Time to admit that privatisation of national utilities isn’t working?

High Fearnley-Whittingstall made exactly the same point on QT last night when Fiona Bruce pointed out the academics' pension scheme was a Thames Water shareholder.

Germanshepherdsmum

Parliament cannot do as it pleases Grantanow. I’m sure you know the procedure for passing a Bill into law. This isn’t France.

Parliament is sovereign. If it passes a Bill as an Act (with the formality of Royal Assent) it becomes law. Of course there is a process to be gone through but a determined government with an adequate majority can force any Bill through and use the Parliament Act to overcome Lord's opposition. Not even the Supreme Court can strike down an Act. The scope for a court to interpret the meaning if an Act is limited by the considered statements made by Ministers introducing the Bill as to its intentions.

Message deleted by Gransnet. Here's a link to our Talk guidelines.

I wasn’t referring to TW but large companies in general in response to DAR.

But they obviously haven’t been doing that GSM. This debate is not just about the dogma that privatisation is always more efficient. It’s whether a vital resource such as water which everyone has to use should be making profits for foreign investors who have no interest in the customers or their environment, which is evidenced by the current parlours state of the service they attempt to offer.

A corporate behemoth can’t be run like a SME. They have to be run by people who understand capital markets because they have to attract investment.

M0nica

Maizie Profits come from excess of income over expenditure. Borrowing is like having a mortgage. A big loan that (in theory) will need to be paid off some time , but, for now, you just pay interest.

I also think there is a tax advantage to investing money in a company because you then get paid interest on the money you have lent and that is treated more advantageously for tax than dividends are.

I do think that legislation should be enacted that stops corporate entities, buying control of companies and then loading them up with debt in order to maximise the investor's returns.

That is the difference between the business juggernauts and our admirable SMEs. No thought, from these cumbersome beasts, of the profit being invested back into the company. It is there to borrow from the improperly named 'market'.

The SMEs almost always have people at the top who are invested in the business both financially and personally. On the other hand, these huge and often toxic companies (literally, in the case of the water companies) are run by financiers, who know little about the method and the product but a great deal about playing financial bingo to feed an inappropriate greed.

Small point, but I think you mean in England Monica? We already pipe a lot of water from Wales to England, and I doubt there’s a shortfall in Scotland either.
The water companies need to invest in building additional reservoirs. The first new large-scale new water storage reservoir to be built in the UK since 1991 is happening at last now though. Portsmouth Water handed a £167m contract to Future Water MJJV Limited to build the Havant Thicket reservoir in southern Hampshire. It’s all possible if there’s a will and sustained investment.

vegansrock I think it rains far more in Ireland and presumably its geology makes it easier to access.

Setting aside those with a need for a lot of water, because their families are large, disabled or incontinent and they are on UC. At the other end of the spectrum there are those with swimming pools, or large paddling pools, emptied and refilled every day, or who spent hours everyday watering their gardens with sprinklers to keep the grass perfect.

When water is a scarce commodity that needs to be used carefully. The best way to do this is to make some charge for water. Even before water meters, many water companies put a supplement on your bill if you used a hose or sprinkler.

In the UK, where water is scarce, we are always being encouraged to economise on water, shower don't bath, only use washing machines and dishwashers when full etc etc and it is noticeable these days, when water is on meters, there are far fewer people using sprinklers every day to keep their front lawns immaculate.

Maizie Profits come from excess of income over expenditure. Borrowing is like having a mortgage. A big loan that (in theory) will need to be paid off some time , but, for now, you just pay interest.

I also think there is a tax advantage to investing money in a company because you then get paid interest on the money you have lent and that is treated more advantageously for tax than dividends are.

I do think that legislation should be enacted that stops corporate entities, buying control of companies and then loading them up with debt in order to maximise the investor's returns.

In Ireland water is free, in that it is paid for out of taxation, people don’t have meters.

MaizieD

What I cannot get over is the fact that water companies appear to be taking on massive debt in order to pay dividends to shareholders!

How have they managed to declare profits when they are deeply in debt? Creative accounting?

And no one is denying it MaizieD. They just seem to be shrugging and passively accepting that is how it is.

Because they can.
Who's stopping them? Not the current government.

What I cannot get over is the fact that water companies appear to be taking on massive debt in order to pay dividends to shareholders!

How have they managed to declare profits when they are deeply in debt? Creative accounting?

Time to re post the Marsh family on waste discharge by Thames Water (its one for their best)
www.youtube.com/watch?v=j4F88MerzZc

warning - its pretty direct.

Of course the shareholders should take a hit if Thames Water has to be nationalised or, less likely, goes into liquidation. They bear some responsibility for that because they failed to take enough interest in what their company was doing. It's not enough to simply sit back and enjoy the dividends if you are a massive institutional or sovereign shareholder as the majority are.

Dinahmo

Oreo

Callistemon21

Germanshepherdsmum

Nationalisation without compensation to shareholders would be theft if the shares have a value,

Yes, the shares need to be purchased but are they worth much anyway?

Water should never have been privatised.

👏🏻👏🏻 Totally agree.

Am on the fence about nationalising other utilities tho.It gets rid of competition.

What competition? I think that those who live in the Thames Water region do not have a choice. Nor do those who live in the other water regions.

Read my comment again.
I want water to be nationalised. Not sure about gas or leccy as if there is no competition you can’t shop around for good deals.
Water could be run completely by the state.Possibly the other utilities but just not sure.
Railways could be taken back by the state as they’re now so badly run there’s no case for them to stay privatised.

Dinahmo

Oreo

Callistemon21

Germanshepherdsmum

Nationalisation without compensation to shareholders would be theft if the shares have a value,

Yes, the shares need to be purchased but are they worth much anyway?

Water should never have been privatised.

👏🏻👏🏻 Totally agree.

Am on the fence about nationalising other utilities tho.It gets rid of competition.

What competition? I think that those who live in the Thames Water region do not have a choice. Nor do those who live in the other water regions.

I thought Oreo meant other utilities such as gas and electricity.

I remember my Dad buying shares in BT.

Oreo

Callistemon21

Germanshepherdsmum

Nationalisation without compensation to shareholders would be theft if the shares have a value,

Yes, the shares need to be purchased but are they worth much anyway?

Water should never have been privatised.

👏🏻👏🏻 Totally agree.

Am on the fence about nationalising other utilities tho.It gets rid of competition.

What competition? I think that those who live in the Thames Water region do not have a choice. Nor do those who live in the other water regions.

The shares in the utilities were offered at a discount because the Tory govt wanted the UK to become a nation of shareholders. Many people applied for shares and as far as can remember the allocations were restricted. Most of the small shareholders sold their shares fairly quickly and made good profits. The purchasers were institutions in the main.

OurKid1

I've always thought that water, as a minimum, should be in public ownership and also should be provided free at the point of use, being essential to life. I think it should be funded, as the NHS is, from taxes. I'm aware that increasing taxes is opening a whole can of worms, but I've never understood why it is not part of that system.

So, those people with swimming pools in their back gardens or int heir homes, like the PM would have free water?

Here in France they are carrying out aerial surveys to check on any unreported swimming pools. Large fines if you one that's unreported.

I'd like to re-nationalise them, certainly gas and electric, but I think to be realistic it can only be achieved "bit by bit".

I think rail is the next priority before the trend continues of more and more road/car use and how much of a mess the railways are in, when to would make such a difference to people's lives to have a viable - and affordable rail system, and proper use of rail for carrying goods.

Was appalled when Thatcher’s regime privatised water companies. We die without clean water! It’s not something you can opt in and out of, such as a phone line. It’s not a money-spinner, but a basic requirement of life. Yes, re-nationalise all of them!

Callistemon21

Germanshepherdsmum

Nationalisation without compensation to shareholders would be theft if the shares have a value,

Yes, the shares need to be purchased but are they worth much anyway?

Water should never have been privatised.

👏🏻👏🏻 Totally agree.

Am on the fence about nationalising other utilities tho.It gets rid of competition.