dhabi.

Thames Water has been motivated by profit and has spent the bare minimum on its infrastructure. It watched as its debt continued to swell and yet it still continued to pay billions over the years to foreign investors. It should be allowed to fail, it should be held accountable - and most importantly taxpayers should not pay a penny for this mess.

Keir Starmer’s government needs to step in and re-nationalise Thames Water so profits can be reinvested instead of going into shareholders bank accounts. There is concern with this that taxpayers will see higher taxes to pay off the debts however there is the option of a pre-pack administration that would make Thames Water go bankrupt (or put into administration) and then getting rid of the debts.

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The lenders, shareholders and millionaire managers of Thames Water deserve no sympathy and no money of any sort. It has paid obscene dividends, watched as sewage discharges increased and its debt swelled alongside it. Seeing reports of the water firm now wanting to raise bills by more than 50% for its customers also just shows the absolute sham of the whole situation. You cannot force customers to pay more for a mess they did not create - and a mess they do not want to be in.

We need a fundamental reset of the water industry. It is not only Thames Water. Anglian Water has been fined £50,000 for not handing over records, Yorkshire Water paid a record £1m to charities after polluting a Harrogate watercourse, and campaigners criticised water companies last year for paying out £1.4bn in dividends while sewage continued to be discharged into rivers and seas.

Privatisation in the past. Public ownership in the present. Let Thames Water go bankrupt and nationalise the company at no cost to the taxpayer. It is sickening wealthy shareholders enjoy the money while customers of Thames Water watch the debt mount and its services “significantly falling short” as the water company put it.

There is a lot that needs to be reformed with the water industry including tougher regulation, but first put Thames Water back into public ownership. It is time to put people over profit.  

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