Last week, Water Minister Emma Hardy admitted that the government would not intervene in the Thames Water scandal unless water stopped coming out of the taps and toilets would not flush to take sewage away. Bizarrely and worryingly, it seems,a Labour Government would rather let London and the surrounding counties descend into a public health and economic catastrophe than interfere in the dubious financial dealings of the infamous water giant responsible for 16 million customers and countless businesses.
These were her words to the Efra Committee in Parliament explaining where government set the level for intervention; Fundamentally, water doesn’t come out of the tap and your toilets don’t flush and sewage goes away. As you might guess there is a law to stop such a collapse wrecking the lives of customers and the economy so that government can take failing utilities into Special Administration which is a sort of short term nationalisation, to keep it delivering essential services. What developed country would take chances with essentials, after all?
Of course there is no point in having this protection if the government of the day has decided that the owners of the company are more important than the customers.
Owners that have wreaked so much damage on the company that it is facing financial collapse while still paying dividends and bonuses and putting up customer bills that will also pay for the £800M the company is predicted to waste on interest, legal fees and consultants in around 6 months.
In looking for clues for an explanation of this betrayal of public protection, the donation of £27K to Chancellor, Rachel Reeves and the placement of a staff member in her team by private equity company, KKR, which later became Thames Water’s favoured bidder for its restructure before the company bailed out of the deal just before the story broke, has raised eyebrows but the truth remains hidden in murky water.
In the end, it may only be the good will of Thames Water staff that stop disaster unfolding – Emma Hardy has made it very clear, it won’t be the government.