THAMES WATER’S impending collapse is the ultimate result of privatising an essential monopoly like water, campaigners said today..
The government is reportedly approaching potential administrators to step in if the troubled utility falls into bankruptcy.
The water giant is struggling under a debt of £19 billion and has warned that it will run out of cash in March unless the High Court signs off a £3bn loan at a hearing next month.
Environment Secretary Steve Reed ruled out nationalisation in October.
But officials have told the Financial Times that the government has spoken to consultancies including Teneo and Interpath to potentially run a special administration regime (SAR) — a temporary measure designed to keep services running.
The measure could be a sign that ministers are bracing themselves for the renationalisation of the company as the court could block the loan agreement due to a high interest rate of 9.75 per cent alongside fees and incentives of the current Thames Water management.
Last month, regulator Ofwat fined the company £18.2 million for paying £158.3m in dividends to shareholders which it said were not justified.
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