March 2023
« Feb    

Why do our leaders let the water companies rip us off again and again and again?

Here’s the latest scam by one of our predatory water companies. Thames Water wants to impose a “one-off” price rise of about 12% (£29) on its 14 million customers giving Thames another lovely £406m a year of our money. Why this special extra charge? Because Thames already charges so much, that many customers can’t afford to pay their bills. Rather than go after defaulting customers, Thames thinks it’s easier to screw the rest of us.

Thames also wants us (taxpayers) to pay billions for a much-needed new cross-London sewer. Thames claims it hasn’t the money to pay for this itself. So let’s have a quick look at Thames Water’s long history of lying and exploitation.

In 2000, Thames Water was bought by German RWE for £6.8bn. During its 6 years ownership, RWE pocketed around £1bn in dividends. But RWE got tired of suggestions that it should lower its leakage rate below 30% and so sold Thames Water to an offshore-based group led by Australian bank Macquarie for £8bn. RWE made a cool £2.2bn from its brief ownership of Thames Water – money that could have been better spent reducing Thames Water’s extraordinary levels of leakage (click to see clearly)

Under Macquarie, Thames Water has been loaded up with massive debt taken out at usurious rates from a Macquarie subsidiary based in an offshore tax haven. These debts are now so great that Thames pays about £400m a year servicing the interest on its debts. Nevertheless, Thames is also able to pay its lucky owners about £231m a year in dividends. This is in addition to the massive profits the owners make lending money at high rates of interest to themselves. Plus, of course, Thames can offset the interest costs against corporation tax, so it hardly pays any tax in spite of the hundreds of millions a year being creamed off by its owners.

The situation at Yorkshire Water is apparently even worse than at Thames. Since 2006, Yorkshire Water has increased its debt to over 70%, yet managed to pay its owners £886.8m in dividends – an £139 extra every year on the average water bill of its customers.

So, what is the regulator Ofwat doing about this massive scam? Well Ofwat has increased its spending on itself from £11.5m in 2006-07 (just before the financial crash) to more than £17.4m now – a rise of over 50% while our government was supposedly cutting public-sector spending. And what has Ofwat done for customers of water companies? Absolutely nothing. The useless, supine, self-serving, greedy Ofwat bosses have just been feathering their own nests and making sure they didn’t upset any of our water companies. After all, many Ofwat panjandrums are probably considering improving their lucrative careers and bolstering their pensions by going to work at a water company.

Oh, and this is a picture of the CEO of Thames Water (I think), though it may be Yorkshires Water’s CEO, I need to check.

(Tomorrow – take our great Global Warming scam quiz – find out how much you really know about the great Global Warming scam)

Leave a Reply

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>