Reports suggests officials have raised concerns about the risk to taxpayers and the potential for legal challenges of nationalising Thames Water
Andy Burnham is under pressure after speculation he has shelved plans to put embattled Thames Water into administration.
Reports say officials have raised concerns about the risk to taxpayers and the potential for legal challenges. It comes as debt-ridden Thames Water’s creditors have put forward a turnaround plan of the troubled utility, which is desperately seeking to avoid a nationalisation.
Regulator Ofwat was said to be close to accepting a deal to write off half of Thames’ £20billion debt. In return, the backers wanted the supplier to escape the threat of fines for pollution for the next four years. However, that was put in doubt when former Environment Secretary Emma Reynolds warned the proposed deal would place a burden on customers.
Mr Burnham has previously indicated he wanted to put Thames Water into a special administration regime (SAR) that would allow essential services to keep running until a buyer was found. However, a report in The Times has raised doubts about whether it still backed the idea, prompting a backlash from those who want him to bring the company under public control.
Cat Hobbs, director of the group We Own It, said: “If Burnham doesn’t take Thames Water into public ownership, he’ll go down in history as a same-old prime minister delivering sewage in our rivers and spiralling bills to households. This is his one and only chance, if he doesn’t take it he’ll be a laughing stock.
“The idea that we can’t take back this company which has literally gone bust, been in breach of its licence for two years and has put forward several proposals for illegal sewage is a joke. It makes a mockery of households, of our entire water system, of the special administration regime, of England.”
Jon Trickett, Labour MP for Normanton and Hemsworth, told the Telegraph: Privatisation of water has been a disaster. It’s a natural monopoly. Worse still, management has proved to be less than competent. Andy Burnham should hold his nerve and stick to his promise”.
James Wallace, chief executive of River Action, said: “Thames Water is drowning in debt, sewage and lost water. The costs of servicing almost £20 billion of debt are enormous, yet huge sums continue to be spent on finance and executive rewards while frontline staff work around the clock to hold this failing company together. It is indefensible.
“The Government should put Thames Water into a Special Administration Regime and rebuild it to serve its customers and clean up our rivers, rather than reward failure. Rather than a wild goose chase for yet another private buyer, an administrator should be appointed immediately to examine all options for ownership in the public interest of Thames Water, and prevent another rapacious market-led private ransacking of our water utility.”