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Thames Water should be “put out of its misery” and renationalized, according to the deputy leader of Reform UK, in a sign that the backlash against water privatization is becoming an increasingly populist issue.
Richard Tice told the Financial Times that the situation at the debt-laden British utility was “completely untenable” and that City financiers were trying to “rip off consumers even further” with high-interest loans and fees in the millions.
He added: “It is basically bankrupt, capital projects are delayed and must be put out of its misery now.” “There must be a moral hazard. Let it go into private administration for £1 and reorganize it for the benefit of taxpayers and consumers.
The statements of the deputy leader of the right-wing populist party came days later Thames water – which provides water and sanitation services to 16 million households but is struggling under a £19bn debt mountain – has warned it faces the risk of running out of cash in the new year.
Unless it can secure a £3bn loan from creditors, Britain's largest privatized water utilities are at risk of being temporarily renationalized under the government's special administration measures.
The two-and-a-half year loan on offer from creditors, which requires court approval next week, comes at an interest rate of 9.75 per cent, with fees that make the true interest cost much higher.
Reform's call for renationalization reflects a shift by populist parties around the world towards focusing on what they see as the extractive vices of global capitalism, including private equity investors, and calling for policies that have historically been more in line with the left.
In Hungary, Viktor Orbán's Fidesz party rolled back costly and unpopular water privatizations in Pécs and Budapest. Meanwhile, in the United States, Vice President-elect J.D. Vance called for more labor unions in the private sector to protect jobs and raise wages.
The UK Labor government has said it prefers a private sector solution to the Thames crisis over private management, under which the state temporarily takes control of a company to ensure it continues to operate.
This is partly because it is concerned that if Thames Water enters special administration, left-wing MPs within the ruling party will demand that all water companies be permanently re-nationalised.
In response to growing public anger over executive pay and wastewater discharges, the UK Green Party has called for public ownership of all water companies. The Liberal Democrats, Britain's third largest party, said Thames Water should be placed under special management.
“Water today is not a competitive market, it is a monopoly,” said Tice, former CEO of real estate investment group CLS Holdings.
The General Electoral Reform Manifesto included a pledge to bring 50% of all facilities into public ownership, with the other half to be bought by UK pension funds.
David Hall, a visiting professor at the University of Greenwich, said there is a global trend towards water services returning to public ownership and full operation.
Thames Water said it had maintained high levels of capital investment in its aging assets and to improve network resilience for the benefit of customers and the environment.
A spokesperson for the company said: “We continue to believe that a market-led solution is the best financial and operational outcome for customers, the environment, UK taxpayers and the UK economy.”
Thames Water's creditors declined to comment.
“The company remains stable and the government is monitoring the situation closely,” the Department for Environment, Food and Rural Affairs said.
