5th Jun 2025 06:39
(Alliance News) - Troubled Thames Water is "contemptible" and lies to the public, Parliament has heard.
The scathing assessment was made at Westminster by Labour former MP John Cryer as peers discussed a collapsed deal to rescue the debt-laden utility.
Britain's biggest water supplier, which has 16 million customers, chose New York-based private equity firm KKR at the end of March to be its preferred bidder under plans to invest around GBP4 billion of new equity to help keep the financially stricken company afloat.
But Thames Water said this week KKR was now not "in a position to proceed".
The firm said the decision was "disappointing" but added it was instead taking forward talks with "certain senior creditors" on an alternative plan to recapitalise the business.
Meanwhile, the government has said public ownership is "not the answer" and warned it would divert money away from other public services such as the NHS.
Thames Water is about GBP19 billion in debt and faced going bust earlier this year before it secured a GBP3 billion loan deal designed to keep it running into 2026.
Cryer said: "I was a London MP for 22 years, and I can say with some conviction that Thames Water was one of the worst and most contemptible organisations I have ever dealt with – and that is up against some pretty stiff competition.
"Can we scotch this myth that has been put out by Thames Water for years that it has not been paying dividends?
"It has been paying what are, in effect, dividends to the parent company.
"Technically they may not be dividends but, in effect, they are. When Thames Water makes these claims, we should call it out for what it is doing: telling lies to the British public."
Environment minister Susan Hayman said: "It is really important that we have clarity and honesty from our water companies, because there are so many problems.
"If we are genuinely going to sort this out, we need to have a proper understanding, and there should not be little tricks and ways of paying money – whether through dividends or otherwise – that circumvent what we would consider to be best behaviour."
Independent crossbencher the Duke of Wellington said: "Does the minister agree that the root of the problem at Thames is the level of debt?
"The fact is that, many years ago, Ofwat allowed Thames Water to increase the level of its own debt beyond any reasonableness. The public have been let down as much by the regulator as by the water companies.
"I very much hope that the Minister will agree that we need to change the type of regulation that the water companies have to live by."
Hayman said: "Clearly, it has not been good that water companies, particularly Thames, have been allowed to get into so much debt. We will absolutely be considering these matters very seriously."
Thames Water has been contacted for comment.
By Nick Lester, Chief Lords Reporter
Press Association: News
source: PA
Copyright 2025 Alliance News Ltd. All Rights Reserved.