Thames Water

Horses Arse said:

How are they following the rules if they pay zero Corp tax whilst making huge profits and dividend payments?

Didn't think dividends offset Corp tax

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Nobby said:

A private company is run for the benefit of its shareholders.
Not employees, or the public.
Privatisation of water, gas and electric, the railways, may have made these operations more efficient but not for the benefit of us ordinary folk.
Unless there are such stringent controls that limit their powers to benefitting the public not their shareholders
Are there haven’t been enough controls
Capitalism in a nutshell innit.

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A1X said:

Water supply shouldn’t even be privately owned anyway. It’s a vital service. It’s not even like there’s competition.

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Jim in the West said:

There is absolutely no reason why it should be "Public = Good, Private = Bad". Not all water companies were in public ownership prior to the massive privatisation in 1989, and not all water companies are now private. A few years ago I worked for Bristol Water, which has ALWAYS, throughout its 177 history, been a privately run company. We had very high levels of customer satisfaction and a fantastic customer-focused ethos within the company. And the water companies in Wales and Scotland do not have external shareholders...they are public-benefit, not-for-profit companies. And if you look at the customer satisfaction stats, Welsh Water and Scottish Water don't have any better customer service metrics than privatised water companies. In my view, and my experience of working in a whole range of industries, the quality of management (and staff) makes a huge difference to the customer experience.

But there ARE some fundamental issues in the water industry which have conspired to generate poor outcomes for customers. One very simple one is that, for at least the last decade, the government has put huge pressure on the regulator (Ofwat) to keep customer bills down, at the expense of investment. The incredibly complex 5 year pricing review process determines how much a water company can charge you, and how much the company can invest in infrastructure. Ofwat has (reacting to government pressure) systematically reduced the investment plans of water companies in order to keep water bills as low as possible.

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beorhthelm said:

usually becuase its operating profits, not a net cash surplus, from which debt payments, investment and other numbers are subtracted. dividends can be paid regardless of profit, either operating or cash.

something odd about the latest news, £14bn debt and budget blackholes. that debt is there in their accounts, growing a bit each year, its not a sudden revelation. also share price bearly reacted. something else afoot or gross misreporting.

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beorhthelm said:

usually becuase its operating profits, not a net cash surplus, from which debt payments, investment and other numbers are subtracted. dividends can be paid regardless of profit, either operating or cash.

something odd about the latest news, £14bn debt and budget blackholes. that debt is there in their accounts, growing a bit each year, its not a sudden revelation. also share price bearly reacted. something else afoot or gross misreporting.

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DavidinSouthampton said:

I worked in the Gas industry - British Gas - until 1983. When they started privatising things, I just had an immediate feeling that it was wrong - immoral even - for the basic utilities like gas, electric and water to be privatised.

But of course privatisation was going to free them all up to raise money in creative ways to give us a much better service all round and probably cheaper…….. er, but people will expect to make a profit out of this!

And then I remember when Railtrack was reprivatised, there were people bleating that this was their pension money and it was not right that their future should be mucked around with like this! I thought at the time “these are shares, you idiot. shares inherently carry an element of risk. If you’re not prepared to take that risk, you DON’T buy shares. If the privatisation has been bungled and the whole thing has been s disaster, then tough. You lose out!”

so of course now all the pension funds and international institutions that invest in things like Thames Water will either be stumping up the readies to rescue things or will be seeing their huge investments go the way of all flesh! Right, yes….. as if! the British taxpayer and/or the customers will bear the brunt of all this while all the clever accountants and business people will be riding off in to the sunset having made their fortunes.

It makes me sick! Very angry. And as usual, it’s all Thatcher’s fault!

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Jim in the West said:

David, I feel your pain!! But I very much doubt in this case that the taxpayer will pick up the bill. The shareholders will either have to fill the "black hole" with very significant capital injections, or TW will effectively be nationalised, and the shareholders would lose their entire investment.

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DavidinSouthampton said:

I worked in the Gas industry - British Gas - until 1983. When they started privatising things, I just had an immediate feeling that it was wrong - immoral even - for the basic utilities like gas, electric and water to be privatised.

But of course privatisation was going to free them all up to raise money in creative ways to give us a much better service all round and probably cheaper…….. er, but people will expect to make a profit out of this!

And then I remember when Railtrack was reprivatised, there were people bleating that this was their pension money and it was not right that their future should be mucked around with like this! I thought at the time “these are shares, you idiot. shares inherently carry an element of risk. If you’re not prepared to take that risk, you DON’T buy shares. If the privatisation has been bungled and the whole thing has been s disaster, then tough. You lose out!”

so of course now all the pension funds and international institutions that invest in things like Thames Water will either be stumping up the readies to rescue things or will be seeing their huge investments go the way of all flesh! Right, yes….. as if! the British taxpayer and/or the customers will bear the brunt of all this while all the clever accountants and business people will be riding off in to the sunset having made their fortunes.

It makes me sick! Very angry. And as usual, it’s all Thatcher’s fault!

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beorhthelm said:

a rabbit warren of corporate companies behind Thames Water. they were bought out from RWE (nice Germany utility co) in 2006 with a lorry load of debt. i'd hazard a guess that group own most the debt, otherwise not sure i understand why they'd set this up (as share holders they lose everything if it goes wrong).

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pb21 said:

Am I just being incredibly wet behind the ears, or is this not stupid and 'shouldn't' be allowed to happen?

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Doonhamer7 said:

No you’re not, some of the finial engineering is so morally wrong and it should be stopped. I don’t know of all the facts without looking it up but if you look at Philip Green (bhs/top shop infamy) he went and bought successful companies with low debt which owned their assets (shops), He then borrowed the money to buy them, then transferred the money he had borrowed as debt onto the business (so it’s now heavily geared), sold / spun off the assets and pocked the money (so now shops are paying higher rent). result a business with huge debt (which in long term it can’t pay) and increased running costs = bankrupcy and the only winner is…..

this happens with a number of investment companies - gear up business with debt, strip the assets, then move on with no care for the damage done. No UK govt will have the balls to stop this

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Weststander said:

Thames Water’s in deep financial sh1t (like the water it pollutes), looking to borrow even more from investors, already £18.3bn. This stems from the Maquerie ownership dividends scam from 2006 to 20167, where they increased TW borrowing by £7.3bn to partly pay out £2.8bn in dividends. Dividends in their ownership were 3x greater than before, 5x greater than since.

The weight of debt and interest makes it difficult for TW to invest adequately for climate change and its effect of sewage pumped into waterways.

The share price has crashed. It wouldn’t cost much for a nationalisation …. over to Labour when they take power.

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Papa Lazarou said:

I can't see how a company that is obliged to invest in infrastructure and improving the quality of our water, with that amount of debt, can survive.

Is letting the company fail and taking it back into state ownership a viable option? After all the shareholders have been receiving dividends for years based upon a lie. Plus shares might be considered low risk investments, but even the largest companies can fail.

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