Britain’s water companies are in trouble
Thames Water, Britain’s biggest water company, is in a state. The company, which provides water and sewage services for 15 million people, is sinking under a £14 billion debt pile. Yesterday Sarah Bentley, its chief executive, resigned unexpectedly and this morning the government was reportedly preparing to temporarily renationalise the company. Last year Thames Water’s owners, a group of pension funds and sovereign wealth funds, invested £500 million in the company – the first equity injection since privatisation in the 1980s. The company has faced public anger over sewage leaks into rivers, while the leakage rate from its pipes is at a five-year high. It’s not the only UK water company in trouble: last year regulator Ofwat said it was worried about the financial resilience of Thames Water, Yorkshire Water, SES Water and Portsmouth Water. One analysis found that water companies’ debt had grown to £54 billion since privatisation – but they paid out dividends to shareholders of £66 billion over the same time period.
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