Really hard to see what the hell is going on with the water sector. I have seen reports saying Thames has not paid shareholder dividends since 2017, when Macquarrie sold them. Yet others are suggesting debt has been taken on to pay dividends.
Big public sector pension fund here (OMERS) is a major shareholder, stake purchased from Macquarrie. They will not be happy to see their stake wiped out, but it appears they took a stand around the last board meeting, not to put any more capital in. Lost confidence.
Yes, I thought it had been paying out dividends. Apparently it has not been paying them out to external shareholders but to âinternalâ stakeholders or the intermediate holding companies in the group for the purposes of âservicing debt and other costsââŠ
Because they have offended the Rwandans? The key ruling is this:
The central issue before the High Court and before the Court of Appeal
was whether the asylum system in Rwanda was capable of delivering
reliable outcomes. The Appellantsâ case is that there are substantial
grounds for believing that there is a real risk that any persons sent to
Rwanda will be removed to their home country when, in fact, they have a
good claim for asylum. Sending them to Rwanda in those circumstances
would breach article 3 of the European Convention on Human Rights. In
that sense, the appellants submitted that Rwanda is not a âsafe third
countryâ.
Seems like no one wants to say it, but looking at the sheer scale of the capital investment required versus the (best guess) dividends paid out plus interest, there are really two problems in the sector. One is the one the trumpets are blaring about, high debt loads, unsustainable dividends. The other is that people in the UK have not been paying the true cost of their water. The numbers just donât add up. Strip away the interest and the dividends and invest it instead, and there is still a generation plus of chronic underinvestment. Not too many sources seem keen to point to that one though.
People in England, maybe. In Scotland it is publically owned and paid for, unmetered, by an additional charge on the Council Tax. As it was never privatised it didnât have its debt wiped out either.
For years Scotland was criticised for this and traditionally the water provision was a bit of a muddle. However it is now cheaper and of better quality than the rest of the country.
Water is just one of those things that is a natural monopoly as well as essential infrastructure and needs to be run on a not for profit basis.
Yes the English havenât even been paying for the Welsh water they get, lots of it!
Itâs not exclusive to the water sector though. Iâd say itâs pretty much across the board and your reasoning is exactly why this whole thing along with privatisation bugs me enormously. Weâve under invested in infrastructure and equally bad, people. You donât just flick a switch and itâs fixed. It needs decades to put right. But for that to happen I suspect there has to be some kind of retraction first. Thatâs probably political suicide but a good start most would agree on would be to tear down the system that allows vast sums of money to simply leak out of the economy and government coffers.
