Contingency plans being drawn up for possible collapse of Thames Water – reports
Holly Williams, PA Business Editor
Wed, 28 June 2023
The Government is reportedly drawing up contingency plans for the emergency nationalisation of Thames Water as concerns grow over its mammoth £14 billion debt pile.
Ministers are said to be in talks about the possibility of temporarily bringing the utility company back into public hands under a so-called special administration regime (SAR).
The discussions are understood to be taking place between water regulator Ofwat, the Department for Environment, Food and Rural Affairs (Defra) and the Treasury, but the plans are at a very early stage and may not need to be put in place.
It comes after Thames Water chief executive Sarah Bentley stepped down with immediate effect on Tuesday amid mounting worries over the financial stability of the firm.
Thames Water is the UK’s biggest water supplier and provides water services for 15 million people in London and the South East.
The firm is now reportedly racing to raise £1 billion from investors to shore up its finances, with AlixPartners said to be advising the firm on turnaround plans.
Thames Water – owned by a consortium of pension funds and sovereign wealth funds – has come under pressure in recent years over its poor performance in tackling leaks and sewage contamination, while facing criticism for handing out big rewards to top bosses and shareholders.
Thames Water chief executive Sarah Bentley stepped down on Tuesday amid mounting concern over the financial stability of the company (Thames Water/PA)
Ms Bentley, who was appointed in 2020, said in May that she would give up her bonus after the company’s environmental and customer performance suffered.
But even after giving up the bonus, the chief executive managed to double her pay, raking in £1.5 million.
On announcing her departure, she said: “The foundations of the turnaround that we have laid position the company for future success to improve service for customers and environmental performance.”
Ofwat, the Treasury and Defra were not immediately available for comment.
Speaking to Sky News, children’s minister Claire Coutinho declined to comment directly on the reported plans to prepare for the possible collapse of Thames Water.
She said: “I certainly think there are water companies like Thames Water which are in difficult positions, but I think our position as Government is to make sure that we have the right policies in place to see consumers protected but also that we’re dealing with things which are really important to the country, like dealing with the sewage leaks.”
Thames Water’s owners last year invested £500 million in the firm – the first injection of equity into the group since privatisation.
They pledged a further £1 billion, subject to conditions, and warned that “further shareholder support may be required”.
The group’s shareholders include Chinese sovereign wealth fund China Investment Corporation, UK private pension fund the Universities Superannuation Scheme, and Abu Dhabi Investment Authority subsidiary Infinity Investments.
Ofwat warned last December over the financial resilience of Thames Water, as well as Yorkshire Water, SES Water and Portsmouth Water.
Thames Water chief executive quits after giving up bonus over sewage spills
August Graham, PA Business Reporter
Tue, 27 June 2023
The boss of Thames Water has stepped down with immediate effect weeks after being forced to give up her bonus over the company’s environmental performance.
The company said that Sarah Bentley would leave the board on Tuesday, but will continue to support her interim replacement until a new full-time boss can be found.
Ms Bentley, who was appointed in 2020, said in May that she would give up her bonus after the company’s environmental and customer performance suffered.
But even after giving up the bonus, the chief executive managed to double her pay, raking in £1.5 million.
At the time Gary Carter, a national officer at the GMB union, said that Ms Bentley’s plan to give up the bonus was “nothing more than a flimsy PR stunt”.
The logo of water company Thames Water seen through a glass of water.
Because she declined it, the company never said how large the 51-year-old’s bonus would have been, but the year before her performance-related pay had reached £496,000.
Chief finance officer Alastair Cochran, who will now take over as interim co-chief executive, also gave up his bonus at the time.
He will now run Thames Water together with Cathryn Ross, the former Ofwat chief executive who joined the business in 2021.
On Tuesday chairman Ian Marchant said: “I want to thank Sarah for everything she has done since joining the company in 2020, building a first class executive team and leading the first phase of the turnaround of the company.
“On behalf of everyone at Thames, the board wishes her every success for the future.”
Ms Bentley said: “It has been an honour to take on such a significant challenge, and a privilege to serve Thames Water’s dedicated and inspirational colleagues.
“The foundations of the turnaround that we have laid position the company for future success to improve service for customers and environmental performance.
“I wish everyone involved in the turnaround the very best.”
Liberal Democrat environment spokesperson Tim Farron said: “This has to be a watershed moment for the scandal-ridden company.
“Thames Water is a complete mess and it’s time ministers stepped in to reform the firm from top to bottom.
“The days of profit before the environment must end.”
August Graham, PA Business Reporter
Tue, 27 June 2023
The boss of Thames Water has stepped down with immediate effect weeks after being forced to give up her bonus over the company’s environmental performance.
The company said that Sarah Bentley would leave the board on Tuesday, but will continue to support her interim replacement until a new full-time boss can be found.
Ms Bentley, who was appointed in 2020, said in May that she would give up her bonus after the company’s environmental and customer performance suffered.
But even after giving up the bonus, the chief executive managed to double her pay, raking in £1.5 million.
At the time Gary Carter, a national officer at the GMB union, said that Ms Bentley’s plan to give up the bonus was “nothing more than a flimsy PR stunt”.
The logo of water company Thames Water seen through a glass of water.
Because she declined it, the company never said how large the 51-year-old’s bonus would have been, but the year before her performance-related pay had reached £496,000.
Chief finance officer Alastair Cochran, who will now take over as interim co-chief executive, also gave up his bonus at the time.
He will now run Thames Water together with Cathryn Ross, the former Ofwat chief executive who joined the business in 2021.
On Tuesday chairman Ian Marchant said: “I want to thank Sarah for everything she has done since joining the company in 2020, building a first class executive team and leading the first phase of the turnaround of the company.
“On behalf of everyone at Thames, the board wishes her every success for the future.”
Ms Bentley said: “It has been an honour to take on such a significant challenge, and a privilege to serve Thames Water’s dedicated and inspirational colleagues.
“The foundations of the turnaround that we have laid position the company for future success to improve service for customers and environmental performance.
“I wish everyone involved in the turnaround the very best.”
Liberal Democrat environment spokesperson Tim Farron said: “This has to be a watershed moment for the scandal-ridden company.
“Thames Water is a complete mess and it’s time ministers stepped in to reform the firm from top to bottom.
“The days of profit before the environment must end.”
No comments:
Post a Comment