Thames Water is ‘drowning in debt’ as pollution and bills soar

Steve Reed OBE, the MP for Streatham (and Croydon North if he can be bothered), and the environment secretary in Keir Starmer’s government, is facing renewed calls to renationalise privatised water companies, after the biggest, Thames Water, today reported an annual loss of £1.65billion as its debts soared to £16.8billion.

Thames Water’s annual report came the day after the company – which has never built a single reservoir since it was privatised – announced a hosepipe ban affecting 1.1million customers.

The company’s annual report, meanwhile, blamed “significant rainfall and high groundwater levels” for a 30% increase in pollution incidents.

In its report, Thames Water admitted that the number of serious pollution incidents on its watch had increased from 350 to 470 in the last calendar year – a period with Reed in government and promising that he would stop the water utilities from ruining the nation’s rivers, streams and waterways.

Meanwhile, with Reed in charge of the environment department, bills for Thames Water’s customers have gone up from £488 to £639 a year.

In May, Thames Water was handed a £122.7million fine, the biggest ever issued by regulator Ofwat, for breaching rules on sewage spills and shareholder payouts.

The Ofwat fine was a factor in Thames’s heavy losses, but they were mostly caused by the writing off of a £1.27billion inter-company loan deemed to be no longer recoverable. It also spent £151million on “restructuring costs”.

Thames Water serves about a quarter of the country’s population, mostly across London and parts of southern England, and employs 8,000 people.

Chris Weston, chief executive of Thames Water, said the company had made “good progress” on its performance, “despite the ongoing challenging financial situation”.

Today, the GMB union, which represents many Thames Water employees, said that “Thames Water is drowning under a mountain of debt.”

The GMB’s Gary Carter said: “Hiking customer bills has led to a rise in operating profit, money that should go on investment, but it is being swallowed up by monstrous loans needed to keep the company afloat.

“While Thames lurches from crisis to crisis, the solution is clear: it must be taken back into public ownership, with workers’ terms, conditions and pensions protected,” Carter said.

And Carter was also underwhelmed by Thames Water’s decision, announced yesterday, to impose a hosepipe ban on more than 1million customers in the west of the Thames valley.

Carter described Thames Water’s hosepipe ban as “disgraceful”.

The hosepipe ban will be introduced across Gloucestershire, Oxfordshire, Berkshire and around Swindon in Wiltshire from next Tuesday.

Some are predicting that a similar ban will be imposed on Londoners very soon, unless there is some kind of summer deluge across the region.

The driest spring for 100 years, and England’s warmest June on record, some scientists are predicting that the whole of Britain will be under drought restrictions by this autumn.

Thames Water’s announcement of the hosepipe ban came after the Environment Agency placed the Thames area into its “prolonged dry weather” category, meaning a heightened risk of drought.

Customers living in areas affected by the ban are asked not to use hosepipes, including for cleaning cars, watering gardens or allotments, filling paddling pools and swimming pools or cleaning windows.

The ban doesn’t apply to water use by businesses, such as garden centres and car washes.

“Thames Water lost 200billion litres of water through leaks last year,” the GMB’s Carter said.

“That’s 570million litres wasted every single day – the worst in the country.

“GMB members at Thames are working hard and doing the best they can, but they’ve had their hands tied behind their backs by crumbling infrastructure and non-existent investment.

“For Thames Water to now impose a hosepipe while bills rocket is disgraceful,” Carter said.

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